NEWS!!! CANDENTE COPPER ANNOUNCES POSITIVE PEA RESULTS!!!! AMAZING NEWS FOR CANDENTE COPPER!!
NEW Preliminary Economic Assessment (“the 2022 PEA”) for its 100% owned Caariaco copper project in Northern Peru.
2022-02-08 07:00 ET - News Release
NPV of US$1.01 B with CapEx of $1.04 B
Annual Average Copper Production of 173 Million Pounds Over Mine Life of 28 Years
VANCOUVER, British Columbia, Feb. 08, 2022 (GLOBE NEWSWIRE) -- Candente Copper Corp. (TSX:DNT, BVL:DNT, US:CDOUF) ("Candente Copper” or “the Company") is very pleased to announce completion by Ausenco Engineering Canada Inc. (“Ausenco”) of a positive Preliminary Economic Assessment (“the 2022 PEA”) for its 100% owned Caariaco copper project in Northern Peru.
Based on projected average annual metal production of 173 million (“M”) pounds (“lb”) (78,543 tonnes) copper, 31,395 ounces (“oz”) gold (“Au”), and 703,588 oz silver (“Ag”) for 28 years and an initial capital cost estimate (“CapEx") of $1.04 B, the Caariaco Norte project has an after-tax net present value (“NPV”) of US$1,010 M, and after-tax internal rate of return (“IRR”) of 16.3% using a copper price of US$3.50 /lb, US$1,650/oz Au, US$21.50/oz Ag and a discount rate of 8%.
The NPV increases to US$1,833 M, with an IRR of 21.9% and payback of 4.5 years when using a copper price of US$4.50/lb, US$1,650/oz Au and US$21.50/oz Ag. The C1 cash operating cost (*see below under Operating Costs) is estimated to be US$1.28/lb of copper. The forecast strip ratio is 0.66.
Commenting on the results, President and CEO Joanne C. Freeze stated, “We are very pleased with the results of this new PEA which has achieved three key project objectives: 1) a lower initial capital cost; 2) a subsequent project expansion financed from cash flow and 3) enhanced environmental, social, and governance (“ESG”) practices. The lower CapEx offers many more opportunities to finance the project. The focus on enhancing ESG practices led to a single dry stack waste management facility (WMF) with co-mingling and co-disposal of waste rock and filtered mill tailings, would produce an overall smaller footprint for the project that is further distanced from farming communities. Building on the ESG mandate, geometallurgical modelling of the Caariaco Norte deposit gives a better understanding of the mineralization, resulting in a highly marketable concentrate with no need for arsenic treatment and lowers the projected operating cost estimate (“OpEx”)”.
“The 2022 PEA presents an alternative business case for developing the Caariaco Project with a smaller initial CapEx, however larger companies could prefer to develop it as a larger project with a much higher throughput on start-up. The Caariaco project offers many advantages. It is reasonably close to key road and power infrastructure, has a low strip ratio, moderately soft rock (BWI 11.2), low operating cost and offers excellent potential for discovery of additional mineralization. The very large data base from previous engineering work supports the 2022 PEA which together could allow moving directly into a feasibility evaluation phase,” also stated Joanne Freeze.
The 2022 PEA by Ausenco builds on earlier advanced engineering studies conducted from 2010 through 2014. Key highlights follow:
- Initial CapEx of $1.04 B – 40,000 tonnes per day (“tpd”) mine and plant;
- Mine and plant expansion to 80,000 tpd in year 7 with additional CapEx of $305 M from cash flow;
- Cash operating cost of US$1.28/lb of copper including all on-site and off-site costs, treatment and refining charges (“TC/RC"), net of by-product credits;
- Advanced ESG development strategies result in improved Infrastructure Design including a single waste management facility (WMF) with co-mingling and co-placement of waste rock and filtered mill tailings creating a smaller overall footprint further distanced from populated areas;
- Waste to mineralized material strip ratio of 0.66:1
- After-tax NPV of US$1,010 M for base case of US$3.50/lb Cu, US$1,650/oz Au, US$21.50/oz Ag, and 8% discount rate;
- After-tax IRR of 16.3% for base case of US$3.50/lb Cu, US$1,650/oz Au, and US$21.50/oz Ag;
- After-tax NPV increases to US$1,833 M, with an IRR of 21.9% and payback of 4.5 years when using a copper price of US$4.50/lb.
- Payback of pre-production capital in 7.1 years using base case price of US$3.50/lb Cu and 4.5 years using US$4.50/lb Cu;
- Highly leveraged to copper prices;
- Life-of mine (“LOM”) metal production of 4,848 Mlb (2,199,215 tonnes) Cu, 879,051 oz Au, and 19,700,467 oz Ag;
- Average annual metal production of 173 Mlb (78,543 tonnes) Cu, 31,395 oz Au, and 703,588 oz Ag during the LOM;
- Average annual metal production of 120 Mlb (54,539 tonnes) Cu, 24,375 oz Au, and 548,667 oz Ag for the first six years;
- Average annual metal production of 193 Mlb (87,475 tonnes) Cu, 34,243 oz Au per year, and 766,753 oz Ag per year for the second mine phase, which will run for 21.4 years;
- Average LOM metal recoveries of 88.1% for Cu, 64.7% for gold and 57.2% for silver;
- Concentrate grades are forecast to average approximately 26% Cu, 3.63 g/t Au and 84.16 g/t Ag for first six years;
- LOM Concentrate grades are projected to average approximately 26% Cu, 3.27 g/t Au and 75.40 g/t Ag;
- Conventional crush/grind and flotation technology;
- Decreased OpEx with marketable concentrate with no need for arsenic treatment;
- Pre-production capital cost of US$1.04 B is based on leased mining equipment and includes a contingency allocation of 18.5%;
- All-in capital cost of US$1.57 B based on leased mining equipment and including life-of-mine sustaining capital, expansion capital and closure cost;
- 28-year mine life, with potential for extension if additional resources identified below proposed pit can be included in a mine plan;
- Located at a moderate elevation with pit centroid and process plant at approximately 3,000 metres above sea level;
- Connection to the national power grid is planned to be by direct line approximately 55 km from the project site to the Carhuaquero substation site;
- Significant potential for discovery of additional mineralization at nearby Caariaco Sur and Quebrada Verde targets.
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