Business
25 June, 2025
North West copper mine making huge investment
AIC Mines is virtually doubling its production capacity at its mine south-east of Cloncurry.
A North West copper mine is preparing for a major expansion as global prices soar.
AIC Mines, which currently employs about 200 people at its Eloise Mine, located 60km south-east of Cloncurry, will spend $77.6 million to expand its throughput capacity.
“Currently, Eloise is a small, but profitable mine,” said AIC Mines managing director Aaron Colleran.
“For a publicly-listed company, it’s relatively small scale.
“It only just supports the exploration that we undertake in the region and our corporate overhead.
“It has much greater potential. We’ve sort of uncovered that potential through both the acquisition of the nearby Jericho deposit and then the expansion of that deposit through exploration, drilling and step-down drilling.
“It’s really that potential of the asset that we’re chasing.
"Currently, we produce roughly 625,000 tonnes of ore per annum from the Eloise underground (mine).
“That production is constrained by mine ventilation, so we need another mine to lift that production.
“That other mine is the nearby Jericho deposit. It’s only located 3km to the south of Eloise.
“We can develop that mine to initially produce at a rate of 600,000 tonnes per annum.
“That effectively doubles the current mining production rate.”
Last week was a huge one in AIC Mines’ history, announcing both a $77.6 million contract for GR Engineering Services to oversee the expansion, as well as the execution of a $US40 million prepayment facility with Trafigura – linked to an offtake agreement for the Jericho mine – to fund the expansion of the Eloise processing facility.
“It’s predominantly a fixed price contract (with GR Engineering Services). For a company our size that needs to fund this, it’s important that we’re able to enter into a fixed cost contract,” Mr Colleran said.
“In August, they’ll mobilise to site and start on some of those earthworks. True construction starts on site from October this year.”
The Perth-based company had shown a commitment to working closely with AIC to deliver the expansion safely, efficiently and with minimal disruption to its current operations, Mr Colleran said.
Regarding the loan, the executive director said Trafigura’s vote of confidence should bode well for the company.
“Why did Trafigura lend us that? I guess there’s two reasons,” Mr Colleran explained to North West Weekly.
“One, they did the sums; it’s good business.
“And two, it’s linked to an offtake agreement.
“Trafigura is a metals trading company, so they actually buy all our product and trade our product. Our product is copper concentrate. We’re a copper sulphide mine.
“What we produce at site is a copper concentrate.
“It’s roughly 27 per cent concentrate that needs to be on-sold to a smelter for refining into copper.
“(Trafigura) currently has the offtake agreement – the life of mine offtake agreement – over Eloise. We now effectively extend that over Jericho.”
While AIC Mines product is sent to Glencore’s Mount Isa copper smelter, Mr Colleran said its future would not have an impact on their operations.
“Unfortunately, there’s not a lot of difference for us whether we send our concentrate to Mount Isa or whether we send it to a smelter in China or Japan,” he said.
“There’s a slight freight cost saving by sending it to Mount Isa, of course, but the reality is the smelters in Japan and China are incredibly cost competitive and it doesn’t make a big difference for us on cost.”
Mr Colleran said AIC Mines was a FIFO operation, with most of its employees coming from Townsville via the Cloncurry Airport.
A handful of workers live in the North West and drive in and drive out for their rosters.
The executive director said he was paying attention to the Mount Isa Copper Operations closure, as well as the situation with the smelter, but believed it would have no bearing on AIC Mines’ long-term prospects.