AIM: EMED
TSX: EMD
NICOSIA, Cyprus, Feb. 18, 2013 /CNW/ - EMED Mining Public Limited (the
"Company" or "EMED Mining"), the Europe-based minerals development and
exploration company, is pleased to announce that independent technical
expert Behre Dolbear has completed an updated NI 43-101 Technical
Report on the Company's Rio Tinto Copper Project.
The report entitled "NI 43-101 Technical Report on EMED's Rio Tinto
Copper Project, Huelva Province, Spain dated February 15, 2013" (the
"NI 43-101 Report") endorsed the Company's planned base case annual
production of existing ore reserves at 9.0Mtpa over 14 years from the
Cerro Colorado deposit, being the first mine EMED Mining plans to bring
into production. Behre Dolbear also noted that there is exploration
potential peripheral to the Cerro Colorado deposit which is open to the
east and at depth. This potentially provides scope to grow the
resource and expand operations including the development of other mines
within the existing permit areas.
Behre Dolbear supports the decision that the Company proceed with the
restart of the Rio Tinto Copper Project as soon as the requisite
project approvals, permits and project financing have been secured on
the basis that in their view the project is viable and appears to be
robust and well analysed in geological, engineering and financial
terms.
Highlights from the NI 43-101 Report include EMED's redevelopment plan
for the Rio Tinto Copper Project which includes processing 9 Mt of ore
per year to produce some 37,000 t of copper-in-concentrate, based on
the following assumptions:
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An average waste-to-ore ratio of about 1.1:1;
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Employment of 400 to 450 employees and contractors at full production;
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Potential to extend the 14-year mine life by conversion of known mineral
resources to reserves;
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Pre-production capital cost estimates of approximately $200M,
pre-production escrow funds of approximately $29M (for social security
environmental and rehabilitation costs) and post start up capital cost
estimates of approximately $75M; and
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Operating Cost estimates over the life of the project:
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$1,223M for Site Operating Costs
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$468M for Freight, Selling, Refining and Smelting
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$171M for Other Cash Operating Costs
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$148 for Non Operating Costs (acquisition costs)
The project cash flows and return calculations have conservatively
deducted project acquisition costs to be paid to the project vendor and
marketing agent as well as costs for site development and environmental
management
For the base case, which assumes a copper price of $3.50/lb, pre-tax
cash flows would pay back the Project's capital costs by the end of
Year 4. After taxes and after deducting the costs of project
acquisition and closure, the net cash flows total $1.138 billion and
generate an NPV of $427M at a 10% discount rate and an IRR of 32%.
The updated NI 43-101 Report has been filed on SEDAR and is available on
the Company's website, along with an updated investor presentation. A
summary of other principal conclusions and recommendations of Behre
Dolbear is as follows:
-
The Rio Tinto Copper Project is viable on the basis of parameters
described in the NI 43-101 Report, in spite of the substantial increase
in the capital cost estimate and environmental costs since the 2010
technical report;
-
The financial forecast contains potential operating cost improvements
which, although feasible, require verification;
-
EMED Mining needs to refine its contingency provision as it completes
its bonding and procurement arrangements, to ensure capital adequacy;
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The Project has been well analysed in geological, engineering and
financial terms
-
A review of the infrastructure and related engineering requirements has
identified items which need to be addressed before start-up, but none
that involve additional major capital expenditure or obstacles for
successful operations;
-
The infrastructure and environmental aspects, as discussed in the NI
43-101 Report, are expected to be manageable;
-
The preparatory work on restarting the open-pit mine operation and the
plans for contract mining appear to be satisfactory;
-
EMED Mining's personnel involved in the project are suitable and
competent;
-
All aspects of Environment, Health and Safety, together with Social and
Community Impact have been addressed by EMED Mining with competent
personnel;
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The annual rate of 9.0Mtpa should be achieved with a recovery of 85 % to
a concentrate grading 21% to 23% Cu, on a dry basis and containing 10%
moisture.
-
The timetable for this programme is challenging, but appears to be
realistic; and
-
There is exploration potential peripheral to the Cerro Colorado deposit
which is open to the east and at depth:
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By exploring the full lateral and vertical extent of the mineralisation
within the existing Cerro Colorado open pit area;
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From Cerro Colorado West to Filon Sur West;
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At Cerro Colorado, west of the existing highway, notably the San
Dionisio deposit under the Corta Atalya open pit;
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From Cerro Colorado East towards San Antonio; and
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At the Southern waste dump
Behre Dolbear also recommended:
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Additional geological modelling to better understand the controls on
mineralisation including the silver;
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Further delineation drilling to determine the limits of the orebody,
both laterally and at depth;
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Additional drilling to upgrade the Inferred Resource and Indicated
Resource material to Measured Resource category;
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Evaluation of nearby deposits as satellite operations; and
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Evaluation of the retreatment of the historical gossan tailings.
Harry Anagnostaras Adams, Managing Director of EMED Mining, commented: "The updated NI 43-101 is another important step in our move towards
production. We are excited about re-establishing Rio Tinto as a mining
field with initial production to commence at Cerro Colorado. There is
huge scope to create a large scale operation and we are delighted that
this independent technical report has validated our plans."
The scientific and technical information in this press release has been
reviewed and approved by R. Cunneen, Group Exploration Manager, who is
a "qualified person" within the meaning of National Instrument 43-101 -
Standards of Disclosure for Mineral Projects.
For further information on the Company's activities, visit www.emed-mining.com or www.emed.tv
Cautionary Notes
This announcement contains "forward looking information" within the
meaning of applicable Canadian securities legislation. "Forward
looking information" may also include statements with respect to the
future financial or operating performance of the Company, its
subsidiaries and its projects, the future price of metals, the
estimation of ore reserves and resources, the conversion of estimated
resources into reserves, the realisation of ore reserve estimates, the
timing and amount of estimated future production, costs of production,
capital, operating and exploration expenditures, costs and timing of
the development of new deposits, costs and timing of future
exploration, requirements for additional capital, government regulation
of mining operations, environmental risks, reclamation expenses, title
disputes or claims, limitations of insurance coverage and the timing
and possible outcome of pending litigation and regulatory matters.
Often, but not always, forward looking statements can be identified by
the use of words such as "plans", "expects", "is expected", "budget",
"scheduled", "estimates", "forecasts", "intends", "anticipates" or
"does not anticipate", or "believes" or variations (including negative
variations) of such words and phrases, or state that certain actions,
events or results "may", "could", "would", "might" or "will" be taken,
occur or be achieved. Accordingly, readers should not place undue
reliance on forward looking statements.
Forward looking statements involve known and unknown risks,
uncertainties and other factors which may cause the actual results,
performance or achievements of the Company and/or its subsidiaries to
be materially different from any future results, performance or
achievements expressed or implied by the forward looking statements.
Such factors include, among others, general business, economic,
competitive, political and social uncertainties; the actual results of
current exploration activities; actual results of reclamation
activities; conclusions of economic evaluations; changes in project
parameters as plans continue to be refined; future prices of metals;
the future costs of capital to the Company; possible variations of ore
grade or recovery rates; failure of plant, equipment or processes to
operate as anticipated; accidents, labour disputes and other risks of
the mining industry; political instability, terrorist attacks,
insurrection or war; delays in obtaining governmental approvals or
financing or in the completion of development or construction
activities, as well as those factors discussed in the section entitled
"Risk Factors" in the Company's annual information form.
Although the Company has attempted to identify important factors that
could cause actual actions, events or results to differ materially from
those described in forward looking statements, there may be other
factors that cause actions, events or results to differ from those
anticipated, estimated or intended. Forward looking statements
contained herein are made as of the date of this announcement and the
Company disclaims any obligation to update any forward looking
statements, whether as a result of new information, future events or
results or otherwise. There can be no assurance that forward looking
statements will prove to be accurate, as actual results and future
events could differ materially from those anticipated in such
statements. Accordingly, readers should not place undue reliance on
forward looking statements
SOURCE: EMED MINING PUBLIC LIMITED
