TIDMPERE
RNS Number : 2617Y
Pembridge Resources plc
12 May 2021
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION AS DEFINED UNDER
THE MARKET ABUSE REGULATION (596/2014/EU) AS IT FORMS PART OF UK
DOMESTIC LAW BY VIRTUE OF THE EUROPEAN (WITHDRAWAL) ACT 2018, IS
FOR INFORMATION PURPOSES ONLY AND IS NOT AN OFFER OF SECURITIES IN
ANY JURISDICTION.
12 May 2021
Minto Explorations Ltd - NI 43-101 Preliminary Economic
Assessment Technical Report
London, United Kingdom - Pembridge Resources plc (LSE: PERE)
("Pembridge" or the "Company") is pleased to announce the key
results from Minto Exploration Ltd. ("Minto") NI 43-101 Preliminary
Economic Assessment Technical Report ("Technical Report") and the
resulting estimate of Minto's mine life and Net Present Value
("NPV").
Highlights
- Life of mine extended from initial 4 years previously
announced (up to 2023) to 8 years (up to 2028) while processing
10,893 kt of a total Indicated and Inferred Resources of 24,105
kt.
- Total Resources have been increased from 22,554 kt(1)
(including 1,417(1) kt of Reserves) to 24,105 kt with a resulting
change in Cu Metal Resources from 712(2) Mlbs (including 60(2) Mlbs
of Reserves) to 727 Mlbs; Au Metal Resources from 394 koz
(including 31(2) koz of Reserves) to 396 koz; Ag Metal Reserves and
Resources from 3,552(2) koz (including 303(2) koz of Reserves) to
3,947 koz.
- Economic model presented in the Technical Report evaluates
Minto NPV after tax using 8% discount rate of USD$84 million (using
long term copper price at $3.10 per pound and USD CAD exchange rate
of 1.315)
- Average annual production of 38 million lbs and average annual
EBITDA in excess of US$40 million between 2021 and 2025(3)
- Using a flat copper price of US$4.50 per lb over the life of
mine and USD CAD exchange rate of 1.250, the Minto NPV after tax
using 8% discount rate is USD$265 million(3)
- C1 cash Cost per lb of Cu is US$2.20
- All In Sustaining Cost (AISC) per lb of Cu is USD$2.65 for
life of mine after by-product credits and before closure costs
The report may be accessed and downloaded from the Company
website:
https://www.pembridgeresources.com/investors/financial-reports-and-presentations
43-101 Preliminary Economic Assessment Report Resources
In February 2021, JDS Engineering & Mining Inc. ("JDS") was
commissioned by Minto to prepare a Technical Report, which updates
the results of the Competent Person's Report commissioned by
Pembridge and delivered in June 2019 with mineral deposits
assessment as at 31 May 2019.
The Technical Report confirms the following Mineral Resources as
at 31 March 2021:
Resource Tonnes Cu. Grade Au Grade Ag Grade
Classification (000's) (%) (g/t) (g/t)
-------- ---------- --------- ---------
Measured and Indicated
Resources 11,092 1.46 0.53 4.75
-------- ---------- --------- ---------
Inferred Resources 13,013 1.29 0.49 4.55
-------- ---------- --------- ---------
Total 24,105
-------- ---------- --------- ---------
Cu Metal Au Metal Ag Metal
-------- ---------- --------- ---------
(Mlbs) (koz) (koz)
-------- ---------- --------- ---------
Measured and Indicated
Resources 356 189 1,858
-------- ---------- --------- ---------
Inferred Resources 370 207 2,089
-------- ---------- --------- ---------
Total 727 396 3,947
-------- ---------- --------- ---------
Total Resources have been increased from 22,554 kt(1) (including
1,417(1) kt of Reserves) to 24,105 kt with a resulting change in Cu
Metal Resources from 712(2) Mlbs (including 60(2) Mlbs of Reserves)
to 727 Mlbs; Au Metal Resources from 394 koz (including 31(2) koz
of Reserves) to 396 koz; Ag Metal Reserves and Resources from
3,552(2) koz (including 303(2) koz of Reserves) to 3,947 koz.
Production at Minto restarted in October 2019 with the following
table showing the change in Reserves and Resources after
considering production for the period from restart to 31 March
2021:
Tonnes Cu Metal Au Metal Ag Metal
(000's) (Mlbs) (koz) (koz)
Reserves and Resources
as at 31 May 2019 23,500 740 408 3,669
--------- --------- --------- ---------
Processed / Produced from
October 2019 to 31 March
2021 (946) (28) (14) (117)
--------- --------- --------- ---------
Depleted Reserves and Resources
at 31 March 2021 22,554 712 394 3,552
--------- --------- --------- ---------
Resources at 3 1 March
2021 as per JDS Technical
Report 24,105 727 396 3,947
--------- --------- --------- ---------
Resource increase / (decrease) 1,551 15 2 395
--------- --------- --------- ---------
According to the Canadian Institute of Mining the public
disclosure of a Mineral Reserve must be demonstrated by a
Pre-Feasibility Study or Feasibility Study and therefore the
Technical Report identifies Minto's mineral deposits as Resources
only.
The Resources modelled in the Technical Report were based on an
8 year mine life. Given the utilisation of only 45% of the total
Resources in the projected 8 year mine life and the fact that
inferred resources lack sufficient drilling and mine planning and
the significant unexplored areas within the Minto claim package,
management expects to increase the life of mine to over 15 years,
subject to successful results of such drilling and applicable mine
planning.
Economic model
The Technical Report includes an economic model that has been
developed by JDS using the following key assumptions:
- Long term copper price of US$3.10/lb; gold price of
US$1,550/oz and silver price of US$18.50/oz
- Agreed upon terms for new amendment of streaming agreement
with Wheaton Precious Metals Corp for gold produced by Minto
expected to be signed shortly
- Long term USD to CAD exchange rate of 1.316
- Ore quantities mined and grades for copper, gold and silver as
per the latest mine plan developed as part of the Technical
Report
- NPV discount rate of 8%
The economic model presented in the Technical Report shows a NPV
after Canadian taxes and royalties of US$84 million and average
annual EBITDA in excess of US$40 million beween 2021 and 2025 when
applying the following price assumptions:
2021 2022 2023 onwards
Copper (US$/lb) 3.40 3.25 3.10
------ ------ -------------
Gold (US$/oz) 1,850 1,625 1,550
------ ------ -------------
Silver (US$/oz) 24.00 21.00 18.50
------ ------ -------------
The NPV after Canadian taxes and royalties exhibits strong
sensitivity to copper and exchange rates as illustrated in the
table below, prepared as part of the Technical Report, to the
following:
Project After-Tax NPV8 (CAD$) Sensitivity Based on Fixed Copper
Price and FX Rate
(Gold = US$1,550/oz and Silver = 18.50/oz) (4)
E xchange Copper Price (US$/lb)
rate
( USD:CAD) 4.50 4.25 4.00 3.75 3.50 3.25 3.10 2.85 2.50 2.20
----- ----- ----- ----- ----- ----- ----- ----- ----- -----
0.82 313 269 225 177 125 67 32 -28 -115 -193
----- ----- ----- ----- ----- ----- ----- ----- ----- -----
0.80 331 288 243 196 144 86 50 -11 -99 -178
----- ----- ----- ----- ----- ----- ----- ----- ----- -----
0.78 351 307 261 215 163 106 69 7 -83 -162
----- ----- ----- ----- ----- ----- ----- ----- ----- -----
0.76 373 327 281 233 183 127 90 26 -65 -147
----- ----- ----- ----- ----- ----- ----- ----- ----- -----
0.74 395 348 301 252 203 146 111 46 -47 -130
----- ----- ----- ----- ----- ----- ----- ----- ----- -----
0.72 419 370 322 273 223 167 132 66 -28 -113
----- ----- ----- ----- ----- ----- ----- ----- ----- -----
0.70 444 394 344 294 243 189 153 88 -8 -94
----- ----- ----- ----- ----- ----- ----- ----- ----- -----
0.68 470 419 367 317 264 211 175 111 12 -75
----- ----- ----- ----- ----- ----- ----- ----- ----- -----
The Technical Report has been approved by the Joint Advisory
Committee of Minto and is only subject to comments from the
Canadian Regulatory bodies.
1. Ore reserves and resources based on 31 May 2019 technical
report adjusted for production up to 31 March 2021.
2. Metal reserves and resources based on 31 May 2019 technical
report adjusted for production up to 31 March 2021.
3. Based on USD CAD exchange rate of 1.316
4. 43-101 preliminary economic assessment technical report page 23-11
Gati Al-Jebouri, Chief Executive Officer and Chairman of the
Board of Pembridge said:
"The Technical Report prepared by JDS confirms our expectations
for the Minto life of mine as well as the potential for further
development. The imbedded value of Minto is now clearly identified,
and the Minto team is very excited to realise and grow this value
for all the Minto stakeholders."
Cautionary Statement
This News Release includes certain "forward-looking statements"
which are not comprised of historical facts. Forward-looking
statements include estimates and statements that describe the
Company's future plans, objectives or goals, including words to the
effect that the Company, or management, expects a stated condition
or result to occur. Forward-looking statements may be identified by
such terms as "believes", "anticipates", "expects", "estimates",
"may", "could", "would", "will", or "plan". Since forward-looking
statements are based on assumptions and address future events and
conditions, by their very nature they involve inherent risks and
uncertainties. Although these statements are based on information
currently available to the Company, the Company provides no
assurance that actual results will meet management's expectations.
Risks, uncertainties and other factors involved with
forward-looking information could cause actual events, results,
performance, prospects and opportunities to differ materially from
those expressed or implied by such forward-looking information.
Forward-looking information in this news release includes, but is
not limited to, the Company's intentions regarding its objectives,
goals or future plans and statements. Factors that could cause
actual results to differ materially from such forward-looking
information include, but are not limited to, the Company's ability
to predict or counteract the potential impact of COVID-19
coronavirus on factors relevant to the Company's business, failure
to identify additional mineral resources, failure to convert
estimated mineral resources to reserves with more advanced studies,
the inability to eventually complete a feasibility study which
could support a production decision, the preliminary nature of
metallurgical test results may not be representative of the deposit
as a whole, delays in obtaining or failures to obtain required
governmental, environmental or other project approvals, political
risks, uncertainties relating to the availability and costs of
financing needed in the future, changes in equity markets,
inflation, changes in exchange rates, fluctuations in commodity
prices, delays in the development of projects, capital, operating
and reclamation costs varying significantly from estimates and the
other risks involved in the mineral exploration and development
industry, and those risks set out in the Company's public
documents. Although the Company believes that the assumptions and
factors used in preparing the forward-looking information in this
news release are reasonable, undue reliance should not be placed on
such information, which only applies as of the date of this news
release, and no assurance can be given that such events will occur
in the disclosed time frames or at all. The Company disclaims any
intention or obligation to update or revise any forward-looking
information, whether as a result of new information, future events
or otherwise, other than as required by law.
ENDS
NOTES TO EDITORS
About Pembridge Resources plc
Pembridge is a mining company that is listed on the standard
segment of the Official List of the FCA and trading on the main
market for listed securities of London Stock Exchange plc.
Pembridge has an investment in Minto Explorations Ltd, a British
Columbia incorporated business operating the Minto mine in Yukon,
Canada.
About Minto Explorations Limited
Minto operates the underground copper-gold-silver mine located
in central Yukon, approximately 240 kilometres north of the capital
Whitehorse along the Klondike Highway. In excess of US$350 million
of capital expenditure has been invested into Minto operations
since site construction began in 2006. The Minto mine was in
continuous production between 2007 and 2018, when the mine was
placed onto temporary care and maintenance. Pembridge acquired
Minto from Capstone Mining Corporation in June 2019 and restarted
operations in October 2019.
Enquiries:
Pembridge Resources plc: +44 (0) 20 7917 2968
Gati Al-Jebouri, Chief Executive Officer and Chairman of the
Board
David James, Chief Financial Officer
Brandon Hill Capital - United Kingdom: +44 (0)20 3463 5016
Jonathan Evans
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