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 33.1-million tonnes containing 1 085 000 oz of gold, 82.3-million pounds of cobalt, 102.1-million pounds of bismuth and 27.2-million pounds of copper. At the planned mill throughput rate of 4 650 t/d of ore, the mineral reserves will sustain operations for 21 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 using 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. The cobalt is 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.

Potential Job Creation
Not stated.

Net Present Value/Internal Rate of Return
Not stated.

Value
C$589-million-plus working capital.

Duration
Fortune aims to have the NICO project in commercial production in the early 2020s.

Latest Developments
Fortune Minerals may defer its planned metals processing plant and may opt to sell concentrates from the flagship NICO mine directly to third parties.

The company has approval for a $200-million metals processing plant to process concentrates from the mine in Northwest Territories to cobalt sulphate, gold, bismuth ingot and oxide and copper precipitate.

However, with third-party refiners now interested in buying concentrates directly from the mine, Fortune is adjusting the NICO project’s engineering designs to allow for flexibility in downstream processing options.

Consultants are updating the NICO project’s 2014 feasibility study and Hatch has now been asked to adjust the engineering design to move the bulk concentrate regrind circuit and secondary flotation concentration process back to the Northwest Territories site.

Fortune is considering four development scenarios:

producing a single bulk flotation concentrate at the mine as currently envisioned for sale to a third-party refinery, or transportation thereof to Saskatchewan for downstream processing at the company's planned refinery;

producing separate cobalt/gold and bismuth/gold concentrates at the mine and selling either or both of these to third-party refineries, or transporting either or both of these to Saskatchewan for downstream processing, and facilities configured with only the required unit operations needed to recover the desired metal(s);

defering the sale of some of the bismuth to align production with the market demand; or

phasing the development of the Saskatchewan refinery with market demand and the needs of the potential strategic partners.

“Although the sale of concentrates was previously investigated by Fortune, the expanded cobalt market, strong future growth, and attractive prices have collectively made this into a potentially attractive development option to defer significant up-front capital,” the company has said.

Fortune is investigating technologies that will assist in upgrading the metal content of its concentrates and reducing deleterious metals that are typically penalised by third-party process plants.

Should Fortune receive the requisite financing for the NICO project and the remaining regulatory approvals in 2018, construction of the mine facilities could begin next year and is expected to take about two years, depending on ice-road logistics.

The refinery requires about 18 months for construction, unless it is deferred.

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.