MMG signs rail agreement for Peru copper mine
PERTH (miningweekly.com) – Metals miner MMG has secured a transport agreement for its $7-billion Las Bambas copper project, under development in Peru.
The rail agreement with Perurail provided for the transportation of copper concentrates from Pillones transfer station to the Port of Matarani, 295 km away, the ASX-listed company reported on Wednesday.
The agreement would start in January 2016 and would run for a period of 15 years, with an option to renew for a further 15 years.
The contract was worth an estimated $489.3-million for the initial 15 years.
“By using rail transportation where available we will significantly reduce heavy vehicle traffic between Pillones and the Matarani port – improving safety conditions for communities and reducing congestion,” said MMG CEO Andrew Michelmore.
To ensure equipment was in place to meet the project timetable, MMG previously entered into purchase contracts for rail wagons, containers, turning equipment and locomotives. Perurail would buy this equipment for $76.1-million.
Truck haulage services would be separately provided by an independent third party to transport the concentrate from the Las Bambas project to the Pillones transfer station, for onwards transport by rail.
MMG, meanwhile, reported that construction of Las Bambas continued to progress to plan, with the overall project 90% complete at the end of March 2015.
Based on an ore reserve of 6.9-million tonnes and a mineral resource of 10.5-million tonnes, Las Bambas was expected to be one of the top three copper producing mine in the world once it reached full production.
The openpit mine was expected to have a mine life of some 20 years, and was expected to produce two-million tonnes of copper in concentrate in its first five years of operation.
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