"What were they doing all that time with drilling, sampling,...

"What were they doing all that time with drilling, sampling, trial runs, metallurgy tests?"

The equipment that CCU had to purchase was always planned expenditure. It was just expected that early on in the piece, it would not be required and that it could be purchased further down the track once the mine had money coming in from its first year of production.

I don't know if you know much about how drilling works, but it's great for assessing hard rock stratigraphy. Once you get extremely weathered rock or bands of soil recovery can be shot. Clays and sands can just get washed out and end up in the bottom of the mud tank. Sometimes the process of drilling itself weathers the core and you interpret the high soil content as just drill affected rock.

You can core soils, but it's quite tricky, and geological drillers aren't very good for that. Mainly because they will be running through some high strength rock and then will hit the clays and suddenly advance a metre through them. You need to get Geotechnical drillers because they have an anally retentive Geotechnical Engineer standing over them moaning about poor core recovery and "please can you not drill so hard that you shatter the core? I need to see the structure."

In addition to this the diameter of a bore is pretty much the same as a coffee mug and a geologist makes a lot of inferences to link up identified strata between bores.

Add to this Miners can be generally counted on doing the right thing, but only after all other avenues have been exhausted. It's all about avoiding or deferring expenditure. That's why tailings dams are built in stages - why build something to a capacity that won't be reached for 20 years when you can spend the money every 5 years to raise the embankment? CCU management would have seen the clayey mined material and thought at first, "this wasn't expected but maybe it's only a temporary thing, lets try a work around until we get back to decent rock"

Eventually the mining manager would have said, "We can't keep doing this, we need to spend the money now, rather than deferring the cost"

CCU went over a dollar when the price of silver was a lot higher - it was in the 40s, heading up to $50 and everyone was getting euphoric. The wider market is different these days and wants concrete results.