Tony Robbins, Indophil Resources NL managing director, pegged the project capital costs at US$1.4 billion, excluding infrastructure costs worth about US$500 million for power station and port development.
Robbins’s disclosures were contained in an “Open Briefing,” an Australian service launched in September 1999 with the support of the Australian Stock Exchange.
“The capital payback time is expected to be less than five years under very conservative price assumptions,” he said, adding the Tampakan project has a mine life of 50 to 70 years.
Robbins said the cost of infrastructure will be shouldered by third parties, which he did not identify.
Indophil owns 95% stake of the Tampakan project being pursued by its Philippine affiliate Sagittarius Mines, Inc. in the towns of Tampakan in South Cotabato, Columbio in Sultan Kudarat and Kiblawan in Davao del Sur.
The $1.4 billion capital was a huge increase to the initial capital projections raised by Sagittarius officials, which was $650 million, when it resumed the project in 2003.
Western Mining Corp. formerly owned the project.
When the firm started the pre-feasibility study (PFS) about two years ago at a 20 metric tons per annum (Mtpa) milling rate, Robbins said the capital cost stood at $1 billion.
The pre-feasibility study was completed last September at a 30 Mtpa milling rate. Robbins stressed they are now looking at a capital cost of around $1.4 billion, excluding the cost of infrastructure which will be supplied by third parties.
“Our current estimate of operating costs is less than US$0.70 per pound and there’s scope to reduce that considerably. The long term operating cost is less than US$7 per ton of ore,” Mr. Robbins said.
“Altogether we think we’ve conducted a robust PFS and we’re very pleased with the results,” he added.
Results of the pre-feasibility study revealed that the Tampakan project is a world class, two billion ton deposit, containing 11.6 million tons of copper and 14.6 million ounces of gold at a 0.3% copper cut-off grade.
Father Romeo Catedral, director of the Social Action Center of the Diocese of Marbel and one of the staunchest critics of the mining venture, said they will not waver in their opposition despite the huge investment and projected economic development that the project will bring to the area.
Catedral said the bulk of the mineral wealth will be brought outside the country by the foreign investor, leaving only a pittance to the communities that will be displaced. He also warned of a destroyed environment.
The Tampakan project is gearing towards a definitive feasibility study, which will be solely funded by Xstrata Queensland Limited (Xstrata Copper), a subsidiary of Xstrata Plc, at a tune of $30 million or P1.5 billion.
This stage is expected to be completed in approximately 18 months.
Robbins said the company is currently looking at production stage in early 2011, a little adjustment from pronouncements earlier that full blast operations would take place not later than 2010. (MindaNews)