https://www.bnamericas.com/news/mining/yamana-to-evaluate-increasing-stake-in-jeronimo-gold-project
Yamana to evaluate increasing stake in Jerónimo gold project - Regional
Published: Friday, February 25, 2011 13:15 (GMT -0400)
oronto-based Yamana Gold (TSX: YRI) is willing to evaluate increasing its 57% stake in the Jerónimo yellow metal project in northern Chile, CEO Peter Marrone told BNamericas.
"We would want to consolidate our interest [at Jerónimo] to a higher level," Marrone said.
Yamana plans to complete a feasibility study on the project in 2011, after which it is expected to evaluate the acquisition of a higher stake from its JV partner in Jerónimo, Chilean state copper producer Codelco.
"Our plan remains to complete a feasibility study this year. We will evaluate our position along with the contribution to production of the project at that time in the context of the results of that study," Marrone said.
"The decision to proceed [with development] will be based on continued positive results from a full feasibility and further consolidation of the ownership of Jerónimo, both of which are expected to occur," Yamana's SVP of technical services Evandro Cintra said during a conference call to discuss 2010 financial results.
The company recently completed a prefeasibility study for the project, outlining pre-production capital of approximately US$310mn, average gold output of 185,000oz/y over the first four years of operations and average production of 145,000oz/y over a full 10-year mine life.
Cash costs are expected to be below US$500/oz during the first four years and to average US$550/oz over the 10-year period. Throughput is estimated to reach 4,200t/d and gold recoveries have been set at around 85% based on pressure oxidation, the company said.
As part of the ongoing feasibility study, Yamana is evaluating other processing methods for better recoveries which are anticipated to further optimize project economics.
"The company will also be incorporating the impact of credits from the sale of manganese which was not included in the prefeasibility, as well as the positive impact of other off-take products," Cintra said.
Based on the prefeasibility study, Jerónimo holds probable reserves of 1.6Moz gold on a fully consolidated basis. Yamana's attributable mineral reserves are 0.93Moz and approximately one-third of the mineral reserves declared were a direct result of conversion from resources via infill drilling.
The mine could start producing gold as early as 2014, Marrone said during the conference call.
PROJECT PIPELINE
Jerónimo belongs to a new wave of early-stage projects in the company's pipeline, which are expected to increase production even further than the 2014 goal of over 1.7Moz of gold equivalent.
Early-stage projects include possible expansions at Brazil's Pilar and Mexico's Mercedes mines, as well as production increases at Brazil's Jacobina.
Yamana expects to start production at four projects within the next two years. These are Mercedes and Brazil's C1 Santa Luz and Ernesto/Pau-a-Pique mines, scheduled to start up next year, followed by Pilar in 2013.
Output growth opportunities for the company also include the already approved expansion at the Gualcamayo mine in Argentina, for which the construction decision was made in August last year, and construction of the first phase of the Chapada mine's Suruca satellite project in Brazil.
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