CUDECO TEAMS UP WITH GLENCORE'S ERNEST HENRY MINE
Written on the 14 October 2014 by Nick Nichols
GOLD Coast based copper miner CuDeco (ASX: CDU) may increase output from its Rocklands project after teaming up with mining giant Glencore International to explore the prospect of crushing its ore at the nearby Ernest Henry Mine in north-west Queensland.
CuDeco, headed by executive chairman Wayne McCrae, has entered into an agreement with Glencore for the supply of 20,000 tonnes of primary sulphide ore from Rocklands to be treated at Ernest Henry‘s mineral processing plant.
The offtake agreement is aimed at testing the suitability of CuDeco’s primary ore for treatment at Ernest Henry, which is located 50km from CuDeco’s emerging mining operation near the township of Cloncurry.
The initial testing could result in a long-term supply deal between CuDeco and Glencore.
CuDeco has targeted three million tonnes per annum from Rocklands, but says additional output would be needed should a long-term arrangement with Glencore be reached.
“Any future agreements for ore supply and concentrate purchase will be based on increased mining for supply, in addition to the 3mtpa to be processed at CuDeco’s Rocklands mineral processing facility,” the company says.
CuDeco says it has the capacity to double output if needed with mining currently proceeding on a 12-hour shift.
The company is currently mining more than 30,000 tonnes a day for supply to China through an agreement with the government-owned Sinosteel Corporation.
It expects to have stockpiled 1.3 million tonnes for processing by November.
CuDeco is also finalising construction of its own processing plant which has a capacity for 3mtpa to supply Sinosteel.
The company has already made its first shipment of 170 tonnes for testwork in Chinese smelters.
It says shipments to Ernest Henry will start this week.
CuDeco’s shares, which resumed trading today after a two-day trading halt, jumped 12c to $1.50 in the first few hours of trading on the ASX.
Author: Nick Nichols