Overview
- Pre-production capital requirements $261 million
- Mill throughput of 2 million tonnes of ore per annum- 6,000
tonnes per day
- Life of Mine 9.5 years
- Life of Mine Production: 239,000 tonnes of copper concentrate,
122,000 tonnes of lead concentrate and 770,000 tonnes of zinc
concentrate
- Total Net Smelter Return Revenue $1,246 million
- Further metallurgical studies planned
- Excellent exploration upside with additional drilling plans on
adjacent Camel Back Claims
June 5, 2013. Vancouver, BC; El Nino Ventures Inc.
("ELN"and the Company") (TSX.V: ELN; OTCQX: ELNOF Frankfurt: E7Q)
is pleased to announce the results of an NI 43-101
Preliminary Economic Assessment ("PEA") for the
Murray Brook polymetallic massive sulfide deposit, New Brunswick
(the "Project"). The results of the PEA demonstrate the potential
technical and economic viability of establishing a new mine and
mill complex on the Murray Brook property. The projected cash flows
indicate an after-tax NPV at a 5% discount rate of $96.4 million,
an IRR of 11.4%, and a payback period of 5.4 years (see table 1).
An NI 43-101 Technical Report will be filed on SEDAR within 45 days
of the date of this press release.
Harry Barr, ELN's Chairman & CEO commented, "The results of the
PEA clearly indicate that there is an indicative basis for a mining
project at Murray Brook. There is excellent potential to
further enhance the projected economics of the project, through
continued refinements in metal recoveries as well as the potential
to augment existing resources by achieving an exploration success
on the adjacent Camel Back claims. With forecasts of
increased metal demand and dwindling supply, the positive PEA
results for the Murray Brook project provide ELN shareholders with
the potential to benefit from the predicted upward trend in zinc
prices over the next few years".
Unless otherwise noted, all amounts in this press release are
expressed in Canadian currency. The PEA is prepared for 100%
ownership of the project revenues and expenditures. As noted below,
ELN holds a 35% interest in the project. The PEA 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, and there is no
certainty that the PEA will be realized.
Table 1- Summary of 2013 Murray Brook PEA
Results
*Life of Mine
The PEA was prepared by P&E
Mining Consultants Inc. and the full results of the study will be
disclosed in a NI 43-101 Technical Report within 45 days of the
date of this press release. The PEA was prepared under the
supervision of Eugene Puritch, P. Eng. of P&E Mining
Consultants Inc. Mr. Puritch is an independent QP in accordance
with NI 43-101 and has reviewed and approved the technical
information in this release.
The main conclusions from the PEA follow below.
Mining and Mineral Processing
Life of Mine production on a diluted and extracted basis for the
Murray Brook potentially economic portion of the resource estimate
is planned to be as follows:
Table 2 - Murray Brook Potentially Economic Portion of
the Resource Estimate
(1) Potentially economic portion
of the mineral resource estimate which are not mineral reserves do
not have demonstrated economic viability. This estimate of mineral
resources may be materially affected by environmental, permitting,
legal, title, taxation, sociopolitical, marketing, or other
relevant issues.
(2) The quantity and grade of reported potentially economic
Inferred resources in this estimation are uncertain in nature and
there has been insufficient exploration to define them as an
Indicated or Measured potentially mineable mineral resource and it
is uncertain if further exploration will result in upgrading them
to an Indicated or Measured potentially economic mineral resource
category.
(3) The potentially economic portion of the mineral resource in
this press release was estimated using the Canadian Institute of
Mining, Metallurgy and Petroleum (CIM), CIM Standards on Mineral
Resources and Reserves, Definitions and Guidelines prepared by the
CIM Standing Committee on Reserve Definitions and adopted by CIM
Council.
The PEA assumes the start of the
open pit mining operations at an average annual process plant
production rate of 2,000,000 tonnes per annum over a mine life of
approximately 9.5 years. The envisaged mining operation is a
conventional open pit. Mining operations will reach a sustained
total annual material movement of 11.6 million tonnes using 11.5 m3
diesel hydraulic excavators, 90 tonne haulage trucks, and track
mounted diesel powered drill rigs with up to 100 mm diameter
blastholes drilled on 6 metre high benches.
The mined material will be processed at a new 6,000 tonnes
per day flotation plant located on the Project site. Three
concentrates will be produced: 1) copper-silver; 2) lead-silver;
and 3) zinc-silver. It is anticipated that the concentrates could
be processed at the nearby Belledune Smelter or other suitable
facilities.
Site Infrastructure
The Project will benefit from infrastructure, services and skilled
labour available in the Bathurst Mining Camp. The Murray Brook
Project site is located 60 km west of the city of Bathurst and is
accessible year-round from paved Provincial Highway 180 and a 6.5
km gravel access road. Project site infrastructure is anticipated
to include:
- Plant site and haul
roads;
- Administration buildings and assay
lab;
- Mine maintenance garage, warehouse
and fuel storage facilities;
- Fresh water supply and sewage
treatment; and
- Lined tailings storage
area
The proposed Murray Brook
Project mill and mine site is ideally located on the access road to
the open pit area. The proposed processing plant site is
located on a ridge overlooking a valley about 100 metres below.
Several lateral ridges form natural containment dykes for at least
two sides of a tailings management facility. Power to the site will
be supplied by a 12 km long transmission line connecting to the
Caribou Mine site and provincial grid.
The labour force for the construction and operation of this project
is anticipated to be drawn from the Bathurst area. The labour pool
in this area is highly skilled and experienced in construction
projects and mining operations.
Financial Assumptions and Results
Total operating costs during the Life of Mine is illustrated in
Table 3:
Table 3-Projection of total operating costs during the
Life of Mine, Murray Brook Project
Capital costs are categorized as
Initial Project Capital and Sustaining Capital. Initial Project
Capital consists primarily of mining equipment, process plant and
ancillary plant construction, initial tailing storage, facility
construction, an allowance for water treatment, and local
infrastructure. Sustaining capital consists of further additions to
mining equipment during production and environmental and closure
costs.
Table 4-Initial Project and Sustaining Capital of
Murray Brook Project
Metal prices used in the PEA are
based on the April 30, 2013 three year trailing prices which are
listed in Table 5 below.
Table 5- Metal prices used in this study
Exchange Rate: $US:$CAD = 1
Project and Exploration
Upside
Further technical studies on the Murray Brook Project will focus on
additional metallurgical studies designed to evaluate potential
techniques of improving metal recoveries. The first step is a small
pilot plant project proposal to test three to five tonnes of drill
core material.
The largest impact on the potential value of the Murray Brook
Project is likely to be achieved by increasing the mineral resource
base available for mining, thereby increasing the mine life and
(or) annual mill throughput. Excellent potential exists for
additional discoveries along and adjacent to the favourable
geological horizon which extends from the former Restigouche Mine
to the west of the Murray Brook deposit deposit to Trevali's
productive stratigraphy could significantly increase the scale of
the Murray Brook Project prior to development. A 2,000 metre
exploration program is proposed to drill test five priority
geophysical and geochemical anomalies this summer.
Qualified Persons Statement
The PEA was prepared under the supervision of Eugene Puritch, P.
Eng. of P&E Mining Consultants Inc. Mr. Puritch is an
independent QP in accordance with NI 43-101 and has reviewed and
approved the technical information in this release. The information
in this release was reviewed by Dr. William Stone, Executive Vice
President of Exploration of ELN and a Qualified Person as defined
by NI43-101.
About El Ni?o Ventures Inc. Bathurst Projects
El Ni?o Ventures Inc. has two active projects in the Bathurst
Mining Camp;
1. Murray Brook Project
Murray Brook property is located 60 km west of Bathurst and a
portion of the property is underlain by the Murray Brook
polymetallic massive sulfide deposit. The property is supported by
excellent nearby infrastructure, including paved roads, grid
electricity and communities to provide goods, services and skilled
labour (Figure 1).
Figure 1- Murray Brook and Camel Back Location map in the
Bathurst Mining Camp
ELN and Votorantim Metals Canada
Inc. "VMC" (who is the operator of the joint venture project)
currently own 70% of the project, of which 35% is held by each of
the two parties. Under a purchase agreement signed by VMC on August
28, 2012 with Murray Brook Minerals and Murray Brook Resources Inc.
(collectively the "Owners"), VMC acquired the right to purchase the
additional 30% of the Murray Brook Project from the Owners. The
purchase agreement between VMC and the Owners provides for a series
of staged payments totaling $6 million over a five year period and
provides for a 0.25% NSR payable to the Owners after one year of
commercial production.
VMC provided ELN the option to purchase an additional 15% in the
project as required by an underlying Amending Agreement dated
September 30, 2010 between Xstrata Zinc (now Glencore Xstrata PLC),
VMC and ELN (see reference to the Tri-Party Agreement immediately
below). ELN did not elect to exercise the option and consequently
at this time the Joint Venture remains at VMC 65%: ELN 35%.
To date, more than 28,000 metres of drilling has been completed
with encouraging results. In February 2012, NI 43-101 resource
estimation was announced (see news
release). The Technical Report is filed on SEDAR.com and also available on ELN's website. The new Preliminary Economic
Assessment Report, PEA, will be filed on SEDAR within 45 days of
the date of this press release.
2. Bathurst Mining Camp Project ( Tri-Party
Agreement):
Consists of an initial 4,712 claims in the Tri?Party Agreement with
Xstrata Zinc (now Glencore Xstrata) and VM Canada, whereby VM
Canada may incur exploration expenditures of $10 million over a
period of 5 years to earn a 50% interest. VM Canada may further
increase its interest to 70% by spending an additional $10 million
over two years. Drilling and further exploration activities have
been planned for 2013.
Votorantim Metals Canada Inc. Statement
Technical details in this news release were provided by VMC whose
professional geologists conduct operations consistent with mineral
industry best practices. VMC accepts no responsibility for this
news release or any inferences made from the technical details
provided herein.
About Votorantim Metals Canada Inc.
VMC is a subsidiary of Votorantim Metais is a company that is part
of the Votorantim Group that was founded in Brazil in 1918. The
Votorantim Group operates in twenty countries and has over 40,000
employees. Votorantim Metais is the largest electrolytic nickel
producer in Latin America and one of the world's leaders in the
production of zinc, aluminum and nickel. Votorantim Canada Metals
Inc. in conjunction with Glencore Xstrata PLC and El Nino Ventures
is operator of the Bathurst Option and Joint Venture which is
actively exploring for base metal deposits within the Bathurst
Mining Camp.
About El Nino Ventures Inc.
El Ni?o Ventures Inc. is an international exploration
company, focused on exploring for zinc, silver, copper, gold and
lead in New Brunswick, Canada and copper in the Democratic Republic
of Congo ("DRC").
On Behalf of the Board of Directors
"Harry Barr"
Harry Barr
Chairman & CEO
El Nino Ventures Inc.
Further Information: Tel: +1 604 685
1870 Fax: +1 604 685 8045
Email: info@elninoventures.com or visit www.elninoventures.com
650-555 West 12th Avenue, City Square, West Tower, Vancouver, B.C.,
Canada, V5Z 3X7
Neither the TSX Venture
Exchange nor its Regulation Services Provider (as that term is
defined in the policies of the TSX Venture Exchange) accepts
responsibility for the adequacy or accuracy of this release.
Cautionary Note Regarding Forward Looking Statements. Note: This
release contains forward-looking statements that involve risks and
uncertainties. These statements may differ materially from actual
future events or results and are based on current expectations or
beliefs. For this purpose, statements of historical fact may be
deemed to be forward-looking statements. In addition,
forward-looking statements include statements in which the Company
uses words such as "continue", "efforts", "expect", "believe",
"anticipate", "confident", "intend", "strategy", "plan", "will",
"estimate", "project", "goal", "target", "prospects", "optimistic"
or similar expressions. These statements by their nature involve
risks and uncertainties, and actual results may differ materially
depending on a variety of important factors, including, among
others, the Company's ability and continuation of efforts to timely
and completely make available adequate current public information,
additional or different regulatory and legal requirements and
restrictions that may be imposed, and other factors as may be
discussed in the documents filed by the Company on SEDAR
(www.sedar.com), including the most recent reports that identify
important risk factors that could cause actual results to differ
from those contained in the forward-looking statements. The Company
does not undertake any obligation to review or confirm analysts'
expectations or estimates or to release publicly any revisions to
any forward-looking statements to reflect events or circumstances
after the date hereof or to reflect the occurrence of unanticipated
events. Investors should not place undue reliance on
forward-looking statements.
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