Issue link: http://resourceworld.uberflip.com/i/990287
J U N E / J U L Y 2 0 1 8 www.resourceworld.com 45 KERR MINES INC. [KER-TSX; KERMF- OTCQB; 7AZ1-FSE] recently released results of a NI 43-101 compliant inde - pendent prefeasibility study (PFS) and resource update prepared by Hard Rock Consulting LLC for its past-producing Copperstone Mine, 16 km north of Quartzite, La Paz County, western Arizona. The company acquired a 100% interest in the Copperstone gold mine in 2014. The mine is fully permitted with significant mining infrastructure, mineral resources and processing infrastructure in place. Following a successful 2017 Phase I exploration program and the PFS, the com - pany confirms updated gold resources and positive economics for the project. During Phase I drilling, Hole KER-17U-50 further extends the Copperstone Zone by returning 7.3 metres grading 102.7 g/t gold. Phase I of the underground program confirmed sig- nificant gold mineralization and increases the potential in expanding resources. PFS highlights in US dollars unless otherwise noted: • Base case $1,250/oz gold; • Initial capital of $22.7-million including a mine equipment capital lease; • Study life operating margin (EBITDA) of $89-million, IRR 40%; • Payback of initial capital within 2.3 years of 2019 production start; • Recovery of gold averaging 95% using crushing, grinding and whole-ore leach; • Average annual sales of 38,347 ounces gold; • Cash operating cost of $684/oz gold oz; • All-in sustaining cost (AISC) of $875/gold oz; • Measured and indicated (M&I) mineral resources of 1,124,800 tonnes averaging 7.63 g/t gold; • 276,100 ounces contained gold in M&I resource; • Inferred resources of 666,000 tonnes aver - aging 6.81 g/t gold; • 145,700 oz contained gold inferred; • Proven and probable (P&P) reserves of 802,048 tonnes averaging 6.79 g/t gold; • 175,093 oz contained gold in P&P reserve; • M&I gold resources ounces not part of the P&P reserve ounces are targeted for potential inclusion in the P&P reserves through recommended future drilling; • Inferred gold resources are open for fur - ther expansion and conversion through recommended future drilling in the Copperstone and footwall zones. "The results of this PFS display the strong near-term production oppor - tunity for the Copperstone Mine and robust returns for our investors. This is just the beginning," said Martin Kostuik, President. "The impressive exploration upside displayed by the 2017 Phase I pro- gram, the historical production of over 500,000 gold ounces and the potential to generate solid positive cash flows by identifying the first four years of gold pro- duction, all point toward the opportunity of many more years, beyond the study time frame, of profitable production. In fact, there are 100,000 gold ounces of M&I min - eral resources that were not included in the P&P mineral resources, part of which are immediately accessible for drilling and potential inclusion." Kostuik continued, "Our intention is to finance the initial capital through cor - porate debt. We are currently engaged in discussions focused on non-dilutive financing options with several lending groups to finalize our forthcoming produc- tion decision. Furthermore, we shall continue our efforts to enhance shareholder value by pursuing other value-adding activi- ties such as conducting an intense 2018 exploration program which is designed to increase mine life." n Kerr's Copperstone PFS predicts 38,347 oz/yr gold sales MINING