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Copper Mountain Mining Corporation (TSX:CMMC | ASX:C6C) ("Copper Mountain" or the "Company") is pleased to announce positive results from its 2020 Feasibility Study Update ("2020 FS") on its 100% owned Eva Copper Project ("Eva" or "the Project"), which is located in Queensland, Australia. The 2020 FS demonstrates significantly improved economics and operating metrics, including a higher after-tax NPV, increased production, lower cash costs and a longer mine life, when compared to the prior 2018 Feasibility Study. All dollars are in U.S. dollars unless otherwise indicated.
2020 FS Highlights
Economic metrics highlights:
-- After-tax Net Present Value (NPV)(1) at an 8% discount rate of $437 million.
-- After-tax Internal Rate of Return (IRR) (1) of 29%.
-- Total initial development capital $382 million.
Operating metrics highlights:
Key Metrics Feasibility Study Update Feasibility Study % change
2020 2018
Total copper production (Mlb) 1,502 959 57%
Average annual copper production (Mlb/a) 100 80 25%
C1 cash costs per pound, after by-product credits(1) ($) 1.44 1.74 -17%
Project life (years) 15 12 25%
(1) Assumes bank consensus metal prices: Year -1 of $2.97 per pound copper and $1,466 per ounce gold, Year 1 of $3.03 per pound copper and $1.434 per ounce gold and Year 2 and long-term prices of $3.04 per pound copper and $1,362 per ounce gold.
"These results demonstrate the high quality nature of the Eva Copper Project," commented Gil Clausen, Copper Mountain's President and CEO. "The economics of the Project have been improved with higher production, a longer mine life and lower operating costs. The Blackard and Scanlan deposits were added to Mineral Reserves, increasing total Mineral Reserves by 46%, and we have made process flow sheet optimizations. Eva Copper has the potential to add significant production and cash flow to our existing solid operating base. While we are and will continue to add value to Eva Copper, it should be noted that we will only move forward with development in the right copper price environment. Eva provides Copper Mountain shareholders with high quality organic growth potential in a low risk jurisdiction."
Mining
Conventional open pit mining methods, which include drilling, blasting, loading, and hauling, will be employed at the Eva Copper Project. There are seven pits that make up the Project's mine plan: Little Eva is the primary pit and will be supplemented by progressively mining six satellite pit areas at Blackard, Scanlan, Turkey Creek, Bedford, Lady Clayre, and Ivy Ann. The pit designs for the seven deposits were based on a Whittle Lerchs-Grossmann optimization at US$2.75 per pound copper price, generated using Measured and Indicated Mineral Resources only. Mining costs are based on a first-principles model based on locally-sourced costs for major inputs.
The mine plan includes mining 551 million tonnes of ore and waste from seven deposits over a mine life of 15 years. Total ore mined is expected to be 170 million tonnes and total waste is expected to be 380 million tonnes, for a waste to ore strip ratio of 2.2 to 1. With an overall copper recovery of 87%, the Project's total copper production is expected to be approximately 1.5 billion pounds of copper, while gold production would be 205,000 ounces based on a gold recovery of 78%. Metal production on an average annual basis would be 100 million pounds of copper and 13,650 ounces of gold. However, the first two years of mining are expected to produce approximately 128 million pounds of copper per year.
Processing
The process plant is designed to mill 31,200 tonnes per day (tpd) for an average throughput of 11.4 million tonnes per year. Sequenced mining from the seven deposits will deliver a mixture of sulphide and native copper ore in a ratio of 75% to 25%. The sulphide deposits include Little Eva, Turkey Creek, Bedford, Lady Clayre, and Ivy Ann, whereas the Blackard and Scanlan deposits contain both native copper and sulphide ore. The processing flowsheet consists of a crushing, grinding, gravity separation and flotation to recover copper and gold in concentrate form. The flotation concentrate will be thickened, filtered and stockpiled for shipping to the Mt. Isa Smelter. Full transportation, smelting and refining costs were based on the Company's existing long-term contract with Glencore's Mt. Isa Smelter, which is situated 194 kilometres to the SW of Eva Project area.
A key update in the 2020 FS flowsheet from the 2018 Feasibility Study is the change from a SAG mill and pebble crushing circuit to a secondary crusher and High-Pressure Grinding Rolls (HPGR) design. The ball mill has also been upsized in order to support 31.2 kt/d at a P80 target grind of 165 um. The process plant flowsheet developed for the Eva Copper Project is a standard concentrator design and all the unit operations selected for the plant consist of proven technology and are considered low-risk.
The Project is near existing infrastructure with power available through a 220 kV powerline. Water for the operations will be supplied through a well field located near the processing facility, pit dewatering and water reclaimed from the tailings storage facility, all of which are located on the Company property. The well field has been drilled, pump tested and verified by independent hydrologists as sufficient for the Project's water consumption needs.
A summary of mining and production parameters is provided below. A summary of the Eva Copper Project's life of mine production schedule by year is available in appendix 1. A detailed life of mine production schedule by deposit and zone is available in the 2020 FS Technical Report.
Total material mined (kt) 550,959
Total ore processed (kt) 170,386
Total waste (kt) 380,574
Waste to ore strip ratio 2.2:1
Processing Rate (tpd) 31,200
Total copper production (Mlbs) 1,502
Annual copper production (First two years) (Mlbs) 128
Annual copper production (LOM) (lbs) 100
Total gold production (koz) 205
Annual gold production (LOM) (koz) 14
Average copper recovery (%) 87%
Average gold recovery (%) 78%
Average copper feed grade (%) 0.46%
Average gold feed grade (g/t) 0.05
Mine life (years) 15
Capital and Operating Costs
Total initial development capital for the Eva Copper Project is estimated to be approximately $382 million, which includes a contingency of $42 million and pre-production revenue of $11 million. Capital is estimated using an Australian dollar to U.S. dollar exchange rate 1.55 to 1.
Total Initial Development Capital $ Millions
(Years -2 to 1)
Direct Costs
Mining 35
Process Plant 151
Infrastructure 68
Ancillaries 26
Total Direct Costs 279
Indirect Costs
Indirect Costs 57
Owner's Costs 15
Total Indirect Costs 72
Subtotal 352
Contingency 42
Pre-production Revenue (11)
Total Project 382
Total life of mine development capital is estimated to be $492 million which includes total sustaining capital of approximately $34 million and total rehabilitation costs of $14 million.
Average C1 cash cost, net of by-product credits, is approximately $1.44 per pound of copper. Total operating costs are estimated to be $11.39 per tonne milled. Total mining costs are estimated to be $1.66 per tonne mined or $5.26 per tonne milled. Total operating costs do not include royalties, which are estimated to be approximately $1.18 per tonne milled.
Unit operating cost $ per tonne milled
Mining 5.26
Processing 5.14
G&A 0.56
Accommodation & Travel 0.43
Total 11.39
Economic Analysis
The after-tax NPV using an 8% discount rate is $437 million and the after-tax IRR is 29%. The economics are calculated using average bank consensus metal prices, which are as follows: for copper, $2.97 per pound in Year -1, $3.03 per pound in Year 1, and $3.04 per pound in Year 2 and long-term. For gold, $1,466 per ounce in Year -1, $1,434 in Year 1 and $1,362 per ounce Year 2 and long-term. The Australian Dollar to United States Dollar exchange rate used was 1.55. A sensitivity analysis on varying copper prices and other variables was completed on the after-tax NPV (8%) and the results are summarized below.
Copper Price
Factor NPV (8%) $M
0.90 286
1.00 (base case) 437
1.10 587
Exchange Rate
Factor NPV (8%) $M
0.90 396
1.00 (base case) 437
1.10 470
Capital Cost
Factor NPV (8%) $M
0.90 466
1.00 (base case) 437
1.10 408
Operating Cost
Factor NPV (8%) $M
0.90 506
1.00 (base case) 437
1.10 367
Mineral Resources and Mineral Reserves
The Eva Copper Mineral Reserve increased 46% to 171 million tonnes grading 0.46% copper and 0.05 g/t gold for a total of 1.7 billion pounds of copper and 260,000 ounces of gold, when compared to the previous September 2018 Mineral Reserve. The Mineral Reserve is included in the Mineral Resource and the effective date of the Mineral Reserve and Mineral Resource is January 30, 2020. A summary of the Mineral Reserve and Mineral Resource is provided below. A complete detailed Mineral Reserve and Mineral Resource table by deposit is available in the 2020 FS Technical Report.
Eva Copper Mineral Reserve
Tonnes Cu Grade Au Grade Cu Pounds Au Ounces
(kt) (% Cu) (g/t) (Mlb) (koz)
Proven 92,623 0.48 0.05 975 144
Probable 78,425 0.43 0.04 743 115
Total Proven and Probable 171,047 0.46 0.05 1,718 260
Total Proven and Probable (Gold only) 106,380 0.08 260
Mineral Reserve Notes:
1. CIM Definition Standards were followed for Mineral Reserves.
2. Mineral Reserves were generated using the December 31, 2019 mining surface.
3. Mineral Reserves are reported at an NSR cut-off value of $8.95/t for Little Eva and Turkey Creek, $9.35/t for Bedford and Blackard, $10.32/t for Lady Clayre and Scanlan, and $11.44/t for Ivy Ann.
4. Mineral Reserves are reported using copper and gold prices of $2.75/lb and $1,250/oz, respectively.
5. Average process recoveries of 95% for copper sulphide, 63% for native copper, and 78% for gold were used for all deposit areas.
6. Little Eva, Turkey Creek, Bedford, and Lady Clayre have an equivalent 5.3% NSR royalty; Ivy Ann has an equivalent 5.8% royalty.
7. Blackard, Scanlan, and Turkey Creek do not contain gold.
8. Totals may show apparent differences due to rounding.
Eva Copper Mineral Resource
Tonnes Cu Grade Au Grade Cu Pounds Au Ounces
(kt) (% Cu) (g/t) (Mlb) (koz)
Measured 111,821 0.45 0.05 1,098 160
Indicated 148,818 0.40 0.04 1,307 172
Total Measured + Indicated 260,659 0.42 0.04 2,419 330
Total Inferred 46,267 0.42 0.04 415 51
Mineral Resource Notes:
1. Joint Ore Reserves Code (JORC) and CIM definitions were followed for Mineral Resources.
2. Mineral Resources are inclusive of Mineral Reserves.
3. Mineral Resources are constrained within a Whittle pit shell generated with a copper price of $3.50/lb, a gold price of $1,250/oz and an exchange rate of AU$1.35 = US$1.00.
4. Density measurements were applied (ranges from 2.4 t/m3 to 3.0 t/m3).
5. Significant figures have been reduced to reflect uncertainty of estimations and therefore numbers may not add due to rounding.
Technical Report
The 43-101 compliant technical report for the Eva Copper 2020 FS ("Technical Report") is available on SEDAR at www.SEDAR.com and on the Company's website at www.CuMtn.com. Ausenco Limited (Ausenco) designed the 2020 process plant and associated site infrastructure for the Eva Copper Project and provided technical input into the preparation of this Technical Report. Klohn Crippen Berger (KCB) designed the 2020 Tailings Storage Facility and provided input to water management. Merit Consultants International (Merit), a division of Cementation Canada Inc., developed the 2020 capital cost, construction management, and execution plan of the Project.
Qualified Persons
The Mineral Resource estimate for the Eva Copper Project was prepared by Copper Mountain Mining Corporation in accordance with standards as defined by the Canadian Institute of Mining, Metallurgy and Petroleum ("CIM") "CIM Definition Standards-For Mineral Resources and Mineral Reserves", adopted by CIM Council on May 10, 2014.
Messrs. Paul Staples, Alistair Kent, David Johns, Peter Holbek, Stuart Collins, Mike Westendorf, Roland Bartsch and Richard Klue serve as Qualified Persons as defined by National Instrument 43-101 for the Technical Report related to the Eva Copper Project. Mr. Stuart Collins of SEC Enterprises Corp., who is independent of the Company, is the Qualified Person for Mining and the Mineral Reserve. Mr. Peter Holbek, Vice President, Exploration at Copper Mountain Mining Corporation, is the Qualified Person for the related Mineral Resource. Mr. Alistair Kent, Senior Project Manager for Merit Consultants International, who is independent of the Company, is the Qualified Person for the Development Capital Estimate. Mr. Paul Staples, Vice President and Global Practice Lead for Ausenco Limited, who is independent of the Company, is the Qualified Person for Ore Processing. Mr. Richard Klue, Mr. Alistair Kent, Mr. Paul Staples, Mr. Johns, Mr. Peter Holbek, Mr. Mike Westendorf, Mr. Roland Bartsch and Mr. Stuart Collins have reviewed and verified that the technical information related to the Eva Copper Project in this news release is accurate.
Competent Persons Statement The information in this report that relates to Exploration Targets, Exploration Results, Mineral Resources or Ore Reserves is based on information compiled by Peter Holbek, B.SC (Hons), M.Sc. P. Geo. Mr. Holbek is a senior officer and a full time employee of the Company and has sufficient experience which is relevant to the style of mineralization and type of deposit under consideration and to the activity being undertaken to qualify as a Competent Person as defined in the 2012 Edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves'. Mr. Holbek does consent to the inclusion in this news release of the matters based on their information in the form and context in which it appears.
About Copper Mountain Mining Corporation:
Copper Mountain's flagship asset is the 75% owned Copper Mountain mine located in southern British Columbia near the town of Princeton. The Copper Mountain mine currently produces on average approximately 90 million pounds of copper equivalent annually. Copper Mountain also has the development-stage Eva Copper Project in Queensland, Australia and an extensive 4,000 km2 highly prospective land package in the Mount Isa area. Copper Mountain trades on the Toronto Stock Exchange under the symbol "CMMC" and Australian Stock Exchange under the symbol "C6C".
Additional information is available on the Company's web page at www.CuMtn.com.
On behalf of the Board of
COPPER MOUNTAIN MINING CORPORATION "Gil Clausen"
Gil Clausen, P.Eng. Chief Executive Officer
Cautionary Note Regarding Forward-Looking Statements
This news release may contain forward-looking statements and forward-looking information (together, "forward-looking statements") within the meaning of applicable securities laws. All statements, other than statements of historical facts, are forward-looking statements. Generally, forward-looking statements can be identified by the use of terminology such as "plans", "expects", "estimates", "intends", "anticipates", "believes" or variations of such words, or statements that certain actions, events or results "may", "could", "would", "might", "occur" or "be achieved". Forward-looking statements involve risks, uncertainties and other factors that could cause actual results, performance and opportunities to differ materially from those implied by such forward-looking statements. Factors that could cause actual results to differ materially from these forward-looking statements include the successful exploration of the Company's properties in Canada and Australia, the reliabili ty of the historical data referenced in this press release and risks set out in Copper Mountain's public documents, including in each management discussion and analysis, filed on SEDAR at www.sedar.com. Although Copper Mountain believes that the information and assumptions used in preparing the forward-looking statements are reasonable, undue reliance should not be placed on these statements, which only apply as of the date of this news release, and no assurance can be given that such events will occur in the disclosed time frames or at all. Except where required by applicable law, Copper Mountain disclaims any intention or obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.
APPENDIX 1: Eva Copper Production Plan
Category Units Total -1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15
Sulfide Tonnes t 000 132,091 1,168 18,908 6,898 9,643 13,285 10,700 9,155 5,701 14,172 6,301 6,186 6,020 7,597 10,628 2,058 3,669
Sulfide Cu Grade % Cu 0.41 0.51 0.53 0.43 0.41 0.41 0.42 0.41 0.35 0.33 0.39 0.36 0.39 0.36 0.38 0.40 0.50
Sulfide Cu Tonnes t 543,767 5,920 100,981 29,902 39,343 54,488 45,320 37,177 20,062 46,989 24,454 22,165 23,272 26,983 40,232 8,199 18,278
Native Tonnes t 000 35,560 0 0 1 3,620 3,302 3,011 2,986 798 2,989 2,922 2,790 2,921 2,961 2,975 2,460 1,824
Native Cu Grade % Cu 0.62 0.00 0.00 0.31 0.57 0.61 0.63 0.66 0.52 0.53 0.56 0.61 0.66 0.68 0.63 0.67 0.74
Native Cu Tonnes t 220,863 0 0 3 20,610 20,302 18,970 19,706 4,174 15,885 16,354 16,892 19,156 20,231 18,711 16,364 13,508
Transition Tonnes t 000 2,734 0 0 0 12 45 256 542 36 136 78 61 124 279 491 674 0
Transition Cu Grade % Cu 0.55 0.00 0.00 0.00 0.47 0.65 0.55 0.51 0.47 0.60 0.86 0.41 0.49 0.55 0.56 0.55 0.00
Transition Cu Tonnes t 15,022 0 0 0 58 291 1,408 2,752 168 812 676 251 611 1,548 2,729 3,718 0
Total Ore Tonnes t 000 170,386 1,168 18,908 6,899 13,275 16,632 13,966 12,683 6,535 17,296 9,301 9,038 9,066 10,838 14,095 5,192 5,494
Total Ore Cu Grade % Cu 0.46 0.51 0.53 0.43 0.45 0.45 0.47 0.47 0.37 0.37 0.45 0.43 0.47 0 0 1 1
Total Ore Cu Tonnes t 779,653 5,920 100,981 29,904 60,010 75,081 65,699 59,636 24,404 63,686 41,484 39,308 43,038 48,762 61,672 28,281 31,786
Waste Tonnes t 000 380,574 13,520 16,132 45,113 35,669 24,541 27,339 36,100 46,185 29,424 20,233 26,265 17,148 15,077 13,245 9,408 5,174
Total Tonnes t 000 550,959 14,688 35,040 52,012 48,943 41,174 41,228 46,671 52,720 46,720 29,534 35,303 26,214 25,915 27,340 14,600 10,668
Total Cu Production klbs 1,501,930 16,685 133,481 122,457 92,767 106,484 107,600 104,086 99,078 91,197 95,298 88,253 93,058 94,300 100,930 79,885 76,372
Sulfide Au Grade g/t 0.05 0.07 0.08 0.02 0.02 0.06 0.06 0.03 0.08 0.07 0.03 0.04 0.05 0.04 0.04 - -
Sulfide Au Ounces oz 000 260 3 49 5 9 34 26 12 16 41 9 10 13 13 18 - -
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SOURCE Copper Mountain Mining Corporation
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