Evolution Mining will build a $160 million underground mine to help fill spare capacity at its Ernest Henry copper operation about 40km north of Cloncurry.

General manager of Ernest Henry operations Joe Mammen addressed the Meeting of the Mines conference in Cloncurry, saying the mine was guiding production this year to between 40,000 and 43,000 tonnes of copper, and 50,000 to 60,000 ounces of gold.

Related: Evolution turns to copper to keep its run going

Ernest Henry had latent mill capacity that needed to be filled, Mr Mammen said.

“Previously in the open pit operation stage, we had the milling capacity greater than nine million tonnes per annum. Currently we’re processing in the realm of sort of six and a half million tonnes per annum, and that’s that latent capacity that’s been mentioned about for Ernest Henry,” he said.

Main image: Ernest Henry mine

Growth would come through the Bert project, toll milling for junior miners, and the acquisition of Carnaby Resources (ASX: CNB), Mr Mammen said.

“We have plans for growth … It’s through the Bert project which all goes through, but it’s also through the Greater Duchess with the intent to acquire Carnaby resources.

“But also we’re looking at toll milling opportunities of how we can also extend other opportunities out there for juniors to contribute back to our latent capacity from there.”

The Bert project was a standout, Mr Mammen said.

“That’s a $160 million standalone underground that will be disconnected from the main operation and it won’t create a distraction to what we do on a day-to-day basis. So, it’s true incremental value-add back into the Ernest Henry office.

“We’re looking at about 750,000 tonnes of ore produced per annum over the life of a seven-year period. It’s got further growth potential in its own right.

“It unlocks that latent mill mass capacity and it’s going to be 100 per cent Evolution owned, but it’s going to be sort of that significant value in itself that’ll generate up to a 50 per cent return at the higher pricing points.”

Evolution first invested in Ernest Henry a decade ago, acquiring the gold credits from owner Glencore.

Glencore at the time gave the operation an 11-year mine life, Mr Mammen said.

“We took full ownership in 2022 at the price of $1 billion … we saw the potential opportunity that Ernest Henry had to offer. We’re now looking at a future beyond 2040.

“We’ve built the mine life, we’ve invested, we’ve put in the drilling strategy, but we had the confidence about what was there to actually see us continue going forward.”