Augusta Resource Corporation’s clean air permit application for its planned Rosemont copper mine could be facing further delays after a state regulator said the application may need to be revised.
The Arizona Daily Star reported Monday that recent changes to Augusta’s mining plan calling for a 22 percent increase in sulfide copper production above the projections Augusta used when it submitted its air permit application in 2011 is raising concerns with regulators.
Trevor Baggiore, deputy director of the Arizona Department of Environmental Quality’s air quality division, told the Star that if higher sulfide production produces more emissions, Augusta “would have to come back and revise their permit before they increase production.”
Vancouver, B.C.-based Augusta, which owns the Rosemont Copper Company, made sweeping changes in July to its mining plan for the proposed open-pit copper mine in the Santa Rita Mountains on the Coronado National Forest south of Tucson.
Augusta said it was abandoning its plan to mine and process about 70 million tons of oxide ore located near the surface of the proposed mile-wide, half-mile deep mine. At the same time, the company said it would sharply increase production of sulfide ore deeper in the pit.
Augusta’s regulatory filings indicate the increased production comes primarily from lowering the “cutoff” grade for acceptable ore than can be profitably processed rather than discovering new copper reserves. The company lowered its cutoff grade based on higher projected copper prices.
Augusta also slightly lowered the average grade of copper that is now included in its increased mining projections.
In 2009, Augusta stated there were 546 million tons of proven and probable sulfide copper ore reserves with an average grade of .45 percent copper.
Augusta increased the amount of proven and probable sulfide copper ore in its August 2012 Feasibility study to 661 million tons with an average grade of .44 percent copper.
Augusta is projecting that most of the increase in sulfide copper production will come in the latter years of the project.
The company projects 83 million tons of the 116 million tons of increased copper sulfide production will occur between years 11 and 21 of the project. Most of this increased production, 63 million tons, is projected between years 16 and 21.
Augusta’s sweeping changes to its mining plan is increasing political opposition to the mine. U.S. Representatives Raul Grijalva and Ron Barber, both Democrats, want the U.S. Forest Service to require Augusta to prepare a new Draft Environmental Impact Statement for public review.
The state’s concerns about the timing of Augusta’s air permit application and subsequent substantial changes to the mining plan along with political pressure to submit a new DEIS come at the same time Augusta has suspended engineering design on the mine.
The company disclosed in an August regulatory filing that engineering work had been suspended in July 2011. The suspension of engineering raises questions over how Augusta is preparing for the significant changes to its mining plan and impact on pending permits.
The company’s air permit application was submitted in late 2011, and subsequent changes to the mining plan of operations were not announced until July 2012. Augusta’s DEIS submitted to the Forest Service is also based on the old mining plan that included oxide ore production and much lower sulfide ore production.
The lack of ongoing engineering could delay construction and increase overall costs of the project, the 2012 Feasibility study (large file warning) states (page 245-246).
The total initial capital cost of the mine has already increased to $1.226 billion, up 32 percent from a 2009 Feasibility Study.