Trilogy Metals Inc. (TSX: TMQ) (NYSE American: TMQ) (“Trilogy Metals” or the “Company”) is pleased to announce the positive results of its Preliminary Economic Assessment Study (“Bornite PEA”) for the Bornite copper project in the Ambler Mining District of Northwestern Alaska (the “Bornite Project”). The Bornite Project is held by Ambler Metals LLC (“Ambler Metals”), the joint venture operating company equally owned by Trilogy Metals and South32 Limited (“South32”). The Bornite PEA was prepared on a 100% ownership basis, of which Trilogy Metals’ share is 50%. All amounts are in U.S. dollars unless otherwise stated.
The PEA is preliminary in nature and includes Inferred mineral resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves. There is no certainty that the PEA will be realized.
The Bornite PEA describes the technical and economic viability of establishing an underground mining operation for a 6,000 tonne-per-day operation with a 17-year mine life. The PEA assumes re-purposing the infrastructure described in the Company’s current Feasibility Study for the Arctic Project for use with the Bornite Project once the Arctic deposit has been depleted.
Tony Giardini, President and Chief Executive Officer of Trilogy Metals commented, “Although we believe that further exploration along the 100km volcanogenic massive sulphide belt will extend the mine life of the Arctic Project beyond the 13 years established by the current Arctic Feasibility Study, the Bornite PEA study shows it is possible, with existing known resources, to continue mine activity at the UKMP beyond 30 years.”
The South Reef includes a relatively high-grade mineralized zone that would be amendable to underground mining methods should a decision be made not to mine the mineral resources by open pit methods. Table 5 illustrates the portions of the South Reef at a higher cut-off grade (sensitivity to cut-off grade), representing an opportunity that could be considered for mining of this material using only underground mining methods which is illustrated in the PEA.
Trilogy Metals engaged independent consultants, Wood Canada Limited (“Wood”), Ausenco Engineering Canada ULC (“Ausenco”), SRK Consulting (Canada) Inc. (“SRK”), International Metallurgical & Environmental Inc. (“Int Met”), and Core Geoscience LLC (“Core”) to prepare the Bornite PEA on a 100% ownership basis, under National Instrument 43-101 – Standards of Disclosure for Mineral Projects (“NI 43-101”).
The Bornite PEA forecasts total payable production to be 1.9 billion pounds of copper over a 17-year mine life. More importantly, the Bornite PEA demonstrates the ability to extend mine activity at the UKMP to over 30 years. The Bornite PEA does not incorporate any closure cost synergies for the Arctic Project which may be significant.
The Bornite PEA is based on a 6,000 tonne-per-day underground mining operation with conventional milling and flotation process that results in the production of copper concentrate. Based on the Bornite PEA level metallurgical work on the sulphide mineralization, the average recoveries are projected to be 90.9% for copper, producing a copper concentrate grade average of 29.5% over the life-of-mine.
Initial capital expenditure is $503.8 million and sustaining capital is $363.1 million for total estimated capital expenditures of $866.9 million. This includes the retrofit costs for re-purposing the Arctic mill for Bornite purposes. In addition, closure and reclamation costs are estimated at $81.2 million.
There has been no material change to the mineral resource estimates for the Bornite Project as reported in the Company’s previous technical reports entitled “NI 43-101 Technical Report on the Mineral Resource Update of the Bornite Project, Northwest, Alaska, USA” with an effective date of January 26, 2023 and “Technical Report Summary on the Initial Assessment of the Bornite Mineral Resource, Northwest Alaska, USA” dated November 30, 2022. The Company’s current mineral reserve and mineral resources tables can be found on the Company’s website.
