MOD Resources: T3 Pre-Feasibility Study - Robust, Long Life Copper Mine
ASX: MOD
www.modresources.com.au
Mr. Julian Hanna reports:
West Perth, WA / January 31, 2018 / JMN Wire / MOD Resources Ltd (ASX: MOD) is pleased to announce the pre-feasibility study (PFS) for a proposed open pit mine and copper concentrator at its 70%-owned T3 copper-silver deposit in the Kalahari Copper Belt, Botswana has delivered outstanding results.
MOD has presented two cases for the PFS, with the Base Case based on a Proved and Probable Ore Reserve and an Expansion Case with a Production Target utilising the Base Case Ore Reserve and additional production from existing Inferred, Measured and Indicated Mineral Resources from Year 4.
"This is our starting mine - and while it is an exciting milestone, we believe there is more to come with potential for satellite deposits around T3 and numerous other exploration targets to be tested along a 140km corridor," said Mr Hanna. "None of this potential upside has been included in the scope of the PFS."
"We are extremely lucky to be operating in such a favourable mining jurisdiction and look forward to transforming into a profitable long life copper producer in Botswana," he said.
Highlights
Strong Project EconomicsNPV of US$281m (A$370m) pre-tax, using long term US3.00/lb Cu and 8% real discount rateNet cashflow of US$530m (A$697m) pre-tax, inclusive of development capitalAnnual free cash flow US$77m (A$101m) pre-tax, from production startPayback 2.7 years from production startLow Cost OperationsEstimated average C1 costs of US$1.22/lb Cu including silver creditsAll in sustaining unit costs (AISC) of US$1.36/lb Cu including silver creditsLOM cash break-even copper price of US$1.78/lb Cu on an undiscounted basisCapital Costs and InfrastructurePre-production capital expenditure of US$155m including US$17m contingencyLow LOM sustaining capital expenditure of US$31mAssumes grid power expected January 2022 adding ~US$10m EBITDA paProject ParametersMaiden Ore Reserve containing 218kt Cu and 7.1Moz AgBase Case 8.8 year mine life from production startAverage production of 23kt pa Cu and 690koz pa Ag in concentrateWaste to Ore ratio 4.76