Nautilus gets go ahead for gold/copper seabed mining project

Seabed mining pioneer Nautilus Minerals has received the go-ahead for its Solwara 1 deep sea gold and base metals mining project from the PNG government.

Author: Andrew Duffy
Posted: Tuesday , 14 Aug 2012

SYDNEY (Australian Mining) -

The Papua New Guinea Government has given the go-ahead for Nautilus Minerals to start the world's first deep sea mining project.

While still facing opposition from local conservationists and fishermen, the Canada-based company will mine gold and copper from hydrothermal vents on the ocean floor.

Located off the coast of New Britain, PNG, Nautilus says its Solwara 1 project is not in a fishing area and has a much smaller environmental impact compared to mines on the surface.

While the Nautilus project is the first of its kind Japan and China have previously expressed interest in making similar developments.

There has also been a spike in seabed mining and exploration applications in Australia.

The Australian projects focus on waters off the Northern Territory coast, and have faced challenges from local environmentalists and traditional land owners.

Re the Solwara 1 resource, Nautilus says on its website "In 2007 the exploration team drilled a 43-101 resource on the Solwara 1 Project using newly developed ROV drills. The resulting high grade copper-gold resource was the world's first Seafloor Massive Sulphide ("SMS") resource statement. In 2010/11 further drilling was conducted at Solwara 1 resulting in an increase in the resource base. Results of the updated resource were as follows (November 25, 2011):

• Indicated Mineral Resource: 1,030kt @ 7.2% Cu, 5.0 g/t Au, 23 g/t Ag, 0.4 % Zn
• Inferred Mineral Resource: 1,540kt @ 8.1 % Cu, 6.4 g/t Au, 34 g/t Ag, 0.9% Zn""

It further reports a 2010 dated capital cost and production estimate as follows:

• Capital costs, including those associated with barging to the Port of Rabaul, estimated to be US$383 million (including a 17.5% contingency).
• Average operating costs to the Port of Rabaul estimated at US$70 per tonne (including a 10% contingency) based on a 1.35 million tonnes per year production rate.
• Production rate commencing at 1.2 million tonnes per year (dry equivalent) with capacity to ramp up to 1.8 million tonnes per year.
• Once approved by the Board of Nautilus, the build program is 30 months to commence commercial production.

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