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Prosperity - One of the largest undeveloped copper-gold deposits in Canada
The Prosperity deposit is a gold-copper porphyry with a 1.0 billion tonne measured and indicated resource containing 5.3 billion pounds of copper and 13.3 million ounces of gold. At today's metal prices (US$900/ounce gold and US$2.00/pound copper) the project has a pre-tax net present value of C$1.6 billion and a 30% pre-tax internal rate of return.
Over the past three years, Taseko has significantly advanced the project, completing the feasibility study and entering the Provincial and Federal Environmental Assessment process. Prosperity is a project that holds the potential to dramatically increase shareholder value. Development of this large-scale deposit will be a major step towards transforming Taseko into a mid-tier mining company.
Feasibility Study
In late-2007, Taseko announced the results of the Prosperity feasibility study. This study, which cost $2 million and took more than a year to complete, confirmed that the project is technically and economically feasible using long-term metal price assumptions of US$575/ounce for gold and US$1.50/pound for copper and a foreign exchange rate assumption of US$0.80/C$1.00.
Project highlights include:
If you wish to view the technical report it can be found at www.sedar.com.
Reserves and Resources
The mineral reserves estimated from the study:
Environmental Assessment
An environmental assessment under the Canadian and British Columbia Environmental Assessment Acts is in progress. Multidisciplinary work teams have gathered new data and validated previous work in order to prepare the 3,000 page Environmental Assessment Report. The EA Report was submitted to the Provincial Government in March 2009. The review process, which began in mid-March is 180 days and we expect a decision by October 2009. The Federal Government has appointed a three-person panel to review the EA Report and it is expected a decision will be made in early 2010. Taseko is extremely confident that EA approvals will be granted by both levels of Government.
The graph below details the timeline we are following:
History
Initial exploration activity in the vicinity of the Prosperity deposit was undertaken by prospectors in the early 1930's. In 1963-64, Phelps Dodge conducted a small exploration drilling program. Taseko acquired the property in 1969 and exploration drilling continued in the 1970's and 1980's under option agreements with several mining companies. Hunter Dickinson acquired Taseko in 1991 and proceeded with extensive drilling, engineering, metallurgical and socioeconomic programs. The work carried out in the 1990's succeeded in delineating a bulk tonnage porphyry gold-copper mineral resource at Prosperity. By 1998, Taseko had advanced the project to the pre-feasibility and feasibility stages. However, in 2000 prevailing metal prices - copper price ranging from US$0.60 - $0.80 per pound and gold price ranging from US$250-300 per ounce - and a poor outlook for price performance resulted in the decision to put the project on hold.
The Prosperity deposit is a gold-copper porphyry with a 1.0 billion tonne measured and indicated resource containing 5.3 billion pounds of copper and 13.3 million ounces of gold. At today's metal prices (US$900/ounce gold and US$2.00/pound copper) the project has a pre-tax net present value of C$1.6 billion and a 30% pre-tax internal rate of return.
Over the past three years, Taseko has significantly advanced the project, completing the feasibility study and entering the Provincial and Federal Environmental Assessment process. Prosperity is a project that holds the potential to dramatically increase shareholder value. Development of this large-scale deposit will be a major step towards transforming Taseko into a mid-tier mining company.
Feasibility Study
In late-2007, Taseko announced the results of the Prosperity feasibility study. This study, which cost $2 million and took more than a year to complete, confirmed that the project is technically and economically feasible using long-term metal price assumptions of US$575/ounce for gold and US$1.50/pound for copper and a foreign exchange rate assumption of US$0.80/C$1.00.
Project highlights include:
- Located near existing infrastructure in south-central British Columbia
- Pre-tax net present value of C$260 million at 7.5% discount rate
- Pre-tax internal rate of return of 12% with a 6 year payback from start of production
- 20 year mine life at a milling rate of 70,000 tonnes per day producing 247,000 ounces of gold and 108 million pounds of copper per year
- Life of mine strip ratio of 0.8:1
- Total pre-production capital cost of C$807 million
- Operating cost of C$6.26 per tonne milled over the life of mine
- Total cash costs, net of copper credits, of US$119/oz gold
- Total cash costs, net of gold credits, of US$0.43/lb copper
If you wish to view the technical report it can be found at www.sedar.com.
Reserves and Resources
The mineral reserves estimated from the study:
| Prosperity Mineral Reserves at C$5.25 NSR/t Cut-off | |||||
| Category | Tonnes (millions) |
Gold (g/t) |
Copper (%) |
Recoverable | |
| Gold Ounces (millions) | Copper Pounds (billions) | ||||
| Proven | 286 | 0.47 | 0.25 | 3.0 | 1.3 |
| Probable | 201 | 0.36 | 0.18 | 1.7 | 0.7 |
| Total | 487 | 0.43 | 0.22 | 4.7 | 2.0 |
Note: The reserve estimate takes into consideration all geologic, mining, milling, and economic factors, and is stated according to Canadian standards (NI43-101).
The Proven and Probable reserves above are included in the following Measured and Indicated Mineral Resources. The Mineral Resources are as outlined by drilling to date, and estimated at a 0.14% Cu cut-off.
| Prosperity Mineral Resources at 0.14% Copper Cut-off | |||
| Category | Tonnes (millions) |
Gold (g/t) |
Copper (%) |
| Measured | 547.1 | 0.46 | 0.27 |
| Indicated | 463.4 | 0.34 | 0.21 |
| Total | 1,010.50 | 0.41 | 0.24 |
Environmental Assessment
An environmental assessment under the Canadian and British Columbia Environmental Assessment Acts is in progress. Multidisciplinary work teams have gathered new data and validated previous work in order to prepare the 3,000 page Environmental Assessment Report. The EA Report was submitted to the Provincial Government in March 2009. The review process, which began in mid-March is 180 days and we expect a decision by October 2009. The Federal Government has appointed a three-person panel to review the EA Report and it is expected a decision will be made in early 2010. Taseko is extremely confident that EA approvals will be granted by both levels of Government.
The graph below details the timeline we are following:
History
Initial exploration activity in the vicinity of the Prosperity deposit was undertaken by prospectors in the early 1930's. In 1963-64, Phelps Dodge conducted a small exploration drilling program. Taseko acquired the property in 1969 and exploration drilling continued in the 1970's and 1980's under option agreements with several mining companies. Hunter Dickinson acquired Taseko in 1991 and proceeded with extensive drilling, engineering, metallurgical and socioeconomic programs. The work carried out in the 1990's succeeded in delineating a bulk tonnage porphyry gold-copper mineral resource at Prosperity. By 1998, Taseko had advanced the project to the pre-feasibility and feasibility stages. However, in 2000 prevailing metal prices - copper price ranging from US$0.60 - $0.80 per pound and gold price ranging from US$250-300 per ounce - and a poor outlook for price performance resulted in the decision to put the project on hold.
