Jim O’Rourke Explains the Ascent of Copper Mountain
By Kevin Michael Grace
2010 Vancouver Mining Forum Special
In mining, Jim O’Rourke is the embodiment of “been there, done that.” He’s worked all round the world, with junior miners and companies as big as Placer and Newmont, and he has served with the Mining Associations of BC and Canada. So when O’Rourke, now CEO of Copper Mountain Mining Corporation, speaks at Canaccord’s 2010 Vancouver Mining Forum, October 14, he will bring a wealth of experience second to none.
The Copper Mountain Mine, which is scheduled to go into production next year, is located 15 kilometres south of Princeton, BC. The mine, which is 75% owned by CMMC and 25% by Mitsubishi Materials Corporation, has a 2009 NI 43-101 measured and indicated resource of 3.2 billion pounds copper, with 1.8 billion pounds inferred. There are currently 360 employees on site, with long-term employment calculated at 260 jobs. O’Rourke notes, however, that these figures “don’t include any of the services, such as trucking of concentrate to Vancouver or the handling of it there.”
When asked about the steps that led to Copper Mountain’s success, O’Rourke has a checklist. No. 1: Low political risk. “The mayor of Princeton is thrilled and has strongly endorsed our project,” O’Rourke relates. “The local area has been strongly supportive as well. In May, we had a Family Day, and about 680 people showed up. The Minister of Mines and the Speaker of the House both gave speeches.”
No. 2: Low technical risk. O’Rourke explains the mine was first operated in 1927, closed and then reopened by Newmont. He says, “I was president of Princeton Mining when we bought it from them in 1988 and ran it until 1996.” A decade later, “We thought it still had potential and raised about $5 million privately and immediately started drilling. We did a 40,000-metre drill program and that confirmed the continuity of mineralization between the existing pits and also the continuity of mineralization at depth. And that gave us what we call our superpit. In 2007, we went public.”
O’Rourke continues, “The current mine plan is for 35,000 tonnes a day, which is just over a million pounds a month, and we have a 17-year mine plan. That will produce about 105 million pounds of copper for the first 12 years.”
In addition, “We have good growth potential. We have a claim block of about 18,000 acres [7,300 hectares] and we have excellent exploration potential on site, which we are following up. In 2007, we contracted with a company to do the Titan 24 Deep Earth imaging program over our site. They took an area about 3.5 kilometres square, laid electrical cables on the ground and introduced electricity into them. There was high chargeability, and this has given us excellent targets both under pit and also in other areas of the deposit.”
I think in the short term the supply of copper is going to be very tight —Jim O’Rourke
No. 3 on his checklist: A product that is readily saleable. O’Rourke elaborates, “I think in the short term the supply of copper is going to be very tight. A lot of the forecasts are in the $3 dollar range for the next 10 to 12 years. Our feasibility study is based on $1.80 per pound. It’s a question of supply and demand. Global consumption rises about 3% a year. You have copper going into energy-saving devices, like hybrid and electric cars. Meanwhile, China is growing in leaps and bounds. They are building a substantial number of power plants every week, and that takes copper.”
He continues, “With regard to the existing mines there’s been deterioration. As they grow older, their grades and production decrease. We see this to a large extent in Chile, and this is putting a squeeze on supply.”
No. 4: Existing permits, good management, a skilled workforce and a partially developed infrastructure.
O’Rourke is not ashamed to admit that No. 5 is “good luck. Everything’s fallen into place favourably and allowed us to move forward quickly.”