PEA Highlights:
Highlights from the PEA, with a base case silver price of
- Pre-Tax NPV (5%) of
$1.1 billion and an IRR of 52%, and a Post-Tax NPV (5%) of$726 million and an IRR of 39%; - Using a +/- 20% sensitivity analysis for silver price, Post-Tax NPV (5%) of
$1,054 million and 50% IRR atUS$27 /oz silver and a Post-Tax NPV (5%) of$398 million and 26% IRR atUS$18 /oz silver; - 14-year mine life producing approximately 171 million ounces total payable silver metal;
- Initial capital costs of
$308 million , which includes$52 million in contingency costs; - Life-of-mine ("LOM") sustaining capital costs total
$20 million ; - Average LOM operating cash cost of
US$8.45 /oz and total all-in sustaining cost ofUS$10.42 /oz silver; - Annual payable metal production exceeds 15 million ounces of silver in years one through four, with LOM average annual payable metal production exceeding 12 million ounces of silver.
"This study demonstrates that the
Economic Results and Sensitivities
Tables 1 shows the assumptions, summarizes the projected production and the economic results of the PEA and Table 2 shows sensitivities to metal price and operating and capital cost.
Table 1: Silver Sand Open Pit Mining – Key Economic Assumptions and Results
Silver Sand | Unit | Value |
TotalMineralizedRockMined | Kt t:t | 55,441 3.60 |
Annual Processing Rate | Kt g/t | 4,000 107 |
Silver Recovery1 | % | 91.0 |
SilverPrice | US$/oz | 22.50 |
Payable SilverMetal | Moz | 171 |
TotalNetRevenue | $M | 3,510 |
InitialCapitalCosts | $M | 308 |
SustainingCapitalCosts | $M | 20 |
Operating Costs (Total)2 | $/t milled | 26.26 |
OperatingCash Cost | US$/oz Ag | 8.45 |
Total All-In Sustaining Cost3 | US$/oz Ag | 10.42 |
Mine Life | Yrs | 14 |
PaybackPeriod (Pre-tax) | Yrs | 1.4 |
PaybackPeriod (Post-tax) | Yrs | 1.9 |
Cumulative | $M | 1,727 |
Pre-tax NPV(5%) | $M | 1,106 |
Pre-tax IRR | % | 52 |
Post-tax NPV(5%) | $M | 726 |
Post-tax IRR | % | 39 |
Notes: | |
1. | LOM average |
2. | Includes mine operating costs, milling, tails management, mine closure and mine G&A |
3. | Includes operating costs, initial capital costs and sustaining capital costs |
Table 2: Silver Sand Project NPV (US$M) / IRR (%) Economic Sensitivity Analysis – Post Tax
Input | Input factor change | ||||
-20 % | -10 % | 100% (base case) | +10 % | +20 % | |
398 / 26% | 562 / 33% | 726 / 39% | 890 / 45% | 1,054 / 50% | |
Mine operating cost (per tonne mined) | 774 / 40% | 750 / 40% | 726 / 39% | 702 / 38% | 678 / 37% |
Process operating cost (per tonne milled) | 796 / 41% | 761 / 40% | 726 / 39% | 691 / 38% | 656 / 37% |
Capex (LOM) | 776 / 47% | 751 / 43% | 726 / 39% | 701 / 36% | 676 / 33% |
Note: Inputs for the base case (100%) are listed in Tables 1, 3 & 4. The Table 2 lists sensitivity analysis for four "Input" variables. For example, if Capex (LOM) increase by 20% (+20%), while Silver price (US$/oz), Mine operating cost (per tonne mined) and Process operating cost (per tonne milled) remain the same as the "base Case" input, then the NPV becomes |
Capital and Operating Costs
Power to site will be provided via the national grid over the life of the mine. An on-site camp is envisioned to house the mine and mill personnel.
Table 3 shows a breakdown of the capital costs and Table 4 shows the main components of the operating costs.
Table 3: Total Capital Cost Estimate
Description | Cost ($M) |
Open pit pre-stripping | 47 |
Contractor mobilization | 1 |
Processing plant | 186 |
Tailings facility | 25 |
Site infrastructure | 47 |
Owner's cost | 21 |
Total capital cost | 327 |
Initial capital | 308 |
Sustaining capital | 20 |
Note: | Total capital cost items include direct, indirect and contingency costs. |
Totals may not add up exactly due to rounding. |
Table 4: Total Operating Cost Estimate
Description | Cost ($/t milled) |
Miningcost | 9.55 |
Processingcost (including tailings) | 14.85 |
Generaland Administration cost | 1.86 |
Total operating cost | 26.26 |
Mining
Processing & Metallurgy
A metallurgical program was completed at SGS Lima during 2020 to build on earlier testwork and to support the PEA. Several process flowsheet options were evaluated for the PEA, including heap leaching, froth flotation and cyanidation. The selected PEA flowsheet consists of comminution by crushing followed by semi-autogenous and ball milling, leaching with cyanide over a period of 48 hours, counter current decantation and zinc precipitation (
Tailings will be thickened and then filtered with pressure filters before being conveyed to the nearby dry stack tailings facility.
The processing plant will operate year-round at a rate of approximately 4 million tonnes per annum and will achieve full throughput by Year 1. The average LOM feed grade is projected to be 107 g/t Ag.
Process water will primarily be sourced from a surface water dam adjacent to the process plant, supplemented by runoff from the waste rock and tailings storage facility.
Opportunities to Enhance Value
This PEA study confirms New Pacific's commitment to enhancing value at the
- Infill drilling to upgrade areas of high-grade mineralization within the current inferred resource area;
- Additional drilling around the current Mineral Resources, where the deposit remains open at depth;
- Detailed drilling of other known mineralized prospects beyond the areas with known Mineral Resources so as include these in future estimations;
- Further metallurgical studies to improve grinding, leaching and CCD parameters under variable operating conditions;
- Completing a dilution study in the next stage of study to ascertain the anticipated mining dilution and ore recovery in combination with the most appropriate mining fleet and associated costs;
- Further work to identify alternative dump locations with short hauls i.e., backfill in-pit dumps, and dump in a nearby gully. Further work should be undertaken to develop a detailed waste and tailings disposal plan.
Mineral Resource estimate
The Mineral Resource estimate which used conceptual open pit mining constraints for reporting purposes has been reported in the news release of
Table 5: Silver Sand Deposit Mineral Resource as of
Resource Category | Tonnes (Mt) | Ag (g/t) | Ag (Moz) |
Measured | 14.88 | 131 | 62.60 |
Indicated | 39.38 | 110 | 139.17 |
Measured & Indicated | 54.26 | 116 | 201.77 |
Inferred | 4.56 | 88 | 12.95 |
Notes: | |
• | CIM Definition Standards (2014) were used for reporting the Mineral Resources. |
• | The Qualified Person is Dinara Nussipakynova, |
• | Mineral Resources are constrained by optimized pit shells at a metal price of |
• | Drilling results up to |
• | The numbers may not compute exactly due to rounding. |
• | Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability. |
Source: |
QUALIFIED PERSONS
The Qualified Persons for the PEA are Mr.
Further details supporting the PEA will be available in an NI 43-101 Technical Report which will be posted under the Company's profile at www.sedar.com within 45 days of this news release.
This news release has been reviewed and approved by
WEBCAST DETAILS
The Company will host a conference call and presentation webcast at
Date: | |
Toll-free: | |
International 1-604-638-5340 | |
Webcast: | https://www.gowebcasting.com/12415 |
ABOUT
New Pacific is a Canadian exploration and development company with precious metal projects in
On behalf of
Dr.
Director and CEO
FOR FURTHER INFORMATION
Phone: (604) 633–1368 Ext. 222
E-mail: invest@newpacificmetals.com
For additional information and to receive company news by e-mail, please register using New Pacific's website at www.newpacificmetals.com.
CAUTIONARY NOTE REGARDING FORWARD–LOOKING INFORMATION
Certain of the statements and information in this news release constitute "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995 and "forward-looking information" within the meaning of applicable Canadian provincial securities laws. Any statements or information that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions, or future events or performance (often, but not always, using words or phrases such as "expects", "is expected", "anticipates", "believes", "plans", "projects", "estimates", "assumes", "intends", "strategies", "targets", "goals", "forecasts", "objectives", "budgets", "schedules", "potential" or variations thereof or stating that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved, or the negative of any of these terms and similar expressions) are not statements of historical fact and may be forward-looking statements or information. Such statements include, but are not limited to: statements regarding anticipated exploration, drilling, development, construction, and other activities or achievements of the Company; timing of receipt of permits and regulatory approvals; timing and content of the PEA; and estimates of the Company's revenues and capital expenditures; and other future plans, objectives or expectations of the Company.
Forward-looking statements or information are subject to a variety of known and unknown risks, uncertainties and other factors that could cause actual events or results to differ from those reflected in the forward-looking statements or information, including, without limitation, risks relating to: global economic and social impact of COVID-19; fluctuating equity prices, bond prices, commodity prices; calculation of resources, reserves and mineralization, general economic conditions, foreign exchange risks, interest rate risk, foreign investment risk; loss of key personnel; conflicts of interest; dependence on management, uncertainties relating to the availability and costs of financing needed in the future, environmental risks, operations and political conditions, the regulatory environment in
This list is not exhaustive of the factors that may affect any of the Company's forward-looking statements or information.
The forward-looking statements are necessarily based on a number of estimates, assumptions, beliefs, expectations and opinions of management as of the date of this news release that, while considered reasonable by management, are inherently subject to significant business, economic and competitive uncertainties and contingencies. These estimates, assumptions, beliefs, expectations and options include, but are not limited to, those related to the Company's ability to carry on current and future operations, including: the duration and effects of COVID-19 on our operations and workforce; development and exploration activities; the timing, extent, duration and economic viability of such operations; the accuracy and reliability of estimates, projections, forecasts, studies and assessments; the Company's ability to meet or achieve estimates, projections and forecasts; the stabilization of the political climate in
Although the forward-looking statements contained in this news release are based upon what management believes are reasonable assumptions, there can be no assurance that actual results will be consistent with these forward-looking statements. All forward-looking statements in this news release are qualified by these cautionary statements. Accordingly, readers should not place undue reliance on such statements. Other than specifically required by applicable laws, the Company is under no obligation and expressly disclaims any such obligation to update or alter the forward-looking statements whether as a result of new information, future events or otherwise except as may be required by law. These forward-looking statements are made as of the date of this news release.
CAUTIONARY NOTE TO US INVESTORS
This news release has been prepared in accordance with the requirements of the securities laws in effect in
Additional information relating to the Company, including the Company's Annual Information Form, can be obtained under the Company's profile on SEDAR at www.sedar.com, on EDGAR at www.sec.gov, and on the Company's website at www.newpacificmetals.com.
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