Cascabel Copper-Gold Project, Ecuador

The revised study also investigated expansion of the process plant, extension opportunities, alternate mine access methods, and tailings storage facility options.

SolGold announced the results of PFS in April 2022.

According to the study, Cascabel Process plant will produce 2.8Mt copper (Cu), 7.6Moz gold (Au) and 21.7Moz silver (Ag) over the initial life of 26 years. The first ore from the project is expected in mid-2029.

The initial cave development, first process plant module and other infrastructure is expected to cost $2.7bn.

The Definitive feasibility study (DFS) for Cascabel project is scheduled to be completed in the second half of 2023.

In July 2023, ENSA agreed upon a term sheet with the Government of Ecuador for the execution of the exploitation agreement for the Cascabel project. Under the agreement, ENSA negotiated to develop the project and produce copper, gold, and silver from the contract area for a period of 33 years, with an option for renewal.

Cascabel Project Location

The Cascabel project is located in northern Ecuador, around three hours’ drive from the capital of Quito.

The concession area has three small settlements- Santa Cecilia Village, Rocafuerte Office Complex and the Alpala Base Camp, while another four are located near the project area.

The elevation at the site ranges from 750m to 2,140m above sea level.

Geology and Mineralisation

The Cascabel project is located within the Cordillera Occidental part (or Western Cordillera) of the Ecuadorian Andes. The property is situated at the margins of a large regional batholith and in the middle of the confluence of a major northeast trending fault zone.

The deposit’s major host rock types are gabbroic and basaltic basement rocks, overlain by Cretaceous siltstones and minor sandstones which are again overlain by a sequence of Tertiary volcano-sedimentary and andesitic lavas.

The main target in the Cascabel concession is the Alpala deposit. The deposit’s equigranular to sub-porphyritic, hornblende-bearing intrusions are defined as narrow, and they become thinner upwards, and are geometrically similar to grade models of Cu, Au and Ag mineralisation.

Mineralisation is identified as a prolate body approximately 2,400m northwest by 1,200m northeast and 2,800m in vertical extent.

Cascabel Project Reserves

At a cut-off grade of 0.21% copper equivalent (CuEq), the Alpala porphyry copper-gold-silver deposit comprises 2,663Mt at 0.53% CuEq in the Measured and Indicated categories. In the Inferred category, the deposit contains an additional 544Mt at 0.31% CuEq.

The Tandayama-America deposit, which is situated around 3km north of the Alpala deposit, contains potentially open pittable Mineral Resources of 356.5Mt at 0.36% CuEq in the Measured and Indicated categories, and an additional 35.7Mt at 0.36% CuEq in the Inferred category, at a cut-off grade of 0.16% CuEq.

Only measured and indicated resource categories were converted and assigned to the Mineral Reserve for the Cascabel Project Alpala underground deposit.

The initial Mineral Reserve estimate includes 558Mt (probable) with 0.58% Cu, 0.52 g/t Au and 1.65 g/t Ag for 3.3Mt Cu, 9.4Moz Au and 30Moz Ag respectively.

Mining and ore processing

SolGold aims to develop Cascabel as one of the lowest carbon intensive copper mines in the world. The company is assessing different steps such as maximising power from hydro-generation sources, electrification of the mining fleet and integrating processes to optimise operational efficiency in a bid to minimise Scope 1 and Scope 2 greenhouse gas emissions.

The project is expected to use block caving underground mining method due to the size, grade, ground conditions and depth of the Alpala deposit.

The Alpala underground mine will be accessed via twin declines commencing from a box cut located near the surface and the first lift near the 300mRL.

Some areas of the deposit may be mined using other bulk underground methods such as sublevel caving.

The 2022 PFS indicates an estimated average production of 132 Kilo Tonnes Per Annum (ktpa) of copper, 358kozpa of gold, and 1Mozpa of silver, with peak copper production of 210ktpa (391ktpa CuEq).

The crushed ore from the underground primary crushers will be transferred to the secondary crushing circuit and from there to the fine ore stockpile and reclaimed to the high-pressure grinding rolls (HPGR) circuit.

Then, from the HPGR circuit, the product will be sent to a grinding circuit comprising ball mills, each operating in a closed circuit with a hydrocyclone cluster.

Subsequently, the cleaner concentrate will be thickened and transferred to port for further thickening and filtration to meet marine transport requirements.

The cleaner scavenger tailings are transferred to the gold recovery circuit, while a pyrite flotation circuit is used to recover pyrite, gold and silver to concentrate and then sent to the CIP plant.

Over 26 years, the process plant will produce 2.8Mt Cu, 7.6Moz Au and 21.7Moz Ag.

Key Infrastructure and Accessibility

The Cascabel Project process plant and mine can be accessed via a new section of road starting from the E10 highway that runs along the Rio Mira River valley. The Port of Esmeraldas is the proposed port location for the project.

Power required for the operations will be supplied via the expansion of the Pimampiro 230kV substation.

Other project infrastructure will include administration buildings, Waste Management Facilities, Tailings Storage Facility and Parambas Water Storage Facility among others.

Contracts and Agreements

The technical report on the Pre-Feasibility Study for Cascabel Project was prepared by officials from Mining Plus, Knight Piésold, Wood Australia and Wood Mackenzie.

In 2019, SRK UK was contracted to acquire data to support the preliminary economic assessment and subsequent PFS.

In November 2022, SolGold signed a binding agreement with Osisko Gold Royalties for a $50m royalty financing for the Cascabel project. Pursuant to that agreement, Osisko will receive a 0.6% NSR interest from SolGold.