First Quantum announces Cobre Panamá project review

Vancouver-based First Quantum Minerals (TSX: FM, LSX: FQM) has estimated a US$6.4bn capital cost for its Cobre Panamá copper-gold project in the Central American country, according to the company's review of the project.

The estimate includes US$913mn incurred prior to the takeover of Canada's Inmet last year (through which it acquired Cobre Panamá), US$1.47bn incurred at November 30 last year, and US$1,58bn committed at November 30.

Cobre Panamá was previously expected to demand capex of US$6.2bn.

The revised project will have installed capacity of about 70Mt/y for the first 10 years, approximately 17% higher than Inmet's plan. Beyond year 10, capacity will be expanded to 100Mt/y.

Based on a 70Mt/y capacity, Cobre Panamá would produce an average of approximately 320,000t/y of copper on a 34 year life-of-mine basis, 20% higher than the original plan.

Average annual life-of-mine by-product production has been estimated at 100,000oz of gold, 1.8Moz of silver and 3,500t of molybdenum. The average copper grade will be 0.5% for the first 10 years and 0.37% for remaining mine life.

The review is based on a measured and indicated resources estimate of 3.271Bt.