Name of the Project
Gunnison copper project.

Location
The project is located about 100 km east of Tucson, Arizona, in the US, on the south-eastern flank of the Little Dragoon mountains, in the Cochise mining district.

Client
Excelsior Mining Corp.

Project Description
The project has estimated resources of 873-million short tons of measured and indicated oxide and transitional mineral resources at a 0.05% total copper cutoff grade, as well as an inferred mineral resource of 187-million short tons.

Diluted mineral reserves are estimated at 782-million short tons of probable mineral reserves.

The project envisages development in three production stages, with capacities of 25-million pounds a year in Stage 1, 75-million pounds in Stage 2, and 125-million pounds a year in Stage 3.

The stages to ramp up production are meant to minimise capital at risk until the in situ recovery (ISR) process at the Gunnison project is better understood.

For Stage 1 operations, Excelsior will use the neighbouring Johnson Camp mine (JCM), which has a functional 25-million-pound-a-year solvent extraction-electrowinning (SX-EW) plant north of the Gunnison project wellfield.

In the current mine plan, Stage 2 production will start in Year 4 of the mine life and will use the JCM SX-EW plant, as well as a new 50-million-pound-a-year Gunnison SX-EW plant.

Stage 3 production will start in Year 7 of the mine life by doubling the size of the Gunnison SX-EW plant.

Excelsior proposes to use the ISR method to extract copper from oxide mineralisation located 91 m to 243 m beneath the alluvial basin fill within the North Star deposit.

ISR is expected to be responsible for 48.4% of the total copper, with an average ‘sweep efficiency’ of 74%. Production for the 24-year life-of-mine is estimated at 2.17-million pounds.

Potential Job Creation
Not stated.

Net Present Value/Internal Rate of Return
The economic analysis for the base case before taxes indicates an internal rate of return (IRR) of 48%, a payback of 4.6 years and a net present value (NPV), at a 7.5% discount rate, of $1.17-million.

The estimated after-tax NPV, at a 7.5% discount rate, is estimated at $807-million and the IRR at 40%, with a payback period `of 6.5 years.

Value
The estimated initial capital cost is $46.9-million.

Duration
First copper production from the wellfield is forecast for 2019.

Latest Developments
Excelsior Mining’s board has approved the construction of the Gunnison copper mine, following the closing of a $75-million project financing package.

The financing, provided by Triple Flag Mining Finance Bermuda, comprises a $65-million copper metal stream and a concurrent $10-million private placement of common shares. The completion of the financing package enables the company to initiate construction activities before the end of December.

Excelsior has said that it has received initial gross proceeds of $20-million from the financing package, $10-million of which is from the $65-million upfront deposit under the terms of a metals purchase and sale agreement, and a further $10-million from the placement. The balance of the Stage 1 deposit will be provided in instalments at the request of Excelsior as it expends or allocates previously received funds for the construction of the project.

Excelsior is expecting an additional $9.4-million in financing proceeds from affiliates of Greenstone Resources pursuant to the terms of a previously announced subscription agreement. If Altius Royalty chooses to exercise its construction royalty option, Excelsior will receive a further C$5-million in financing proceeds.

Excelsior announced the decision to proceed with the construction of Gunnison on November 30.

Key Contracts and Suppliers
None stated.

On Budget and on Time?
Not stated.

Contact Details for Project Information
Excelsior Mining Corp VP corporate affairs JJ Jennex, tel +1 604 681 8030 (ext 240) or email info@excelsiormining.com.