Local residents express environmental concern over gold mine
Date: 03-Jan-02
Country: PERU
Author: Eduardo Orozco
"Tambogrande is a great, very interesting reserve and it could be one of the finest in the world of its type. So of course we want to continue with the project," Manhattan's Peruvian division chief, Roberto Obradovich, told Reuters in an interview.
According to Manhattan, the B5 sulfide deposit at Tambogrande - one of three deposits it is exploring in the giant mineral field - contains sedimentary rocks with an average of 0.21 ounces of gold per tonne and an average of 3.7 ounces of silver per tonne.
The firm also believes that the deposit's rocks contain between 6 percent and 10.6 percent copper, as well as smaller amounts of zinc and lead.
Obradovich said the discovery of minerals like gold, silver and copper in the B5 deposit, which it operates along with two other deposits, would justify Manhattan's continued involvement in Tambogrande.
Manhattan began surveying the giant reserve some 630 miles (1,050 km.) north of the capital Lima since securing an exploration concession in 1999 - with the option to later exploit - that is due to expire in May 2003.
Mining provides this poor Andean nation with more than half its cash exports.
But Manhattan's Tambogrande experience has not been without problems. Local residents have complained the project could ruin the region's key agriculture industry, which they say employs some 26,000 people and produces an average of $105 million a year.
Due to the standoff, Manhattan has said it is working to quickly conclude an environmental impact analysis, which it says will prove its operations pose no threat.
"In March or April we are going to have a draft...and the final version should be ready for May or June of this year," Obradovich said.
He added that the firm was holding talks with local Tambogrande residents to explain how it would avoid environmental degradation, while giving residents a chance to air their own concerns.
STILL EXPLORING
The cost of exploitation of Tambogrande is estimated at $315 million. Manhattan has already invested some $58 million and Obradovich said this year the company would spend $4 million to $5 million more.
He said the TG1 deposit was attractive due to a layer of gold oxides.
"The layer will be mined at a rate of 7,500 tonnes a day with an annual production of 276,000 ounces of gold and 3.5 million ounces of silver," he said. He added the production cost for gold would be around $40 per ounce, with an exploitation life of 3.5 years.
Manhattan has estimated an investment of $150 million for gold extraction over three years.
Obradovich said the firm also planned to install a concentration plant, which could cost $80 million initially and process some 15,000 tonnes of metals a day in the short term, and 40,000 tonnes a day in eight years.
He said the TG1 deposit could be productive for 15 to 17 years and could yield some 70,000 tonnes of copper concentrates and 35,000 to 40,000 tonnes of zinc concentrate a year.
He added that the company still needed to explore the TG3 deposit, but estimated it could hold 100 million tonnes of minerals.