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Black Butte copper project, US – update

Image of core sample from the Black Butte project

Photo by Sandfire Resources America

1st March 2024

By: Sheila Barradas

Creamer Media Research Coordinator & Senior Deputy Editor

     

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Name of the Project
Black Butte copper project.

Location
White Sulphur Springs, in Montana, in the US.

Project Owner/s
Sandfire Resources America, a subsidiary of Sandfire Resources.

Project Description
Sandfire Resources America has announced the results of a feasibility study on the Johnny Lee deposit, the cornerstone of the Black Butte project. The deposit comprises the upper copper zone and the lower copper zone; both are characterised as being high-grade, laying at low angles and with relatively narrow widths. All deposits have anomalous silver and cobalt mineralisation; however, copper is the only economic product considered in the feasibility study.

The feasibility study is underpinned by a maiden reserve for the Johnny Lee deposit of 8.8-million tonnes at 2.6% copper for 226 100 t of copper.

The deposit underpins an eight-year mine life and is designed to be mined at 1.2-million tonnes of ore a year. Forecast production totalling 805 000 dry metric tonnes of copper concentrate containing 189 500 t of copper metal is forecast over the life-of-mine.

Black Butte's development is centred around the Johnny Lee deposit, which has a reserve of 8.8-million tonnes at 2.6% copper for 226 100 t of copper.

The deposit underpins an eight-year mine life and is designed to be mined at 1.2-million tonnes of ore a year. Forecast production totalling 805 000 dry metric tonnes of copper concentrate containing 189 500 t of copper metal is forecast over the life-of-mine

Potential Job Creation
Not stated.

Net Present Value/Internal Rate of Return
The project has a pretax net present value, at a 5% discount rate, of $124.9-million and an internal rate of return of 17%, with a payback of three years from the commissioning of the mine.

Capital Expenditure
$247.7-million.

Planned Start/End Date
Not stated.

Latest Developments
Sandfire Resources America has been given approval to proceed with the construction of its Black Butte project, after the Montana Supreme Court reversed a 2021 district court decision that invalidated the mining permit.

The positive ruling, delivered with a 5-2 decision, supported the 2020 decision of the Montana Department of Environmental Quality (MT DEQ) to permit copper mining at the Black Butte project.

The legal battle was initiated in 2020 against the MT DEQ and Sandfire America subsidiary Tintina Montana.

Stipulated agreements for water rights, granted through the Montana Department of Natural Resources and Conservation, have been finalised. However, a challenge to the Montana Constitution’s definition of the “beneficial use of water” remains, with an appeal scheduled for March 29, at the Montana Supreme Court. This challenge, while ongoing, does not currently impact on the company’s water rights package.

Key Contracts, Suppliers and Consultants
None stated.

Contact Details for Project Information
Sandfire Resources America VP of communications Nancy Schlepp, tel +1406547 3466 or email nschlepp@sandfireamerica.com.

Edited by Creamer Media Reporter

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