Awesome news!!!!!VANCOUVER, BRITISH COLUMBIA, Mar 17, 2008 (Marketwire via COMTEX News Network) --
Nevada Copper Corp. (TSX:NCU)(FRANKFURT:ZYT) ("Nevada Copper") is pleased to announce that it has completed a positive Preliminary Economic Assessment ("PEA") for its 100% owned Pumpkin Hollow Copper Property located in Nevada. The PEA evaluates an integrated underground and open pit mining operation with a standard milling and floatation plant that will produce high-grade copper concentrates. Annual production will average 95,000 tons of copper per year over a mine life exceeding 20 years.
Highlights from the PEA at copper prices from $1.75 to $3.00 per lb. copper are as follows:
- Net Present Value: $2.6 Billion to $6.3 Billion with 0% discount rate;
- Net Present Value: $765 Million to $1.9 Billion with 8% discount rate;
- Internal Rate of Return: 20.5% to 29.3%;
- Total operating cost: $1.02 per lb. copper, net of by-product credits;
- Capital cost estimate: $780 Million, including working capital & contingencies; and,
- Project payback from start of construction: 3.1 to 4.8 years.
The designed mining operation would have a 60,000 ton per day concentrator throughput. Metallurgical recoveries are estimated at 89% for copper, 70% for gold and 68% for silver.
Joe Kircher, Nevada Copper's Vice President, Chief Operating Officer, commented, "We are extremely pleased with the results of the PEA as it provides a robust economic base that warrants completion of a Definitive Feasibility Study. Pumpkin Hollow's large high-grade copper resource combined with superior project development characteristics will result in a profitable and large North American source of copper production. Nevada Copper will now aggressively move to the completion of a Definitive Feasibility Study over the next 12 months. During feasibility several aspects of the project will be evaluated which should further enhance an already robust economic profile."
Financial highlights of the PEA are as follows:
--------------------------------------------------------------------------(In Millions of US Dollars and Imperial Units)-------------------------------------------------------------------------- Base Case Alternative Case --------------------------- -------------------------- Variable VariableCopper Price to to($/lb) $ 1.75(2) $2.50(3) $ 3.00 $ 1.75(2) $2.50(3) $ 3.00--------------------------------------------------------------------------NPV @ 0% $ 2,625 $ 4,303 $ 6,328 $ 1,413 $ 3,088 $ 5,113--------------------------------------------------------------------------NPV @ 4% $ 1,381 $ 2,143 $ 3,396 $ 863 $ 1,623 $ 2,876--------------------------------------------------------------------------NPV @ 8 % $ 765 $ 1,086 $ 1,918 $ 531 $ 851 $ 1,684--------------------------------------------------------------------------IRR (includes contingency) 23.8% 20.5% 29.3% 22.9% 19.7% 29.0%--------------------------------------------------------------------------Capital (includes contingency & working capital) $ 780 $ 780 $ 780 $ 780 $ 780 $ 780--------------------------------------------------------------------------Payback (years) 3.1 4.8 3.6 3.1 4.8 3.6--------------------------------------------------------------------------NOTES:(1) NPV stands for Net Present Value and is quoted after royalties; IRR stands for Internal Rate of Return.(2) The variable copper price was established using the 24-month forward prices for the first two years trending down to a long-term fixed price of $1.75/lb.(3) The Securities and Exchange Commission 36-month trailing average price is $2.67/lb. as compared to the $2.50/lb. used in the Base and Alternative Case.(4) Gold and Silver prices used for all price sensitivities are fixed at $600 & $10 per ounce respectively.
The PEA was based on a rigorous detailed analysis which includes an updated National Instrument 43-101 compliant resource dated December 17, 2007; bench scale metallurgical test work; detailed open pit and underground mine plans; comprehensive geotechnical, hydrological, and environmental studies; current price estimates for major equipment and infrastructure, cost contingencies and forecasts of long-term prices for copper, gold, silver and iron. The PEA was prepared by the mineral resource and mining division of Tetra Tech MM Inc. ('Tetra Tech") an industry leading international engineering firm.
Aspects Common to Both Cases: Potentially mineable resource of 460 million tons @ 0.55% copper, 0.002 opt gold and 0.08 opt silver consisting of 432 million tons @ 0.47% copper mineable by open pit methods using conventional truck and shovel mining and 28 million tons @ 1.75% copper mineable by underground using cut and fill mining methods; 60,000 tons per day concentrator throughput, 90% open pit and 10% underground; 24 year mine life; waste to ore ratio in the open pits are 3.1 to 1; metallurgical recoveries projected at, 89% copper, 70% gold and 68% silver; 27% copper concentrate product; 10% capital contingency.
Detailed mine production schedules include for the open pit Whittle shells and ultimate pit designs and for the underground, life of mine development plans, including shaft access and individual stope layouts.
Base Case: Copper, gold and silver operation including an iron credit commencing in year 9; undiscounted direct cash operating cost of $0.57/lb. copper, net of by-product credits; recoverable copper equivalent of 5.4 billion pounds; copper equivalent head grade 0.66%; iron tons processed: 162 million tons @ 30% iron including 120 million tons from copper concentrate tailings and 42 million from copper pit waste; iron operation commences in year 9 requiring an additional $130 million of capital split between years 8 and 19 generating 53 million tons of 67% iron pellet feed over project years 9 to 24; iron concentrate price of $60/ton; total operating cost of $1.02/lb. copper, net of by-product credits.
Alternative Case: Copper, gold, and silver concentrate operation with no iron credit; undiscounted direct cash operating costs $0.85/lb. copper, net of by-product credits; recoverable copper equivalent 4.4 billion pounds; total operating costs of $1.29/lb. copper, net of by-product credits.
Other significant highlights include the following:
- The updated resource is based on a database that now consists of 455 drill holes containing in excess of 200,000 meters of drilling and 38,000 assays. The PEA potentially mineable resource of 460 million tons at 0.55% copper consists of 48% measured and indicated and 52% inferred resource. Based on the success of the 2007 drilling program it is projected that a significant portion of the inferred resource will be moved into the measured and inferred category in 2008 as a result of the current drilling program;
- Opportunities to enhance the average grade of the open pit mineable areas in years 1 through 3 have been identified in both the North, South and Southeast deposits. These targets are currently being drilled;
- Both the underground and open pit mines are economically viable on a stand-alone basis and will be evaluated in detail during Feasibility, including a potential "high-grade" underground operation;
- Favorable environmental characteristics of the Pumpkin Hollow deposits combined with a mining friendly jurisdiction should facilitate a reasonable permitting timeline;
- Existing infrastructure, excellent logistics and good community demographics will positively impact capital expenditures and operating costs compared to current industry averages;
- As previously announced Nevada Copper has commenced a drilling program for 2008 which has significant potential to further increase the existing resource by way of drill testing down dip and along strike where the deposits remain open in several directions and to follow up several mineralizing trends and geophysical anomalies. For further details on the planned drilling program please refer to Nevada's Copper's news release dated January 30, 2008;
- The ongoing re-assay program of historic core is expected to add to the total gold and silver resources in each deposit; and,
- Historically, only a small portion of the drilling was assayed for molybdenum. The latest drilling by Nevada Copper indicates molybdenum may be present in sufficient quantities to allow for commercial recovery.
Nevada Copper assembled a "best in class" team in early 2007 as it progresses to towards a Definitive Feasibility Study ("Feasibility Study") which includes the following highly respected firms: Tetra Tech (PEA Coordinator & Mineral Resource-open pit mining); Hazen Research (Metallurgy); Resource Development Inc. (Processing); Golder Associates (Geotechnical); Water Management (Hydrology); Dynatec (Underground Mining); and The Mines Group (Community Relations and Permitting).
During the next several months, geotechnical, metallurgical test-work, hydrological analyses and the permitting activities will be ongoing while Nevada Copper negotiates with engineering consultants for purposes of awarding the contract for the Feasibility Study.
Nevada Copper will be updating its current resource estimate in 2008 to incorporate the results of its current 15,000 meter drilling program and its ongoing assaying program of historical core. Currently, assay results from a total of 5,300 meters (17,390 ft) of historic core and pulps have been processed. This program focused on ore intervals that lacked gold and silver assays as much of the initial historic drilling only focused on the iron and copper. Currently coarse reject samples from 85 drill holes have been analyzed for the additional elements. The assay program of the historic drilling core is continuing and currently 40 percent complete. This program will provide a more complete assay database for the Feasibility Study.
According to NI 43-101 guidelines, a PEA is considered preliminary in nature and includes the use of inferred mineral resources which are considered too speculative geologically to apply economic considerations that would enable them to be categorized as mineral reserves. Thus, there is no certainty that the production profile concluded in the Preliminary Economic Assessment will be realized. Actual results may vary.
The PEA report on the Pumpkin Hollow property will be available within 45 days on SEDAR at www.sedar.com.
Qualified Person
Nevada Copper retained Tetra Tech of Golden, Colorado to estimate the Pumpkin Hollow mineral resource as part of the PEA. The mineral estimation work was performed by or under the direction of John Rozelle, PG, Tetra Tech's Mineral Resource Division Principal Geologist an independent Qualified Person as set forth by Canadian National Instrument 43-101. Mr. Mike Kolin, P.E. was responsible for the mine planning and mine engineering portions of the PEA. Messrs. Rozelle and Kolin have coordinated the PEA report with the other engineering and environmental contactors working on the project.
The Pumpkin Hollow project is under the supervision of Gregory French, CPG #10708, a Qualified Person as defined in Canadian National Instrument 43-101, who is responsible for the preparation of the technical information in this news release. All assaying and whole rock geochemistry is processed at the American Assay Laboratories (AAL) in Reno, Nevada. Samples are delivered from the project core logging facility to AAL by Nevada Copper or AAL personnel. A Quality Assurance and Quality Control Assay Protocol have been implemented whereby blanks and standards are inserted into the assay stream and check samples are sent to Chemex-Reno and Inspectorate-Reno laboratories.
About Nevada Copper
Nevada Copper is a well financed emerging copper company listed on the TSX, responsibly developing the Pumpkin Hollow copper-iron property located in Western Nevada. Nevada Copper has embarked on a systematic fast-track program to develop the Pumpkin Hollow Property into Nevada's next copper mine.
Nevada Copper has 36.8 million shares outstanding and is well financed with no debt. For additional information about Nevada Copper please visit our website at www.nevadacopper.com.
NEVADA COPPER CORP.
Giulio T. Bonifacio, President & CEO