Foran Mining Reports Positive Economic Assessment

Copper Company News Return to Copper Company News Directory Foran Mining Reports Positive PEA for McIlvenna Bay: Estimated pre-tax NPV of $382M, 22% IRR Wednesday November 12, 2014, 4:02pm PST

 Foran Mining (TSXV:FOM) released results of a preliminary economic assessment conducted at its McIlvenna Bay deposit in Saskatchewan.The project has an estimated post tax net present value of $262.2 million with an 18.9 percent internal rate of return and a 4.1 year payback period.

As quoted in the press release:

The PEA envisages an average throughput rate of 5,000 tonnes per day (“tpd”) as a conventional underground operation through longhole stoping and cemented paste backfill. The mine is expected to have a 14 year life, with potential to extend the life of operations through resource expansion at depth or delineation of nearby satellite deposits. A stand-alone concentrator is proposed to be constructed adjacent to the McIlvenna Bay mine. Key parameters for the PEA are summarized in Tables 1 and 2.

The estimated pre-tax NPV7% is $381.7M, with a 21.9% IRR and 4.1 year payback; post-tax NPV7% is $262.6M, with a 18.9% IRR and 4.1 year payback.

Total payable life of mine (“LOM”) production is expected to be 804.7 million pounds (“Mlbs.”) of zinc, 513.7 Mlbs. of copper, 15.8 Mlbs. of lead, 218,000 ounces of gold and 5.44 million ounces of silver.

McIlvenna Bay pre-production capital cost (“CapEx”) is estimated at $207.3M, with a $41.5M contingency, for a total of $248.8M (Table 2). Sustaining capital is estimated at $125.2M, with a $25.0M contingency, for a total of $150.3M. The total estimated capital cost over the LOM including closure costs net of salvage value is estimated at $332.5M, with a $66.5M contingency, for a total of $399.1M. The majority of mine construction is expected to take 18 months, with underground mine development adding an additional 6 months to the build-out period.

Foran president and CEO, Patrick Soares, said:

The positive results outlined in the McIlvenna Bay PEA clearly illustrate the robust nature of this deposit. The positive results outlined in the McIlvenna Bay PEA clearly illustrate the robust nature of this deposit.

 

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