Utilizing only the project’s South Deposit, the most recent PEA report was based on a resource estimate that contained a total resource (measured + indicated) of 7.7 million tonnes – 0.64% copper, 0.12% molybdenum, 0.07% tungsten, 4.75 g/t silver. At a mine production rate of 3,000 tonnes per day and an initial capital cost of $92 million, the project demonstrated pre-tax net cash flows of $163 million and an internal rate of return of 34% (see Company’s press release dated January 10, 2012).
In 2011, Minera Alamos acquired the North Deposit area (previously known as Potreritos) located approximately 2 km north of the Los Verdes property limits. Historic estimates for the North Deposit include 1.4 million tonnes of indicated resources (0.47% Cu / 0.12% Mo) and 0.8 million tonnes of inferred resources (0.22% Cu / 0.033% Mo) (see Company’s press release dated October 27, 2011).
The Company is currently considering strategic alternatives for Los Verdes based on current industry/market expectations and a resizing of the planned operations.