Lubo-Boneng Project
Overview
The Company is acquiring the Lubo-Boneng mine from Al Magan Mining Exploration Corporation (AMMEX) and will become the operating partner. The acquisition is being made on an all stock basis.
Figure 1
The mine is located in the municipality of Kibungan, Province of Benguet in the Cordillera Administrative region, Luzon Island in Northern Philippines. The mine is 15 air kilometers from Baguio City, the summer capital of the Philippines, and can be reached in less than three hours through a 56 km dirt road from the city. It is 125 kms by road to the port at San Fernando City, from which shipments of ore can be made to foreign owned smelters.
In addition, there are 6 satellite properties related to the Lubo minesite for which varying levels of exploration and development have indicated promise (see Satellite Properties).
The Lubo mine is a past producer of copper, with additional gold and silver deposits. The mine operated for a total of 7 years during the 1970s and 1980s and was shut down in February 1982 due to high financing charges attributable to an ill-timed 100% expansion from 15.000 to 30,000 tonnes per day and low copper prices, i.e. less than 80 US cents per pound.
Nearly 30 million tonnes of crude ore was mined from the old open pit from 1971 to 1982. The ore was transported by off-highway trucks to a concentrator situated less than a kilometer from the open pit. The plant produced 65,230 tonnes of copper, 3.70 tonnes of gold, and 1507 tonnes of silver contained in concentrates, which were shipped overseas to smelters in Japan.
However, with the current price of copper trending upwards over the last year and currently well above $3.00 USD per pound, along with the major improvements in silver and gold prices at historical highs over $1,300 per ounce, management believes the mine can recommence operations on a profitable basis once again (see detailed financial analysis).
The 30,000 tonnes per day concentrator and other movable assets were sold by the creditors and shipped out and since then the project area became dormant. However, the remaining major infrastructure is in good condition, like the open pit, concentrator site, the tailings and water dam, the 1.2 kilometre-long connecting adit used to transport tailings from the concentrator to the tailings dam and at the same time convey water by gravity to the mill, and access road to the minesite.
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