Mercator Gold PLC (AIM: MCR) said it secured the right to acquire an exclusive option over a porphyry copper-molybdenum-gold-silver deposit in New Mexico in the US, and has commenced due diligence.
The group envisages an open pit mining operation treating up to 6 million short tons per annum to produce 13,000-20,000 metric tons of copper per annum at Copper Flat in the Las Animas mining district in south central New Mexico.
Following due diligence, the group may acquire the option by making on or before August 14 2009 a payment of US$150,000.
The deposit has historical reserves of 45.5 million metric tons grading 0.45 percent Cu, , 0.015 percent Mo, 0.15 grams per ton Au and 2.25 g/t Ag, equating to in excess of US$1.3 billion of contained metal at current prices. The project has significant infrastructure in place and could be brought into production within a short timeframe for a relatively low capital outlay, Mercator said.
The project is a former producing mine, and important infrastructure remains in place, including the tailings pond, 19 miles of power lines, access roads and a major system of diversion dams and channels. Electrical power is available at site at low cost from the local grid. In addition, a full pre-strip of the ore body has been completed, it added.
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