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COMPAÑÍA MINERA CASALE

CERRO CASALE PROJECT, CHILE
FEASIBILITY STUDY REPORT

C ONTENTS
24.0

OPERATING COSTS ............................................................................................. 24-1
24.1 Summary .................................................................................................... 24-1
24.2 Basis of Estimate ........................................................................................ 24-1
24.2.1 Wages and Salaries ..................................................................... 24-2
24.2.2 Work Schedules ........................................................................... 24-4
24.2.3 Fuel Costs .................................................................................... 24-4
24.2.4 Electricity Costs ............................................................................ 24-4
24.3 Mine Operating Costs ................................................................................. 24-5
24.3.1 Summary ...................................................................................... 24-5
24.3.2 Detailed Cost Breakdown ............................................................. 24-5
24.3.3 Fixed and Variable Costs Analysis ............................................. 24-10
24.4 Processing Operating Costs ..................................................................... 24-11
24.4.1 Sulphide Ore Processing............................................................ 24-11
24.4.2 HL – Gold Recovery – SART Circuits......................................... 24-34
24.5 General and Administration Operating Costs ........................................... 24-45
24.5.1 Summary .................................................................................... 24-45
24.5.2 Detailed Cost Breakdown ........................................................... 24-47
24.5.3 Personnel ................................................................................... 24-58

T AB L E S
Table 24.1-1:
Table 24.2-1:
Table 24.2-2:
Table 24.3-1:
Table 24.3-2:
Table 24.3-3:
Table 24.3-4:
Table 24.3-5:
Table 24.4-1:
Table 24.4-2:
Table 24.4-3:
Table 24.4-4:
Table 24.4-5:
Table 24.4-6:
Table 24.4-7:
Table 24.4-8:
Table 24.4-9:
Table 24.4-10:
Table 24.4-11:
Table 24.4-12:
Table 24.4-13:

Average Direct Operating Costs.............................................................................. 24-1
Cross Section of Labour Monthly Salaries (Fully Burdened) .................................. 24-3
Average Power Demand and Annual Consumption................................................ 24-5
Mine Operating Cost by Unit Operation .................................................................. 24-6
Mine Operating Cost by Major Consumable ........................................................... 24-7
Mine Labour Requirements and Costs .................................................................... 24-9
Major Mine Consumables LOM Quantity and Cost ............................................... 24-10
Fixed Costs Elements of the Mining Costs............................................................ 24-11
Summary of Average Sulphide Ore Processing Costs – by Cost Type ................ 24-12
Summary of Average Sulphide Ore Processing Costs – by Cost Area ................ 24-12
Yearly Sulphide Ore Plant Operating Cost............................................................ 24-13
Flotation Plant Manpower Costs Breakdown ........................................................ 24-16
Crusher and Grinding Mill Liner and Media Costs ................................................ 24-17
Abrasion Indices and Mine Reserve Proportions per Rock Type.......................... 24-18
Abrasion Indices and Power Intensity per Grinding Stage .................................... 24-18
Sulphide Ore Reagent Costs................................................................................. 24-21
Site-Specific Electricity Pricing and Off-Site Transmission Losses....................... 24-22
Nameplate-Specific On-Site Transformation & Transmission Losses .................. 24-23
Electrical Motor Efficiency Table ........................................................................... 24-23
Sulphide Ore Processing Plant Electrical Loads and Costs by Operations Area . 24-24
Parameters Applied for Maintenance Material Costs Derivation........................... 24-26

Project No.: 159742
February 2010

TOC i

COMPAÑÍA MINERA CASALE
CERRO CASALE PROJECT, CHILE
FEASIBILITY STUDY REPORT

Table 24.4-14:
Table 24.4-15:
Table 24.4-16:
Table 24.4-17:
Table 24.4-18:
Table 24.4-19:
Table 24.4-20:
Table 24.4-21:
Table 24.4-22:
Table 24.4-23:
Table 24.4-24:
Table 24.4-25:
Table 24.4-26:
Table 24.4-27:
Table 24.4-28:
Table 24.4-29:
Table 24.5-1:
Table 24.5-2:
Table 24.5-3:

Contractual Maintenance Costs ............................................................................ 24-28
Fresh Water Distribution System – Distribution of Direct Costs over LOM ........... 24-31
Lime Slaking System – Distribution of Costs over LOM........................................ 24-32
ADR and SART Circuits – Distribution of Costs over LOM ................................... 24-33
Costs and Credits Related to CIL Circuit Use of ADR and SART......................... 24-33
Fixed Cost Elements of the Flotation Plant Processing Costs .............................. 24-34
Summary of Average Oxide Ore Processing Costs – by Cost Type..................... 24-35
Summary of Average Oxide Ore Processing Costs – by Cost Area ..................... 24-35
HL/Gold Recovery/SART Plant Manpower Cost Breakdown ............................... 24-37
HL/Gold Recovery/SART Consumable Costs ....................................................... 24-37
HL/Gold Recovery/SART Reagents Costs............................................................ 24-39
HL/Gold Recovery/SART Electrical Loads and Costs per Area............................ 24-40
Parameters Applied for Maintenance Material Costs Derivation........................... 24-41
ADR/Refinery Circuits Unit Cost Details................................................................ 24-43
SART Circuit Unit Cost Details .............................................................................. 24-44
Fixed Costs for the HL/Gold Recovery/SART Circuits .......................................... 24-45
G&A Cost Breakdown............................................................................................ 24-46
General Services Equipment List .......................................................................... 24-55
G&A Person Count Breakdown by Department .................................................... 24-59

F IGURES
Figure 24.3-1: Mine Operating Cost Unit Operation Distribution .................................................... 24-6
Figure 24.3-2: Mine Operating Cost Consumables Distribution ..................................................... 24-7
Figure 24.5-1: G&A Cost Distribution............................................................................................ 24-46

Project No.: 159742
February 2010

TOC ii

COMPAÑÍA MINERA CASALE
CERRO CASALE PROJECT, CHILE
FEASIBILITY STUDY REPORT

24.0

OPERATING COSTS

24.1

Summary
The average overall operating costs for the Cerro Casale property are presented in Table
24.1-1.
These costs are representative of mid-2009 pricing in Unites States of America dollars
(US$). The costs relate to the processing of oxide and sulphide ores at the yearly
nominal throughput.
The exchange rate used for the operating costs was 525 CLP:USD. The majority of the
operating cost exposed to foreign currency (CLP) is the labour costs. Labour costs
represent approximately 11% of the LOM operating costs. A 1% change in CLP
exchange rate changes the NPV5% by approximately US$16 million.
Table 24.1-1:

Average Direct Operating Costs
Cost
(US$M/a)

Cost per tonne per Indicated
Type
(US$/t)

Percentage of
Overall Cost
(%)

Mining

286.0

1.63/t of mined rock

37

Processing – Flotation
Plant

350.11

6.08/t of sulphide ore

45

Processing – HL

93.0

2.58/t of oxide ore

12

G&A

49.2

0.76/t ore processed

6

Component

1

Total
778.3
Note: 1. Annual processing costs based on nominal throughput.

24.2

100

Basis of Estimate
Operating cost estimates for the 2009 Feasibility Study were developed to a target
accuracy of -5% to +10% based on first-principles assessment and known operations.
Neither escalation nor contingency have been applied. Operating costs were derived, as
applicable for second quarter of 2009, by applying the following to the production
forecast:





mobile equipment productivities and equipment/circuit availabilities
mobile equipment hourly operating costs
labour requirements
wages and salaries
grinding steel consumption adjusted to rock type abrasion indices per empirical
equations
reagent consumption per testwork or stoichiometric relationships.

Project No.: 159742
February 2010

Page 24-1

The mining and processing costs were developed from the detailed mine plan and calculated metal production schedule.: 159742 February 2010 Page 24-2 . dollars (CLP525/US$1) was used. Mining production equipment operator labour requirements. The model allows advanced auditing capabilities. instrumentation. light steel and building wall shells). tires. and the comminution equipment liners which were costed on the basis of anticipated replacement frequency. hourly equipment operating rates. Exceptions are the comminution circuits for which the yearly sum budgeted for maintenance was derived from first principles. from Chilean Pesos to U. The Owners’ currency exchange rate guidance for th Opex estimate. supplies.COMPAÑÍA MINERA CASALE CERRO CASALE PROJECT. electrical. estimates of mechanical availabilities. The operating costs for production and ancillary mobile equipment include such items as power or fuel. Statistics of consumption of the major consumables per period are also available as an output. CHILE FEASIBILITY STUDY REPORT The overall operating costs structure was established in an extensive Xeras-based model. spare parts. G&A operating costs are driven mainly by the number of on-site employees and other fixed overhead costs as detailed in the G&A section of this chapter. cable and piping supports. maintenance parts and materials are factored as a fraction of the capital costs related to the purchase of equipment (mechanical. incorporating the influence of the metal production schedule and peak power demand. For the process plant. and groundengaging tools. Maintenance costs for mine production and ancillary equipment are based on estimated equipment hours. 24.1 Wages and Salaries Wage and salary guidance was obtained from a Chilean consultant using a first quarter 2009 job classifications and rates survey. tracking the sources of the data used to derive the operating costs. The survey was conducted across several current Chilean mining operations. as well as sorting these by type and area. weight of lining sets. Support labour within the mining and process operations was determined by engineering using estimates of activities. The 75 Project No. and hourly equipment operating rates prepared by engineering. and steel price. lubricants.S. piping. quantities of material moved. These factors were adjusted over the life of the equipment to reflect the age of the units. and maintenance labour intensities for each fleet type.2. based on recovery projections established per rock type and variable with head grades. and consumables are based on equipment hours estimated from estimates of productivities and activities. Process equipment costs are based on installed power with individual load factors assigned to reflect utilization rate. A mobile equipment cost is allocated to G&A under the General Services sub-section. cabling.

838 1.333. CHILE FEASIBILITY STUDY REPORT percentile of the fully burdened peak LOM rates were used as salaries.309.717.434.COMPAÑÍA MINERA CASALE CERRO CASALE PROJECT.647. 5.180.911 Truck Operator 1.228 5.957 Chief Geologist 5.570 3.855.783.309.131.073 Tech Services .455 Maintenance Superintendent 6.197 2.754 7.004 Mine Manager 10.596. and pension allowance.341.: 159742 February 2010 A complete list of the fully-burdened Fully Burdened Monthly Salaries (CLP$) P50 P60 P75 General Manager 18.005 7.851 Mine Superintendent 6.916.341 20.596.856.556 3. Data from the survey provided fully-loaded rates built up from five different levels.536 2.645.591.068 5.501 3.050. Sample salaries are provided in Table 24.697.536 2.173 22.042.995.697.155 3.148 1.101.908 Recruiting Officers 4.2-1: Cross Section of Labour Monthly Salaries (Fully Burdened) Position Project No. Within each salary level.239.Chief Eng.908 Chief Surveyor 3.247. salaries by position is provided in Appendix R.053 7.145 Mine Supervisor 3.306.896.306.818.075 2.589 3.026.689 Shovel Operator 1.141.585 11. Salaries were built up from base levels to a fully loaded rate and then burdened further with additional costs such as severance and disability to reach the fully burdened rates.899 3.681. health insurance.823 11.631.687 4. The fully-loaded rates were increased further to fully-burdened rates by adding company salary burdens including some Chilean-specific statutory additions.647.046.173 1.340. Table 24.180.618.197 Welder 1.943 2.997 Primary Crusher Operator 1.761.111 General Mine Labourer 1.579 IT Support Tech 3.190.083.501.516.319.536 Page 24-3 .039 7.258.765 1.603 2.169.896.803 2.239 5.347 Process Manager 10.545.697.429 1.596.012.908 Chief Accountant 5.537.428.246 11.229 Management Secretary 2.107.229 4. All salaries used in this report are fully loaded and fully burdened to include the full cash payout by the project per position.075 2. there are several rate categories all of which include bonuses.657.228 5.357 2.198 Diesel Mechanic 2.032.152.2-1.101.010.322 1.343.467.910 3. equivalent to the expected levels reached by all job categories in Year 10 of the operations.997 Tailings System Operator 1.068 5.242 3.409 2.184.549 11.413 Plant Supervisor 3.723.228 5.

4 Electricity Costs The average electrical energy cost (power cost) assumed for this study is US$0. Operations and mining personnel will work two 12-hour shifts.8 million.2 Work Schedules The work schedule assumes mine production and processing facilities will operate 24 h/d. The power required will vary as the mine develops.0912/kWh.2. short-range planners and engineers. Table 24. and blasthole samplers who will rotate with the crews Administration staff located off site in the Nantoco office will work 42 hours on a 5-day week schedule. Management personnel (general supervisor level and up) will work day shifts on a 4-daysin/3-days-out rotation with rotating weekend coverage.2. Based on the average annual electrical energy demand of 1. the average annual power cost for Cerro Casale will be US$171. Project No.2-2 shows the average power demand.71/L delivered on site. and annual electrical energy consumption estimated for each of the three project sites.COMPAÑÍA MINERA CASALE CERRO CASALE PROJECT. These results in a unit diesel price of US$0. with the exception of certain positions in the mine department such as ore control. CHILE FEASIBILITY STUDY REPORT 24.2. 24. Operations.3 Fuel Costs A fuel price of US$75/bbl WTI has been assumed for the study. 365 d/a. power price.888 GWh over the LOM. inclusive of transmission losses from the power supply provider to each site listed and the transformation and distribution losses at the sites themselves. 24. Power to the mine site will be delivered to the Cardones substation on the Chilean Systema Interconectado Central (SIC) transmission grid.: 159742 February 2010 Page 24-4 . Salaried (exempt) personnel will work a 12 h/d shift on an 8-days-in/6-days-out rotation. 7 d/wk. Hourly (non-exempt) personnel work a 7-days-in/7-days-out rotation. Further details on the working rosters are provided in Section 20. This reflects different pricing used for the three main sites which will be receiving their energy from different providers. Technical support staff will work the day shift only following a 7 x 7 rotational roster.

The unit operating cost distribution is shown in Figure 24.3.e. heap leach operations.2 1. not LOM average). those for the sulphide plant.098 90.2.658.443 Port 1.656 Total – Cerro Casale Mine Site 203. provides details about the project power.3.633 Total/Average The Cerro Casale mine site includes power consumptions for both the main substation and the pit substation.375 G&A 3.483 91.3 Mine Operating Costs 24.COMPAÑÍA MINERA CASALE CERRO CASALE PROJECT.3-1 Project No. due mainly to long uphill hauls from the bottom of the pit.224 215.1 Summary The life-of-mine (LOM) average mine operating cost per tonne was estimated to be US$1.2 37.671 90. Power.352 102.053 156.2-2: Average Power Demand and Annual Consumption Site Mining Average Power Demand (Pav(T)) (kW) Unit Power Price (US$/MWh) Annual Energy Consumption (Ey) (MWh) 4. 24.888 90. Section 11.2 Detailed Cost Breakdown Mine operating costs have been broken down by unit operation and major consumables by quarter and annual (see Appendix I). and port are based on years of operation of both oxide and sulphide processing facilities at the nominal capacity (i.163 Generated power .44/t over the first ten years of the mine life progressively increasing to average costs of US$1.3 99.2 95. 24. CHILE FEASIBILITY STUDY REPORT Table 24.1 Cost by Unit Operation Table 24.5.90/t over the last ten years.44.3.2 .887.376 Sulphide Processing 189.778. Piedra P˚mez. This estimated operating cost varies between average costs of approximately US$1.63.2 1.6 9.2 1.267 90. 24.708 Oxide Processing 10.078 90.966 Piedra Pómez 11. The average demand and energy consumption for the pit was estimated using the mining plan for 18 years of mining operation.350 90.2 32.: 159742 February 2010 Page 24-5 .3-1 shows the operating costs by unit operation and represent the LOM weighted average cost.

628 100 Figure 24.007 - Sub-total 1.220 13 Hauling 0.091 6 Total 1.2. Project No.045 3 Unit Operation Pit Dewatering 0.537 94 Mine Overhead 0.139 9 Ancillary 0.3.3-1: Mine Operating Cost by Unit Operation Cost (US$/t) Contribution to Total (%) Drilling 0.COMPAÑÍA MINERA CASALE CERRO CASALE PROJECT.: 159742 February 2010 Page 24-6 .232 14 Loading 0.3-1: Mine Operating Cost Unit Operation Distribution Mine Overhead 6% Drilling 12% Blasting 14% Loading 13% Pit Dew atering 0% Ancillary 3% Support 9% Hauling 43% 24.2 Cost by Major Consumables Table 24.3-2. CHILE FEASIBILITY STUDY REPORT Table 24.3-2 shows the operating costs by major consumable and represents the LOM weighted average cost.698 43 Support 0. The consumables distribution is shown in Figure 24.196 12 Blasting 0.

033 2% Tires 0.Table 24.628 100 Consumables Figure 24.004 0% Fresh Water 0.3-2: Mine Operating Cost Consumables Distribution Contractor 3% Maintenance Parts 29% Assay Lab 0% Tires 4% Fresh Water 1% GET 2% Fuel & Lub 29% Labour 14% Explosives 12% Bits & Steels 4% Pow er 2% .061 4% Maintenance Parts & Supplies 0.473 29% GET 0.480 29% Contractor 0.070 4% Power 0.036 2% Fuel & Lubricants 0.010 1% Total 1.188 12% Bits & Steels 0.3-2: Mine Operating Cost by Major Consumable Cost (US$/t) Contribution to Total (%) Labour 0.226 14% Explosives 0.048 3% Assay Lab 0.

Under the direction of the mine operations superintendent. Operations.3. Other support labour within the mining operation was determined by estimates of activities prepared by engineering.6 maintenance employees for each mine operations employee. the mine operations department will be responsible for operator training and the open pit operation. Equipment operator labour requirements are based on equipment hours calculated from engineering estimates of productivities and activities. all hourly labour and supervisory personnel will rotate between day and night shifts. The number of operators is based on the annual equipment requirements and the crew schedules. The mine electrical department will . Maintenance labour requirements for ancillary equipment assume an additional 8. dump and haul road construction/maintenance.24. Mine labour requirements and costs are shown in Table 24. with the exception of blasthole samplers who will rotate with the crews. pioneering work.5% person count.3 Mine Personnel Basis With the exception of the blasting crew and the general labourers. There will be three departments: • • • Mine Operations Mine Maintenance Mine Technical Services. Maintenance labour requirements are based on an assumed ratio of 0. The number of maintenance personnel is based on the number of equipment operators using an equipment-dependent ratio of 0. and hauling of ore and waste.2. provides more details. This will include drilling. ensuring that sufficient operators are available in each crew to operate the equipment. Management and technical support staff will work day shifts only. loading. blasting. This is an industry benchmark standard for mines located in well-developed mining markets such as Chile.5% for ancillary equipment. quantities of material moved. Each maintenance crew will be led by a maintenance shift foreman. The mine maintenance department will report to a mine maintenance superintendent. Section 20. Maintenance crews will work the same shift schedule as mine operations crews. and equipment operating hours. and mine dewatering.60 maintenance personnel per equipment operator plus 8. This is an industry benchmark standard for mines located in well developed mining markets such as Chile.3-3. Personnel Levels and Structure The mine will be headed by the Mine Manager who will report to the Operations Manager.

4 Major Consumable Quantities and Costs Consumable costs were obtained from Barrick and Kinross corporate procurement group.982.298 0. an electrical engineer. Staff requirements were determined by assessing the preproduction mine plans and life of mine activities. Engineering will provide daily. .consist of an electrical superintendent. and eight high voltage linemen who will support the mine operations by maintaining the mine electrical reticulation system required for electric rope shovels and electric drills.575.2.3.337 0.230 Labour Training Labour training is covered in Section 20.3-3: Mine Labour Requirements and Costs Description Mine Management Avg. Table 24.245 0. The estimated LOM quantities and costs for major mine consumables are shown in Table 24.3-4. estimating ore reserves.863.093 Mine Operations Department 465 370. 24. Operations.434 0.108 Total Mine 850 792. weekly.002 Mine Technical Services Department 60 91. This department will also include the geology and geotechnical groups responsible for updating the resource model. and monthly plans for operations working on full rotation. The engineering department will be part of the mine technical services department under the direction of the technical services superintendent. grade control. and geotechnical design.324. # LOM Wages LOM Wages People US$ US$/t 2 6.027 Mine Maintenance Department 323 322.176 0.903.

Powder factors average 0. 24.190. due mainly to the long hauls to the valley bottom during the pre-stripping period and the long uphill hauls from the pit bottom at the end of the mine life.00R57) ea 314 8.271 171.000 Cat 854K (Michelin 45/65 R45) ea 619 11.269 121. Large haul truck tires consumed over the LOM will cost US$172 million or 6. Diesel cost per litre of US$0.5R29) ea 645 6.364 Letourneau L2350 (Bridgestone 70/70-57) ea 104 2.364 per tire (Source – CMC).358 267.185 470 Bulk Emulsion t 512.63 L/t which is higher than the average 0.02 Liebherr T282C (Michelin 56/80 R63 or Bridgestone 59/80 R63) ea 6.961.562 28.353.870 Cat 777 (27.894. the main exceptions are mine overhead costs.076 12.473 1.038 24.00-49) ea 714 7.072.719 0.Table 24.706.038 9.495 640 Stemming/Fuse/Booster ea 1.71 Bulk Ammonium Nitrate t 569.961.847 10.916 10.790 18. and labour.10% of the overall mining costs are fixed in nature.71 has been derived from a crude oil cost of US$75/bbl.448.3.60 Blast Accessories ea 1.271 tires based on an average tire life of 6. technical services.289.794.3 Fixed and Variable Costs Analysis The majority of the cost items related to the mining cost are variable in nature. This indicates that 16.798 328.844.50 L/t typically seen at large open pit mines.682 27.526 0.598.346 Cat 793F (40.370 5.485.3-5. The cost items that are considered fixed are shown in Table 24.5R25) ea 851 4.168.078 m pit entrance elevation will be wet and therefore require emulsion type explosives.000 Cat 24M (Michelin 29.866. This powder factor assumes that 50% of the blastholes below the 4.597.709.794 Diesel consumption averages 0.539.410 5.3-4: Major Mine Consumables LOM Quantity and Cost Consumables Electricity Unit Consumption LOM Cost (US$) Unit Cost (US$) kWh 1.0902 Diesel L 2. .000 hours and US$27.910 27.351.31 kg/t due to the high rock strength and the fragmentation required.351 Cat 740 (29.995.

10 Item 24.4-1. these costs relate to dry tonnes of sulphide ore milled. in particular overheads related to the operation of the ADR.4.26 Total 0.11 Mine Maintenance 0.1 Sulphide Ore Processing 24.1. design information. .262 16. and in Table 24.07 Labour 0.1 Summary Operating costs for the sulphide ore processing plant (flotation plant) were established using reagent pricing data supplied by CMC. The costs reflect sharing of some costs with the HL operation. per cost type. ore hardness. and grinding media and liner wear rates in a non-linear fashion.12 Mine Operations 0.4. The overall estimated costs are presented in Table 24. per processing area. Yearly fluctuations are due to the variability of average grades. Once the HL operations finish.167 10.002 0. where process operating costs are noted in US$/t processed.54 Mine Technical Services 0. and SART circuits. the full amount of the fixed costs for the circuits previously shared with the oxide ore processing will report to the flotation plant.025 1.4 Processing Operating Costs 24.4-2. Benchmarking against similar operations was used for comparison.Table 24.050 3.1. and suppliers’ quotes.018 1. grinding power draw.3-5: Fixed Costs Elements of the Mining Costs Unit cost (US$/t) Percentage of Overall Opex (%) Mine Management 0. In this Section 24.4. and composite abrasion index which will influence product volumes. gold refinery.

4-1: Summary of Average Sulphide Ore Processing Costs – by Cost Type US$/t processed % of total processing costs Wear Steel 1.060 17 Dewatering & Port 0. . SART circuit and fresh water supply are distributed under the various items for the sulphide processing plant.294 100 Table 24. the transferred allocation for common circuits such as the gold stripping circuit (ADR).217) 6.217) 6.357 37 Flotation 1.570 9 Other Costs 0.250 4 Sub-Total Credits (CN from SART.374 6 Tertiary Crushing 0.072 1 Water Treatment at Mine Site 0.006 - Overheads 0.Table 24.078 Summary of Average Sulphide Ore Processing Costs – by Cost Area US$/t processed % of total processing costs Primary Crushing 0.169 3 Secondary Crushing 0.319 21 Reagents 0.4-1. power from fresh water pipeline) Total 6.294 100 Processing Area (0.842 45 Labour 0.4-2: (0.991 16 Item Consumables 0.227 4 Carbon-in-Leach (CIL) 0. The Consumables costs include diesel and maintenance parts used for the mobile equipment.078 In Table 24. power from fresh water pipeline) Total 6.361 6 Maintenance Spares & Materials 0. gold refinery.955 15 Grinding 2.036 1 Power 2.175 3 Sub-Total Credits (CN from SART.783 12 Tailings Storage Facility (TSF) 0.042 1 Water Treatment at Port 0.

92 2028 5. A value of 0. and most of the mobile equipment fleet maintenance for vehicles not dedicated to a specific circuit.97 2023 6. Table 24. refinery and SART circuits.02 2021 6.05 2022 5.4-.217$/t.The Other Costs item includes items such as contracted maintenance and the mobile equipment fleet maintenance labour costs transferred from the central maintenance shop.97 2032 6. represents the cyanide recovered through the use of the SART circuit.4-3: Yearly Sulphide Ore Plant Operating Cost Year Sulphide Ore Processing Cost (US$/t) 2015 6.96 2027 5. as well as all of those related to the cyanide destruction circuit appear under the CIL area.87 2029 5.95 2025 5. In Table 24. Table 24.00 2024 5.30 2020 6.27 2017 6.92 2026 5.4-3 reflects the yearly processing costs projected from the detailed Xeras model with 2033 representing only three days of operations. of the total credits of 0.14 2033 8. with the HL facilities. as well as general expenditures such as research and development (R&D).92 2031 5.89 2030 5.2 the portion of the costs for common use. of the ADR.23 2018 6. along with a credit for the lime slaking system from the HL costs for its share of the total lime consumption.02 . The balance mostly stems from the generation of electricity by the turbine installed in the fresh water pipeline.148$/t. Overheads include the supervisory and technical personnel salaries not dedicated to a specific operating area.75 2016 6.24 2019 6.

24. including concentrate pipeline operation and shiploading activity (excluding sampling for assay exchanges with smelters which are accounted for under marketing costs) • delivery of the plant rougher tailings to the tailings storage facility (TSF) • cyanide destruction costs related to the CIL leach circuit tailings • delivery of the neutralized cleaner tailings to the lined containment facility • reagent preparation and distribution for the processing units listed above • • supply of plant and instrument air to the processes and equipment described above water treatment plant at the mine site and at the port site.1.The following sections describe the method used to estimate each processing cost item and the underlying assumptions. first cleaner tailings pre-leach. post-leach. • recirculated water from the thickener overflows back to the process water pond • rock comminution from the primary crusher feed pockets to the ball mill cyclone overflows • flotation circuit including regrinding. and on-stream analysis • first cleaner tailings carbon-in-leach (CIL) circuit • concentrate. sampling. Transfers of costs from circuits shared with oxide processing are included in the sulphide ore processing costs.4. Some costs incurred within facilities operated by the flotation processing plant but used by other customers are distributed back to the consumers. These include: • • • • assaying costs (shared with the mine and geology department) cyanide destruction costs (shared with the SART circuit) the preparation of milk of lime in a centralized location at the flotation plant (used on the leach pad and in the shared ADR circuit) fresh water system. gold refinery. from extraction of fresh water at the Piedra Pómez well field and reclaim water from the TSF to delivery to the fresh and process water ponds. and rougher tailings thickeners • delivery of flotation concentrate from the plant site to the port site.2 Sulphide Ore Plant Cost Estimate Battery Limits The sulphide plant operating cost estimate covers the following elements: • water supply. . and SART circuits. These shared costs include the operation of the ADR.

24. The number of people in the maintenance department is consistent with an operating philosophy that plans to use contractors for the majority of the repetitive major maintenance tasks. the proportional load of cyanide sent to the circuit from the SART circuit and the CIL circuit is used.4. Maintenance crews will work on day shift only. The total number of staff is comparable to levels at similar large scale porphyry operations in Chile with adjustments for the plant configuration and the high altitude at Cerro Casale.1. except for a crew of one supervisor with four millwrights and four helpers assigned on a rotation basis on night shift duty for plant emergencies. operations. A breakdown of the number of persons covering the various processing department functions and related operating costs is provided in Table 24. Section 20. the tonnes of loaded carbon processed from the CIL and CIC circuit are used • for the SART circuit.3 Flotation Plant Personnel The salary levels for staff. tailings discharge to the pond. The individual fully-burdened wages were derived from the classification system provided by CMC.2.4-4. The HL costs and the gold recovery and SART circuits are detailed in Section 24. Some of the personnel assigned to duties such as reagent preparation. The operations crews will provide 24/7 coverage. Operations.4. and janitorial duties will work a 4-days-on/4-days-off schedule. provides further details and the organization chart for the processing department. . These will generally be performed when the plant is shut down for planned maintenance. the copper load contributed from each of the CIL tailings and bleed from the barren leach solution from the heap leach pad is used • for cyanide destruction.The apportioning of the total costs for each of these shared facilities is based on the most appropriate parameter to use in each case: • for the ADR operation. and maintenance personnel are based on information provided by CMC.

Comminution Equipment Wear Steel The wear steel costs associated with the crushing. or benchmarking. or other Chilean projects.707 $ 5.4. regrinding.937 $ 178.4-4: Flotation Plant Manpower Costs Breakdown Number of Employees Burdened Salaries Management & Administration Operations Pipelines Tailings Storage Facility Water Treatment Plant Maintenance .015/t Shared Circuits allocation – Assay Laboratory Mobile equipment maintenance Total na na $ 0.mill. The expected consumption is derived from testwork data.280. and lime preparation duties are shown in Table 24. as it was assumed that all items will enter the country duty free from countries that have free trade agreements with Chile. Where required the base price is increased by a transportation charge equivalent to US$30.024/t Shared Circuits allocation .308 $ 1.00/t.001/t $ 0. The lime slaker wear steel costs are net of the credits received from the HL operations.Fresh water pipeline na $ 0. amounting to US$0.511 $ 17.SART Shared Circuits allocation .691.017/t $ 0.004/t $ 0.1.234.LOM Shared Circuits allocation .004/t of sulphide ore over the LOM. port Metallurgy Assay laboratory Sub-Total Average . interpretation based on established empirical equations.137 $ 526.ADR 2 117 29 9 4 125 23 19 328 na na $ 307.300/t $ 0.283 $ 842.298 $ 1. Pricing is based on delivered product at site. No import duties were applied.626.361/t Area 24. TSF.4-5.873.4 Consumables The price of consumables was provided by CMC (see Appendix I) or obtained from equipment bids.429 $ 0.248 $ 6. recent quotes. grinding.Table 24. .

817 Regrind mill 1. The primary crusher wear rate is based on replacing the concave liners twice per year and replacing the mantle liners four times per year.004) 1.500 2.5 0. . Therefore. one replacement every six weeks is programmed for both the bowl and mantle liners.055 na na 0.224/t). led to projecting a life of 6.800 hours was used to evaluate the liner costs.5 0.736 1. a more conservative estimate of 4.323 (0.319 Crusher Liners The crusher liner wear rates were derived by considering the frequency of replacement for the liner parts for the gyratory and secondary crushers and the estimated weight of the liner pieces.266 42 0.287/t).336 31 0. This is based on lower moisture content and a lower circulating load around the units than that anticipated for the scaledup circuit of Cerro Casale.287 Ball mill 2.6 0.850 hours.013 0.086 13.Table 24. For the HPGR roll wear. Polysius provided a cost of 0.072 Regrind mill Lime slaker Grinding Media 8.015 2. after reviewing benchmarking data.016 Secondary crusher 4.4-5: Crusher and Grinding Mill Liner and Media Costs Item Purchase Price US$/t Consumption g/t Unit Cost US$/t Liners Primary crusher 6.001 Tertiary crusher Ball mill 951 859 0.054 Lime slaker 1.16 Euros/t (US$0. the interpretation of the testwork data obtained by the potential equipment vendor. Pricing for each lining part was obtained from recent quotes from potential equipment vendors.008 Sub-Total Credits (from HL – lime slaking) Total 1. After adjustment for the expected roll life described above this increased to 0. For wear rate calculations for the secondary crushers.266 6.7 0.205 Euros/t (US$0.4 0.

This provided a unit steel consumption (expressed in g/t of feed to the milling stage). expressed in weight of abraded material per unit of energy input (kg/kWh).4326 16.Grinding Media and Liners The grinding ball wear rates were derived using the empirical Bond equations presented in Equations {24-1}. .4-7: Abrasion Indices and Power Intensity per Grinding Stage 6 Grinding Stage Power Intensity (kWh/t of feed to mill) Ai Primary Ball Mill 0.4-6: Abrasion Indices and Mine Reserve Proportions per Rock Type Rock Type Ai % of Mine Reserves Granodioritic Porphyry – GRD 0. Power input based on indicated average limestone BMWi of 10.4-6 along with the proportions of the different rock types in the mine plan. These were obtained from testwork performed on rock type composite samples and are shown in Table 24. The parameters for each grinding stage are shown in Table 24.40 Lime Preparation Mill Note: 1 2 3 4 5 6 4 5 Ai is the weighted value for the mine plan ore composition Benchmarked from similar duty at other copper porphyry plants Average value for nine limestone processors. Ball and vertical mill media wear [kg/kWh] = 0.6 kWh/t.050 3 7. Power intensity expressed before drive train transmission losses. at a cut size of 8 mm. Table 24.015) ⅓ {Equation 24-1} The wear rate equation requires the abrasion index (Ai) of the materials being processed.90 0. with 30% discount for use of a VertiMill Power intensity from Bond equation for target grind size of 120 µm.159 * (Ai – 0. of 4.25 mm obtained from simulations. were then multiplied by the energy intensity (in kWh/t) required to perform each of the grinding duties. P80 of 45 μm and 30% power discount for use of VertiMill.6 Dioritic Porphyry Sulphide– DP 0.296 1 12.9 1 Volcanic Rocks – VCGL+VS 0. Table 24.4 Microdiorite Breccia – MDBX (sul and mix) 0. as reported by Bond.2854 29.2962 - Note: 1 Ai for VCGL and VS actually measured on a volcanic breccia sample The resulting wear rates obtained from Equation {24-1}.19 Regrind Mill 0.150 2 10.3570 12. with 5% increment to the BMWi measured at a grind of 149 µm and 5% reduction for micro-cracking from HPGR pre-treatment: transfer size from wet screening.2250 41.2 Weighted Average 0.4-7.

This approach results in an estimated consumption in line with that indicated by the liner change frequency indicated by benchmarking: • • • One complete replacement of wall liners and screw liners per year One complete replacement of the screw liners only per year Two additional replacement of the digging heel (bottom screw liner) per year.06 kg/t of oxide ore. The liner consumption estimated for the lime slaking duty using a VertiMill is based on the results from the empirical equation (Equation {24-1}). The unit cost (US$/t) for the consumed liners would likely be equivalent to that for steel liners. set at 70% of that of an equivalent ball mill. the replacement schedule was also used to derive liner costs. Reagents The reagent consumptions associated with the flotation circuit are based on the testwork program completed at the G&T and SGS laboratories in 2008. Budget quotes obtained from comminution equipment bidders or from CMC’s Owners’ price guidance when available were used to calculate the grinding steel unit prices. . CIL. The consumption figures assume a quicklime supply with 76% available CaO. The latter value is used to estimate the actual consumption rate of balls and liners. In this case. and cyanide destruction circuits) and 4. easier handling during relining. This is based on a replacement frequency of once per 30 months. the Ai of the material feeding the regrinding stage is unknown and the empirical equation cannot be applied. The regrind mill will be rubber lined. This equates to a consumption of 31 g/t.16 kg/t of flotation plant mill feed (combined flotation. For the regrind ball mills. including the pilot plant trials at SGS and consideration of the additional work completed at SGS in 2009. The power intensity (kWh/t) used reflects the higher efficiency of the VertiMill. The ball mill liner consumption derivation assumes a full mill reline every 14 months from benchmarking of large-diameter ball mills with Ni-Hard liners. and lower noise level in the plant. the lower consumption with rubber would be fully compensated by the higher purchase price. instead of the lower quality cast type from which the Bond empirical equations were derived. The benefits of using rubber are longer life. Reagent use for the CIL circuit was derived from testwork completed by SGS in 2009.A credit of 30% has been applied against the ball consumption estimated using the Bond equations for the use of forged media in the plant. Conversion to tonnes of mill feed for the regrind duty and the lime preparation mills was made based on the mass balance at the average feed grade for the regrind mill and at lime consumptions of 1.

Flocculant consumptions were estimated from thickening tests completed by Outotec on pilot plant samples provided from the SGS Lakefield testwork in 2008. The data include the transferred costs of reagents used for the shared operation of the ADR and SART circuits. with the HL facilities. These circuit operations are detailed in Section 24. The stoichiometric proportion of sulphur present in sulphur dioxide used in the cyanide destruction circuit was converted into consumption of elemental sulphur (the reagent used to prepare the sulphur dioxide solution) with a conversion efficiency of 80%.82 kg/t indicated in Table 24.85 kg NaCN/t of cleaner tailings leached vs the gross consumption of 1. Table 24. The anti-scalant addition rate is based on providing a concentration of 5 ppm to the process water stream. The additional flow treated through cyanide destruction from the SART circuit neutralization residue is minimal (in terms of overall cyanide load) and similar stoichiometric requirements were used as for the CIL slurry. The detailed reagent pricing. The net cyanide consumption associated with the CIL circuit. .4-8. The reagent consumptions for the cyanide destruction circuit are based on testwork data obtained from SGS work in 2009 on CIL tailings. amounts to 0. amounting to US$0.2.4-8. consumptions. after the credit for cyanide recovered within the SART circuit (shown as a separate line item in Table 24. There is no credit applied to the expected lime consumption from having a large fraction of the process water recirculated (from thickener overflows) with residual alkaline buffering potential.84/t of plant feed. The indicated credit (the line similarly titled in Table 24.41). decreases the total net cost of the reagents used to process the sulphide ore to US$0. The data do not include the reagents used in the water treatment plants. and costs are shown in Table 24.15/t. This is in the mid-range of normal requirements to soften industrial water according to the supplier’s technical data sheet. The consumption is based on a volume of treated water of 592 L/s (the average volume of fresh water introduced into the circuit).4-1).4.4-8 reflects the adjustment between the available CaO content of the hydrated lime used in the testwork and that available to CMC (at 76%).

029 per t of rougher conc.6 0.010 per t of flotation clnr.127 0.174 0.003 0.4-8: Sulphide Ore Reagent Costs Item Purchase Price Consumption US$/t Flotation Circuit Lime Primary collector (PAX) Secondary collector (A3477) Methyl Isobutyl Carbinol (MIBC) Carboxy-Methyl-Cellulose CIL Circuit Lime Cyanide Activated carbon Transfer from SART Transfer from ADR Dewatering Circuits Flocculant Magnafloc 351 (concentrate at site) Flocculant Magnafloc 336 (concentrate at port) Flocculant Magnafloc 351 (cleaner tailings) Flocculant Magnafloc 351 (rougher tailings) Cyanide Destruction Sulphur dioxide (as elemental sulphur) Lime Water Treatment Antiscalant Total 149 3.068 0.013 3.Table 24.280 2.710 1.090 20 0.4 0.098 0.1 0.120 1.026 per t of conc.600 in grams .000 3.090 15 0.024 0. tailings 2. g/t $/t per t of plant feed 855 30 30 10 855 30 30 10 0.090 33 29 0.820 20 162 172 1.090 45 4.022 1.090 201 151 0. tailings 1. or tailings 3.270 2. 100 10 0.9 0.865 970 149 1.90.600 3 1.. This total is divided between the following different clients: • • assaying of production hole drill cuttings. A daily load of 380 samples was estimated.800 per m of fresh water 5 Assaying Supplies The assaying supplies cost was estimated based on the work load expected in the assay laboratory with an average unit cost per sample assayed of US$2.991 130 149 per t of flotation clnr..609 1. and geological samples (305 samples) metallurgical accounting sampling (10 samples) .1 0.003 0.000 3.277 0. grab samples for grade control.026 0.

pumps.5 Flotation Plant and Ancillary Power Consumption Costs The unit price for electricity provided by CMC was used to develop the power cost for the process equipment. These data are provided in the mechanical equipment list in Appendix F.013/t. for assay supplies and the share of the hourly personnel salaries which is a cost attributed back to these departments.3 1.40 Piedra Pómez Well Field 102.020/t but is then the subject of a credit of US$0. the motor electrical efficiency factor (per motor size. Various levels of on-site transformation and transmission losses are applicable depending on the voltage of the motor.4. received from the geological and mining groups. The balance.• • on-stream analyzer calibration samples (15 samples) metallurgical development work samples. differentiated by the nameplate capacity in Table 24. Three prices are applicable plus three levels of off-site transmission losses as shown in Table 24. is included in the total assay supply cost of US$0.4-9) and on-site losses (from Table 24-4-10) were added to derive a net payable consumption. 24. including circuit utilization provided the average total mechanical demand.4-10.73 Port Site 156. off-site transmission losses (from Table 24. To this value. 75 samples per day are therefore allocated to the process plant requirements. Table 24. feed grades.4-11). and conveyor motors. Assignment of operating load per item. and nominal plant throughput. mills. . either from plant surveys or from laboratory scale testwork conducted in the metallurgical laboratory at site (50 samples) Of the daily total of 380 samples.2 1.1. The resulting power costs are based on the average ore hardness. with consideration for calculated average demand versus installed power base for crushers.4-9: Site-Specific Electricity Pricing and Off-Site Transmission Losses Electricity Cost (US$/MW) Off-Site Transmission Losses (% of power consumed) Cerro Casale Mine Site 90.6 0.92 Site The plant electrical costs were estimated based on the detailed equipment list. from Table 24.4-9.

4-12 The total of 2. actual operated loads.49 > 4000 0.5 89.99 > 165 . .4-10: Nameplate-Specific On-Site Transformation & Transmission Losses Site Motor Nameplate (kW) On-Site Transmission and Transformation Losses (% of power consumed) < 165 0.2 83.5 87.0 The estimate of installed power.0 <22 – ≥15 91.0 <1.0 <110 – ≥55 95.4-1 corresponds to the total shown in Table 24.842 $/t shown in Table 24.< 4000 0.55 71.5 – ≥0.0 <400 – ≥110 96.06 > 165 .2 – ≥1. and resulting cost by operations area is shown in Table 24.0 >0.27 < 165 0.5 – ≥4 86.0 <15 – ≥11 90.0 <45 – ≥30 93.55 74.0 <2.Table 24.03 Piedra Pómez Wells Field Port Site Table 24.0 <30 – ≥22 92.4-11: Electrical Motor Efficiency Table Motor Nameplate (kW) Efficiency (%) ≥400 97.5 78.< 4000 0.0 <11 – ≥7.4-12 but without the application of the credit for power generated by the turbine installed on the fresh water pipeline.0 <7.56 Cerro Casale Mine Site > 165 .0 <5.96 > 4000 0.0 <55 – ≥45 94.0 <4 – ≥2.37 < 165 0.5 – ≥5.< 4000 0.

376 2.8% 169 0.083 95.3% 98.8% 93. from lime slaking for HL Transfer for share of ADR/SART circuits operation 206.164 77.340 73.792 67.030) -0.736 94.8% 9.226 64.6% 5.4% 2.COMPAÑÍA MINERA CASALE CERRO CASALE PROJECT.6% 11.5% 885 0.615 0.069 (3.1% 273 0.7% 10.141 Tertiary Crushing 43.345 95.148 2.1% 3.2% 6.095 0.3% 314 0.7% 257 94.002 267.049 Fresh Water System 17.189 73.348 94.0% Shared credit for power generated from the fresh water pipeline Credit for shared use of fresh water pipeline from mine.448 93.056 80.0% 690 94.423 Grinding 116.165 1.972 0.012 1.522 78.4-12: Sulphide Ore Processing Plant Electrical Loads and Costs by Operations Area Plant Area Operated Load (kW) Mechanical Load Factors Consumed Mechanical Load (kW) Electrical Efficiency Factors Total Consumed Load (kW) Unit Cost (US$/t) Primary Crushing and Ore Reclaim 10.029 Tailings handling 1.773 On-Site Concentrate Dewatering & Pipeline Concentrate Dewatering (port site) and Loading Reagent preparation Water treatment Plant at Site Plant Services (water distribution.124 74.864 0.062) -0.341 77.9% 693 93.8% 277 88.404 1.069 0.036 0.414 50. air) Cleaner Tailings Pond Reclaim Water Water Treatment Plant at Port Total / Average Project No.4% 836 94.544 0.8% 727 0.3% 196.779 95.9% 6.034 66.010 Reclaim Water System 4.5% 3.0% 952 0.096 Secondary Crushing 13.5% 158 93.615 94.004 219 72.789 95.010 11.083 330 77.0% 29.864 0.453 0.6% 2.2% 2.042 3.7% 6.013 506 54.085 63.9% 27. HL.831 (5.5% 741 0.053 Total 202.974 94.036 CN Destruction 2.1% 30. CHILE FEASIBILITY STUDY REPORT Table 24.078 64.3% 12.384 1.350 Flotation and Regrinding 39.319 70.942 46.004 CIL Circuit 3.352 94.1% 895 94.890 94.3% 1.7% 29.284 0.: 159742 February 2010 Page 24-24 .

COMPAÑÍA MINERA CASALE CERRO CASALE PROJECT. Table 24.: 159742 February 2010 Page 24-25 . the frequency.57/t.4.4-13 is a maintenance spares and materials cost of US$0.6 Flotation Plant Maintenance Supplies Costs Maintenance Materials and Equipment Spares The calculation of the spare parts cost is based on a yearly amount derived using the Capex cost base represented by all process related equipment. CHILE FEASIBILITY STUDY REPORT 24. The percentages vary between the various plant areas reflecting the type of duty represented. electrical. and wall cladding of buildings foreach process area. piping. Transfer of credits for shared use of the fresh water distribution system and lime preparation system. and the cost of each repair in parts and materials. and instrumentation hardware. The amounts for the comminution circuits were derived from a first-principles approach where individual pieces of equipment were analyzed for the type of replacement or repairs required. Project No. pipe and cable trays. Additioal contacts with some vendors were made to complete the list of parts required.4-1.4-13 indicates the parameters and the Capex per area. The resulting unit cost from applying the data in Table 24.1. as well as allocated costs from use of the ADR and SART circuits are accounted. light structural steel. Most major spare parts were costed from the pricing indicated in the budgetary equipment bids received. cabling. For the rest of the plant areas a percentage was applied against the capital cost base of the equipment in each area. This total excludes spare parts for mobile equipment maintenance reported under Other Costs in Table 24.

397. tires. Each equipment type is costed per the detailed cost sheets developed per equipment type.COMPAÑÍA MINERA CASALE CERRO CASALE PROJECT.560 3.514 2.303.5 Grinding 163.0 Fresh water 19. The wage of an operator from the surface crew for operation of the maintenance crane or the dozer on the coarse ore stockpile when required.584) $/yr allocated (ADR.0 Secondary Crushing 76. 14.310 $/yr 0.945.0 Port Facilities (w/o WTP) 18. SART) 408.71/L.0 Tailings Handling 5.879.042. and the wage of a boom truck operator from the maintenance crew external to the mill maintenance group were added to the processing costs as charges transferred from these departments.131.565 3.428 2. CHILE FEASIBILITY STUDY REPORT Table 24.819 $/yr less credits (water lime) (64.5 CN Destruction 9. and lubricants to operate the fleet of mobile equipment assigned to the mill was established as an hourly cost based on benchmarked data with utilization rates assigned to establish actual fuel consumption.835.859 5.335 5. fuel. Drivers for the Project No.386.157 8.749 2.075 $/yr 32.170.252 3.0 Reagent Preparation 12.967.113.274 1.491.5 Reclaim Water 12.7 Flotation & Regrinding 79.570 $/t Area Total Opex Mobile Equipment Operating Costs The costs for spare parts.963 9.5 Tertiary Crushing 129.348 3. The cost of diesel provided by CMC is US$0.973.: 159742 February 2010 Page 24-26 .933 2.019.347 5.2 Opex cost 32.4-13: Parameters Applied for Maintenance Material Costs Derivation Capex ($) Proportion for Opex (%) Primary Crushing 26.7 Plant Services.159 3.652.072.973 4.413.128 7.532.3 Coarse Ore Handling 11.4 WTP (Mine Site & Port) 11.7 Ore Reclaim 10.0 CIL 14.0 Dewatering 5.0 Total / Average 620.067.076.172 3.

The total for contracted maintenance is 244. Supervisors were assigned a rate twice the rate for the crew (US$38.131 hours per year. Work hours for contractors have been added into each scheduled shut-down period to carry out major repair work.COMPAÑÍA MINERA CASALE CERRO CASALE PROJECT. Travel costs are included in the administrative cost allowance. Since these are regular but infrequent occurrences. CHILE FEASIBILITY STUDY REPORT personnel buses commuting between the mine and camp sites. or 117 man-years. this work will be assigned to contractors instead of increasing the size of the permanent mill maintenance crew. although it would likely be reflected by higher hourly rates charged by the contractor instead of being an actual payment for hours spent in transit. From this.090 $/t are included in the item Other Costs in Table 24. and task duration to derive a total yearly cost.4-1. it is estimated that a peak crew of almost 203 persons can be expected on site when simultaneous manpower-intensive tasks are being undertaken during partial or complete plant shutdowns. is shown in Table 24. inclusive of the ADR and SART circuit costs allocated to the concentrator. or with the assistance of maintenance contractors. A mobilization/demobilization allowance of 12 hours per trip was built in.00/h (a mixture of local and out of country support). as well as the maintenance personnel assigned to maintain the buses also appear in the processing costs. The above total does not include the costs for the concentrate and fresh water pipeline maintenance which is included under the yearly operating costs of these facilities and appears under the heading Other Costs.20/h for the millwrights and helpers (provided by contractors) has been estimated from CMC’s wage rates with adjustments to the benefits and the addition of profit. which is included under the “consumables” and Other Costs items of Table 24.4-1 is US$0. A mobilization/demobilization allowance of 4 hours per trip was built in.: 159742 February 2010 Page 24-27 . and structural repairs. This includes the mobilization/demobilization time.40/h). A cost of US$19.4-1. crew size. The tasks are analyzed in Table 24.040. Trips by equipment vendor technical representatives were also included in this cost category at US$120. The resulting mobile equipment cost estimate. Project No.4-14 with estimates of frequency. The breakdown of activities to be completed by. equipment rebuilds. The contractual maintenance costs of 0. Maintenance Contractors A series of repetitive maintenance tasks will be performed during planned shutdowns of one grinding line or mill.

rubber 2 0.86 96 16 9.: 159742 February 2010 # of operated units 1 wall relining and screw/shoes 1 Page 24-28 .COMPAÑÍA MINERA CASALE CERRO CASALE PROJECT.234 0.152 $ 27.742 14 4 1.86 8 4 247 $ 4.810 2 18 7 504 $ 9.994 $ 579.397 32 12 27.669 upper and lower mantle 2 upper and lower mantle rebuild 2 24 12 1. CHILE FEASIBILITY STUDY REPORT Table 24.564 Secondary crushing 8.7 Ball mill relining: # of operated units Ball mill relining Ball mill bolts retorquing 6 Regrindi mill relining: # of operated units Ball mill relining .4-14: Contractual Maintenance Costs Recurrence Item (#/yr) Task Duration (hours/task) Crew Size Total Duration Total Cost (men per job) (hours/yr) (US$/yr) Primary crusher liner changes and rebuild: # of operated units 2 concave and spider removal 1 32 12 768 $ 14.776 $ 173.216 $ 187.7 HPGR # of operated units roll life (hrs) HPGR roll changes: 6 4800 9.320 $ 185.626 # of operated units Secondary crusher liner changes and rebuild 8 16 6 8.715 64 16 973 $ 19.504 28 6 7.344 $ 27.4 Dry screens maintenance # of operated units 4 4 Wet screens maintenance # of operated units 12 3 Lime slaking mill Project No.275 36 10 360 $ 7.027 0.

451 $ 68.017 0.056 39 12 6.528 $ 135. bins maintenance and upgrades Tailings pipeline line rotation Miscellaneous main plant piping hardware repairs Technical vendor representative trips to site Supplemental contractor's support during shutdowns Total Project No.496 $ 299.667 screw+shoes 1 24 6 144 $ 2.665 9.075 232.33 # of operated units 45 pump rebuild 3 12 4 9.745 24 12 20.557 $ 29.33 # of operated units apron maintenance pumps General plant chutes.131 Page 24-29 $ 5.603 $ 1.160 $ 385.: 159742 February 2010 42 8 1.750 16 4 1.311 244.299 $ 120.COMPAÑÍA MINERA CASALE CERRO CASALE PROJECT.327 $ 708.7 66 48 36.2 615 24 3.302 24 40 1 2.720 $ 251 12 25 98.065 Recurrence Item # of operated units Flotation cell agitator rebuild 73 0. CHILE FEASIBILITY STUDY REPORT Crew Size Total Duration Total Cost (#/yr) Task Duration (hours/task) (men per job) (hours/yr) (US$/yr) digging shoes 2 16 6 192 $ 3.3 Belt and Feeders maintenance # of operated units Belt feeders belt replacement apron feeders 1.7 18 36 6.960.181.520 9.736 .

4. returned to an evaporation pond.4-1 is an allowance of US$500.000/yr.9 Other Costs Another cost item appearing in the “other costs” item of Table 24.1. This allowance adds US$0. as shown in the overview in Table 24.4-1.1.4.COMPAÑÍA MINERA CASALE CERRO CASALE PROJECT.042/t of sulphide ore processed. The reverse osmosis (RO) plant is designed to handle up to 17 L/s of water. The balance of the requirements related to maintenance spares and materials as well as right of way payments is shown in Table 24. This is for metallurgical or maintenance related projects performed by. These residual costs for the concentrate pipeline amount to US$642. accounting for variation in expected watershed water supply these costs translate into a unit cost of US$0. With the variable yearly flow rates indicated by the site water balance. at 3 a cost of US$0. treating the surplus process water generated from dewatering the concentrate. 24. 24. or in cooperation with.000/yr.3 million per year has been estimated for the treatment of an average of 120 L/s of Piedra Pómez water which will be released at the cut-off wall marking the property watershed boundary and downstream waterways. either as part of the fresh water system or the port and dewatering for the concentrate pipeline.009/t to the overall processing plant costs.021/t of sulphide ore processed.4. These costs are added to the sulphide ore processing costs. with production of a retentate of 4 L/s. Another WTP is located at the port site. These elements are shown in the tables above.1.006 $/t as reported in Table 24.027/t of sulphide ore needed to cover the reagents and maintenance spares.4-1 in Other Costs.000/a for R&D. divided between the manpower requirements and electrical load.7 Water Treatment Costs An average water treatment plant (WTP) cost of US$1. outside experts. Project No.4-1.: 159742 February 2010 Page 24-30 .218/m treated. CHILE FEASIBILITY STUDY REPORT 24. This is equivalent to 0. These give a total unit cost of US$0. The overall WTP costs are included in the sulphide plant processing costs. The costs associated with the fresh water pipeline add US$600. with an additional cost of US$0.8 Pipelines The detailed operating costs provided by PSI have been divided into manpower and electrical costs.

and pipeline. respectively. and the mine.6 0.186 Mine 3.4-15: Fresh Water Distribution System – Distribution of Direct Costs over LOM % of Total Cost US$/t of Sulphide Ore Sulphide Processing Plant 96.4. the HL facilities.0 0.COMPAÑÍA MINERA CASALE CERRO CASALE PROJECT.0 0. once the flotation plant is in operation.011 100.4-15 indicates that the fresh water distribution system costs over the LOM for the identified users totals US$238 million. Lime and Cyanide Preparation Systems The milk of lime and cyanide used for the HL facilities are prepared in systems which also provide the flotation plant with these reagents.2 L/s and 17 L/s. The volume of fresh water for the HL is mostly water used for reagent preparation.4 0. Manpower costs and the total of other costs are split between the flotation plant. Water use for the preparation of shared circuits such as ADR and SART are charged to the flotation plant because of the limited volumes.4-16 provides a breakdown of the lime preparation costs between users.230 User Total Credits for the power generated from the fresh water pipeline are assigned to the sulphide processing plant and HL. The cost transferred to the mine and HL is based on the direct consumptions of 19. The bulk of the water consumed for heap irrigation is reclaimed water from the cleaner tailings pond. from an average total fresh water usage of 716 L/s. with the 86 L/s consumed by the water treatment plant included in the flotation plant costs. Table 24. Over the LOM these costs total US$19. The costs are included in the sulphide processing plant costs as electrical loads and liner and ball wear in the lime slaking mill.6 million Project No. CHILE FEASIBILITY STUDY REPORT 24.10 Shared Facilities Costs Fresh Water Distribution The fresh water distribution system includes the power and maintenance costs associated with the well pumps.1.: 159742 February 2010 Page 24-31 . Table 24. booster pump stations. Table 24.033 HL 0.

Table 24.7% of the lime slaking costs is allocated to the HL operation (including its share of the SART requirements). Per the input data and the detailed cost model.005 HL 22. while the HL is operated at nominal throughput in parallel with the sulphide plant. The same facilities also process all/or a bleed stream (in the case of the SART circuit) of the leach solution originating from the heap leach pad.004/t of sulphide ore. and the SART process are applied to the additional metal load provided from the CIL circuit according to the mass balances for the flotation plant and leach pad.018 SART Circuit Based on the proportion of lime used by the HL facilities.4 million.8 0. a transfer of the equivalent portion of the operating costs for the lime preparation plant is made. on the basis that about 65% of the lime is provided for the oxide ore.5 0. Over the LOM.5 0. Gold Recovery Plant and SART Circuit This covers the processing costs associated with the recovery of gold.0 0.001 Flotation Circuit CIL Circuit CN Destruction Circuit 5. The LOM cost to operate the ADR circuit totals US$128.: 159742 February 2010 Page 24-32 .4.4-16: Lime Slaking System – Distribution of Costs over LOM User % of Total Cost US$/t of Sulphide Ore 34.2 for operating the carbon stripping and regeneration circuit (ADR). Unit costs derived in Section 24.004 Total 100. Project No. and the recovery of cyanide from the cupro-cyanide complexes generated from leaching the flotation cleaner tailings.001 27.4 million and that of the SART circuit is US$265. dissolved copper. gold electrowinning and refining.COMPAÑÍA MINERA CASALE CERRO CASALE PROJECT. This amounts to US$0.2 0. only 22.007 5. with the shorter life of the oxide operations.4-17 was built to establish the distributed costs over the LOM for the ADR and SART circuits between the sulphide (CIL circuit) and oxide ore processing facilities.9 0. CHILE FEASIBILITY STUDY REPORT Table 24.

097 na na 0. CHILE FEASIBILITY STUDY REPORT Table 24. cyanide recovered within the SART circuit is treated as a credit against cost.897 t/a NaCN (0.216 na HL 15.08 kg NaCN/kg Cu2 3.216 1.0 The copper units recovered within the SART circuit are not shown as a credit against the processing costs.31 kg NaCN/kg of Cu.084 Total 100.365 kg/a Au 0. However.4-17: ADR and SART Circuits – Distribution of Costs over LOM Circuit ADR SART User % of Total Cost US$/t of Sulphide Ore US$/t of Oxide Ore CIL 87.4-18.083 HL 12.4-18: Costs and Credits Related to CIL Circuit Use of ADR and SART Cost/Credit Item Cost – ADR and gold refining Cost – SART for copper recovery Credit – CN from cupro-cyanate dissociation in SART Credit – for free cyanide sent to SART and recycled Note: Project No. recoveries and nominal throughput Based on stoichiometric ratio of 2. The unit costs and production levels established for the LOM average feed grades are shown in Table 24.2 na 0. The copper recovery from SART was set at 95% and cyanide recovery at 87.097 4.5% based on testwork data. leaving the NSR revenues associated with the total of 49.: 159742 February 2010 1 2 Unit Rate Average Yearly 1 Production US$/t 50.6 g NaCN recovered/t of CIL tailings solution to SART 1.1 0. reduced by CN SART recovery of 90% Page 24-33 . but as additional pay-metal production above that from the copper concentrate obtained by flotation. The cyanide credit for the sulphide ore covers 69% of the operational costs associated with the SART circuit.491 t/a NaCN 86.148) Average production at average feed grades. Table 24. Overall.53 US$/lb Cu 2. against which a cyanide credit is attributed to the CIL circuit costs shared with the HL facilities.4 Mlb of copper produced from sulphide ore to cover the balance. The items shown in Table 24.03 US$/oz 3.4-17 represent the costs of recovering gold and dissolved copper. there is a net cost of US$0.COMPAÑÍA MINERA CASALE CERRO CASALE PROJECT.8 0.165/t for these three items.85 Mlbt/a Cu 0.9 Total 100.0 CIL 84.

and in Table 24.4. 24.4-19: Fixed Cost Elements of the Flotation Plant Processing Costs Unit Cost US$/t % of Overall Net Cost Services Electrical Load Mobile Equipment Fleet CMC Manpower (less maintenance for mobile equipment in above) 0.1%. adding another 9. thus being considered a fixed cost.9 Contracted Manpower R&D Pipeline Maintenance Water Treatment Total 0.4-21 by area.1. Table 24.8 10.021 0.7 Item It may be argued that.4-20 by cost type. design information. A list of the cost items considered fixed is shown in Table 24. and suppliers’ quotes.048 0. the main exceptions are the manpower costs (CMC’s and contracted).: 159742 February 2010 Page 24-34 . even within a range of throughput wider than expected by the ore hardness variability.2 HL – Gold Recovery – SART Circuits 24.4-19.040 1.090 0.009 0.4-19.5 0.1 0.4. This would add US$0. CHILE FEASIBILITY STUDY REPORT 24.1 Summary Operating costs for this part of the plant were estimated using data supplied by CMC. The overall costs derived for the heap leach and gold recovery circuit with all ancillary carbon circuits and the SART circuit are presented in Table 24.4 0. Project No. Benchmarking against similar operations was used for comparison.7 0.3 0.COMPAÑÍA MINERA CASALE CERRO CASALE PROJECT.4. Only 10.083 0.570/t to the total shown in Table 24.2.357 5. the maintenance materials and spares cost would still not vary much.4% to the overall fixed plant costs and bring the total to 20.11 Fixed and Variable Costs Analysis The majority of the cost items related to the process facilities are variable in nature.648 1.3% of the overall plant processing costs are fixed costs.

083 3 Overheads 0.848 100 Processing Area Sub-Total Credits (0. CHILE FEASIBILITY STUDY REPORT Table 24.265) Total 2.054 2 Wear Steel 0. Project No.345 12 Consumables 0.592 56 Other Costs 0.4-21: Summary of Average Oxide Ore Processing Costs – by Cost Area US$/t Processed % of Total Processing Cost Leaching 1.022 1 Sub-Total 2.342 12 Labour 0.: 159742 February 2010 Page 24-35 .583 Pricing for consumables was obtained from data provided by CMC andss recent budget quotes received from potential suppliers.583 Table 24.848 100 Item Credits (0.346 12 Power 0.COMPAÑÍA MINERA CASALE CERRO CASALE PROJECT. The wear steel costs (US$0.024 1 Water treatment 0.265) Total 2.235 8 ADR/Refining 0. No import duties were applied. assuming that all items will originate from countries that have free trade agreements with Chile. The credits represent mostly the cyanide recovered through the use of the SART circuit.022/t) are related to the share of the lime slaking costs transferred to the HL facilities. The Other Costs item includes items such as contracted maintenance and the mobile equipment fleet maintenance labour costs transferred from the central maintenance shop.818 64 Stacking 0.681 24 SART 0. For the sulphide processing costs the Consumables costs include diesel and maintenance parts used for the mobile equipment as well as materials used to prepare the pad and irrigation systems on the heap.006 0 2.147 5 Maintenance Spares & Materials 0.4-20: Summary of Average Oxide Ore Processing Costs – by Cost Type US$/t Processed % of Total Processing Cost Reagents 1.

including receiving carbon from CIL circuit.420.2 HL/Gold Recovery/SART Plant Cost Estimate Battery Limits The HL. gold recovery plant. These activities therefore increase the LOM costs. Project No. HL/Gold Recovery/SART Plant Personnel The salary levels for staff and operation and maintenance personnel are based on information provided by CMC. Staffing for the gold recovery plant is based on similar operations with adjustments for the Cerro Casale plant configuration and size.3 heap construction (excluding heap base construction.4. and SART plant cost estimate covers the following elements and assumptions: • • • • • • • • • 24. 24. The individual burdened salaries were derived from CMC’s classification system. and attritioning recovery of copper and cyanide through the application of the SART process delivery of the SART neutralization residue to cyanide destruction reagent preparation and distribution for the processing units included above supply of compressed air and instrument air to the various processes and equipment described above. Additional details on the composition of the staffing are provided in Section 20. Table 24. The following sections describe the methods used to derive the line items in Table 24. This is the result of having two extra years of leached metal recovery after the last fresh oxide ore is put on the pad. CHILE FEASIBILITY STUDY REPORT The costs per ton extracted from Xeras are higher for some items than the indicated average annual expenditures divided by the nominal yearly tonnage of 36 Mt would indicate. regeneration.2. electrowinning.COMPAÑÍA MINERA CASALE CERRO CASALE PROJECT.2.: 159742 February 2010 Page 24-36 . and gold refining carbon handling.4-22 shows the breakdown of the manpower costs per area. The total number of staff involved in heap leach pad activities is based on Maricunga’s heap leach operation. capitalized) and ROM ore stacking installation of heap irrigation piping gold adsorption by carbon-in-column (CIC) carbon stripping.4. These are exclusive of contractors costs. as well as having two years of heap rinsing to meet residual cyanide requirements.

COMPAÑÍA MINERA CASALE
CERRO CASALE PROJECT, CHILE
FEASIBILITY STUDY REPORT

Table 24.4-22: HL/Gold Recovery/SART Plant Manpower Cost Breakdown
No. of
Employees

Area
Leach Pad Operation
Gold Recovery Plant Operations
SART Circuit Operations
Maintenance
Metallurgy
Sub-Total

33
27
12
15
3
90
$/t

Allocated mobile equipment maintenance
personnel
Total

24.4.2.4

Total Burdened
Salary, $/yr
$
$
$
$
$
$

1,466,324
1,234,792
442,185
750,329
177,923
4,071,553
0.114

$/t

0.033

$/t

0.147

Consumables
Pricing is based on delivered product to site.
Where applicable, the base price is
augmented by a transportation charge for delivery to the mine site from the port,
equivalent to US$30.00/t.
HL Consumables
Consumables for pad preparation and heap construction are based on benchmarking and
AMEC E&E file data. These are illustrated in Table 24.4-23.
Table 24.4-23: HL/Gold Recovery/SART Consumable Costs
Item

$/t oxide ore

Heap Leaching

0.232

Pad preparation

0.133

Irrigation preparation

0.038

Leaching supplies

0.028

Mobile equipment diesel, lubricants

0.033

ADR / SART

0.110

Mobile equipment diesel, lubricants

0.110

Total

0.342

The consumables cost is US$0.342/t, with approximately 39% of this for piping and tubes
for irrigation.

Project No.: 159742
February 2010

Page 24-37

COMPAÑÍA MINERA CASALE
CERRO CASALE PROJECT, CHILE
FEASIBILITY STUDY REPORT

24.4.2.5

Reagents
The reagent consumptions associated with the heap leach are largely based on the
testwork program completed at McClelland laboratories.
Scale-up adjustments from
laboratory scale to full scale are applied based on experience as well as adjustments
required to convert the testwork conditions (crushed ore) to the design basis (ROM ore).
The net amount of cyanide consumed is reduced (as a credit) by the estimated recovery
of cyanide from the SART circuit.
Reagents used in the elution circuit are based on similar operations with acid washing,
caustic washing, and ambient and hot stripping.
Activated carbon addition rates are based on estimated fines loss through screening and
losses in regeneration.
The anti-scalant addition rate is based on an addition rate to provide a concentration of
5 ppm in the process water stream, this is the mid-range of that usually required to soften
industrial water from the supplier’s technical data sheet. The consumption is based on
the amount of fresh water required in the overall circuit.
The reagent consumptions for the SART circuit are based on the testwork and
stoichiometry. Sodium hydrosulphide addition is based on estimated incoming copper
levels and stoichiometry. Acid and lime additions are based on specific testwork from
Cerro Casale leach solutions.
Detailed consumable costs are shown in Table 24.4-24. Lime consumption is adjusted to
account for an expected available CaO content of the purchased quicklime delivered at
site (76%).
Sulphuric acid will be delivered as 93% solution strength and hydrochloric acid as 35%
solution. Sodium hydrosulphide (NaSH) will be delivered as a 42% solution strength and
caustic as a 50% solution.

Project No.: 159742
February 2010

Page 24-38

COMPAÑÍA MINERA CASALE
CERRO CASALE PROJECT, CHILE
FEASIBILITY STUDY REPORT

Table 24.4-24: HL/Gold Recovery/SART Reagents Costs
Reagent Cost

Item

Consumption
Rate

US$/t Oxide
Ore

kg/t oxide ore
3.95
0.51
g/g Au to elution
250
148
6.75
0.61

1,500

24
kg/t Cu to SART
1,069

1.409
0.588
0.821
0.015
0.010
0.003
0.002
0.000
0.006
0.006
0.161
0.105

130

3,834

0.029

0.43
3,930
0.12
g/t fresh water
5

0.000
0.000
0.027
0.000
0.000
0.000
1.592

US$/t

HL
Pebble Lime (76% CaO)
Cyanide (NaCN briquettes)
ADR
Hydrochloric Acid (35%w/w HCl Solution)
Caustic (50%w/w NaOH Solution)
Cyanide (NaCN briquettes)
Refining Reagents
Carbon Circuits
Activated Carbon
SART
Sodium Hydrosulphide (42% w/w NaSH Solution)
Sulphuric Acid (93% w/w H2SO4 Solution)
Caustic (50% w/w NaOH Solution)
Flocculant 1 (SART Clarifier) (M156)
Pebble Lime (76% CaO)
Flocculant 2 (SART Tailings Clarifier) (M156)
Water Treatment
Anti-scalant

147
1,609
255
180
1,609
1,000
1,600

180
3,090
147
3,090
1,800

TOTAL:

24.4.2.6

HL/Gold Recovery/SART and Ancillary Power Consumption Costs
The unit price for electricity provided by CMC (US$90.2/MWh at the Cerro Casale mine
site) was used to develop the cost of power associated with the process equipment.
The plant electrical costs were estimated based on a detailed equipment list. Assignment
of operating load per item and inclusion of circuit utilization provided the average total
electrical consumption. These data are included in the mechanical equipment list in
Appendix F.
The estimates of operated load, consumed power, and the resulting cost per process
area are shown in Table 24.4-25. The low overall load factor reflects the batch operation
of most of the plant circuits. The factors presented allow for off-site transmission losses
as well as on-site transformation and distribution, as defined for the concentrator in Table
24.4-9, Table 24.4-10, and Table 24.4-11.

Project No.: 159742
February 2010

Page 24-39

8% 92.4-25: HL/Gold Recovery/SART Electrical Loads and Costs per Area Operated Load (kW) Mechanical Load Factors Consumed Mechanical Load (kW) Electrical Efficiency Factors Total Consumed Load (kW) Unit Cost (US$/t) 9.4% 7.: 159742 February 2010 Page 24-40 .7% 1.COMPAÑÍA MINERA CASALE CERRO CASALE PROJECT.632 159 626 0.049 0.589 0.085 15.320 501 0.1% 1.430 95.0% 1.689 0.627 95.8% 56.110 (41) -0.1% 2.1% 88.711 0.200 65.821 94.003 0.1% 1.177 74.038 3.503 141 576 95. CHILE FEASIBILITY STUDY REPORT Table 24.2% 2.027 69. lime slaking Shared credit for power generated with fresh water pipeline Credit from sulphide plant for share of ADR/SART circuits operation Total 14.503 0.336 Plant Area Heap leach Project No.0% 243 90.058 0.169 HL/ADR/SART Reagent Systems 375 65.8% 268 0.014 2.082 80.6% 79.301 95.0% 13.0% 7.7% Power cost for fresh water pipeline use.009 (386) -0.033 18.216 250 728 77.006 Carbon Regeneration ADR Refining SART ADR/SART Plant Services Total / Average 2.

24.4. resulting in an indicated cost for this line item of US$0. CHILE FEASIBILITY STUDY REPORT The power cost of 0. piping. the LOM average cost increases to US$0.284. originating from countries that have free trade agreements with Chile.6 Carbon Regeneration 1. Table 24.130 5.769.054/t. and instrumentation hardware costs.910. water) 43.4-26 indicates the distributed Capex and applied percentages.109. This value is representative of a year operated with the nominal fresh ore capacity of 100 kt/d delivered to the heap. Other Costs The two main components of this line item are the mobile equipment parts and materials and the contracted labour.290 2.4 ADR 2.026 $/t The Capex in this category is US$29. it was assumed that all items will enter the country duty free.7 SART 8.7 HL/Gold Recovery/SART Plant Maintenance Supplies Costs Maintenance Materials and Equipment Spares The estimation of the spare parts and maintenance materials cost is based on assigning a yearly allocation to the various processing areas under consideration.: 159742 February 2010 Page 24-41 .125 $/yr less credits (ADR.4 Total / Average 29.8M.841.753 $/yr 0.COMPAÑÍA MINERA CASALE CERRO CASALE PROJECT. Because leaching activities continue past the end of the stacking period for residual gold recovery.223 3. electrical.4-26: Parameters Applied for Maintenance Material Costs Derivation Capex ($) Proportion for Opex (%) CIC-HL Solution Handling 10. Project No.507 2. Table 24.009$/t from the fresh water pipeline operation.4-25 is without the power credit of 0.3 Opex cost 1. This allocation is based on the indicated capital cost (Capex) associated with the related equipment. followed by a rinsing period to remove residual cyanide from the heap.109 2.273.5 Refining 3.959.2 CIC 2. No import duties were applied.345$/t in the summary in Table 24. SART) (408.216 6.2.475 4.026/t.075) $/yr Area allocated (lime.703 $/yr Total Opex 919.676.

and other surface facilities.125/t of oxide material. vehicle washing).315/t. The crews assigned to install the pad irrigation systems add an additional cost of US$0. 24.064/t of oxide ore processed.031/t).COMPAÑÍA MINERA CASALE CERRO CASALE PROJECT. The cost applied to the HL operation is based on the proportion of the overall fresh water volume consumed (0. CHILE FEASIBILITY STUDY REPORT MOBILE EQUIPMENT OPERATING COSTS The costs for spare parts to operate the fleet of mobile equipment assigned to the HL operation and gold recovery/SART circuits was established as an hourly cost based on benchmarked data by type of equipment with utilization rates assigned to establish actual fuel consumption. This represents US$0. CONTRACTED WORK A series of maintenance tasks will be performed at regular but infrequent intervals by contractors instead of increasing the size of the permanent CMC maintenance crew. Project No. booster pump stations. The overall cost for the mobile equipment maintenance amounts to US$0.4.: 159742 February 2010 Page 24-42 . with US$0.8 Shared Facilities Costs These costs are distributed under the relevant cost type in Table 24. The cost of the contracted maintenance is factored as 25% of the plant manpower cost (US$0. The wage of an operator from the surface crew for occasional operation of the maintenance crane and the wage of a boom truck operator from the maintenance crew were added to the processing costs as charges transferred from these departments.6%). Fresh Water Supply The fresh water distribution system includes the power and maintenance costs associated with the well pumps. These costs and the labour costs are shared between the flotation plant and the HL operation.4-20 and included into the Leaching area of Table 24. and pipeline. neglecting the water consumed by the mine (road dust abatement.4-21.30/t for pad preparation and the rest for setting the irrigation piping.2.

3 44.4-27 presents the cost inputs making up the overall cost of the ADR/refinery circuit (for HL and sulphide ore combined).9 5.8 0.84 Page 24-43 % of Total .LOM) 8.8 2 7 35 4 3 7 6 100 0 0. The cost applied to the HL operation is based on the proportion of lime consumed.31 4.26 2.7 4 1.44 1.cyanide .72 2.09 13.1.032/t of oxide ore treated.63 0.hydrochloric acid .06 38. Table 24. is outlined in Section 24.4 8.0 million).41 2.refining reagents Power Diesel & lubricants Maintenance spares Mobile equipment maintenance Contractual maintenance Assaying Total Project No. For the SART circuit the proportion of solution fed and specific reagent usage rate were used to divide the cost between the HL operation and CIL circuit.COMPAÑÍA MINERA CASALE CERRO CASALE PROJECT.47 14. Table 24. For the elution and carbon circuits the cost is in proportion to the estimated loaded carbon tonnage processed from the CIL or CIC circuits.carbon .095/t (US$17.: 159742 February 2010 Cost US$ million (LOM) 28. including the shared SART circuit cost.3 22 Cost US$/oz Au (HL + CIL .16 0. Gold Recovery and SART Circuit Operation The cost representing the portions of these circuits used for processing products originating from the flotation plant is redistributed to that plant. The gold recovery circuits operating costs associated with the HL operation through the life of these facilities amount to US$0.10.4-27: ADR/Refinery Circuits Unit Cost Details Item Labour Reagents: .63 2.caustic soda .8 7.2 129. For the refining circuit the estimated pregnant solution contributed from each of these sources was used.4.65 1.5 4.3 0.2 8. CHILE FEASIBILITY STUDY REPORT Lime Slaking The lime slaking system costs are shared between the flotation plant and HL operation.4 11 4. The derivation of US$0.

4. or US$42.8 21 0. the unit cost applicable to the HL from the SART circuit is US$1.2 1 0.43/lb.18 Maintenance spares 5. Project No. the main exceptions are labour costs (CMC’s and contracted). for US$14.2 - 0.76 .lime 95.flocculant Assaying TOTAL 0. from costs of US$100.53/lb.3 3 0.07 Contractual maintenance 7.LOM) 0.4-29. the unit cost applicable against the gold produced from HL is US$11.6 million over the sulphide operations LOM.01 Power 13. CHILE FEASIBILITY STUDY REPORT Considering the LOM gold production from HL. 24. the unit costs are reduced for the HL and sulphide plant respectively by US$0. These costs are compiled before applying any credit for the recovered cyanide.30 Item Labour % of Total Reagents: .00 265.4-28 presents the cost inputs making up the overall cost of the SART circuit (HL and sulphide ore).4-28: SART Circuit Unit Cost Details Cost US$ million (LOM) 28. In the case of the gold produced from the CIL circuit.03/oz. Table 24. and the shorter life than for the concentrator (with fixed costs then fully supported by the CIL circuit). Table 24.9 Fixed and Variable Costs Analysis The majority of the cost items related to the processing facilities are variable in nature.11/oz.63 For the LOM gold production from HL and the shorter life than for the concentrator (with fixed costs then fully supported by the CIL circuit).: 159742 February 2010 Page 24-44 .77/lb. The cost items considered fixed are shown in Table 24.2.sodium hydrosulphide 0.03 . the unit cost is US$50. Considering this.4 11 Cost US$/lb Cu (HL + CIL .10 Lime slaking 2.9 million of distributed oxide LOM expenditures.39 57.4 2 0.4 100 3.13/lb and US$1.2 5 0.4 million.4 22 0. the gold loading onto carbon. The copper produced from the CIL circuit has a unit cost of US$4. This indicates that 37% of the overall plant processing costs are fixed in nature.COMPAÑÍA MINERA CASALE CERRO CASALE PROJECT.78 .sulphuric acid 55. or US$223.0 36 1.0 million of distributed LOM expenditures.5 - 0.

supplies.5 General and Administration Operating Costs 24.147 5 Contractual Manpower 0.1 Summary The general and administration (G&A) operating costs are the expenses for cost centres not directly linked to the mining and processing areas described in the mining and processing operating costs above.4-29: Fixed Costs for the HL/Gold Recovery/SART Circuits Unit Cost (US$/t) Percentage of 1 Total Costs (%) Services Electrical Load 0. CHILE FEASIBILITY STUDY REPORT Table 24. If the maintenance spares and materials are included in the fixed cost component.: 159742 February 2010 Page 24-45 .199 7 TOTAL 0.5-1. 24.4-29. G&A operating costs for the project are estimated on average to be US$0. and all other overhead costs. giving a total of 37% of the overall costs as fixed costs.346 12 Pad preparation materials 0.COMPAÑÍA MINERA CASALE CERRO CASALE PROJECT.266 9 CMC Manpower 0.76/t total ore processed.054/t would be added to the total shown in Table 24.5. Before credits. Project No. another US$0. G&A costs include labour. The unit cost breakdown of G&A by category is shown in Table 24.2M/a over the 20 year operating life of the project based on an exchange rate of the Chilean Peso to the US dollar of 525:1.991 35 Item Note 1.033 1 Mobile Equipment Fleet 0. or approximately US$49.5-1 and illustrated in Figure 24. consulting.

053 $0.596 7.154 $0.021 $0.962 17.004 $0.767 70.727 5.085 $0.183 102.840 18.683 4.433 5.504 17.113 $0.699 12.015 $0.5-1: G&A Cost Breakdown G&A Cost Category Camp & Catering Nantoco Office General Services Insurance IT Power Health & Safety Waste Management Security Clinic Training & Recruiting Admin Finance Management Legal Land Permitting Human Resources Environmental Emergency Response Aviation Total LOM Total USk$ LOM Avg Us$/t LOM Avg USk$/yr 186.058 $0.004 $0.015 $0. CHILE FEASIBILITY STUDY REPORT Table 24.026 $0.544 2.086 $0.807 31.153 Figure 24.76 9.594 52.779 3.: 159742 February 2010 Page 24-46 .010 $0.450 136.816 1.940 104.015 $0.5-1: G&A Cost Distribution Cerro Casale G&A Opex Split Camp & 2% 2% 1%1%0% 2% 2% Catering 2% Copiapo Office 20% General Services 3% Insurance IT 3% Power Health & Safety 3% Waste Management Security 6% Clinic 15% Training & Recruiting Admin 7% Finance Management Legal Land Permitting 8% 11% 11% Human Resources Environmental Emergency Response Aviation Project No.224 20.056 1.366 25.000 30.535 919.650 1.017 $0.044 $0.364 1.618 1.015 $0.025 $0.238 $0.009 964 938 956 682 271 245 49.COMPAÑÍA MINERA CASALE CERRO CASALE PROJECT.952 4.505 3.012 64.720 17.

Cleaning costs are based on the design area of the on-site and off-site build ings and offices including the truckshop mine/technical services offices. security facility. Rates include the cost of catering labour and administration for a 2. This cost excludes industrial cleaning and bus services. A detailed description of the G&A estimate by category is presented below. Costs have been supplied from current quotations or derived from first principles. . camp maintenance. these operating costs are included in this G&A cost category. Bussing costs for all operations employees from Copiapó to camp are based on a CMCapproved contractor owned and operated service utilizing 40 passenger buses. The most competitive quote used for this study was from Sodexho. Nantoco administration offices. HR – camp and catering costs average US$24. and were confirmed to be in line with benchmarks from current Owner operations. and industrial cleaning services. Average annual on-site operations manpower was estimated using the schedules of work described in the mining and process sections. janitorial. Sodexho provided unit rates for full service catering. and the Caldera port offices.5-1 G&A costs are derived from 19 separate categories.S. a Santiago based. full service camp contractor that has provided services to many mines in Chile for many years.000 bed camp. The camp and catering estimate was derived from the comparison of several quotations from Chilean companies. Because the camp and catering quotations included industrial cleaning.00 per day during operations. camp administration offices.2 Detailed Cost Breakdown As shown in Table 24. dollars A fixed cost analysis was not performed as G&A costs are driven mainly by manpower and are essentially fixed over the life of the project. All costs have been rounded to the nearest thousand U. clinic.5. laundry.000 on-site employees over the life of the project.5. Appendix I contains a more detailed breakdown of G&A costs by production year.1 HR – Camp and Catering As a sub-area to site. process offices. Operations manpower has been derived by functional area and the average is approximately 1.24.2. 24. Operations camp management and supervision labour costs are included in the camp and catering unit cost estimate.

nurses. EMTs.2. Community and Government Relations: Community and government relations (CR/GR) have an estimated average annual cost of US$1. • Emergency Medivac – Estimated for escorted and non-escorted ground ambulance services to Copiapó.not just the Cerro Casale workforce . The $0. The medical staff has been structured to ensure there are one doctor and two nurses present on site for all shifts.2 HSE – Clinic The clinic will be operated on site to provide treatment for medical ailments and first aid for minor injuries. EMS medications. Additional EMT and driver support is also included. Labour Labour costs include clinic staff.Labour Camp and catering labour includes operations management and supervision only. Supplies Clinic supply costs include the following: 24. bus service between site and Copiapó. and maintenance labour is included in the quoted unit rates. Medical clinic costs over the life of operations were estimated at an average of US$1. janitorial.2.and are . industrial cleaning. These expenditures benefit the surrounding communities . Supplies The full camp and catering cost includes food.3 • Medical Consumables – Estimated on a per person per year basis using US$40/person/month unit cost for pharmacy. related to community development costs. or $0. The ratio of employees to camp staff is approximately 7 to 1. • Contract Medical Director – Estimated on a retainer basis to provide medical QA/QC and overview. and ambulance drivers.3M/a.76/t G&A cost listed excludes approximately $21 million LOM. Assuming one escorted and one unescorted medical evacuation per quarter. doctors. No provision for air Medivac has been applied. and initial catering mobilization. The Medivac labour cost is accounted for in the clinic labour costs. laundry.0M/a over the LOM. and supplies.5. accounts for ambulance operation and medical consumables only. 24. janitorial.02/t. Based on one visit per quarter. includes retainer and malpractice insurance fees. Camp catering.5.

repairs. It is estimated that a 24-person team (4 groups of 6 people) will be training 96 h/a.2. CR manager travel. Supplies Supplies for the emergency response section include the cost of emergency equipment parts.5 HSE – Environmental The estimated average annual cost for environmental is US$682. Labour All CR/GR labour costs have been assigned to the Nantoco office subsection of the G&A costs as these employees will be located off site at the Nantoco offices. This is an annual fixed cost estimated at US$96. Supplies Supply costs for the CR/GR section of G&A includes consulting and PR costs.5. 24.4 Emergency Response Emergency response has an estimated average annual cost of US$271. Operating costs of the emergency response vehicles including ambulances and hazmat/fire response mobile equipment are included in the mobile equipment operating costs assigned to the General Services cost category of G&A.5.excluded from cash cost calculations.000 and accounts for all on-site mine rescue and fire response training. and off-site operation of the emergency refuge stations on the main access highway.000 which accounts for the following activities: . and training consumables. community and government engagement expenditures and investments. Labour costs for emergency response vehicle operators are included in the Clinic cost category of G&A. 24. Labour Labour costs for emergency response accounts for all labour costs associated with initial and ongoing emergency response training for the volunteers. and office supplies. benchmarked from other projects and operations.2.000. These costs are captured in the financial model as Other Expenses.

Labour The Environmental Superintendent reports to the HR Manager and the department will include other environmental personnel over the LOM.0 million over the LOM. gases.and off-site administration and finance. Labour The labour costs include only the administration/finance personnel designated to site. tailings solid sampling. . and meteorology controls. air quality monitoring including PM. IT. The administration/finance section has an estimated average annual cost of US$1. • Start-up costs – Include initial training and manuals. The remainder of the department labour reports to the Nantoco Office section of the G&A based on the assigned location of those positions. The majority of administration/finance labour costs are included in the off-site Nantoco Office cost category of G&A.6 • Environmental Monitoring – Included in these costs are water quality/quantity monitoring. Administration/Finance This G&A cost section include all costs related to on. Supplies The environmental supplies cost includes the following: 24.2. This includes warehouse and select IT support.5. and communications Domestic travel for the Administration/Finance Manager Office supplies cost. tax Purchasing/contracts.• • • • environmental monitoring environmental lobbying manager travel reclamation and closure plan updates. labour compliance Management systems. compliance. Supplies The supply costs include: • • • • • Accounting controls. audit.

The average annual operating cost for the Nantoco office including labour and supplies is estimated at US$7. safety awards.2. Supplies Included in the supplies category for the Nantoco office is an office consumables cost averaging US$16. and communications are covered under the IT section of the G&A costs.All office computer.7 Nantoco Office This section contains all costs associated with employees assigned as off-site support services. database.Compensation Legal/Land/Permitting Community Relations Security (Offices and Port).2.8 million per operating year and accounts for all labour.5. 24.8 HSE – Health and Safety The health and safety section of the G&A costs averages an estimated US$2. Labour The labour costs for the Nantoco office include approximately 56 employees plus 28 allocated off-site security guards per operating year for the following departments and the associated department managers: • • • • • • • • • • • Administration/Finance – Purchasing Administration/Finance – Off-Site IT and ERP Support Administration/Finance – Office Services Administration/Finance – Marketing Administration/Finance – Financial Reporting Administration/Finance – Accounting HR – Recruiting HR . Labour is the dominant cost component. General management labour and associated costs are included in the management cost category of G&A costs. and travel associated with the area.800 per operating year. personnel protection equipment (PPE). . 24.433 million per operating year over the LOM.5.

boots. Supplies The supplies cost includes costs for general office consumables. The average estimated annual cost for this section is US$956.2. HR – HR/Benefits This section includes costs for HR management staff and the compensations group within HR. hearing protection.2.000 per operating year. The cost has been estimated at US$100/employee/year • Office Supplies – Includes office supplies and manager travel. and cold weather jackets.Labour The labour cost includes all HSE department personnel excluding the medical staff assigned to the HSE – Clinic section of the G&A. 24. Remaining HR labour reports to the Nantoco Office and is thus included in that cost category of G&A.10 Insurance The required insurances during the project life are: • Construction All Risk insurance (property) including earthquake . and continuous improvement personnel. • Consulting – Includes a nominal annual expense for health and safety consulting and training.9 • Personal Protection Equipment (PPE) – Includes estimates for all Cerro Casale employees for safety glasses. Supplies The supply costs include the following: 24. and management travel. Contractor The contractor cost includes a provision for HR consulting services. benefits.5. hard hats. printing services. • Safety Awards – Includes a provision for safety awards presented to employees. stationary. special eye protection.5. Labour The cost for labour with this area includes labour costs for the labour relations.

2. There are no other costs assigned to this G&A category. The insurance cost was estimated using guidance provided by Marsh Canada and Owner guidance and is a function of the installed capital costs and annual metal production. and personal computing is estimated at US$3. . The average annual IT cost for all on. 24. Off-site IT support labour is assigned to the Nantoco Office section of the G&A costs.8 million per operating year. maintenance (software and hardware).11 IT The information technology (IT) cost estimate was built from first principles using a detailed spreadsheet. Costs are split with average LOM costs for hardware systems and software systems/licensing. and upgrades for IT systems on and off site.• • Wrap up Liability Motor Vehicle Once the project becomes operational the following insurance will be required: • • • Property All Risk including earthquake General Liability Motor Vehicle. Labour The labour costs assigned to IT include all necessary IT supervision and support for on-site IT support. software systems.5. Supplies The costs assumed for this category include all IT operating costs excluding labour and include the following estimated average annual costs for the LOM during operations: • • • • Enterprise Systems MIT (pit/engineering) General Applications (office software) Technology (IT server/communication systems). communications. These costs cover all annual licensing.and off-site IT infrastructure.

and WTP maintenance. Labour There is no labour cost assigned to this section. ROW.5. waste collection. This department is located off site and therefore accounted for in the Nantoco Office section. Labour The annual labour cost includes: • • • Electrical maintenance (on and off-site electrical infrastructure) Mechanical (building maintenance and fixed structures) Waste management (sewage treatment plant (STP). Supplies The supplies costs include a nominal US$25/person/month cost for general office supplies and consumables. .12 Legal/Land/Permitting For this G&A section the average estimated annual operating cost is US$0. Equipment operators are included to cover the following general services activities: • • garbage collection and storage general building (camp and offices).13 General Services The average estimated average annual cost for this G&A section is US$5.5. electrical. Mining Properties.2.24. Supplies This cost includes supplies for: • • • Legal and Title Permitting & Approvals Land and Water Management. and waste removal). site landfill. The area also accounts for site general mobile equipment not assigned to the mine or plant as well as general services personnel.938 million.727 million. 24.2.

5-2: General Services Equipment List Equipment Type D9 988 16M 450 Bobcat CS76TX Flat Bed Truck Boom Truck 1090 Mobile Crane 1150 Mobile Crane Small Forklift Scissor Lift Light Plant Vacuum Truck Pickup VanMan Crew Bus Ambulance Hazmat FireTruck Nantoco Pickups Security Pickups Total Number 1 1 2 1 3 1 11 6 1 1 6 1 10 1 12 1 1 2 2 8 12 84 24.5. Table 24.5-2 shows the allocated installed General Services equipment list at full production year 2016.The general services mobile equipment fleet annual operating cost is included. Labour The labour cost includes salaries for the general manager. This includes clerical support and travel expenses. Table 24.2. and clerical support.000 per operating year.14 Management The management cost covers the general management and operations management annual costs estimated at US$964. operations manager. .

Labour Labour includes the wages of on-site training supervision and trainers for each of the operations areas. Supplies The estimated annual operating cost includes the following: • • • • • initial induction and orientation training of all employees initial HSE and emergency response training for all employees initial operations specific training for operations personnel including plant training.Supplies The supplies cost includes the cost of travel for the general manager and operations manager. Labour Labour costs include supervision and security personnel. and related classroom/simulator training annual ongoing training costs for new employees based on an annual turnover rate of 10% start-up recruitment and relocation costs.15 Security The average annual operating cost is estimated at US$1.16 HR – Training and Recruiting The annual estimated average cost is US$1 million during operations. Also included is the operating cost for equipment maintenance and replacement.5.6 million for all site security covering a staff of 47 (including the contractor’s staff). 24. 24. See Section 19. On.2.and off-site guards will be contracted. operating procedures.5.2. A US$25/person/month cost is also included to account for general office consumables. for a full description of the security services. Supplies The supplies cost includes a nominal cost of US$25/person/month for office related consumables including security forms and printed safety information. Security. .

18 Power This section covers the power costs for all on-site buildings and structures. It is assumed that a Copiapó based waste removal company(s) will provide this service to the site.5. 24. waste management was placed into a separate G&A cost category to provide visibility of the site waste management costs. Section 9. Contractor A sanitary domestic waste landfill is planned for the site. Labour All waste management labour reports to the General Services G&A cost category discussed above.5.2. however. The average annual operating cost for on.and off-site permanent structures are estimated at US$3.7 million.24.0902/kWh. Supplies This section has the total costs associated for all permanent on-site and port structures including: .5 million based on the base case weighted power rate of US$0. provides a complete description of the waste disposal systems and processes. Supplies Waste management is costed into the following sub-categories and is based on quotations obtained from Chilean waste removal companies: • • • • Sewage treatment plant (at the camp and process plant) Domestic waste Solid inert waste Solid hazardous waste.17 Waste Management The waste management department reports to the general services manager. Infrastructure and Services. The average estimated annual waste management operating cost is US$1. Power associated with mining and processing is included in the respective operating cost estimates for those areas.2. Contractor costs for waste management cover removal of hazardous waste material off site.

5. 24. 24. The G&A labour person count breakdown is shown in Table 24.5.• • • • • • • • • • • all off-site power line maintenance assay laboratory truckshop offices first aid building (clinic) process offices camp accommodation (permanent) Nantoco offices Nantoco training and bus areas guard houses (site) guard house (port) office/laboratory (port). and one aircraft mechanic. and site airstrip. .3 Personnel Labour resources within the G&A cover a wide variety of activities both on and off site and have been based on the working schedules described in this report. maintenance. Labour The aviation labour includes one pilot. flight crew.2.19 Aviation This section covers the costs for operation of a charter Twin Otter aircraft.5-3. one co-pilot. Supplies The supplies cost for aviation includes the total fixed and variables costs of operating and maintaining the Twin Otter based on a nominal flight schedule servicing visits by senior corporate management and minimal miscellaneous flights.

032 2. No G&A Opex is recorded in the model during 2012.5-3: G&A Person Count Breakdown by Department Operations Area Mining + Technical Services (Includes Mining Capital Projects) Processing G&A (Includes Project Management Team less security contractors) Permanent Contractors (Mine Blasting. in Year 2018 following the completion of mining capital projects and the initial TSF dam construction. Camp. The permanent employed contractors include pit blasting/OEM maintenance.030 The totals in Table 24.987 2. This is part of Owner’s Cost in the Capital Cost estimate for these years. and camp/catering permanent contractors.5-4 represent the complete employed labour complement plus permanent contractors for the Cerro Casale project and are the period ramp-up totals to full operating capacity in 2016. and a portion of 2014. Security) Total (Mine + Process + G&A + Contractors) Year (Q4 Operations Manpower Totals) 2012 2013 2014 2015 2016 450 854 873 931 932 3 74 388 422 422 241 263 300 226 223 298 352 426 453 453 992 1. security (on and off site).950 employees. The average manpower settles to approximately 1. .543 1.Table 24. OEM Maintenance. 2013.