Name of the Project
NICO gold/cobalt/bismuth/copper mine project.

Location
Northwest Territories, Canada.

Client
Fortune Minerals.

Project Description
The proposed NICO mine is located 50 km north of the Tlicho community of Whati and 160 km north-west of Yellowknife, in Canada’s Northwest Territories.

The NICO deposit contains openpit and underground proven and probable mineral reserves totalling 33-million tonnes, containing 1 085 000 oz of gold, 82-million pounds of cobalt, 102-million pounds of bismuth and 27-million pounds of copper. At the planned mill throughput rate of 4 650 t/d of ore, the mineral reserves will sustain operations for 19.8 years.

Openpit methods will be used, with underground ores contributing 22% of the mill feed during the second year of operations. The openpit part of the mine will be a conventional truck-and-shovel/loader operation, accomplished in four phases at an average waste-to-ore strip ratio of 3.0:1.

The underground portion of the mine will be mined by a contractor using retreat blasthole open stoping, providing access for gold-rich, higher-grade ores.

The ore will be processed in two stages at the NICO site and Saskatchewan metals processing plant (SMPP). At the NICO site, an average of 4 650 dry tonnes a day of ore will be processed in a crushing, grinding and flotation concentrator to produce about 180 t/d of wet bulk concentrate.

The bulk concentrate will be bagged and transported by truck to Hay River, Northern Territories, for transfer to rail and delivery to Fortune’s proposed SMPP on the CN main line, near Saskatoon, where the concentrate will undergo additional grinding and flotation to produce separate gold-bearing cobalt and bismuth concentrates.

The cobalt concentrate will be processed by pressure acid leach in an autoclave to dissolve the metals. The pregnant solution that is produced will be treated with lime sequential neutralisation to remove impurities and then with sodium carbonate to precipitate cobalt carbonate. This carbonate is releached in sulphuric acid to a produce cobalt sulphate solution, which is purified further through ion exchange and the cobalt precipitated using electrowinning to cobalt cathode that is 99.8% purity.

Alternatively, the cobalt that is present as a sulphate in solution can be processed further through solvent extraction to remove metal impurities, followed by crystallisation, to generate 20.9% cobalt sulphate heptahydrate crystals.

Copper that is removed from the cobalt solution during neutralisation is releached in acid and precipitated onto iron fines as a copper metal precipitate or ‘cement’.

The bismuth concentrate is treated using atmospheric acid leach, followed by electrowinning to produce 99.5% bismuth cathode, which is melted and poured to produce 99.99% bismuth ingots.

Jobs to be Created
Not stated.

Net Presents Value/Internal Rate of Return
Not stated.

Value
C$589-million-plus working capital.

Duration
According to the National Instrument 43-101 technical report completed on the project in July 2012, the mine production schedule assumes that openpit waste stripping will begin in July 2015, openpit ore production in September 2015, underground dewatering and rehabilitation of existing workings in May 2016, underground ore and waste development in June 2016 and underground stoping in July 2016.

Underground ore production will end in January 2017, while openpit ore production will end in 2035.

Latest Developments
Investors will have to wait a little longer to review an update of the 2014 feasibility study on Fortune’s Nico cobalt/gold/bismuth/copper project.

The feasibility study update by Hatch and Micon is proceeding well for the initially planned scope of work for the mine and concentrator.

However, Hatch requires two metallurgical testwork programmes to properly size equipment and conduct the detailed design work for the copper cementation circuit and the manganese removal step in the cobalt sulphate circuit for the planned refinery near Saskatoon, Saskatchewan.

This work is currently in progress at SGS Lakefield Research, but because of laboratory congestion, it will not be completed until the end of October.

The metallurgical flowsheet for Nico was previously confirmed from piloting, and a high-quality cobalt sulphate heptahydrate product has already been produced that meets the specifications of the rechargeable battery industry, Fortune has said.

Therefore, completion of the feasibility study update has been delayed until after metallurgical testwork and the optimisation of the mineral reserves, production rate and mine schedule – if and as required – have been completed.

Fortune has also reported that it has completed the winter, spring and summer phases of field activities at the Nico mine site, which is required by the Wek'eezhii Land and Water Board before mine construction can start. The final water quality sampling for this programme will be completed in September.

Fortune has also advised that it can improve and expand roads and lay-down areas at the mine site in preparation for the arrival of supplies and materials on the winter ice road.

Pending financing, Fortune plans to conduct the first year of construction of the mine using winter road access, while the Northwest Territories government (GNWT) Transportation Department constructs a new all-weather gravel road to Whati. Fortune will build a 50 km gravel spur road to connect with the government road as part of its development. Fortune and the GNWT are also negotiating a socioeconomic agreement.

Key Contracts and Suppliers
None stated.

On Budget and on Time?
Not stated.

Contact Details for Project Information
Fortune Minerals investor relations manager Troy Nazarewicz, tel +1 519 858 8188, fax +1 519 858 8155 or email info@fortuneminerals.com.