Issue link: http://resourceworld.uberflip.com/i/661612
A P R I L / M A Y 2 0 1 6 www.resourceworld.com 49 MININg aurico Metals releases positive feasibility for Kemess copper-gold project Chris Richter, President and CEO, reported AuRico Metals Inc. [AMI-TSX] has released results of a NI 43-101 compliant Feasibility Study (FS) update prepared for the Kemess Underground (KUG) Project located on the 100%-owned Kemess prop- erty in the Toodoggone River region about 250 km north of Smithers, northern British Columbia. Prepared by independent consultants, the FS envisions a low-cost, underground, panel caving operation to extract the KUG reserves over a 12-year mine life. Results demonstrate the KUG Project is a robust, low-risk project benefiting from extensive infrastructure already in place, notably the milling facility used to process ore from the Kemess South Mine 5.5 km south. The Feasibility Study Base Case assumes a long term (LT) gold price of US $1,250/oz, a LT copper price of US $2.50/lb, and a C$/ US$ exchange rate of 0.75; Consensus Case LT gold and copper prices of US $1,250/oz and US $3.00/lb respectively. • Pre-tax net cash flow of C $1,102M in Base Case (C $1,453M in Consensus Case) • After tax net cash flow of C $746M in Base Case (C $969M in Consensus Case) • After tax NPV5% of C $289M in Base Case (C $421M in Consensus Case) • IRR of 12.6% in Base case (15.4% in Consensus Case) • Total life-of-mine production of 1.4Moz gold, 573Mlb copper and 4.5Moz silver • Average annual Production of 129Koz of gold and 52Mlbs of copper over first five years • Co-product all-in sustaining costs (AISC) over first five years of US $682/oz of gold and US $1.36/lb of copper • By-product AISC over first five years of US $201/oz of gold • Pre-commercial production capital costs (including 12.5% contingency) of C $450M (US $337M) plus an additional C $153M (US $115M) in capitalized operating costs (net of revenue); Capital expenditures are back-end weighted • Large indicated resource base of 246.4Mt including reserves of 107.4Mt (currently constrained by tailings storage capacity of the mined-out Kemess South open pit) Testwork indicates that KUG ore will pro- duce a concentrate that is free of deleterious elements and readily marketable to both smelters and traders. AuRico has submitted its Environmental Assessment Application and expects to enter the 180-day Application Review period in early April. There is further property resource potential at the 100%-owned Kemess East (1 km east of KUG) as reported in a resource update which does not factor into the FS. At Kemess East, there is a NI 43-101 compliant, updated, high-grade core esti- mated to host indicated resources of 19.2M tonnes of 0.47% copper and 0.72 g/t gold plus 31.7M tonnes of 0.45% copper and 0.63 g/t gold inferred. AuRico receives substantial annual rev- enues from royalty streams derived from various mining operations. n