Goldcorp Boosts Peñasquito Project Capacity

Goldcorp has commissioned three large wheel loaders at its Peñasquito gold project, as prestripping operations get under way.
The mine’s primary crusher (left) is designed to handle two 300-ton-capacity trucks simultaneously.
Goldcorp in early December provided details of a plan to expand mill throughput by 30% at its Peñasquito project in Mexico to 130,000 mt/d ore and to accelerate the project production schedule. This expansion follows a 48% increase in proven and probable reserves announced in June, 2007. The revised plan for the project also calls for an increase in estimated capital cost completion to $1.49 billion, up significantly from a June 2006 estimate of $882 million for a 100,000-mt/d facility.

Goldcorp said the expanded operation is expected to produce an average 1.7 million gold equivalent ounces per year (approximately 400,000 oz of gold plus silver, zinc and lead). The new capital cost estimate includes approximately $450 million spent to date.

“We have accelerated the metals production profile and extended the mine life at Peñasquito, generating a strong rate of return in a challenging cost environment,” said Kevin McArthur, president and CEO. “Our investment in this world-class mine is well under way. The team is making great progress toward initial oxide production in 2008 and startup of the milling circuit in 2009. Exploration drilling and optimization efforts are continuing to provide excellent potential to deliver additional long-term shareholder value.”

According to the company, the enhanced production rate will be accomplished through additional equipment in each of the two milling circuits and the addition of mobile mining equipment needed to achieve peak requirements of 216 million mt/y of ore and waste rock. Approximately 40% of the capital increase is due to changes in project scope brought about by the growing project footprint, facilities optimization and revised infrastructure requirements. An additional 40% of the increase is attributable to the throughput increase, including the addition of high pressure grinding rolls, shovels and haul trucks. The remaining 20% is due to cost escalation since the 2006 feasibility study.

Goldcorp has received $485 million in cash from Silver Wheaton in exchange for selling 25% of the life of mine silver production at Peñasquito for $3.90/oz of silver.

The new construction plan calls for an acceleration of the second SAG mill line fabrication, eliminating an 18-month delay between completion of the first line and the start of the second. Personnel and equipment will now be retained on site for continuous construction, thus shifting forward metals production. The new production profile will average 1.7 million gold equivalent ounces per year, using $650 gold, $12 silver, $0.50 lead and $0.90 zinc.

On-site, the company reported that prestripping activities have begun on the initial benches of the Penasco pit. The Pabellon- Salaverna road, which provides improved access for equipment and materials deliveries, was opened to the public in September. All towers and cable for the 400-kV power line have been installed, and the line is expected to be energized early in 2008. Construction of the crusher installations, oxide conveyor, leach pad, Merrill Crowe facility and mill foundation are on schedule. The company expects production of the first gold ounces from heap leaching of oxides in 2008 and mill start-up in 2009.

As featured in Womp 07 Vol 9 -