Canada NewsWire
Highlights:
- The Curipamba feasibility study covers the first 10 years of mine life with an open-pit Mineral Reserve ("Feasibility Study"). An updated preliminary economic assessment on the separate underground mine optionality envisioned in years 10 to 14 is also outlined ("Underground PEA")
- US$12M Feasibility Study resulted in an increase in the resource base, improved metallurgy leading to high quality copper and zinc concentrates, grading 28% copper and 56% zinc respectively, and strong project definition with detailed geotechnical and hydrogeological drilling programs completed
- Environmental, Social and Impact Assessment ("ESIA") for open-pit mine and mill development shall be submitted to the Ecuadorian Ministry of Environment in November 2021 , which references the highest standards with respect to tailings design, water and waste management, and discharge quality
- Adventus Mining has initiated a comprehensive review of all strategic development options, including concentrate off-take and project finance packages, as well as potential options for strategic investment or corporate transaction. Advanced discussions are underway for up to US$240M in non-equity financing
- Detailed engineering for Curipamba development is expected to begin in Q1 2022
- The tailings storage facility design has sufficient capacity for significant mineral reserve additions
- Adventus Mining will host a 2021 Feasibility Study Webinar on Wednesday, October 27, 2021 , at 11 am ET . Please register at: https://www.amvestcapital.com/webinar-directory/adventus102721
Open Pit NI 43-101 Feasibility Study
- After-tax Feasibility Study IRR of 32% and NPV 8% of US$259 million for initial open-pit development only
- 77% of life-of-mine revenues from payable copper and gold
- Production C1 cash cost of US$1.14 /lb and AISC of US$1.26 /lb copper equivalent
- Average annual production of 10,463 tpa copper and 21,390 tpa copper equivalent over the life-of-mine
- Proven and Probable Mineral Reserves of 6.5 M tonnes at 1.93% Cu, 2.49% Zn, 2.52 g/t Au, 45.7 g/t Ag, 0.25% Pb
Underground PEA Update ([1])
- Underground mine plan based on Indicated and Inferred Resources, independent of those resources used in the open pit Feasibility Study
- After-tax NPV 8% of US$49 million , assuming underground production starts after the completion of the open-pit mine plan in year 10, and discounted to the same time zero as the open-pit Feasibility Study (year -2)
- Additional Indicated and Inferred Mineral Resources of 1.9 million tonnes at 2.72% Cu, 2.38% Zn, 1.37 g/t Au, 31 g/t Ag, 0.14% Pb and 0.8 million tonnes at 2.31% Cu, 2.68% Zn, 1.74 g/t Au, 29 g/t Ag, 0.11% Pb, respectively
- Option to upgrade underground Mineral Resources to reserves by an infill drilling, test-work program and completion of a separate feasibility study estimated to cost approximately US$8M over 2.5 years
TORONTO , Oct. 26, 2021 /CNW/ - Adventus Mining Corporation ("Adventus") (TSXV: ADZN) (OTCQX: ADVZF) and Salazar Resources Limited ("Salazar") (TSXV: SRL) (OTCQB: SRLZF) (collectively the "Partners") are pleased to announce the feasibility study results, the first estimate of Mineral Reserves, and updated Mineral Resources for the El Domo volcanogenic massive sulphide deposit, located within the 21,537-hectare Curipamba project in central Ecuador ("Curipamba" or "El Domo"). The Feasibility Study was commissioned by Adventus and led by DRA Americas Inc. ("DRA") to further advance the engineering design and future construction of an open-pit mine and facilities to produce concentrates of copper, zinc, and lead with significant gold and silver credits. This work has been completed as part of Adventus's option agreement with Salazar whereby Adventus may earn a 75% ownership interest in the Curipamba project with a preferential 95% payback of future cash flows until its investment has been fully repaid. The Feasibility Study results will be summarized in an independent National Instrument 43-101 Technical Report ("NI 43-101") and filed on the companies' SEDAR profiles within 45 days. After filing of the NI 43-101 Technical Report, Adventus will have then fulfilled the company's earn-in requirements under the Curipamba option agreement with Salazar, having also spent more than the required US$25M (approximately US$38.9M up to June 30, 2021 since October 2017 ). The Partners will then enter into a joint venture agreement governed by a pre-agreed shareholders agreement.
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1 The preliminary economic assessment is preliminary in nature and includes inferred mineral resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves. There is no certainty that the preliminary economic assessment will be realized. Mineral resources that are not mineral reserves do not have demonstrated economic viability. |
President and CEO of Adventus, Christian Kargl-Simard stated:
" The completion of the Curipamba feasibility study is a major milestone for the Adventus Mining and Salazar partnership, with the results highlighting the project's attractive economics, improvements since the 2019 PEA, and benefits to many stakeholders. Across valuation metrics and benchmarks – highlighted by its low capital intensity, lowest quartile production costs and forecast free cash flows – Curipamba is an exceptional copper-gold investment proposition not only within the Americas but also globally. The technical and economic results of the study also reinforce the viability of the Curipamba project to stakeholders in Ecuador as the government seeks to support direct investment in its rapidly growing mining sector. In addition to the formal completion of partnership earn-in requirements, we look forward to providing exciting news updates prior to the initiation of detailed engineering at the start of 2022. We also see meaningful value creation through expanding the underground resource and the potential of accelerating its development in earlier years with an expansion funded through future cash flows."
President and CEO of Salazar, Fredy Salazar stated:
" We want to thank our partner Adventus Mining for its leadership in advancing the Curipamba project, including the best-practice engineering work completed by the international technical team that will benefit many stakeholders in our home country of Ecuador . Salazar has been uniquely involved at Curipamba since the discovery of the El Domo deposit in 2007. We are proud of today's milestone with maiden Mineral Reserves and now look forward to the execution path towards future construction and operations."
Updated Mineral Resource Estimate
An update to the Mineral Resource estimate (Table 1a to 1c) for El Domo deposit at Curipamba has been completed as part of the Feasibility Study to include all recent infill drilling completed in 2020 and 2021. The updated Mineral Resource estimate has an effective date of October 26, 2021 and is disclosed in accordance with National Instrument 43-101 Standards of Disclosure for Mineral Projects and prepared by SLR Consulting ( Canada ) Ltd. ("SLR"), formerly Roscoe Postle Associates.
The updated Mineral Resource estimate is supported by information provided from 391 core boreholes, totaling 74,992 metres, completed between 2007 and 2021 and possesses a similar footprint to the previous Mineral Resource estimate (see May 2, 2019 news release). The infill drilling in 2020 and 2021 resulted in the upgrading of portions of the Mineral Resource from previously classified Indicated to Measured and Inferred to Indicated categories. Other highlights include copper grades increasing by 9%.
Table 1a. Total Mineral Resource for El Domo, Curipamba Project – October 26, 2021 (sum of table 1b and 1c)
|
Resource
|
Tonnes
|
Grade |
Contained Metal |
||||||||
|
Cu
|
Pb
|
Zn
|
Au
|
Ag
|
Cu (kt) |
Pb
|
Zn (kt) |
Au
|
Ag (koz) |
||
|
Measured |
3.2 |
2.61 |
0.24 |
2.50 |
3.03 |
45 |
84.9 |
7.7 |
81.1 |
316 |
4,704 |
|
Indicated |
5.7 |
1.83 |
0.24 |
2.64 |
1.98 |
45 |
104.5 |
13.9 |
150.6 |
364 |
8,265 |
|
M+I |
9.0 |
2.11 |
0.24 |
2.59 |
2.36 |
45 |
189.4 |
21.6 |
231.7 |
680 |
12,969 |
|
Inferred |
1.1 |
1.72 |
0.14 |
2.18 |
1.62 |
32 |
18.5 |
1.5 |
23.6 |
57 |
1,118 |
Table 1b . Pit Constrained Mineral Resource for El Domo, Curipamba Project – October 26, 2021
|
Resource
|
Tonnes
|
Grade |
Contained Metal |
||||||||
|
Cu
|
Pb
|
Zn
|
Au
|
Ag
|
Cu (kt) |
Pb
|
Zn (kt) |
Au
|
Ag (koz) |
||
|
Measured |
3.2 |
2.61 |
0.24 |
2.50 |
3.03 |
45 |
84.9 |
7.7 |
81.1 |
316 |
4,704 |
|
Indicated |
3.8 |
1.38 |
0.30 |
2.77 |
2.29 |
52 |
52.6 |
11.3 |
105.2 |
280 |
6,370 |
|
M+I |
7.1 |
1.95 |
0.27 |
2.64 |
2.63 |
49 |
137.5 |
19.0 |
186.3 |
596 |
11,074 |
|
Inferred |
0.3 |
0.34 |
0.20 |
1.01 |
1.34 |
39 |
1.2 |
0.7 |
3.5 |
15 |
430 |
Table 1c. Underground Mineral Resource for El Domo, Curipamba Project – October 26, 2021
|
Resource
|
Tonnes (Mt)
|
Grade |
Contained Metal |
||||||||
|
Cu
|
Pb
|
Zn
|
Au
|
Ag
|
Cu
|
Pb
|
Zn
|
Au
|
Ag
|
||
|
Indicated |
1.9 |
2.72 |
0.14 |
2.38 |
1.37 |
31 |
51.9 |
2.6 |
45.4 |
84 |
1,895 |
|
Inferred |
0.8 |
2.31 |
0.11 |
2.68 |
1.74 |
29 |
17.3 |
0.8 |
20.1 |
42 |
688 |
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Notes: 1. CIM Definition Standards (2014) definitions were followed for Mineral Resources. 2. Mineral Resources are reported above a cut-off NSR value of US$29/t for Mineral Resources amenable to open-pit mining and the underground portion of the 2021 Mineral Resources are reported with mining shapes which were generated using a $105/t NSR cut-off value. 3. The NSR value is based on estimated metallurgical recoveries, assumed metal prices, and smelter terms, which include payable factors treatment charges, penalties, and refining charges. 4. Mineral Resources are estimated using the metal price assumptions: US$4.00/lb Cu, US$1.05/lb Pb, US$1.30/lb Zn, US$1,800/oz Au, and US$24/oz Ag. 5. Metallurgical recovery assumptions were based on three mineral types defined by the metal ratio Cu/(Pb+Zn): a. Zinc Mineral (Cu/(Pb+Zn) <0.33): 86% Cu, 90% Pb, 97% Zn, 68% Au and 78% Ag b. Mixed Cu/Zn Mineral (0.33≤ Cu/(Pb+Zn) ≤3.0): 86% Cu, 82% Pb, 95% Zn, 55% Au and 67% Ag c. Copper Mineral (Cu/(Pb+Zn) >3.0): 80% Cu, 37% Pb, 36% Zn, 14% Au and 29% Ag 6. NSR factors were also based on the metal ratio Cu/(Pb+Zn): a. Zinc Mineral (Cu/(Pb+Zn) <0.33): 53.41 US$/% Cu, 7.99 US$/% Pb, 13.47 US$/% Zn, 30.91 US$/g Au and 0.39 US$/g Ag b. Mixed Cu/Zn Mineral (0.33≤ Cu/(Pb+Zn) ≤3.0): 58.99 US$/% Cu, 7.05 US$/% Pb ,13.41 US$/% Zn, 25.12 US$/g Au and 0.34 US$/g Ag c. Copper Mineral (Cu/(Pb+Zn) >3.0): 57.83 US$/% Cu, 6.84 US$/g Au and 0.19 US$/g Ag 7. Bulk density interpolated on a block per block basis using assayed value, the correlation between measured density values and iron content, and base metal grade. The bulk densities range between 2.1 t/m 3 and 4.6 t/m 3 8. Mineral Resources are inclusive of Mineral Reserves. 9. Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability. 10. The underground portion of the Mineral Resources are reported within underground reporting shapes and include low grade blocks falling within the shapes. 11. QP is not aware of any environmental, permitting, legal, title, taxation, socio-economic, marketing, political, or other relevant factors that could materially affect the Mineral Resource estimate 12. Numbers may not add due to rounding. |
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Feasibility Study Mineral Reserves
The basis of the Curipamba Feasibility Study is on the maiden open-pit Mineral Reserves that were estimated from the updated open-pit Mineral Resources and on the mine design by DRA (Table 2).
Table 2: Open-Pit Mineral Reserves Statement
|
Classification |
|
Grade |
Contained Metal |
||||||||
|
Tonnage
|
Cu
|
Pb
|
Zn
|
Au
|
Ag
|
Cu
|
Pb
|
Zn
|
Au
|
Ag
|
|
|
Proven Reserves |
3,136 |
2.50 |
0.2 |
2.30 |
2.83 |
41 |
78.4 |
6.7 |
72.0 |
285 |
4175 |
|
Probable Reserves |
3,343 |
1.39 |
0.3 |
2.67 |
2.23 |
50 |
46.4 |
9.4 |
89.4 |
240 |
5342 |
|
Proven + Probable |
6,478 |
1.93 |
0.2 |
2.49 |
2.52 |
46 |
124.9 |
16.2 |
161.4 |
525 |
9517 |
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Notes: 1. Waste: Ore Strip Ratio 6.02 : 1 not including pre-strip waste and 8.59 : 1 including pre-strip waste 2. The effective date of the Mineral Reserve Estimate is October 22, 2021. 3. Mineral Reserves are reported in accordance with CIM Definition Standards (2014) and best practice guidelines (2019). 4. An NSR cut-off grade of US$32.99 was used for all material. 5. Mineral reserves were estimated at a gold price of $1,630/oz, a silver price of $21.00/oz, a lead price of $0.92/lb, a zinc price of $1.16/lb, and a copper price of $3.31/lb; they include modifying factors related to mining cost, dilution, mine recovery, process recoveries and costs, G&A, royalties, and rehabilitation costs. 6. Figures have been rounded to an appropriate level of precision for the reporting of Mineral Reserves. 7. Due to rounding, some columns or rows may not compute exactly as shown. 8. The Mineral Reserves are stated as dry tonnes processed at the crusher. 9. Tonnages are presented in metric tonnes |
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Open-Pit Feasibility Study
The Feasibility Study is based only on open-pit Mineral Reserves, whereas the 2019 preliminary economic assessment included both the open pit and potential underground Mineral Resources ("2019 PEA"). Table 3 and Figure 1 provide a summary of the key Feasibility Study results and cash flows respectively, with sensitivity scenarios for higher and lower metal prices also shown.
Table 3: Open Pit Feasibility Study Results
|
Open Pit Feasibility Study Results |
Feasibility Study
|
-15% Price Deck |
Spot Prices as of
|
|
After-Tax NPV (US$ million, 8% discount rate) (1) |
$259 |
$159 |
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