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
The Gunnison copper project is performing better than planned, with the initial copper recovery grades exceeding feasibility study expectations, Excelsior Mining has reported.

Pregnant leach solution grade is currently measuring 0.15 g/ℓ copper in the primary recovery pond – a milestone that Excelsior has achieved ahead of schedule and that keeps the project on track for copper production this quarter.

Acid injection is being steadily increased and is currently at about 50% of the full production rate. The 41 injection and recovery wells that comprise the production wellfield will continue to circulate mining solutions in a closed-loop system until the concentration of copper held in solution warrants processing.

Once this grade is achieved, mining solutions will then be treated through the Johnson Camp processing facilities to extract copper and produce London Metal Exchange-grade copper cathode sheets.

First copper cathode sales are expected in the first quarter.

Excelsior started operations at Gunnison in the second week of January. The start of mining operations using acid injection has been approved by the Environmental Protection Agency.

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.