Built in 1972, Gibraltar was originally designed to process 36,000 tons of ore per day, producing approximately 60 million pounds of copper annually. Soon after the re-start in 2004, Taseko realized the potential of this large resource and embarked on a program to increase the copper reserves and expand the mining and processing capacity.
In 2007, the first modernization phase
commenced. The initial phase included the construction of a 34 foot
semi-autogenous grinding (SAG) mill, conversion of rod mills to ball mills and
the complete replacement of the flotation recovery system with 160m3 float
cells, along with the addition of new mining equipment. Once completed in 2008,
these modifications and new equipment increased the processing rate of the
concentrator to 46,000 tons per day. This capital investment totaled $76
Phase II modifications were designed to allow the new SAG mill to process up to its designed capacity of 55,000 tons per day by increasing capacity in other circuits of the concentrator.
In 2009, the Company initiated this phase of the modernization project which included an inpit crusher and conveyor system, increasing regrind and cleaner flotation capacity, the installation of a two-stage tailings pumping system plus a new coarse ore stockpile and SAG direct feed system. The mining fleet was further upgraded with the addition of a Bucyrus 495HR 60 yard shovel and four new 320 ton haul trucks This phase was completed in mid-2011 for a total cost of $224 million.
Gibraltar Development Plan 3 (GDP3) was originally planned to commence in 2009, but with the crash of the world financial markets and devalued copper price in late 2008, the Company placed the plans on hold.
In the spring of 2011, construction commenced for Gibraltar Development Plan 3 (GDP3). GDP3 included the construction of a standalone 30,000 ton per day concentrator, built adjacent to the existing 55,000 ton per day facility. The new design capacity of Gibraltar was designed to be 85,000 tons per day. An integral part of the project was a new molybdenum recovery facility. In addition to the new concentrator, the mining fleet will be upgraded with a new mining shovel, production drill and ten haul trucks
Capital costs for GDP3 were $235 million for the concentrator and molybdenum plant and approximately $90 million for mining equipment. GDP3 was completed on time and on budget in Q4 2012 and commissioning began in December 2012. In early 2013, first concentrate from GDP3 was produced and Gibraltar’s processing capacity increased to 85,000 tons per day.
After the capital investments to improve and expand this facility, Taseko’s 75% share of this asset has a $1 billion net present value, or roughly $5 per share.
In May of 2015, the Company completed an updated mine plan for Gibraltar featuring a 50% decrease in strip ratio. This new mine plan was a result of a detailed, six-month engineering study and forms the basis of an updated NI 43-101 compliant reserve (see News Release May 5, 2015: Taseko Announces Improved Economics At Its Gibraltar Copper Mine). The new mine plan took into account lower milling costs as a result of the modernized processing facilities.
Under the new mine plane, average annual production is 138 million pounds of copper, over approximately 24 years of operations.