Recently we were fortunate enough to interview copper mining expert, Australian born, Stephen Twyerould, Ph.D. Dr. Twyerould has over 25 years of mining experience and we got a chance to hear how he feels his new company, Excelsior Mining Corp. (Excelsior), will be insulated from copper price fluctuations due to a low cost copper mining technique the company plans to use called in-situ recovery (ISR).
Gunnison Copper Deposit in Arizona, US
Excelsior is an exploration and development company with a copper project located within the copper porphyry belt of Arizona. Arizona has seen 9 of the world’s global copper ISR projects. Starting back in October 2010, Excelsior initiated development of their low cost copper project, Gunnison. In January, the company began a 10,000 m drill program aimed at upgrading and increasing the current resource. Included in the program will be metallurgical and hydrological test work. The Excelsior team consists of experienced professionals with proven track records of advancing projects towards production. The company is a promising early stage copper explorer with near term production potential.
As indicated on the Excelsior website, over 50,000 meters have been drilled on the property to date. This gives rise to a significant copper resource of which over 2/3 occurs as oxide copper which has the potential to be mined using ISR methods, a much lower cost and less evasive method than conventional mining methods.
While discussing ISR copper mining, Dr. Twyerould stated, “We have 4.77 billion pounds of copper of which over 3 billion pounds is copper oxide amenable to ISR mining.” Dr. Twyerould also informed us that they really only have one comparison company, a Canadian company who is about 2 years ahead of them and is also advancing their project using ISR copper mining.
Arizona ISR of Copper Oxide
Understanding the ISR method of copper mining
According to Dr. Twyerould, one of the major challenges he sees to the success of Excelsior is helping investors and the markets understand the benefits of ISR mining. He added, “The biggest challenge to success is education. The market does not understand in-situ copper mining although it has been around for quite a while.”
ISR mining is very different from the traditional method of mining copper and other metals. ISR is a low cost, environmentally sound process of extracting metals from deposits and has been commercially used in Arizona to extract copper on several occasions.
ISR Cu Production Method
Excelsior describes the ISR method of copper mining on their website as a process that uses a mild solution that is approximately 99% water, which is pumped through a series of concrete lined injection wells to dissolve the copper. The copper-rich solution then moves through the rock in a controlled manner to nearby recovery wells where it is then pumped back to the surface for processing. Dr. Twyerould indicated, “It’s a very similar process to ISR mining of uranium.” For more information on the ISR process visit http://excelsiormining.com/e/in-siturecovery.php
Hydrological and metallurgical test work will commence in the first quarter of 2011 in order to confirm previous results that demonstrate that Gunnison can be mined using the ISR method of copper mining.
Profitability of ISR copper mining in Arizona
Dr. Twyerould stated that, “The property in Arizona is 43-101 compliant with 160 drill holes already in the ground.”
One of the reasons investors should consider Excelsior is the potential for low operating cost and high profitability. Dr. Twyerould adds, “Operating costs for ISR copper projects are typically in the $0.60-0.70 per pound range. If you can get $3.00 per pound for copper, that’s a high margin, which makes us attractive. It does not take long to do the math.”
On capital expenditures Dr. Twyerould said, “No major capital expenditure yet, but ISR operations are typically 2/3 to 1/2 of usual capital costs for a similar sized open pit.” He added the following reason, “We don’t have to buy the trucks, dig the waste and move the ore.”
Future outlook
According to Dr. Twyerould the next phase for their ISR copper mining project is obtaining additional data. He stated, “We are obtaining baseline environmental data and additional technical data now.”
Excelsior Mining Corp is currently upgrading its resources to include new metallurgical and hydrological testing. Dr. Twyerould indicated this will occur during the first part of 2011.
When asked about capital requirements for the next phase, Dr. Twyerould stated the company plans to raise a small amount of capital now to complete a scoping study, due later this year, and will raise $10-15 million to complete additional metallurgical studies, hydrological studies and resource drilling to complete a pre-feasibility study in 2012.
On the infrastructure of Arizona for copper mining, Dr. Twyerould said, “Arizona has good infrastructure. The project is located next to the highway, railway and power lines. Its remote location minimizes community issues.”
He also feels they have an excellent team of professionals dedicated to taking the project to production. Among them is newly hired and industry recognized Dr. Aberra Getahun, Ph.D. as General Manager of Production and Permitting. For the press release information on this new team member, visit http://www.excelsiormining.com/NewsReleases/2011-01-13-NewsRelease.pdf.
Dr. Twyerould is conservative in making predictions about the future of copper mining, “Those who make predictions on copper are often wrong.”
But he does feel the neat thing about Excelsior is that they are insulated from price fluctuations in copper, “Even if you did see a significant turndown in copper prices we would be insulated due to low operating and capital costs, while others will be out of business.”
Currently, Excelsior has 42 million outstanding shares at $0.70 per share, of which 22% is held by management. Excelsior trades under the symbol TSX-V: MIN.
Dr. Twyerould describes Excelsior as, “Big resources in a tightly held company that has potential to be a low cost producer.” And that’s enough reason to keep an eye out for this mining company as they proceed in their next phase.
For more information about ISR copper mining and Excelsior Mining Corp visit
www.excelsiormining.com
Vancouver Office:
Attn: Mark Morabito
1240 - 1140 West Pender Street
Vancouver, BC
V6E 4G1
Tel: 604-681-8030
Fax: 604-681-8039
Toll Free: 1-866-683-8030
Investor Relations:
Email: info@excelsiormining.com