Teck, Goldcorp's Project Corridor advances

The Project Corridor copper-gold project, located in Chile's northern Atacama region (III), is moving forward following the completion of the agreement between Canadian miners Goldcorp and Teck Resources to form a new 50:50 JV that will control the new asset.

Goldcorp and Teck had announced in August the combination of their respective US$3.9bn El Morro and US$4.5bn Relincho assets to form a single copper-gold project with an initial capital cost of US$3.5bn.

The two deposits are located 40km apart. Developing them together will allow for substantial cost reductions, as the preliminary economic assessment includes a single desalination plant, port, transmission line, concentrator and tailings facility.

Development of both El Morro and Relincho had been postponed, with the former being delayed by a series of court challenges, and the latter being mothballed because of unfavorable market conditions.

Project Corridor is set to have a mine life of 32 years, while first-stage development includes a concentrator with a 90,000-110,000t/d capacity to produce an average of around 190,000t copper and 315,000oz gold a year over the first 10 years.

Work on a prefeasibility study, together with community consultation, is now expected to start in the third quarter of 2016 and be completed by the end of 2017. Teck had said previously the study would be launched in early 2016.

Goldcorp also announced the completion of a related deal, in which it acquired New Gold's 30% stake in El Morro for US$90mn cash plus a 4% gold stream payable on future production from El Morro.

New Gold said in a release that the transaction would increase its financial flexibility and strengthen its balance sheet while also enabling it to maintain exposure to El Morro's significant gold reserves and ongoing exploration potential.