Mustang Files NI 43-101 PEA on Nickel-Copper-PGM Project in Southeastern Manitoba
26.05.2014 | FSCwire
Toronto, Ontario CANADA, May 26, 2014 /FSC/ - Mustang Minerals Corp. (MUM - TSX Venture), ("Mustang" or the "Company") today announced it has filed the National Instrument 43-101 compliant Technical Report on the Preliminary Economic Assessment (the "PEA") of the Mayville-Makwa Project (the "Project) at www.sedar.com. The summary results of the PEA were announced April 8, 2014. RPA Inc. is the independent third party that authored the PEA. PEA Operational Overview
The PEA proposed the mining of the mineral resources located in southeastern Manitoba by two open pits. Average annual production of metals concentrate are 3,600 tonnes per annum nickel and 8,700 tonnes per annum copper along with 9,800 ounces platinum group metals per annum. The PEA outlines the mining of the Makwa Nickel Deposit first followed by the Mayville Cu-Ni Deposit with milling operations located at the Mayville site.
Project Economics
Nickel production from the Project is higher in the first four years with the mining of the Makwa deposit. The following table outlines a base case analysis based on the assumptions set out in the PEA along with sensitivity to nickel price.
-***-
---------------------------------- ----------------- --------- -----------------
Description -20% Nickel +20% Nickel Price
Price (Decrease) Base Case (Increase)
---------------------------------- ----------------- --------- -----------------
Nickel US$ (lb) US$6.80 US$8.50 US$10.20
---------------------------------- ----------------- --------- -----------------
Copper US$ ( lb) US$3.40 US$3.40 US$3.40
---------------------------------- ----------------- --------- -----------------
Palladium US$ (oz) US$800 US$800 US$800
---------------------------------- ----------------- --------- -----------------
C$/US$ Exchange Rate $0.90 $0.90 $0.90
---------------------------------- ----------------- --------- -----------------
Operating Cashflow ( millions ) C$441 C$637 C$832
---------------------------------- ----------------- --------- -----------------
Initial Capex ( millions ) C$208 C$208 C$208
---------------------------------- ----------------- --------- -----------------
Total Capex incl. Sustaining C$300 C$300 C$300
---------------------------------- ----------------- --------- -----------------
Pre-tax NPV at 7.5% ( millions ) (C$14) C$109 C$232
---------------------------------- ----------------- --------- -----------------
Pre-tax IRR at 7.5% (millions ) 6% 17% 28%
---------------------------------- ----------------- --------- -----------------
After tax NPV at 7.5% ( millions ) (C$16) C$97 C$194
---------------------------------- ----------------- --------- -----------------
After tax IRR at 7.5% ( millions ) 6% 16% 25%
---------------------------------- ----------------- --------- -----------------
-****-
The PEA is preliminary in nature, includes inferred mineral resources that are considered too speculative geologically to have economic considerations applied to them that would enable them to be categorized as mineral reserves and there is no certainty the PEA will be realized.
Project Mineral Resource Estimates
The portion of the measured mineral resources, indicated mineral resources and inferred mineral resources used for evaluation in the PEA is shown in the following table:
MINERAL RESOURCE SUMMARY AS OF NOVEMBER 27, 2013
Mustang Minerals Corp. - Makwa-Mayville Project
-***-
Category and Deposit Tonnes Ni Cu Pt Pd Au Co
( Mt) (%) (%) (g/t) (g/t) (g/t) (%)
--------------------- --------- ------ ------ ------ ------ ------ ------
-------------------------------------------------------------------------
Indicated
Makwa 7.2 0.61 0.13 0.10 0.36 N/A 0.01
Mayville 26.6 0.18 0.44 0.05 0.14 0.05 N/A
--------------------- --------- ------ ------ ------ ------ ------ ------
Total Indicated 33.8 0.27 0.37 0.06 0.19 N/A N/A
Inferred
Makwa 0.7 0.27 0.08 0.05 0.14 N/A 0.02
Mayville 5.2 0.19 0.48 0.06 0.15 0.04 N/A
--------------------- --------- ------ ------ ------ ------ ------ ------
Total Inferred 5.8 0.19 0.43 0.06 0.15 N/A N/A
-****-
Notes:
1. CIM Definition Standards have been followed for classification of Mineral Resources
2. Mineral Resources are reported at a net smelter return (NSR) cut-off value of C$15/tonne at Mayville and C$20.64/tonne at Makwa
3. At Mayville, NSR values are calculated in C$ using factors of $51 per % Cu and $41 per % Ni. These factors are based on metal prices of US$3.40/lb Cu and US$8.50/lb Ni, estimated recoveries and smelter terms, and a US$/C$ exchange rate of 0.97.
4. The Makwa Mineral Resources are estimated using metal prices of US$3.40/lb Cu and US$8.50/lb Ni, estimated recoveries and smelter terms, and a US$/C$ exchange rate of 0.97. The NSR factors used are: $87.33 per % Ni, $29.65 per % Cu, $38.25 per % Co, $0.14 per g/t Pt and 0.08 per g/t Pd.
5. Totals may not add correctly due to rounding.
6. Mineral Resource that are not Mineral Reserves do not have demonstrated economic viability.
Exploration
The Company will soon commence exploration activities which will include trenching, geological mapping and sampling at the former producing Dumbarton mine which is adjacent to the Makwa Deposit. The Dumbarton Mine horizon was highlighted in the PEA as a potential source of additional open pit nickel feed for the Project. Based on the results of that program and availability of financing the Company will follow with drilling at the Project as well as implementing other recommendations made in the PEA.
Carey Galeschuk P.Geo. is the National Instrument 43-101 Qualified Person for Mustang Minerals Corp. and has approved the contents of this release. For more information online please view the Mustang website at www.mustangminerals.com
Western Areas Ltd. (ASX:WSA) owns a ~19% equity interest in Mustang.
To find out more about Mustang Minerals Corp. (TSX-V: MUM)
visit our website at www.mustangminerals.com or:
Telephone: 416-955-4773 email: info@mustangminerals.com
We seek safe harbour.
This news release contains forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995 and forward-looking information within the meaning of the Securities Act (Ontario) (together, "forward-looking statements"). Such forward-looking statements may include the Company's plans for its mineral projects in Manitoba, the overall economic potential of its properties, the availability of adequate financing and involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements expressed or implied by such forward-looking statements to be materially different. Such factors include, among others, risks and uncertainties relating to potential political risk, uncertainty of production and capital costs estimates and the potential for unexpected costs and expenses, physical risks inherent in mining operations, currency fluctuations, fluctuations in the price of nickel and other metals, completion of economic evaluations, changes in project parameters as plans continue to be refined, the inability or failure to obtain adequate financing on a timely basis, and other risks and uncertainties, including those described in the Company's Management Discussion and Analysis for the most recent financial period and Material Change Reports filed with the Canadian Securities Administrators and available at www.sedar.com.
Neither the TSX Venture Exchange nor it Regulations Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this press release.
To view the press release as a PDF, please click on the following link:
http://www.fscwire.com/sites/default/files/news_release_pdf/mustang05262014.pdf
Source: Mustang Minerals Corp. (TSX-V: MUM) http://www.mustangminerals.com
Maximum News Dissemination by FSCwire. http://www.fscwire.com
