WWW.RESOURCEGLOBALNETWORK.COM
MARIM COP CO
One of the most important copper dis
MACA PER RP
scoveries in Chile over the last decade
MINING | MARIMACA COPPER
Chile-focused explorer Marimaca Copper holds the distinction of making one of a handful of (or perhaps the only) new copper discoveries around the world since 2015. While this paucity of new discoveries speaks to a growing problem in the balance of supply and demand for the dynamic ‘red metal’, Marimaca’s namesake project was unearthed in 2016 by the TSX-listed company’s VP of exploration, Sergio Rivera, when a one-in-a hundred-year rainfall washed away decades of Atacama dust to reveal a green hue on a mountain side in an area of Chile’s prolific copper mining centre in Antofagasta. Having said that, the Marimaca deposit was not completely unknown prior to the rare weather event; there was outcropping mineralisation at surface that had been walked over and identified by numerous geologists, but generally accepted wisdom for the area dictated that there would be nothing new to uncover of sufficient scale for a mine. “I think it’s been a story of challenging the generally accepted wisdom about what sort of copper project could be in the belt of rocks we have there in Northern Chile,” says Marimaca’s president and CEO Hayden Locke.
MINING | MARIMACA COPPER
“Our geologists challenged
fantastic copper environment
that wisdom and decided
for us.
it was worth drilling. What they found was significant
“Marimaca’s discovery of a
extensions North and South
surface oxide copper deposit
along strike and also at depth.
with significant depth
As a result, it is one of the
potential not only contradicts
most significant new oxide
the once-held views of many
discoveries in Chile in the last
experts in the field, it also
decade and certainly one of
creates a low-risk, low-cost
the most exciting development
mine development scenario
stage copper projects in the
for the company.
world today. It also has a very short timeline to get
“It is quite a unique project
into production in what is a
in that there is oxide
mineralisation at surface, a low strip ratio for an open pit mine with a very low capex relative to most of the new copper development stories in the world. We’re excited to have this project in our control.”
Location, location, location The location of the deposit is a huge part of Marimaca’s attractive story, according to Locke, who cut his teeth mostly developing projects in African mining jurisdictions,
“Marimaca is one of the most significant new oxide discoveries in Chile in the last decade and certainly one of the most exciting development stage copper projects in the world today” – Hayden Locke, Marimaca Copper president and CEO
where infrastructure has been at times poor, and mine locations often remote. Good locations have existing infrastructure in place and access to a highly skilled workforce; things which have a knock-on impact in terms of execution risk and capital costs. “The location we have at Marimaca is absolutely outstanding,” Locke proclaims. “We’re in the low coastal range of the Chilean mountain range, so fairly low altitude compared
MINING | MARIMACA COPPER
to being in the high Andes. We have access to power, roads and communication is incredible. There’s an international airport 45 km away, we have a very large, highly skilled workforce that is generally working in the mining industry or some derivative of it. “All of that adds up to much lower execution risk, but also much lower capital cost for the overall project. It [the location] is a huge benefit for us and one that we are very happy
with.” He highlights access to water – a key input in the copper mining process, but a scant resource in one of the most arid parts of the world – as the single biggest locational advantage. Marimaca will use seawater at its operation, which crucially means it won’t have to tap into local freshwater aquifers that are vital for drinking, agriculture and the general
MA R I M A CA CO P P E R AT A G L A N C E
STOCK TICKER: TSX:MARI MARKET CAPITALISATION: US$328.5 million (as of April 22, 2020) aj
MINING | MARIMACA COPPER
environment. From an ESG standpoint, this is absolutely essential to the project’s successful development in a region where political and social objections have blocked the progress of mining projects in very recent memory.
Publishing the PEA The low upfront and all-in sustaining costs (AISC) nature of the Marimaca project was confirmed by the August 2020 preliminary economic assessment (PEA). The study calculated the upfront capital cost at US$285 million, while the AISC of $1.29 per pound of copper is in the bottom 15% of the curve. Hayden explains that the low-cost nature of the project comes down to three key attributes: “First, it’s a very simple open pit mine. As a result, there is virtually no pre-strip, very little up front capital costs to get this project into mining and start taking
ALTUS S
R Marimaca
MINING | MARIMACA COPPER
valuable ore and putting it on
copper produced basis, the
the leach pads.”
capital intensity for an SX-EW plant is much lower than a
The presence of a high-grade
concentrator, notes Locke.
core in the first five years of mining is an added advantage
Locational advantage,
which means the company can
predominantly Marimaca’s
move lower material tonnes
access to a power line 7 km
and hence use a smaller fleet
away, is the third contributor
of equipment during the first
to the low-cost project
stage.
estimates. Roads and the seawater pipeline are already
The second low-cost attribute
in place and there is no need
is the ability to use SX-EW
for a mining camp as there are
leaching as the process
two urban centres (Antofagasta
method. On a per tonne of
and Mejillones) within 45 km
RGN editor Jacob Ambrose Willson interviews Copper Corp president Hayden Locke, March 30, 2021
of the site. The PEA also calculated a posttax NPV of $524 million for the project (assuming a $3.15 per pound flat long-term copper price) and an IRR of 33.5%, with annual copper production at approximately 40,000 tonnes in the first six years, over a total 12-year life. Marimaca actually went above and beyond with certain elements inside the PEA advanced to an even higher degree of confidence. For
instance, the metallurgical recoveries are supported by four phases of testing. “The fifth phase is really about making sure we are completely bankable, but also preparing ourselves for operational readiness and making sure we have a really robust geometallurgical model,” Locke declares. A round of infill drilling will also be required to shift the remaining 30% of the Marimaca resource from inferred to measured and indicated (M&I). The project currently contains nearly 420,000 tonnes of contained copper in M&I, according to a December 2019 mineral resource estimate. “We’ll probably do a bit more extensional drilling to add some more to the overall resource ahead of the feasibility study, which we’ll hopefully start in the second half of this year with the goal to deliver that in the early part of next year.”
HAYDEN LOCKE, MARIMACA COPPER PRESIDENT AND CEO
MINING | MARIMACA COPPER
Lifting the lid further
and on-ground mapping
The company has developed a
reconnaissance work,
cluster of five regional targets
Marimaca is also pursuing a
including geochemical
over the last 12 months and is
dual-track exploration strategy
analysis and soil sampling.
beginning to test those as we
after identifying the potential
approach the middle of the
to add resources at depth and
“These days there is much
year. “We should have a fairly
across the coastal copper belt
less outcrop at surface, which
good idea of whether there’s
district. While the company
means there are less obvious
something there by the end of
has reported good visibility
reasons to go out and drill a
first half of 2021.”
on a couple of years of oxide
target, so we’re creating those
resource around Marimaca,
targets using a multitude
To conclude, the significance
it is focusing its near-mine
of methods, including
of the Marimaca project is
exploration on the potential at
magnetism,” Locke explains.
not its potential scale per say,
depth.
“This is an IOCG belt with
but the fact that it is a copper
a strong preponderance of
discovery that has arrived at a
“We know the oxide has to
magnetite and so we believe
time when the supply-demand
have been fed by a sulphide
that a magnetic response
equation is tipping drastically
system at depth somewhere.
is a good way for us to start
in favour of the latter, as the
We’re looking at whether
targeting areas to look for
electrification of the global
or not there is an economic
potential repetitions of
economy begins to gather
extension of that sulphide
Marimaca style deposits.
speed.
deposit. We are currently
“We believe we now have a
“Copper is going to become
on-site drilling deeper drill
good geological exploration
more important and we’re
holes right now and trying to
model to target repetitions of
excited to be part of that
understand what’s going on in
Marimaca-style mineralisation
important demand shift
that all-important feeder zone
and hopefully add significant
with a project that can be
at depth.”
oxide tonnes close to our
brought into production in
current project, but also find
a short timeframe,” Hayden
The second phase of
some larger sulphide deposits
summarises.
exploration will look for
at depth as well with our
repetitions of Marimaca in
ongoing exploration.”
orebody below the Marimaca
the surrounding area, using a mixture of geophysics
Published by Anderson Murray Media Ltd
To tell the resource market your story, contact: editorial@resourceglobalnetwork.com
WWW.RESOURCEGLOBALNETWORK.COM