LUNDIN MINING ANNOUNCES EAGLE EAST FEASIBILITY STUDY RESULTS AND PROVIDES A PROJECT UPDATE
Toronto, April 10, 2017 (TSX: LUN; OMX: LUMI) Lundin Mining Corporation (“Lundin Mining” or the “Company”) is pleased to announce the results of a Feasibility Study, including an updated Mineral Resource estimate and a maiden Mineral Reserve estimate, on the high grade Eagle East nickel/copper mineralization, as well as provide an update on the project progress.
(This news release contains forward-looking information about expected future events and financial and operating performance of the Company. We refer to the risks and assumptions set out in our Cautionary Statement on Forward-Looking Information located on page 5. All currency figures are in US$ unless otherwise stated.)
- The Feasibility Study demonstrates the viability of mining Eagle East as an extension of the current Eagle Mine with an incremental estimated post-tax net present value (“NPV”) of $205 million at an 8% discount rate and an estimated internal rate of return (“IRR”) of 47%. The estimated pre-production capital cost is $102 million.
- Given the robust results of the Feasibility Study, the Company has approved the full development of Eagle East subject to the successful receipt of amendments to the mining permit.
- An updated Mineral Resource estimate comprising 1.29 million tonnes classified as Indicated grading 5.2% Ni and 4.2% Cu and an additional 0.29 million tonnes of Inferred grading 1.7 % Ni and 1.4% Cu.
- The Feasibility Study indicates that these Mineral Resources can be mined with no significant changes to the current mine, ore transport, mill, and tailings infrastructure.
- Similar mining methods to Eagle are proposed and a maiden Probable Mineral Reserve of 1.54 Mt at 3.7% Ni and 3.0% Cu has been estimated. Mining of this Mineral Reserve will significantly increase nickel and copper production from 2020 and extend estimated mine life to at least 2023.
- The Michigan Department of Environmental Quality has approved the initial Eagle East access ramp development within the existing Eagle mine boundary. An application for a modification to the existing Part 632 mining permit to allow the mining of Eagle East, with a supporting Environmental Impact Assessment, was submitted in late March 2017 and a decision is expected prior to the end of 2017.
- Eagle East exploration/access ramp development has progressed well since commencement in July 2016. At the end of Q1 2017, a total of 938 metres of centreline advance had been completed together with the purchase of additional mobile mining equipment and installation of mining infrastructure. Ongoing drilling has enabled a Probable Reserve classification, a mine plan update and improved forecast return on investment.
We are seeking regulatory approvals in two parts:
The first request is to seek approval for the continued advancement of the Eagle East decline within the project boundary. This request was submitted to the Michigan Department of Environmental Quality on February 16, 2017 and approved by the MDEQ on March 23, 2017.
An additional permit amendment request to our Part 632 permit was submitted on March 21, 2017 for the approval to develop the Eagle East mineralization. We expect this review to take up to six months.