Bajo de la Alumbrera Copper and Gold Mine, Argentina

The Bajo de la Alumbrera (Alumbrera) copper-gold mine in Argentina, owned and operated by Minera Alumbrera Ltd (MAA), commenced commercial operation in February 1998. The mine is located in Catamarca province, 1,100km north west of Buenos Aires at an altitude of 2,500m.
The Argentine state- and provincially-owned mining company, Yacimientos Mineros de Agua de Dionisio (YMAD), which has the title to the deposit, awarded an international tender for the Alumbrera concession to International Musto Exploration in 1992. Minera Alumbrera was formed in 1994 when MIM Holdings bought a 50% operating interest. During 1995, North Ltd and Rio Algom acquired shares in International Musto and each took a 25% holding in MAA. Pre-production capital expenditure totalled $1.2bn and capital expenditures in the 1998 and 1999 financial years were $198m and $17m respectively. Royalty payments to Catamarca province commenced in 1998. YMAD will start earning 20% of the net proceeds (before tax) once project capital plus interest has been repaid.
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In 2003, three years after Rio Tinto acquired North Ltd and Billiton (now BHP Billiton) bought Rio Algom, the two companies sold their holdings to the Canadian company, Wheaton River Minerals, while MIM was acquired by Xstrata. In 2005 Xstrata opened an office in Chile, initially to manage both Alumbrera and the company's Las Bambas copper project in Peru.
GEOLOGY AND RESERVES
The Bajo de la Alumbrera deposit is a classic copper-gold porphyry. Porphyritic dacite intrudes volcanic andesite, chalcopyrite being the main copper mineral. Near-surface weathered material overlies primary sulphide. In 2003 the mine's reserve base totalled 330Mt proven grading 0.51% copper and 0.59g/t gold plus 42Mt probable grading 0.55% copper and 0.64g/t gold.
However, 2004 drilling led MAA to reoptimise the mine plan based on a new geological model and new cost figures, and this increased contained metal reserves by more than 20%, extending the mine's life to 2015. In mid-2005, reserves were reported to be 360Mt, grading 0.46% copper and 0.51g/t gold, while mineral resources stood at 380Mt (0.47% copper and 0.51g/t gold).