Vancouver backer of giant Arizona copper mine surges 80% on environment study

24 December 2013 | 13:50 Code : 22070 Geoscience events
Augusta Resource Corp. (TSE, NYSEMKT:AZC) screamed more than 80% higher on....

Augusta Resource Corp. (TSE, NYSEMKT:AZC) screamed more than 80% higher on Thursday after announcing the US Forest Service has completed the final environmental impact statement for its massive Rosemont Copper project.The Rosemont Copper project near Tucson, Arizona would be the third largest copper mine in the US and the impact statement follows an exhaustive six-year review process. Augusta now expects a water use permit for which it has already secured the rights and the final so-called record of decision from environmental authorities in the US in the first quarter of next year, with construction starting in the second half of 2014. Rosemount mine construction and commissioning is pegged at $1.23 billion of which more than $100 million has already been spent with planned production scheduled for 2015. Augusta has inked a deal with streaming company Silver Wheaton which in exchange will inject $230 million in up-front cash payment for 100% of Rosemont’s life of mine gold and silver production. The Vancouver-based company also has a $106 million deal with Korean investors, leaving it to raise $890 million for capex. At the close Augusta shares were trading up 63.7% at $1.68 on the NYSE MKT, with the counter adding another 12.5% in after hours trading to bring its gains on the day to 83.5%. More than 950,000 shares changed hands versus normal volumes for the stock of 330,000.The $242 million company is still showing losses for 2013 – it is down 37% year to date.At full tilt Rosemont could account for about 10% of annual US copper output, producing 243 million pounds of copper per year, 5.4 million pounds of molybdenum, 2.9 million ounces of silver and small quantities of gold as a by-product over a mine life of more than 22 years.Augusta estimates production costs of just $0.87 a pound of copper compared to today’s price for the red metal of $3.20.


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