Located in north-central Chile, the El Morro property covers 417 square kilometres and is accessible from the Chilean city of Vallenar via 129 kilometres of paved and unpaved roads. Resources and mining expertise are available in Vallenar and other cities in the region.
Under the terms of New Gold’s agreement with Goldcorp Inc., Goldcorp is responsible for funding New Gold’s full 30 percent share of capital costs. The carried funding accrues interest at a fixed rate of 4.58 percent. New Gold will repay its share of capital plus accumulated interest out of 80 percent of its share of the project’s cash flow, with New Gold retaining 20 percent of its share of cash flow from the time production commences.
On November 7, 2014, Goldcorp announced that it had withdrawn the Environmental Impact Study (EIS) for the El Morro project. The decision was made after an October 7, 2014 ruling by the Chilean Supreme Court that invalidated the EIS. Since that time, the El Morro team has continued to progress its studies to determine the optimal development plan for the project. El Morro remains committed to productive interaction and engagement with the adjacent communities and regional authorities.
El Morro remains one of the highest-grade undeveloped copper-gold porphyry deposits in the world. At the end of 2014, New Gold’s 30 percent share of the project contained proven and probable gold reserves of 2.7 million ounces and proven and probable copper reserves of 2.0 billion pounds. In addition, there is significant exploration potential on the broad El Morro land package.