Mitsui Mining & Smelting to Expand Zinc Mining at Palca

Mitsui Mining & Smelting increases the zinc ore output at Palca mine of Peru, which started full operation in late March. The mine plans to produce 450 tonnes per day of crude ore and annual 153,000 tonnes in the 340 days operation in fiscal 2006 to March 2007. The firm will increase the output to 500 tonnes per day and annual 170,000 tonnes in fiscal 2007. The firm tries to increase the output by 20% to 600 tonnes per day and annual 204,000 tonnes in fiscal 2009 from fiscal 2007. The new mine is second zinc mine for the firm. The mine produces ore with 11.6% of zinc. The mine plans to produce 153,000 tonnes of crude ore, 31,000 tonnes of zinc concentrate, which represents 15,000 tonnes of zinc, and 1,600 tonnes of lead concentrate, which represents 800 tonnes of lead, in 2006. The mine expects US$ 2.7 million of recurring profit with US$ 14 million of sales for fiscal 2006. The mine uses ore treatment facilities including concentrator at Huanzala, which is around 40 kilometers north of Palca, to produce zinc and lead concentrate. Compania Minera Santa Luisa, of which Mitsui Mining & Smelting controls 70% with 30% interest by Mitsui & Co., operates Huanzala. Huanzala, which started operation in 1968, produced 477,350 tonnes of crude ore, 74,381 tonnes of zinc concentrate or 38,000 tonnes of zinc and 24,332 tonnes of lead concentrate or 16,000 tonnes of lead in 2005. Huanzala plans to reduce the output in 2006 with the limited availability of concentrator due to utilization by Palca. Huanzala will produce 390,600 tonnes per year in and after 2006. The mine will produce annual 57,872 tonnes of zinc concentrate or around 30,000 tonnes of zinc and 18,763 tonnes of lead concentrate or around 12,000 tonnes of lead.