United Silver Files Preliminary Economic Assessment for Crescent Mine on SEDAR
September 25 2013 - 8:42AM
Business Wire
United Silver Corp. (“United Silver Corp”, the “Company” or
“USC”: TSX; USC: OTC; USCZF: Frankfurt: UM8) announced
today the filing on SEDAR of an updated National Instrument 43-101
(“NI 43-101”) compliant resource estimate and a positive
Preliminary Economic Assessment (“PEA”). This Technical Report is
independently prepared by SRK Consulting (U.S.) Inc. (“SRK”) of
Reno, Nevada, USA. The full report will also be accessible on USC’s
website.
PEA Summary
PEA Mineralized Tons Processed (Diluted)
601,000 Tons Silver Recovered
6,108,000 Ounces Mine Life
6 Years IRR @ $20 US Silver
32% Post Tax Net Present Value @ 8% Discount Rate
$8,575,000 Preproduction
Development Cost $12,121,000
Total Capital Cost $13,993,000
Production Rate 400 Tons Per Day
Dilution 33% Mill Recovery
92% Mining Costs
$55.09 Per Ton Processing Cost (Including
Haulage, Mine to Mill $26.76 Per
Ton General and Administrative
$18.08 Per Ton Total Operating Cash Costs
$99.93 Per Ton Smelting and Refining Costs
$44.58 Per Ton Site Operation Cash
Costs $144.51 Per Ton
The IRR is higher (32% vs. 31%) than reported in the July 29,
2013 press release based on a correction in how the royalty was
calculated. The Net Present Value was corrected to $8,575,000 from
$8,834,000 in the July 29, 2013 press release due to a logic error
in the previous spreadsheet.
“We are very pleased with the results of the PEA and updated
resource estimate,” said Greg Stewart, CEO of United Silver Corp.
“The results confirm our belief that the Crescent Mine will become
an efficient and productive mining operation, and consistent with
mining experience in Silver Valley, we expect the Crescent Mine to
continue to increase and develop resources to extend its active
mining life well beyond the PEA’s six year mine life.”
The Project is very sensitive to the price of silver. The
following table illustrates how quickly the project IRR and NPV’s
change with a change in the price of silver. The base case for the
analysis is $20.00/oz.
Silver Price Sensitivity
Ag Price Per Ounce In US $
$18.00
$20.00 $22.00
$24.00 $26.00 $28.00
IRR 6%
32%
56% 76%
97% 117%
NPV @ 8% (X000)
($633)
$8,575
$17,188 $23,324
$29,341 $35,279
Recommendations
SRK recommends that USC undertake to complete the following
recommended work to improve geologic understanding and confidence
in the project.
- Implement an underground 20 hole
diamond drill program to confirm the presence of width and grade of
inferred resources in areas of widely spaced drilling.
- Undertake metallurgical test work to
improve recoveries in oxidized mineralization.
- Construct and implement an underground
grade control laboratory utilizing an XRF analyzer to assist in
timely marking of faces to reduce and eliminate blasting
delays.
- Undertake test mining to confirm that
the conceptualized mining methods are both productive and improve
grade control practices, improving economics.
- Conduct hydrogeochemical
characterization of post-closure mine drainage water quality.
The cost estimate for these recommended work items is
approximately $1.8M.
The technical aspects of this press release have been reviewed
and approved by Michael P. Gross M.S., P.Geol., Chief Operating
Officer of United Silver Corp., and Kent Hartley P.E., SRK
Consulting, both of whom are the “Qualified Persons” for this
project as defined by NI 43-101 regulations.
ABOUT UNITED SILVER CORP.
USC is a vertically integrated Canadian mining company with
operations in Idaho, USA. It has an 80% interest in the Crescent
Silver Mine project in the Silver Valley’s prolific Silver Belt -
directly between two of the district’s historically largest silver
producing properties, the Sunshine and Bunker Hill mines. USC also
offers a full suite of mining services including contract mining
and providing a complete fabrication shop and service for building
and repairing mining equipment to silver miners in the district.
USC's common shares trade on the Toronto Stock Exchange under the
symbol "USC". For more information about USC, please visit:
www.unitedsilvercorp.com
ON BEHALF OF UNITED SILVER CORP.
"Gregory Stewart"Chairman and CEO
Investor RelationsTel. (855) 238-0202
FORWARD LOOKING STATEMENTS: This news release contains
forward-looking information which is subject to a variety of risks
and uncertainties and other factors that could cause actual events
or results to differ from those projected in the forward-looking
statements. Forward looking statements in this press release
include that the Crescent Mine will become an efficient and
productive mining operation, and that we expect the Crescent to
continue to increase and develop resources to extend its active
mining life well beyond the PEA’s six year mine life.
These forward-looking statements are based on the opinions and
estimates of management and its consultants at the date the
information is disseminated. They are subject to a variety of risks
and uncertainties and other factors that could cause actual events
or results to differ materially from those projected in the
forward-looking information. Risks that could change or prevent
these statements from coming to fruition include changing costs for
mining and processing and their impact on the cut off value
established; increased capital costs; changing forecasts of mine
production rates; the timing and content of upcoming work programs;
geological interpretations based on drilling that may change with
more detailed information; potential process methods and mineral
recoveries assumption based on limited test work; the availability
of labour, equipment and markets for the products produced; market
pricing for the products produced; our possible inability to
service our debts and pay liabilities as they become due; and
despite the current expected viability of the project, conditions
changing such that the minerals on our property cannot be
economically mined, or that the required permits to build and
operate the envisaged mine can be obtained. The forward-looking
information contained herein is given as of the date hereof and the
Company assumes no responsibility to update or revise such
information to reflect new events or circumstances, except as
required by law.
The Toronto Stock Exchange has not reviewed and does not accept
responsibility for the adequacy or accuracy of the content of this
news release.
United Silver Corp.Investor RelationsGregory Stewart,
855-238-0202Chairman and CEO