The construction decision is based on a construction capital expenditure estimate of US$197 million for the Pumpkin Hollow underground project, and Nevada Copper continues to expect first concentrate production in the December quarter of 2019.
Pre-construction activities at the site have been ongoing since May 2018, and transition from pre-construction works to full-scale construction of the underground project is expected to commence shortly. The project execution plan includes additional benefits from recent value engineering and detailed design.
Matt Gili, president and CEO of Nevada Copper, said: "We are very excited to commence full-scale construction of the Pumpkin Hollow underground project, which will include the processing plant and completion of the underground mine.
"Delivery of the underground project is the first key step in our strategy of capital-efficient, phased growth from our base in Nevada. I would like to thank all our shareholders and stakeholders, including our financing partners Triple Flag and Red Kite, for their support as we proceed with construction, targeting first copper production in 2019."
In connection with the construction decision, Nevada Copper has awarded a mining contract for shaft sinking and underground mine development work at Pumpkin Hollow to Cementation USA. This follows the earlier pre-works programme carried out by Cementation at Pumpkin Hollow to prepare the existing shaft and hoist infrastructure in advance of commencement of underground construction activities.
In addition, Nevada Copper has awarded an engineering, procurement and construction (EPC) contract for the surface plant and infrastructure to Sedgman USA, a member of CIMIC Group, for a fixed price of US$118 million.
The EPC contract follows several months of a detailed engineering and design programme conducted by Sedgman, incorporating a number of significant improvements to the earlier pre-feasibility study for project published in November 2017.
The fixed price nature of the EPC contract provides Nevada Copper with significant cost protection for project delivery and the use of a leading mineral processing EPC contractor with knowledge of the project further de-risks project execution during ramp-up.