Xstrata Produces First Ore at Lady Loretta, Suspends Cosmos

Xstrata reported on September 25, 2012, that ore production has started ahead of schedule at Xstrata Zinc’s A$303 million Lady Loretta mine 140 km northwest of Mount Isa in northwest Queensland. The following day, the company reported that Xstrata Nickel Australasia was suspending operations at its Cosmos nickel mine in central Western Australia in response to adverse market conditions

Lady Loretta:First deliveries of zinc-lead-silver ore from the Lady Loretta mine were trucked to Xstrata Zinc’s Mount Isa process-ing operations before the end of September. This early production accompanies ongoing development of the underground zinc-lead-silver mine and is well ahead of the original scheduled start date. Full-scale commercial mining at Lady Loretta will begin in mid-2013, delivering an estimated 1.2 million mt/y of ore to Mount Isa and contributing a 20% net increase to Mount Isa’s annual zinc production.

The Lady Loretta deposit contains an estimated 12.7-million-mt reserve, grading 14.2% zinc and 4.8% lead, along with 84 g/mt silver. Contained metal production over a 12-year mine life is expected to total 1.8 million mt of zinc and 610,000 mt of lead.

Construction of the project began in July 2011. First ore production was origi-nally scheduled for late 2013, but in May 2012, Xstrata decided to accelerate development of the mine by developing the upper ore bodies independently of the deeper underground resources and to increase the annual ore production rate from 1 million to 1.2 million mt/y.

Brian Hearne, COO of Xstrata Zinc Australia, said, “We are taking early advan-tage of Lady Loretta’s higher-grade zinc, which will improve the overall quality of our Mount Isa resource base. It is all part of our plan to increase production from the region.”

Cosmos: Xstrata Nickel Australasia placed its Cosmos nickel mine on care and maintenance in response to market condi-tions that included a prolonged period of low nickel prices and a strong Australian dollar. The company is continuing to eval-uate the newly-discovered Odysseus, Odysseus North and Odysseus Massive de-posits at Cosmos, with a view to complet-ing a feasibility study by the first quarter of 2014 to enable an investment decision, dependent on market conditions.

Xstrata Nickel Australasia’s Sinclair Nickel Operation, approximately 100 km south of Cosmos, is unaffected and contin-ues to operate at normal capacity. Sinclair is expected to produce about 7,000 mt of nickel in concentrate this year.

Cosmos produced its first concentrate in April 2000. Since then, more than 2.9 million mt of ore have been mined and 127,000 mt of nickel in concentrate have been produced at Cosmos, including an estimated 4,200 mt in 2012.

As featured in Womp 2012 Vol 11 - www.womp-int.com