Press Release
11 February 2009
BOUGAINVILLE COPPER LIMITED ANNOUNCES A MINERAL
RESOURCE OF OVER 1 BILLION TONNES AT PANGUNA
Bougainville Copper Limited has completed an order of magnitude study to
evaluate the technical and financial requirements to re-develop the Panguna
Mine. This study indicates there is sufficient potential for a viable operation to
report a Mineral Resource statement.
Introduction
Bougainville Copper Limited (BCL) is owned by Rio Tinto (53.58%) and the
government of Papua and New Guinea (19.06%) with the remaining 27.36%
publicly owned. Panguna is a large porphyry copper-gold deposit located on
Bougainville, Papua New Guinea. BCL operated the Panguna open pit mine
from 1972 until 1989 when operations were suspended due to militant attacks
on company personnel and operations.
The operation comprised an open pit mine and an adjacent ore processing
facility producing copper-gold concentrate for export from the port of Anewa
Bay. The site was operated as fully residential with staff accommodated at
Panguna and the township of Arawa.
In 1988 total material mined from the open pit was 90 million tonnes,
comprising 33 million tonnes of direct feed ore (DFO), 35 million tonnes of
pre-concentration screening material (PCS) and 22 million tonnes of waste.
PCS was material mined to access the DFO amenable to beneficiation by
screening; the fines were upgraded sufficiently for economic processing and
the coarse material was sent to waste. The open pit was kept drained by an
adit from the bottom of the pit. The concentrator was processing 48 million
tonnes of ore (DFO and PCS fines) per year and produced concentrates
containing 166 thousand tonnes of copper and 445 thousand ounces of gold.
BCL has had no access to the site since operations were suspended in 1989.
During the 18 years of operation some 3 million tonnes of copper and 9.3
million ounces of gold were produced in concentrates from 675million tonnes
of ore milled.
At the time of closure, BCL quoted an ore reserve of 496 Mt @ 0.42% Cu and
0.55 g/t Au and additional material amenable for upgrading by screening that,
combined, provide mill feed of 691Mt @ 0.40% Cu and 0.47g/t Au.
Order of Magnitude Study(OoM)
Redevelopment of Panguna evaluated in the recent OoM study completed in
November 2008 envisaged similar mining, processing and concentrate export
facilities to the earlier operation.
Mineral resource
An updated mineral resource has been estimated using geological, mine
planning and production data archived in 1989. The archived data sets have
been reviewed and validated by Rio Tinto and ex BCL staff during 2008. No
additional data was collected as part of this study. The geological block model
is based on data from 253 diamond holes drilled on a 122m by 122m grid,
with some wider spaced holes on the periphery. Life of project blast hole
assay data was also used for validation studies. During the operating period
the geological block model underestimated the copper production by
approximately 5%. This low bias has been principally attributed to the drill
hole spacing being too wide to sufficiently sample narrow high grade zones
within the orebody, and to material lost during the diamond drilling process.
Although bias has been identified, no upgrade has been applied to the
resource at this stage until further sampling studies are available.
Mineralisation within the block model has been segregated based on cut off
grade and rock type parameters into DFO and PCS process ore types, and
evaluated against mining and processing scenarios to determine a new
potential economic pit shell.
Material above cut-off within the pit shell defined by 122m spaced drilling was
classified as Indicated, and material within the pit shell defined by wider
spaced drilling was classified as Inferred.
No Measured material was defined due to the unresolved low bias identified in
the block model during the validation studies.
Tonnes
(M)
Cu (%) Au (g/t) Cu (Mt) Au
(Moz)
Measured Resource 0 0.00 0.00 0 0
Indicated Resource 1000 0.33 0.37 3.3 11.9
Inferred Resource 64 0.28 0.41 0.2 0.8
Total Resource 1064 0.33 0.37 3.5 12.7
CP Statement
The information in this press release that relates to Mineral Resources is
based on information compiled by Perry Collier and Gerald Clark who are
members of the Australasian Institute of Mining and Metallurgy. Perry Collier
is a full-time employee of Rio Tinto Limited and has experience which is
relevant to the style of mineralisation and type of deposits under consideration
and to the activity which they have undertaken to qualify as a Competent
Person as defined in the 2004 Edition of the ‘Australasian Code for Reporting
of Exploration Results, Minerals Resources and Ore Reserves’. Gerald Clark
is an external consultant and has experience which is relevant to the style of
mineralisation and type of deposits under consideration and to the activity
which they have undertaken to qualify as a Competent Person as defined in
the 2004 Edition of the ‘Australasian Code for Reporting of Exploration
Results, Minerals Resources and Ore Reserves’. Perry Collier and Gerald
Clark consent to the inclusion in the press release of the matters based on
their information in the form and context in which it appears.
As required by the Australian Stock Exchange, the information presented here
contains details of other mineralisation that has a reasonable prospect of
being economically extracted in the future but which is not yet classified as
Proved or Probable Reserves. This material is defined as Mineral Resources
under the JORC Code. Estimates of such material are based largely on
geological information with only preliminary consideration of mining, economic
and other factors. While in the judgement of the Competent Person there are
realistic expectations that all or part of the Mineral Resources will eventually
become Proved or Probable Reserves, there is no guarantee that this will
occur as the result depends on further technical and economic studies and
prevailing economic conditions in the future.
By Order of the Board
Paul Coleman