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Chile's Escondida copper mine, controlled by Anglo-Australian BHP Billiton, is conducting scoping studies on the construction of a molybdenum plant, according to Escondida VP processes Marcelo Villouta.
"I think we will have the scoping studies complete within six months," Villouta told journalists on Monday on the sidelines of a mining seminar in Santiago.
The world's largest producer of copper, Escondida's low molybdenum grades would be offset by the large quantity of material processed, he said.
"We could be talking about 4,000t/y of molybdenum in concentrates," said the Escondida official.
Escondida mineralization holds 70ppm of molybdenum in comparison to other Chilean operations that range from 100-400ppm, according to Villouta.
Villouta estimated that capital costs could range from US$70mn-80mn given that the Collahuasi molybdenum plant, the latest to be built in Chile, cost US$38mn-40mn.
"Probably we would be around US$70mn-80mn considering the quantity of concentrates to be treated is almost double [that of Collahuasi]," he said.
Escondida expects to produce the first cathode in June 2006 from its US$870mn sulfide leach project currently under construction, said Villouta.
The project envisages bioleaching run-of-mine low-grade ore from Escondida's two open pits. More than 1.7Bt grading 0.3-0.7% copper has been outlined, with recoveries currently running at an average 36%.
Initial production will be 90,000t/y but will increase to 180,000t/y in year 2 at a cost of US$0.40/lb, said Villouta during an earlier presentation.
BHP Billiton holds 57.5% of Escondida, London-based Rio Tinto 30%, a Mitsubishi-led Japanese consortium 10% and the World Bank's International Finance Corporation another 2.5%.
Escondida in northern Chile's Region II has capacity to produce 1.25Mt/y of copper in concentrates and cathodes.