COPPER SMELTER & MINE DEVELOPMENT -- MANES & VALLEX
| Manes
and Vallex is the only producer of refined copper in the Caucasus. It proposes
to construct a 30,000 tpy smelter to reconstruct the Alaverdi Copper Smelter and equip for the development of the Tekhout mine. The feasibility of this strategic opportunity is being studied in collaboration with Lurgi Metallurgie and Norddeutsche Affinerie of Germany. Company: Manes Yev Vallex Inc. Amount: $150m for North Armenian Mining and Metallurgical Complex: Tenor/Terms: To be decided Documentation: • Tekhout Copper Deposit Development license for 25 years; • Technical report on Tekhout Mine prepared by Mining Metallurgical Institute, Yerevan; • Passport of Tekhout Copper-Molybdenum Deposit (resource of 454 Mt of averaging 0,36 % Cu and 0,02 % Mo ); • Cooperation Agreement between Lurgi Metallurgy and Manes yev Vallex for mining and metallurgical complex in Alaverdi, North Armenia. • Letters of Intents between the Government of the Republic of Armenia, Manes yev Vallex and Lurgi Metallurgy, and Norddeutsche Affinerie. Use of Funds: Construction of 30,000 tpy copper smelter as the first stage of Alaverdi Copper Smelter reconstruction and extension project Construction and equipment for Tekhout mine development facilities, including mine infrastructure, concentrator, tailings and etc. Legal Status: Manes Yev Vallex is a private company incorporated in Armenia. Vallex F.M. Establishment and Elecom A.G are the owners with 53.7% and 46.3%. shares respectively. Local and Strategic Partners: 1. Lurgi Metallurgie GmbH, Frankfurt am Main, Germany 2. International Business Consultant Berlin, Berlin, Germany 3. Norddeutsche Affinerie, Germany Current Operations: M&V is an Armenian private company engaged in the discovery, development, production, processing and marketing of minerals and metals, specializing in diversified resources. M&V is a single producer of refined copper in the Caucasus. The company currently produces approx. 8,000 tpy of blister copper from national copper concentrates currently mined in South Armenia and copper scrap. The existing production facility is Alaverdi Copper Smelter located in Lori, North Armenia and have capacity up to 18,000 tpy. Since 1998 Company is also engaged in the acquisition, exploration and development of mining properties in Armenia. M&V currently controls mining exploration and development rights over several mining properties, including copper and molybdenum Tekhout (inferred resource is assumed of 454 Mt of copper, averaging 0,36 % Cu and 0,02% Mo) Hankadzor ( 1,6 % Cu), Hagvi ( 1,8 % Cu); and small gold deposits: Margahovit, Karaberd, Tandzut and Marts-Dzaghidzor . Product Quantity, tone per year Market Potential Buyer/ User Copper concentrate (Cu 28%) 98,000 Domestic Alaverdi Smelter Concentrate containing Trioxide Mo 1,600 Domestic Pure Iron JSC Blister Copper 20,000 Export Nord Deutsche Affinerie, Germany Copper Cathodes 10,000 Export/ Domestic [Arm Cable] Sulfuric acid 100,000 Export/Domestic NA Business Plan: North Armenian mining-metallurgical complex development constitutes two distinct projects. 1. Reconstruction and extension of the operating Alaverdi smelting plant through the construction of a new, cost-effective and ecologically friendly smelting facility with up to 60,000 tpy capacity treating of copper concentrate. 2. Simultaneous development of Tekhout copper mine (inferred resource is assumed of 454 Mt, averaging 0,36% Cu and 0,02% Mo) capable of mining and concentrating approximately 8,000,000 ton per annum to produce some 98,000 ton copper concentrate (Cu 28%). It is envisaged that a bankable feasibility study will be commenced in 2001 after completion of a scoping Pre—Feasibility Study on Tekhout Mine and Technical Study on Alaverdi Smelter. Investment, Capital Cost and Financing Structure Proposed: Preliminary Estimated Capital Costs Project Name Capacity Capital Cost Tekhout Mine 98,000 tpy copper concentrate (Cu 28%) $89 million Alaverdi Smelter 30,000 tpy copper $60 million Other Project Details: Alaverdi Copper Smelter Expansion Project. Location/Infrastructure/Tradition. The Alaverdi copper smelter celebrated in the year 2000 their 230th anniversary of copper production at the same location. The long tradition and operation represent attractive infrastructure and skilled personnel. The smelter in the Lori-region in the north of Armenia has a good road and rail connection for the regional standards. The product is transported by rail to the port of Poti in neighboring Georgia. A few kilometers upstream along the river which runs through the premises is an operating hydro power station with 24 MW installed capacity. The river is a reliable source of water throughout the year. The Copper Smelter. The copper smelter consists of the basic steps required to melt the concentrates and to convert the molten copper sulfide into blister copper of market quality. The concentrates are fed to the lateral walls of the reverb furnace. The front end side is equipped with fuel burners combusting heavy oil. The thermal energy passes from the bottom of the reverb furnace into one layer of liquid copper and copper sulfides covered by another layer of slag low in copper content which is discarded: Main reverb: 11m length 4m width The lower copper containing phase is drained into containers which are then transported into the copper converters where the sulfur contained in the liquid phase is oxidized by air injected from the bottom of the converter into the liquid phase. Converter dimension: 2.8 m diameter 5.0 m cyl. Length This exothermal reaction in the converter keeps the produced copper in liquid form, which is casted in special forms as final product for export. The gas of the reverb furnace and the converter is vented after dilution with air through a stack without further treatment. The dedusting and desulfurization of these gases will be an integral part of the modernization program. Modernization Program. The existing facilities would have an industrial life of up to five years, but urgently require modernization to improve production cost structure and comply with environmental standards. Expansion Program and Copper Concentrate Supplies. Availability and reliability of locally mined copper concentrate supplies would be a critical precondition for the Alaverdi Copper Smelter Expansion program. Recent study of Armenia s copper miningmetallurgical industry conducted by IMC has indicated that currently operational mines in South Armenia without substantial investment would be able to produce approx. 20,000 to 30,000 tons per annum of copper, in concentrate. Taking into account anticipated production of approx. 30,000 to 35,000 tons per annum copper concentrate in new mines, (mainly Tekhout), and estimated availability of a copper-scrap in quantities up to 5,000 tons per annum, raw material supplies which would be available locally for copper production are predicted to reach 55,000 to 70,000 tons per annum in 2003. Tekhout Mine Project. The Tekhout copper-molybdenum deposit is located in northern Armenia, 35 km east of Alaverdi Copper Smelter. The inferred mineral resource is assumed to be 454 Mt grading 0,36 % copper and 0,02 % molybdenum. Ore producing and concentrating plant will comprise open-pit mine, concentrator (with tailings), and mine infrastructure as well. The average ore production rate will be 8 Mt per annum grading 0.41% copper and 0.012% molybdenum. The processing plant would have a design capacity of 98,728 tones per annum and would comprise primary crushing, Semi-Autogenous Grinding (SAG) milling, collectivelyselective copper-molybdenum flotation, thickening and filtration. The metallurgical testing program indicated that recoveries of 84.28% and 70.65% for copper and molybdenum respectively could be achieved to produce a concentrate averaging 28% copper and molybdenum trioxide grading of 54.5% molybdenum. Points of Contact: Mr. Valery Medzhlumyan Chairman & General Director Manes Yev Vallex Yerevan Armenia Tel: 374-1-54 83 18 Fax: 374-1-54 01 86 E-mail: vallex@vallex.ru In Moscow Tel: 007-095-784 71 11 007-095 784 71 71 Fax: 007 -095-784-71 10 Prof. Dr. Johannes Dietmar Weisser International Business Consult Berlin Budapeter Strasse 11 10787 Berlin Germany Tel: 49-30-257-97-192 Fax: 49-30-257 97-191 E-mail: intercoms@t-online.de In Yerevan 19 Khanjayan Street, Yerevan Tel: 374-1-54 01 85 Fax: 374-1-54-0186 E-mail: vallex@vallex.am |