Frieda R. copper reserves rise; large mine costs

Press, 1 June 1977, Page 19

Frieda R. copper reserves rise; large mine costs

[NZPA Sydnej i The Frieda River porphry ’copper prospect, in the highj lands of Papua New Guinea [is 54 per cent larger than 1 previously-announced estimates, MIM Holdings, Ltd which is examining the prospect in partnership with a Japanese consortium says. Exploration so far hac indicated about 500 M tonnes of copper mineralisation, I containing 0.5 per cent copper. ■ Mineralisation had preIviously been estimated at [about 360 M tonnes, averaging 0.45 per cent copper. The figures put Frieda River behind the reserves of Bougainville Copper. Ltd, which were 900 M tonnes, averaging 0.48 per cent copper, hut well ahead of BHP’S Ok Tedi prospect with 150 M tonnes, averaging 0.9 pet cent copper. Despite the significant addition to the Frieda River resource, no decision on its development, is likley to be made before the Japanese

; partners finish their five- ! year drilling programme late inext year, or early in 1979. I The Japanese companies ' — Sumitomo Metal, Dowa ‘Mining, Sumitomo Shoji [Kaisha, and Marubeni Corjporation —- are required to 'spend SSM on exploration [and other work to earn a 40 I per cent interest in the property. The deposit is in a remote , area, and there would be logistic difficulties even more formidable than those encountered by the Bougainville project. “The infrastructure problems are enormous,' 1 an MIM spokesman says. The economics of developing the large but lowgrade deposit are substantially different from those of the Mount Isa mine, which has primary copper-ore reserves of 135 M tonnes averaging 3.2 per cent copper, as well as large silver-lead-zinc-reserves. The key to the development of the project lies in [the terms of the agreement [to be offered by the govern-

' merit of Papua New Guinea, and the extent to which it will contribute to the largeinfrastructure costs. i Talks on an agreement, were held in Port Moresby last week between represent tatives of the Government: and Mount Isa Mines, Ltd, j and MIM guardedly reported: that “progress had been: made.” The government of Papua New Guinea had displayed a “co-operative attitude” towards the development of the Frieda River deposits, and this co-operation would | continue “if it became appropriate to proceed with; the project,” the MIM; (spokesman says. This co-operation is understandable: Copper has already transformed the economy, and the prospect that the country could emerge as a ' major world supplier of the metal' could prompt the Government to offer less stringent terms to the Frieda River, and Ok Tedi projects than those in the renego-l tiated Bougainville agree-I inent of 1974.