The feasibility study for the expanded and rescoped McIlvenna Bay metals project, in Saskatchewan, has defined compelling financial metrics, TSX-V-listed Foran Mining announced on Monday.
At current prices, the study defines a pretax net present value (NPV) of C$1.49-billion and an internal rate of return (IRR) of 46%. Base case economics, which use a copper price of $3.50/lb and $1.20/lb zinc, outline a pretax NPV of C$678-million and an IRR of 26%.
The study is based on a mineral reserve of 25.7-million tonnes at 2.51% copper-equivalent, which is a 127% increase in tonnes compared with the prior mineral reserve estimate and represents a 66% conversion rate from the existing 39.1-million tonnes of indicated resources.
The feasibility study outlines an 18.4-year mine life, based on a planned 4 200 t/d throughput rate. McIlvenna Bay will produce an average of 72.8-million pounds of copper equivalent over the first 15 years of mine life, equating to 38.8-million pounds of copper, 63.6-million pounds of zinc, 20 000 oz of gold and 486 000 oz of silver.
Life-of-mine C1 cash costs are expected to average $0.26/lb copper, net of byproduct credits, and all-in sustaining costs will average $0.90/lb at base case prices.
Initial capital costs total C$368-million.
“It is important to be mindful that the study showcases only a snapshot in time of what our initial mine and centralised mill will look like, as we envision scaled expansions and future growth while sequencing in other deposits across the district,” commented Foran executive chairperson and CEO Dan Myerson.
He added that Foran was still in “the early innings of understanding what this remarkable district has to offer”.
“McIlvenna Bay is expected to be the centralized mill that could be expanded in phases as we continue to explore, define and potentially develop near-mine deposits and more within a 50 km radius. Our land package is over 1 450 km², providing us with the canvas to explore in a systematic way. The neighbouring Flin Flon district has been operating for close to a century, and it is our vision to transform the Hanson Lake District into the next multi-decade mining camp,” Myerson said.
The McIlvenna Bay project is located in east-central Saskatchewan, 375 km northeast of Saskatoon, and 85 km West of Flin Flon Manitoba, and is accessible year-round via an 18 km all-weather road connected to Saskatchewan Provincial Highway 106.