(Kitco News) -Canada’s newest copper-gold mine, Thompson Creek Metals Co. Inc.’s (TSX:TCM)(NYSE:TC) Mt. Milligan mine, is on pace to begin commercial production in the fourth quarter.
The company opened Mt. Milligan earlier this week, and they expect to remain on schedule with their production disclosure.
“We said we’ll get to commercial production by the fourth quarter, and I think we’ll make that,” said Kevin Loughrey, chief executive officer of Thompson Creek. “Within 12 months from startup we should reach full production levels.”
Located 155 kilometers northwest of Prince George, British Columbia, Mt. Milligan’s feasibility study pegs the mine to produce an average of 81 million pounds of copper and 194,500 ounces of gold annually over its 22-year mine life.
The first six years of production will see a high-grade cycle which will produce an average 89 million pounds per year, and gold production is expected to average 262,000 ounces per year.
Despite the headwinds in the mining industry, Thompson Creek still managed to bring the large project to production.
“It’s a very big thing to bring a project of this magnitude on stream these days, getting it somewhat on budget with all these inflationary pressures we’ve been facing over the past few years in terms of bringing mining projects online,” Loughrey said. “But, we were able to get it done, we have the big mill turning, we’ve got both ball mill lines running, we’re producing concentrate and things are on schedule.”
Born into a time where cost discipline by mining companies is king, Mt. Milligan benefits in some ways from the timing.
“The advantage with Mt. Milligan is that it’s brand new, so, it was designed and conceived in a time when cost cutting was in everybody’s mind,” Loughrey said. “The whole facility is engineered from a cost cutting basis.
“It’s a very small footprint,” he added. “So smaller roads, smaller fleet, it’s a zero-discharge facility, so you don’t have any wastes dumps whatsoever because all the material you move is either processed through the mill and put into tailings, or placed back onto the tailings facility as part of the dam-building process.”
The company has yet to release production costs for either metal.
“We were very cautious about giving those numbers out because it’s so early in the process,” Loughrey said. “We feel that until we have a bit of operating time under our belt and are able to know how the mill and mine are able to perform, we thought it would be misleading to give precise cost estimates.
“We will give that in the next month or two as we develop some history with the mine,” he added.
For Loughrey, this project caps off a long career in the mining business. He will retire Monday, and will be replaced by Jacques Perron. Loughrey wanted to wait and see this last project come online.
“I wanted to leave with completing the diversification effort, which we started some years ago, to try and get more commodity basis for our revenues than just molybdenum,” he said. “So, yeah, this is a nice way to go out with the starting of a brand new copper and gold mine.”
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