Background

El Pachón is a bi-national project, developed under the auspices of the Mining Integration Agreement signed between Chile and Argentina in 1997.

It consists of a 100 hectare area for the development of an open pit copper mine, located in the District of Calingasta, in San Juan province in Argentina, five kilometres from the Chilean border. On the Chilean border, the project will include the necessary infrastructure to transport the product from the mine to a port on the Pacific Ocean.

El Pachón is located between 3,100 metres and 4,500 metres above the sea level. The sector under study includes the basins of the Pachón, Mondaca, Camicería and Arroyo Mondaquita as well as part of the Santa Cruz river. The nearest village to the camp is Barreal, 150 kilometres away.

Since its discovery in 1964, El Pachón has been explored by different companies and, in 2002, was reactivated by international companies. In September 2006, Xstrata plc acquired the ownership of the El Pachón project, as part of its global takeover of Falconbridge.

According to the latest studies, the ore body has the potential to produce an average of 200,000 tonnes a year of copper concentrate during its working life (around 20 years), with grades of 0.65% copper, 0.015% molybdenum and 2.65 g/t of silver.