Copper plan cast in doubt as costs soar
The estimated cost of developing the Petaquilla copper project in Panama has more than doubled, to $3.5 billion (U.S.), due to higher costs and design changes, according to stakeholders Inmet Mining, Petaquilla Copper Ltd. and Teck Cominco Ltd.
Projected cash costs per pound of copper also rose, about 12 per cent, leading to debate among the three firms about whether to go ahead with the project, Jochen Tilk, Inmet’s president and chief operating officer, added yesterday.
"When you look at the capital costs and operating costs, it’s not a slam dunk," Tilk said in an interview.
"But, going forward, we think this is a very consistent pattern in the industry.
"It’s very hard to believe there is another project of the quality of Petaquilla that could be developed at any lower development cost."
The $3.5 billion price tag is up from a $1.7 billion estimate the companies issued slightly more than a year ago pay day loans.
That estimate was based on a 1998 feasibility study of Petaquilla, which is considered to be one of the biggest undeveloped copper projects in the world.
The cash costs are now expected to be about 85 cents per pound of copper produced in the first 10 years of the project, up from 76 cents a pound in the January 2007 estimate.