Metallica Resources Inc. (TSX: MR)(AMEX: MRB) reports that it has granted a four month extension to Xstrata Copper ("Xstrata") to deliver the El Morro Feasibility Study. Under the current agreement, originally signed in September 1999, Xstrata is required to prepare and deliver a Feasibility Study on the project by September 14, 2007.
Due to adverse weather conditions this winter in Chile and slow progress in the development tunnel, Xstrata would be unable to incorporate all drilling and metallurgical data into the Study prior to the September deadline. Although Xstrata could have delivered a Study in September to satisfy its contractual obligation, both parties agree that all data should be incorporated in order to deliver a thorough and comprehensive Feasibility Study and avoid the need for an updated Study in early 2008. In return for the extension to January 2008, Xstrata will fund all ongoing Feasibility Study costs as well as any additional costs during the extension period, which are estimated at US$7 to US$9 million.
Completion of the core drilling and metallurgical sampling programs is expected to occur by the end of November 2007, with the delivery of the Feasibility Study in mid-January 2008.
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