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Cerro De Pasco Resources has seventeen year plan for historic mine in Peru

CDPR is looking at opportunities for all the metals at the polymetallic mine.

Peru
Mine has been producing for 400 years

Cerro de Pasco in Peru is one of the world’s oldest (and highest) mines with a legacy of 400 years of production

A recently formed Canadian company, Cerro De Pasco Resources Inc (CSE:CDPR), has recently agreed to take over the mine, infrastructure and historic piles of mined ore and tailings.

Steven Zadka is its executive chairman and he says cleaning up the historic mess is one of the priorities.

“We are not a typical mining company”, he says, “but a resource management company with the goal of environmental remediation at Cerro de Pasco.”

Of course, there is also the potential for a healthy business with some 70mln tonnes of tailings and 100mln tonnes of stockpiled ore.

That is the largest surface deposit of metals anywhere in the world and it is by processing this that Zadka also sees the opportunity to tackle the historic pollution that has dogged the adjacent city for decades.

“The tailings are old at circa 1920 while the stockpile built up between1950 until 1990.

“These are mining environmental liabilities that are creating hazards to the environment.

“We will start with the tailings and the stockpile and by processing these will effectively clean up the environment because we will remove them from their current location.

 “Experts agree that the only way to resolve the problem is to reprocess and store what comes out from the processing plant in a modern storage facility that can contain it.”

CDPR is looking at opportunities for all the metals at the polymetallic mine.

That includes pyrite and strategic metals as well as traditionally mined commodities such as silver, lead, zinc, copper and gold.

Originally, CDPR just had rights to the tailings and stockpiles but in a US$30mln deal finalised last month it agreed to buy the mine as well and that brings with it a processing plant and concentrator.

Zadka says: “We saw this as a great opportunity as we would be able to utilise that infrastructure to process the above-ground tailings and stockpile.”

Everything at Cerro de Pasco is connected, he adds.

“Water pumped from the mine infiltrates underground into the stockpile and then flows through into the tailings.

“You need to address the whole system under one roof and strategically decide what goes first, second and third.

“That's what we can achieve now after this acquisition.”

Acquiring the operating mine and associated infrastructure will cost US$30mln, with current owner Volcan to be paid US$15mln on the deal closing and the final US$15mln on the first anniversary.

Volcan will also receive a variable payment on the gold and silver produced from the oxide plant plus take zinc and lead concentrate.

While the mine is currently operating it estimated that around  US$100mln will be needed for refurbishments and amplification of production to 20,000 TPD, which is scheduled for later in 2020 as CDPR has had to re-submit its current environmental impact assessment to include the resources within the mine.

Zadka says CDPR has a seventeen-year remediation plan for Cerro de Pasco, which also includes some additional mining of the West Wall which would bring total production to 30,000tpd.

Support for the plans from the local community is strong, he adds, even though the relationship between the mine and parts of the city’s 50,000 inhabitants has become fractured.

Indeed, the Peruvian government has even proposed the city and its people be moved although no progress has been made on this despite the law being passed in 2006.

“The level of poverty in Cerro de Pasco City is extremely high,” says Zadka, with some people literally living on top of the mine.

He says CDPR is ‘very interested’ in the moving project but adds this is something for the future when the company has become more established.

For the next year, the plan is working on completion and bringing the tailings into production plus some confirmation to confirm the existing resource.

But it's not just planning for this year, it's planning for the future, he says.

The mine life is seventeen years but with the right steps it can go on for another fifty.

Quick facts: Cerro De Pasco Resources

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