May 13, 2008, Vancouver, BC - Taseko Mines Limited (TSX: TKO; AMEX: TGB) is pleased to announce that its Board of Directors has approved a Phase III expansion of the Company’s wholly owned Gibraltar Mine, located in south-central British Columbia.
Under the approved capital plan, the Gibraltar operation will be expanded by 30,000 tons per day processing capacity at a capital cost of approximately C$350 million. This increase in the milling capacity of the Gibraltar concentrator will result in annual copper production capability of approximately 180 million pounds per year, as well as 4.5 million pounds of molybdenum, by the fourth quarter of 2010. The Company is considering a number of financing alternatives, involving approximately 30% debt and 70% generated from internal cash flow, to fund the capital expenditure.
Russell E. Hallbauer, President and CEO of Taseko, commented:
“As the Company has continued to look for growth opportunities it was clear that further investment at Gibraltar is the most accretive for our shareholders. With infrastructure already in place, plus extensive reserves and resources, we can increase production by an additional 50% in a very short period of time, while maintaining a long mine life.
Our engineering group has been engaged for a number of months on the concentrator design and mine development plan for this expansion. We have an engineering, procurement, construction and management team in place that is in the final stages of completing our Phase I and II expansion, on time and on budget, and this is very important to the next phase. Critical mill and mine equipment has been sourced and we believe that this next expansion can be completed in roughly 27 months. The accelerated time-line is targeted to capitalize on the forward copper price curve, resulting in a very short payback and reducing the risk of the project.”
Mr. Hallbauer continued: “This expansion will help reduce our cost structure at Gibraltar and further increase the long-term viability of the mine. This project will have a significant effect on the regional economy of the south-Cariboo because of the construction workforce that will be required over the next 2 years as well as the long-term permanent direct and indirect jobs. When the project is complete, we will have invested over $500 million in the region and our Company will have had a material impact on mitigating the effects of the slowdown in the forest industry resulting from the pine beetle devastation, price of lumber and the US housing market slowdown.
Additionally, we are prepared to invest upwards of $800 million in our Prosperity project. We are urging the governments to move forward in the process before the opportunity to build this mine is gone as a result of a change in the metal markets, or to investment opportunities that present themselves to our Company in other jurisdictions.”
For further details on Taseko and its properties, please visit the Company’s website at www.tasekomines.com or contact Investor Services at (604) 684-6365 or within North America at 1-800-667-2114.
President and CEO
No regulatory authority has approved or disapproved of the information contained in this news release.
CAUTION REGARDING FORWARD-LOOKING INFORMATION
This document contains “forward-looking statements” that were based on Taseko’s expectations, estimates and projections as of the dates as of which those statements were made. Generally, these forward-looking statements can be identified by the use of forward-looking terminology such as “outlook”, “anticipate”, “project”, “target”, “believe”, “estimate”, “expect”, “intend”, “should” and similar expressions.
Forward-looking statements are subject to known and unknown risks, uncertainties and other factors that may cause the Company’s actual results, level of activity, performance or achievements to be materially different from those expressed or implied by such forward-looking statements. These included but are not limited to:
- uncertainties and costs related to the Company’s exploration and development activities, such as those associated with continuity of mineralization or determining whether mineral resources or reserves exist on a property;
- uncertainties related to the accuracy of our estimates of mineral reserves, mineral resources, production rates and timing of production, future production and future cash and total costs of production and milling;
- uncertainties related to feasibility studies that provide estimates of expected or anticipated costs, expenditures and economic returns from a mining project;
- uncertainties related to our ability to complete the mill upgrade on time estimated and at the scheduled cost;
- uncertainties related to the ability to obtain necessary licenses permits for development projects and project delays due to third party opposition;
- uncertainties related to unexpected or ongoing judicial or regulatory proceedings;
- changes in, and the effects of, the laws, regulations and government policies affecting our exploration and development activities and mining operations, particularly laws, regulations and policies;
- changes in general economic conditions, the financial markets and in the demand and market price for copper, gold and other minerals and commodities, such as diesel fuel, steel, concrete, electricity and other forms of energy, mining equipment, and fluctuations in exchange rates, particularly with respect to the value of the U.S. dollar and Canadian dollar, and the continued availability of capital and financing;
- the effects of forward selling instruments to protect against fluctuations in copper prices and exchange rate movements and the risks of counterparty defaults, and mark to market risk;
- the risk of inadequate insurance or inability to obtain insurance to cover mining risks;
- the risk of loss of key employees; the risk of changes in accounting policies and methods we use to report our financial condition, including uncertainties associated with critical accounting assumptions and estimates;
- environmental issues and liabilities associated with mining including processing and stock piling ore; and
- labour strikes, work stoppages, or other interruptions to, or difficulties in, the employment of labour in markets in which we operate mines, or environmental hazards, industrial accidents or other events or occurrences, including third party interference that interrupt the production of minerals in our mines.
For further information on Taseko, investors should review the Company’s annual Form 40-F filing with the United States Securities and Exchange Commission www.sec.gov and home jurisdiction filings that are available at www.sedar.com.
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