Xstrata Announced Plans to Increase Ore Production by a Further 33% to 1.6 Million Tonnes

Xstrata Zinc announced plans to increase ore production by a further 33% to 1.6 million tonnes per annum at its high-grade Lady Loretta mine in north-west Queensland, Australia. The greenfield underground zinc-lead-silver Lady Loretta mine commenced ore production ahead of schedule in September. Commercial-scale mining is due to commence in mid-2013 and the expanded production rate of 1.6 million tonne per annum level is expected by 2016.

Lady Loretta was originally designed to produce one million tonnes of ore per annum, but Xstrata Zinc’s project teams have continued to assess opportunities to increase maximum output. An internal study identified an opportunity to increase the maximum output of the Lady Loretta mine by reviewing stoping sequences over the life of mine, the second project announced this year to accelerate production. This latest expansion increases maximum output by 60% over the original mine plan through a AUD 59.2 million (USD 60.4 million) project and brings the total investment to develop the mine to date to AUD 362.2 million (USD 356.4 million).

Mr Brian Hearne COO of Xstrata Zinc Australia said that “This increase in high-grade ore supplied to our Mount Isa processing facilities reflects Lady Loretta’s important place in our regional production profile. The expansion project will allow the earlier recovery of resources from several of Lady Loretta’s upper ore bodies and will increase the number of stoping levels available in the underground mine in future years. To achieve this, we are investing in larger ore handling facilities, increased mobile and fixed plant equipment including an expanded ventilation system, more village accommodation and utilities upgrades.”

Construction is well advanced on the concrete batch plant, paste plant, warehouse, fuel farm and power station with surface infrastructure now 56% complete. The operation will employ a permanent workforce of more than 200 people.

The Lady Loretta deposit contains an estimated 12.7 million tonne reserve, consisting of a 14.2% zinc and 4.8% lead grade, alongside 84 grams of silver per tonne. The amount of zinc metal contained is assessed at 1,803kt and lead metal contained at 610kt.