Yamana Gold has reported the results of a prefeasibility study (PFS) of the integrated Agua Rica-Alumbrera project in Catamarca province, Argentina. The PFS and planned project development are based on a definitive integration agreement between Yamana, Glencore International, and Newmont Goldcorp that contemplates development and operation of an open-pit mine on the Agua Rica deposit, with ore transported via conveyor to the existing processing facilities of Minera Alumbrera.

Relatively modest modifications to the Alumbrera processing circuit are needed to process the Agua Rica ore. The high-quality Alumbrera infrastructure will be fully utilized, including tailings storage facility, power supply, water supply, ancillary buildings, and logistical installations.

Ownership of the integrated project is Yamana, 56.25%; Glencore, 25%; and Newmont Goldcorp, 18.75%.

The Agua Rica deposit hosts a large-scale, long-life copper mineral resource, with associated gold, silver, and molybdenum, while the Alumbrera infrastructure is of significant scale and configuration that is ideally suited for the integration plan. Mined ore will be processed through a primary crusher at the mine site and transported 35 kilometers (km) via conveyor to the Alumbrera processing plant. Conveyor construction will include approximately 5.2 km of tunnel development.

The PFS is based on proven and probable mineral reserves of 11.8 billion lb of copper and 7.4 million ounces (oz) of gold contained in 1.1 million metric tons (mt) of ore at Agua Rica. Mining will be by conventional, high-tonnage, truck-and-shovel open-pit methods. Average annual life-of-mine material moved is expected to total about 108 million mt per year (mt/y), producing plant feed of 40 million mt/y at an average life-of-mine strip ratio of 1.66.

Initial mine life is estimated at 28 years. Annual copper equivalent production for the first 10 full years of operation is estimated at 533 million lb at cash costs of $1.29/lb and all-in sustaining costs of $1.52/lb.

Initial capital costs are estimated at $2.4 billion.

Opportunities to further improve project economics are being evaluated in a value-seeking study scheduled for 2019, with results to be incorporated into a full feasibility study planned for completion in 2020.