Overview
The 100%-owned Project is a Porphyry Copper project located on private land, near the city of Casa Grande, Arizona, USA. The city of Phoenix and Sky Harbor International Airport are situated approximately 55 miles to the north and Tucson is approximately 75 miles to the southeast. The property location provides easy access to infrastructure and amenities such as power, water, rail, roads and a skilled workforce. The Project itself covers approximately 5,000 acres (with the remainder of the land package covering additional exploration properties).
As of December 31, 2022, a total of $53 million has been incurred in capitalized exploration expenditures in respect of the Project. This includes the technical work required for the integrated 2021 PEA, demonstrating initial project economics of all leachable material including the Stockpile Project, Cactus West, and Cactus East, and the 2022 update including Parks/Salyer's mineral resource estimate. Further details of the PEA are provided below. The Company is currently advancing the Cactus Project, inclusive of the Parks/Salyer deposit to a Pre-Feasibility Study (“PFS”), and subsequently to a Definitive Feasibility Study (“DFS”) stage (subject to a positive outcome from the PFS).
The Cactus Project, previously known as the Sacaton Mine, was owned and operated by ASARCO from 1972-1984. The mine was shut down due to economic conditions. The property has since undergone a $20 million reclamation program under the guidance of the ASARCO Trust and the Arizona Department of Environmental Quality. The reclamation program remediated the property, excluding the surface Stockpile.
The core shack, return water impoundment and water wells, rail spur, power lines and roads are in good condition and have undergone some renovation since the acquisition. The vent raise and shaft are still in place but have not been accessed since the initial shut down of Sacaton Mine. An environmental baseline study has been completed for the Cactus Project and work is steadily progressing through project permitting.
Arizona is a Tier 1 mining jurisdiction, as the USA's top copper-producing state and accounting for 70% of domestic output of copper in 2022 (Fraser Institute). It is also an established and attractive mining jurisdiction, ranking No. 7 in 2022’s Investment Attractiveness Index by the Fraser Institute.
Geology
The Cactus deposits represent a portion of a large Porphyry Copper system that has been dismembered and displaced by Tertiary extensional faulting. Major host rocks at Cactus are Precambrian Oracle granite and Laramide monzonite and quartz monzonite porphyries. The porphyries intruded the older rocks to form mixed and monolithic breccias that occur as large masses, poorly defined dike-like masses, and thin well-defined but discontinuous dikes. The deposit is structurally complex with intense fracturing, faulting, and both pre-mineral and post-mineral brecciation. It is bounded on the east and west sides by normal faults.
Pending Pre-Feasibility Study (“PFS”)
Due to the significant increase in the Company-wide Mineral Resources, the oxide and enriched material at Parks/Salyer will be considered for inclusion in the future technical study integrating both the Cactus and Parks/Salyer deposits. Future studies will be based on the expanded leachable (oxides and enriched) inventory, approximately 75% of the total mineral resource, into a simple heap leaching and SX/EW flowsheet.
Ausenco has been appointed as lead engineering firm for the Cactus & Parks/Salyer Integrated PFS. In addition to its own technical staff, Ausenco is leading a technical consultant team comprised of Samuel Engineering, AGP Mining Consultants, Stantec, MineFill Services, Clear Creek Associates and Call & Nicholas Inc. (collectively the “PFS Consultants”).
The PFS Consultants are reviewing a Cactus draft PFS, which began prior to the declaration of Parks/Salyer maiden resources and will be integrating the two projects into a new re-scoped and step-up PFS. The study will explore a simple heap leach operation, targeting a potential of 45,000 tons per annum of LME Grade A Copper Cathode from an onsite Solvent Extraction/ Electrowinning (SX/EW) plant. Mineralized material will be sourced from four deposits initially, including the Stockpile, Cactus East, Parks/Salyer and Cactus West.
As part of the PFS work for the project, ASCU and its PFS Consultants will complete trade-off and optimization studies and detailed mine production scenario analysis in the following areas:
- Mineralized material sources from an open pit expansion (Cactus West), underground development (Cactus East and Parks/Salyer), and the existing Stockpile
- Ore handling, storage, and agglomeration
- Leach pad design and operation
- Acid storage, consumption and handling
- Solvent extraction and electro-winning
- Existing and new infrastructure (as required)
- Preliminary design of access roads in coordination with mine access roads
- Preliminary design and location of mine support facilities
- Mine and geotechnical design
Critical technical work ahead of detailed mine planning continued in Q2/2023. The PFS Consultants continued reviewing past process studies to confirm those inputs remain valid, and also reviewed the previous mining trade-offs to determine expansion, as needed. Mining method studies are ongoing for the different options for Cactus East and Parks/Salyer. The results of these technical works are being reviewed internally with anticipated mining method and costing to be determined in Q3/2023. The PFS remains on schedule to be completed in Q1/2024.
Infrastructure and Permitting
As a brownfields project, the property benefits from significant ready infrastructure, including electric power available through a transmission line connected to an existing substation at the mine site, water access to a permitted industrial-use aquifer and proximity to a rail line for future transportation, as required.
Being situated on private land streamlines the permitting process by reporting to State, County and City levels. ASCU has successfully obtained major permits required for the Cactus redevelopment, including a positive JDS determination in 2022, stating there are no Waters of the United States flowing through the property. The determination acts as a State and Local led permitting process confirmation.
The Company, including its executives, employees and contractors, ensure each decision is made based on Our Core Values and Good Governance practices in support of the project, the community and the environment.