Significant improvement in sale value of cobalt and bismuth concentrates to third party
processors and anticipated material reduction in capital and operating costs for development
Issued Capital: 338,603,220
LONDON, ON, Sept. 17, 2018 /CNW/ - Fortune Minerals Limited
(TSX: FT) (OTCQX: FTMDF) ("Fortune" or the "Company") (www.fortuneminerals.com) is pleased to announce that it has received successful results of metallurgical test work
verifying that it can produce an upgraded and essentially arsenic-free cobalt concentrate for the NICO Cobalt-Gold-Bismuth-Copper
development in Canada ("NICO Project"). Gold can also be recovered by Fortune from its
metal concentrates at the mine site allowing the Company to control the gold revenue stream, while producing separate cobalt and
bismuth concentrates for sale to third party processors after arsenic that is typically penalized is removed. The 100% owned NICO
Project is a development stage primary cobalt asset with significant gold and bismuth by-products. Fortune has already received
environmental assessment ("EA") approval and the major permits for the mine and concentrator in the Northwest Territories as well as EA approval for a refinery in Saskatchewan.
Fortune engaged Dundee Sustainable Technologies Inc. ("DST") to conduct a metallurgical test work program to assess the
application of its "Pyrolysis Roast" and "Arsenic Stabilization" processes on metal concentrates produced from the NICO Project.
The objective of this work was to demonstrate that Fortune can remove the arsenic and create metal concentrates that are more
attractive to the market and can be processed in existing metal recovery circuits operating around the world. The test work was
initiated after several mining and refining companies contacted Fortune expressing interest in purchasing metal concentrates
directly from the mine (see News Release, dated June 14, 2018). The DST processes have already been
proven in pilot scale tests conducted for other gold and base metal projects as well as a development stage cobalt project with
similar cobalt concentrate composition. A commercial plant utilizing DST's arsenic stabilization by vitrification process has
also been constructed for a metal processing facility that will be commissioned later this year.
Key Results of DST Test Work:
- Successful removal of 99% of the arsenic in NICO bulk concentrate to lower than 0.2%
- Metal grades in the concentrate increased by 20-30% due to mass reduction from selective removal of arsenic and sulphur
during pyrolysis
- No cobalt, gold, or copper losses from pyrolysis
- Gold can be successfully recovered by cyanidation of the bulk concentrate
- Recovery of bismuth has already been proven with secondary flotation
- Recovery of bismuth oxide by pyrolysis has now also been demonstrated as an option
- Successful separation and capture of arsenic from sulphur liberated during pyrolysis
- Arsenic removed from the concentrate was successfully stabilized using vitrification
- Fused arsenic glass passes TCLP tests for safe disposal
The DST technology utililizes proven fluidized bed pyrolysis technology to roast metal concentrates in an oxygen deprived
environment for selective removal and capture of arsenic and much of the sulphur from the contained sulphide minerals. Arsenic is
then stabilized by vitrification in a fused iron silicate glass that passes U.S. Environmental Protection Agency Procedure TCLP
Method 1311 tests for environmentally safe disposal in a landfill. Gold would be recovered by cyanidation of the bulk concentrate
prior to secondary flotation to produce separate cobalt and bismuth concentrates. The pyrolysis roast would be applied to the
cobalt concentrate to remove the arsenic and enable its sale to third party processors without excessive arsenic penalties.
Additional work is in progress at DST to optimize roast conditions and gold recovery, after completion of which, Fortune may
complete a pilot plant from ores it has stockpiled to produce feasibility level economic analysis of the process. Negotiations
are also progressing with third-party refineries to obtain indicative prices for the sale of upgraded cobalt and bismuth
concentrates with Fortune to remain in control of the gold process stream and revenues.
The DST process technology is anticipated to have materially lower capital and operating costs for the NICO development in
comparison to building and operating a fully vertically integrated hydrometallurgical plant producing cobalt sulphate, gold,
bismuth ingot and copper cement. However, revenues would be comparatively lower for the sale of metal concentrates and there
would be greater dependence on third party processors. The engineering for the facilities in the Northwest Territories is essentially complete for the updated Technical Report to produce metal
concentrates. A small gold recovery circuit may now be required in the mill if pryrolysis process technology is pursued for the
project. Fortune is evaluating the merits and conducting cost-benefit analysis of building a lower capital cost project that
would produce concentrates vs. a higher capital cost project that would produce value added cobalt chemicals in a purpose built
refinery. The Company will evaluate the best development option in consultation with potential strategic partners and in
consideration of their downstream product and commercial objectives. A technical report will be prepared to document the most
commercially attractive project. Fortune has more than 35 confidentiality agreements with companies interested in strategic
partnerships to build and operate the NICO Project.
The disclosure of scientific and technical information contained in this news release has been approved by Robin Goad, M.Sc., P.Geo., President and Chief Executive Officer of Fortune, who is a "Qualified Person" under
National Instrument 43-101.
About Fortune Minerals
Fortune is a Canadian mining company focused on developing the vertically integrated NICO cobalt-gold-bismuth-copper project
in the Northwest Territories and a related refinery the Company plans to construct in
Saskatchewan. Fortune also owns the Sue-Dianne copper-silver-gold deposit located 25 km north of
the NICO Project and a potential future source of incremental mill feed to potentially extend the life of the NICO Project
mill.
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This press release contains forward-looking information and forward-looking statements within the meaning of applicable
securities legislation. This forward-looking information includes statements with respect to, among other things, the Company's
plans to develop the NICO Project, the Company's plans to complete a pilot plant to assess the impact of the application of DST's
processing technology to the Nico Project and the economic impact of utilizing such technology . Forward-looking information is
based on the opinions and estimates of management as well as certain assumptions at the date the information is given (including,
in respect of the forward-looking information contained in this press release, assumptions regarding: the Company's ability to
arrange the necessary financing to continue operations and develop the NICO Project; the construction of the Tlicho All-Season
Road (the "TASR") that would allow all-season access to the NICO Project and the timing of its completion; the receipt of all
necessary regulatory approvals and the timing thereof; the completion of a pilot plant to assess the impact of the application of
DST's processing technology and the results thereof; the rezoning of the Saskatchewan refinery
lands and the timing thereof; growth in the demand for cobalt; the time required to construct the NICO Project; and the
economic environment in which the Company will operate in the future, including the price of gold, cobalt and other by-product
metals, anticipated costs and the volumes of metals to be produced at the NICO Project). However, such forward-looking
information is subject to a variety of risks and uncertainties and other factors that could cause actual events or results to
differ materially from those projected in the forward-looking information. These factors include the risks that the Company may
not be able to finance and develop NICO on favourable terms or at all, the completion of a pilot plant to assess the impact of
the application of DST's processing technology may take longer than anticipated and the economic impact of such technology on the
NICO Project may be less favourable than anticipated, uncertainties with respect to the receipt or timing of required permits,
approvals and agreements for the development of the Nico Project, the TASR may not be constructed in a timely fashion or at all,
the construction of the NICO Project may take longer than anticipated, the Company may not be able to secure offtake agreements
for the metals to be produced at the NICO Project, the inherent risks involved in the exploration and development of mineral
properties and in the mining industry in general, the market for rechargeable batteries and the use of stationary storage cells
may not grow to the extent anticipated, the future supply of cobalt may not be as limited as anticipated, the risk of decreases
in the market prices of cobalt and other metals to be produced by the NICO project, discrepancies between actual and estimated
mineral resources or between actual and estimated metallurgical recoveries, uncertainties associated with estimating mineral
resources and the risk that even if such resources prove accurate the risk that such resources may not be converted into mineral
reserves, once economic conditions are applied, the Company's production of cobalt and other metals may be less than anticipated
and other operational and development risks, market risks and regulatory risks. Readers are cautioned to not place undue reliance
on forward-looking information because it is possible that predictions, forecasts, projections and other forms of forward-looking
information will not be achieved by the Company. The forward-looking information contained herein is made as of the date hereof
and the Company assumes no responsibility to update or revise it to reflect new events or circumstances, except as required by
law.
SOURCE Fortune Minerals Limited
View original content: http://www.newswire.ca/en/releases/archive/September2018/17/c2077.html