SolGold, Cornerstone release Ecuador copper-gold study

SolGold [SOLG-TSX, LSE] and Cornerstone Capital Resources Inc. [CGP-TSX, CTNXF-OTC, GWN-F] said results of a new pre-feasibility study indicate that the Cascabel joint venture in northern Ecuador is expected to be a top 20 South American copper gold mine.

It is a project that is expected to benefit from a high-grade core, advantageous infrastructure and an increasingly investor-friendly government.  “The mine is expected to produce a clean copper-gold-silver concentrate that will be sold to Asian and European smelters,” the companies said in a press release Wednesday.

Shares of both companies were largely unchanged on the news. Cornerstone was up 0.62% or $0.03 to $4.90. The shares trade in a 52-week range of $5.28 and $3.46.

SolGold eased 1.75% or $0.01 to 56 cents and now trade in a 52-week range of 67 cents and 38.5 cents.

The Cascabel Project is a porphyry copper-gold deposit located in the Imbabura province of northwestern Ecuador, which lies within the under-explored northern section of the richly endowed Andean Copper Belt.

Exploraciones Novomining S.A. (ENSA) an Ecuadorian company owned by SoldGold and Cornerstone, holds a 100% interest in the Casabel concession. Subject to the satisfaction of certain conditions, including SolGold’s commitment to fully fund the project through to feasibility, SolGold will own 85% of the equity of ENSA and Cornerstone will own the remaining 15%. SolGold is funding 100% of the exploration at Cascabel and is the operator of the project.

Cornerstone holds a 6.85% of the shares of SolGold, leaving Cornerstone wit a total direct and indirect interest of 20.8%.

The pre-feasibility study is based on an initial mineral reserve of 558 million tonnes, containing 3.3 million tonnes at 0.58% copper, 9.4 million ounces of gold at 52 g/t and 30 million ounces of silver at 1.65 g/t, material that is expected to support a mine life span of at least 26 years.

The study envisages average annual production of 132,000 tonnes of copper, 358,000 ounces of gold, and 1.0 million ounces of silver, or 212,000 tonnes-per-year of copper equivalent.

On achieving nameplate capacity, production is expected to average 190,000 tonnes of copper annually, 680,000 ounces of gold and 1.3 million ounces of silver over the initial five years at an average negative all-in-sustaining cost of US$1.38 per pound.

Other highlights from the pre-feasibility study include estimated pre-production capital of US$2.7 billion for the initial cave development, first process plant module and infrastructure.

On Wednesday, the companies said a definitive feasibility study is expected to be completed in the first half of 2023.

“Cascabel will be a significant, multi-decade and very low-cost producer of copper that can help enable Ecuador’s emergence as the next copper frontier at a time when the world needs copper the most as we transition to a net zero carbon emission future,” said SolGold CEO Darryl Cuzzubbo.