Monday, 16 April 2012
Curis says Florence copper project to boost Arizona economy by $2.2bln over 28 years
Curis Resources (TSE:CUV) released Monday a socio-economic study of its Florence copper project by Arizona State University (ASU), indicating that the asset will bring more than $2.2 billion in new economic activity to the state over the next 28 years.
The study details a case of "lasting economic value", the company said, including new capital investment, job creation, personal income, private sector business growth and government revenue, both in Florence, Pinal County, and in Arizona as a whole.
"The ASU Economic Impact Study is a sophisticated, independent third party review of the overall economic, employment, business and public benefits to be generated by Florence Copper," said Curis president and CEO, Michael McPhie.
"It confirms that Florence Copper will make a profound near-term and sustained contribution to the economic well-being of Pinal County and the state of Arizona through the creation of stable, well-paid jobs, hundreds of millions of dollars in supply and service contracts for local businesses and contributions to governments at the local, county and state levels."
The study was commissioned by Curis to forecast potential impacts of the project, including the impact of an environmentally and socially responsible in-situ copper recovery operation at the site on Arizona and the local economy.
The report concluded that of the $2.2 billion in economic activity within Arizona, $1.1 billion would occur within Pinal County.
The study also indicated that the project will support an annual average of 681 Arizona jobs over 28 years, with personal income for Pinal County residents anticipated to rise by more than $700 million.
New jobs created are expected to support "head-of-household wages", the company said, as compensation within Arizona's mining industry is 44 percent higher than the state average.
The report also found that two out of three jobs required can be sourced from workers in Pinal County, and that Arizona governments will collect roughly $325 million in taxes and royalties from the project.
"With current unemployment rates of 20.3 percent in the Town of Florence and 9.5 percent for Pinal County, we believe Florence Copper represents an extraordinary opportunity to provide lasting benefits to the people of this community," McPhie said.
"It's also an unparalleled opportunity to kick-start the regional and local economy as it begins to recover from the effects of the recent housing crisis and economic downturn."
The 129-page study, completed by Dennis Hoffman, PhD, Lee McPheters, PhD, and Tom Rex, MBA, used data from the U.S. Bureau of Labor Statistics, the U.S. Department of Commerce, the state of Arizona, Pinal County and other official sources.
The ASU study also examined the ripple effect that the Florence copper project will have on Pinal County, "predicting the project has more potential than any other economic factor to spur an economic recovery in the near term", the company said.
The study's Hoffman said: "Based on our analysis, Florence Copper could create hundreds of high wage jobs, and generate millions in annual revenues for local and state governments and businesses.
"Florence Copper represents a regional economic development opportunity with real, near term benefits."
The full economic impact study is available at www.florencecopper.com.
Earlier this month, Curis said it had inked an agreement for a $40 million senior secured loan facility and copper-off take deal with RK Mine Finance Trust (Red Kite).
Under the terms of the loan, Red Kite will provide a US$40 million loan with interest payable at Libor plus 8%, maturing two years from the date of closing.
The funds from the loan will be used to advance the development of the phase 1 production test facility and related engineering, infrastructure, as well as permitting-related activities of the Florence copper project located in Central Arizona.
In addition to the loan, Curis will supply Red Kite with 25 percent, or if the extension option is exercised, 30 percent of the Florence project's copper cathode production for the life of the mine once it reaches commercial production.
The project hosts a measured and indicated copper oxide resource of 354 million tonnes grading 0.34 percent copper for an in-situ resource of 2.62 billion pounds of copper. The deposit’s characteristics are amenable to in-situ recovery mining, which is appealing for minimum surface disturbance and lower capital and operational costs.
Commercial production is expected by 2014. Initial capital costs are seen at $280 million for the project, with cash costs (including royalties) of $0.89 per pound of copper for an 80 million pound per year project.
Initial copper production is forecast for mid-2012, and the project is expected to produce around 76 to 84 million pounds of copper annually when in full operation, currently seen by 2014.