Adventus Mining (TSXV: ADZN) and Salazar Resources (TSXV: SRL) have achieved a significant milestone by completing the first phase of consultation activities for the environmental and social impact assessment (ESIA) of their jointly owned El Domo – Curipamba copper-gold project in Ecuador.
The ESIA consultation process, overseen by the government of Ecuador, follows the technical approval of the ESIA in May 2022 and adheres to the new environmental consultation regulation decree signed by the President of Ecuador in 2023, according to Adventus, the majority owner of the project.
The first phase of the consultation process marks the midpoint of the final stage in the ESIA approval process initiated in June 2023. The next step involves the issuance of a public summary report by MAATE (Ministry of Environment and Water), expected to be released in August, followed by the final phase of consultation activities.
Anticipated Progress and Background of the Project
Adventus and Salazar Resources expect the El Domo environmental license to be approved by the government of Ecuador in the second half of 2023. Following this approval and final funding arrangements, construction activities are scheduled to commence during this period.
The El Domo – Curipamba project is considered by Adventus as the future modern mine in Ecuador, capitalizing on its high copper-gold grades and low capital intensities compared to global standards. El Domo, a high-grade deposit within the approximately 21,500 ha Curipamba property, is located 150 km northeast of Guayaquil, a major port city in central Ecuador.
In 2017, Adventus and Salazar entered an agreement whereby Adventus could earn a majority interest in the Curipamba project by investing $25 million in exploration over five years and meeting specific development obligations, including a feasibility study for the El Domo deposit’s development.
Adventus is set to fund capital costs to production and receive 95% of the free cash flows until its investments since 2017 are repaid, after which project cash flows will be shared at a ratio of 75% to Adventus and 25% to Salazar. In late 2021, Adventus completed its earn-in option, obtaining majority ownership of the Curipamba project.
The feasibility study completed in 2021 estimated mineral reserves (proven and probable) for the El Domo deposit, totaling 6.5 million tonnes at 1.93% copper and 2.52 grams per tonne gold. The study showed a post-tax internal rate of return of 32% and a net present value (at an 8% discount rate) of $259 million for initial open-pit development only, with a mine life of 10 years. The initial capital cost was projected at $248 million, with the possibility of an additional $49 million to the NPV with a potential underground mine option in years 10 to 14.