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First insitu production for Taseko's Florence

Vancouver-based base metals producer Taseko Mines has produced the first copper metal from its Florence insitu project in Arizona.
First insitu production for Taseko's Florence First insitu production for Taseko's Florence First insitu production for Taseko's Florence First insitu production for Taseko's Florence First insitu production for Taseko's Florence

Taseko has produced the first copper from its insitu leach Florence copper project in Arizona

Staff Reporter

The company said Friday the test facility was operating at full capacity and the solvent extraction/electrowinning plant was able draw on the underground copper in solution to produce metal.

Taseko said about 1.5 million tons of copper ore was contacted underground with leach solution in the past three months.

"With the entire test wellfield and SX-EW plant now operating as a continuous unit, we will use the coming months to refine operational parameters which will help with the ramp-up of the commercial plant," said CEO Russell Hallbauer.

The company said the proportion of ore contacted underground with leach solution, known as sweep efficiency, had been "very encouraging" to-date. Modelling predicted a 55% sweep efficiency after the first year of leaching, but Hallbauer said this figure had already been achieved after only the first three months.

"Not only is the data proving that we are able to maintain hydraulic control of the leach solution underground, but it is providing valuable data to validate our leach model as well as optimise well designs and performance and hydraulic control parameters," he said.

Taseko acquired Florence late in 2014 for US$79 million via a takeover of Curis Resources. Florence will produce an average of 85Mlb/y of copper for 20 years at an average operating cost of $1.10/lb.

The commercial-scale project will cost US$200 million to build, according to a January 2017 technical report. The project is expected to produce more than 1.7 billion pounds of the red metal over its mine life.

With an NPV of roughly C$1 billion, Hallbauer bemoaned the significant disconnect with Taseko's market capitalisation of only $199 million.

"This valuation gap should close considerably in the coming months as we move closer to the construction of the lowest capital intensity project in the world, that will have operating costs in the lowest quartile of the industry," Hallbauer said.

Taseko shares (TSX:TKO) have gained 27% or C17c in the year to date, but are still trading 47% lower than a year ago. On Friday the stock gained more than 5% or 4c, to 81c.