Marimaca Positioned as a Premium Copper Operation

Published on 13 Jun 2024

In an in-depth conversation with Mining Journal’s Chris Cann, Marimaca’s Chief Executive, Hayden Locke, delves into the strategic advantages and prospects of the Marimaca copper project in Chile. This video is a must-watch for anyone interested in the dynamics of the copper mining industry, particularly in the context of how Marimaca is setting itself apart as a premium operation. Here’s a closer look at the key highlights covered in this engaging discussion.

Core Project Metrics and Global Positioning

The interview starts with a detailed examination of the production metrics of the Marimaca project. Chris Cann probes into the initial production figures from the Preliminary Economic Assessment (PEA) conducted in June 2020, which outlined a production of 36,000 tons of copper per year. Hayden Locke provides an insightful update, explaining how the project has evolved since then. The most recent resource estimate in 2023 doubled the contained copper resource, setting the stage for a definitive feasibility study (DFS) that is expected to reflect a significant increase in scale, potentially targeting around 50,000 tons per year.

Locke emphasizes that while Marimaca remains relatively small on a global scale, its efficient, lean operation, and robust economics make it a standout in the current mining landscape. He points out that in the new climate of global mining, “small is beautiful,” highlighting the project’s potential to offer strong returns on invested capital despite its modest size.

Geological and Strategic Advantages

One of the most intriguing parts of the discussion revolves around Marimaca's geological setting. Located in the low coastal range of the Chilean Sierra, this region is not typically known for large porphyry copper deposits. Locke explains how Marimaca’s management team challenged this conventional wisdom and made a significant IOCG (iron oxide copper gold) discovery. This type of deposit, while less common, offers unique advantages and has the potential to be quite large, as evidenced by the Olympic Dam.

Locke also addresses a critical question: why hasn’t a project like this been developed sooner? He attributes it to major mining companies' geological perceptions and exploration focus, which tend to seek out large porphyry deposits. Marimaca’s ability to identify and develop a substantial IOCG project in this region underscores its team's innovative and bold approach.

Economic Viability and Feasibility Study

The conversation then shifts to the economic metrics outlined in the PEA, which utilized a conservative copper price assumption of $3.15 per pound. Locke hints at the improvements expected in the upcoming DFS, driven by updated commodity price assumptions and optimized project parameters. Despite global inflationary pressures, Locke remains confident that Marimaca’s capital intensity and operating costs will remain competitive. He forecasts that the project will likely position itself at the top of the first quartile or the bottom of the second quartile regarding all-in-sustaining costs.

Locke’s confidence is bolstered by Marimaca’s advantageous location, close to essential infrastructure such as ports and supply chains, significantly reducing execution risk and costs. He underscores the importance of having up-to-date and accurate cost data, especially given the volatile nature of commodity prices and economic conditions.

Leadership and Management Expertise

A critical component of any successful mining project is its leadership team. Locke outlines Marimaca's transition from an exploration and development company to a mine builder. The company is strategically building out its capabilities with experienced board members and senior management with a proven track record in the mining industry.

At the board level, figures like Clive Newall, a founder of First Quantum, and John Carlo Bruno, with extensive experience from Capstone and Anglo-American, bring a wealth of knowledge and expertise. Leonardo Heresio, formerly VP of Capital Projects for Barrick in South America, leads the project development efforts in the management team.

Locke acknowledges his experience and expresses a readiness to adapt and grow with the project while also being open to bringing in additional expertise as needed. This pragmatic approach to leadership is crucial in ensuring that Marimaca is well-positioned to navigate the challenges and complexities of mine construction and operation.

Learn More From The Experts

Watch this insightful video to gain a deeper understanding of the Marimaca copper project and its potential impact on the mining industry. Hayden Locke’s detailed explanations and transparent discussion of the project’s metrics, challenges, and opportunities offer valuable insights for investors, industry professionals, and anyone interested in the mining sector. Don’t miss the chance to hear firsthand from Marimaca’s Chief Executive and better understand what makes this project a standout in the industry.