A drill site at the Palmer Project north of Haines. (Photo courtesy of Constantine Metal Resources)
Constantine Metal Resources has released some of the results of its Preliminary Economic Assessment of the Palmer Project, a controversial mineral exploration project near Klukwan and Haines. The assessment is a tool for investors that outlines the economic potential for a mine and the logistics of mine development.
Constantine has been exploring minerals at the Palmer Project for over a decade. The main mineral deposits that have been discovered contain copper, zinc, gold, silver and barite.
Now the company has completed its first economic assessment of the site. Constantine Vice President of External Affairs Liz Cornejo says the document will be shared with investors in hopes of securing funding to develop a mine.
“With the PEA some of the important numbers people look for with these assessments is how much is it going to cost to construct the mine, how much does it cost to operate the mine,” Cornejo says.
The PEA estimates that the project will require $418 million in funding over the entire life of the mine, from pre-production to closure. The estimated net profit over the lifetime of the project is $266 million.
Cornejo says that in addition to economic information, the PEA also helps people understand how the mine would operate.
“We can answer some of those questions that people have had and use it in our discussions as far as assessing well what might a mine here look like. How big would it be? How long would it operate? How many people would be involved?” Cornejo says.
According to the PEA, Constantine expects a mine at the Palmer Project would operate for 11 years and provide a total of 260 full-time jobs.
In terms of scale, the mine would produce 3,500 metric tonnes of ore concentrates each day.
“The material comes out of the mountain, goes through the mill, it gets ground up and sorted into different products. And then would be trucked into Haines. Currently, there is not an ore terminal for loading, so we would be shuttling it over to Skagway for loading and shipping out to the buyers,” Cornejo says.
Most of the zinc concentrates produced by Constantine would be sold to DOWA, a Japanese metal producer that has a 49 percent stake in the Palmer Project. The copper is likely to end up with smelters in other parts of Asia, while the barite would be shipped to oil and gas producers in Canada and the Midwest.
But not all of the rock taken from the ground will be exported for sale. Many residents and environmental groups worry that waste rock and mine tailings will degrade rivers downstream from the project. Cornejo says the conceptual plan outlined in the PEA would minimize the amount of waste produced.
“Both waste rock and tailings can be non-acid generating or potentially acid generating,” Cornejo says. “In this case, there would be enough space underground that is created that we would be able to put all of the potentially acid-generating waste rock and remaining tailings back underground. The only tailings remaining on surface at mine closure are designed to be non-acid generating.”
However, according to the PEA, some potentially acid generating rock would be stored at surface during the first few years of operation until there is enough space available underground for disposal.
While the PEA provides a general picture of what a mine would look like, two highly detailed feasibility studies must be carried out in the future before development can begin. Cornejo says that the company is still working to better understand the mineral deposits as well as the infrastructure needs of the project.
Constantine will release the full technical report for the PEA within the next 45 days.
Clarification: While Constantine has released some results from its Preliminary Economic Assessment, the full document is still unavailable.
