Baja Mining Corp. (TSX:BAJ; OTCQX:BAJFF) said Tuesday it is ready to break ground on a copper-cobalt-
zinc-manganese project located near Santa Rosalia, Mexico, after raising US$858 million in September and, more recently, $184 million in bought-deal financing.
The Vancouver company expects to begin moving earth at its Boleo project within a month, and expects to reach copper production by 2013.
Baja Mining owns a 70% interest in Boleo, with a Korean syndicate of industrial companies holding the remaining 30%.
The project has 265 million tonnes of measured and indicated resources, including roughly 70 million tonnes of proven and probable reserves and roughly 165 million tonnes of inferred resources.
The project has a minimum scheduled mine life of 25 years with an ore body value of US$1.306 billion.
John Greenslade, Baja Mining’s president and CEO, told BIV Tuesday the company began preparing for construction two years ago in anticipation of having its bank financing in place.
The financial downturn de-railed that financing, and construction plans were halted.
Of the company’s successful second attempt at project financing, Greenslade said: “It’s probably one of the largest financings done by a junior company in Canada.”
Bank financing was structured using $1.75 per pound of copper. The mineral’s current market price is $3.70 per pound.
“We should be out of bank debt with in three years at current metal prices,” said Greenslade. “[The mine] has a long life, a reasonable amount of metal, and its very low cost.”
Baja Mining initially began development of the Boleo project, which is the company’s sole project, in 1992.