Morococha (89.4%)
Pan American concluded the Morococha mine acquisition in August, 2004. Morococha is an underground, polymetallic vein mine located in the Junin district, approximately 50 kilometers southwest of the Company's Huaron mine.
History:
The Morococha district has been mined continuously for more than 100 years and lies within one of the world's most prolific mineral belts for polymetallic vein systems. Neighbouring mines include Yauliyacu, San Cristobal and Andaychacua. Morococha hosts a very large and prolific network of veins, mantos, chimneys, skarns and other replacement bodies within a mineral rights package covering 110 square kilometers of concessions that make up some of the most prospective ground in the Company's portfolio.
Operating Statistics:
|
2007 |
2006 |
2005 |
Tonnes Milled |
609,540 |
577,201 |
467,521 |
Silver ounces |
2,870,000 |
2,923,267 |
2,736,393 |
Zinc tonnes |
17,133 |
18,115 |
15,689 |
Lead tonnes |
6,085 |
5,722 |
5,875 |
Copper tonnes |
2,088 |
1,546 |
925 |
| Gold ounces |
1,306 |
1,019 |
1,741 |
Cash cost per ounce |
$(2.16) |
$ (3.71) |
$ 2.61 |
Mineral Reserves:
|
Tonnes |
Silver Grade
(g/tonne) |
Contained Silver
(ounces) |
Proven |
4,131,000 |
148 |
19,693,000 |
Probable |
2,540,000 |
152 |
12,427,000 |
Total |
6,671,000 |
150 |
32,120,000 |
Calculated as at December 31, 2007 using the silver price of US$11.00 /ounce.
Mineral reserve estimates for Morococha were prepared under the supervision of, or were reviewed by Michael Steinmann, P.Geo., Sr. VP Geology & Exploration, and Martin G. WAfforn, P.Eng., VP of Mine Engineering, as Qualified Persons, as the term is defined inNI 43-101.
Tonnes are shown for 100% of the Morococha property. Pan American, through its subsidiary Pan American Peru, has a 89.35% voting interest in the Morococha property.
2006 Summary:
Peruvian operations accounted for 71% of Pan American’s total 2006 silver production with Morococha producing 2.9 million ounces. Pan American's investments in mine infrastructure and development as part of the company's program of modernizing the operation, continued to generate better than expected results. The mine achieved higher throughput rates and better recoveries which allowed it to overcome lower than expected grades to post record silver production. Mill capacity has increased by 20% over the last two years, and is now processing at a rate of approximately 55,000 tonnes per month, up from the 42,000 tonnes per month when the mine was acquired.
During 2006, exploration efforts at the Morococha property contributed to a 57% increase in proven and probable reserves. There are between eight to ten drill rigs active at any time on the property and 40,000 metres of drilling is expected through 2007.
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