VANCOUVER, July 20, 2018 /PRNewswire/ - Trilogy Metals
Inc. (TSX/NYSE American: TMQ) ("Trilogy Metals"
or the "Company") is pleased to announce it has filed a National
Instrument 43-101 technical report with the Canadian securities
regulators relating to the Bornite Project which supports the
resource estimate previously announced on June 5, 2018. The technical report is entitled
"NI 43-101 Technical Report on the Bornite Project, Northwest Alaska, USA" and has been prepared
by Bruce Davis, Robert Sim and Jeff
Austin, all of whom are independent "Qualified Persons"
under NI 43-101 (the "Technical Report"). This Technical
Report is available on the Company's website at
www.trilogymetals.com and on the Company's profiles at
www.sedar.com and www.sec.gov and is consistent with the disclosure
made by the Company in its news release dated June 5, 2018.
Highlights of the Cobalt Resource:
- At a base case 0.50% copper cut-off grade, and within the
combined Indicated and Inferred Cu resource pit shell, the Bornite
Project is estimated to contain in-pit Inferred Resources of
124.6 million tonnes grading 0.017% Co for 45
million pounds of contained cobalt (see Table 1 for
details).
- Below the resource limiting pit shell and at a base case
cut-off grade of 1.5% copper, the Bornite Project is estimated to
contain additional Inferred Resources of 57.8 million tonnes
grading 0.025% Co for 32 million pounds of contained
cobalt.
- Total Inferred Resources (in-pit and below-pit) of
182.4 million tonnes grading 0.019% Co for 77 million
pounds of contained cobalt (see Table 1 for details).
- The current copper resources at the Bornite Project remain
unchanged (see Table 2 for details).
Rick Van Nieuwenhuyse, President
and CEO of Trilogy Metals, commented, "Now that we have filed the
new Technical Report for the Bornite Project, the next step is to
finish the metallurgical test work on the cobalt resources, which
we expect to be completed by the end of the year. Having a
successful outcome from this metallurgical test program could yield
considerable value for our shareholders. I specifically note the
$690 million transaction that Wheaton
Precious Metals Corp. ("WPM") and Cobalt 27 Capital Corp. ("Cobalt
27") completed with Vale S.A. in which WPM and Cobalt 27 combined
acquired a 75% cobalt stream from the Voisey's Bay underground
deposit – a project requiring a $2.1
Billion investment and anticipated to begin production in
2021. This transaction resulted in WPM and Cobalt 27 jointly
adding approximately 54 million pounds of attributable cobalt
reserve to their combined inventory. Demonstrating the economic
viability of the cobalt resources at Bornite could become a game
changer for the Company given our current 77 million pound inferred
cobalt resource. I also note that we currently have three drill
rigs in operation at the Bornite Project continuing with an in-fill
and expansion drill program. Management expects continued success
in expanding the cobalt and copper resources at Bornite to yield
additional value to the Company."
Table 1: Estimate of Cobalt Mineral Resources for the Bornite
Deposit
Type
|
Cut-off
(Cu%)
|
Tonnes
(million)
|
Average
Grade
Co
(%)
|
Contained
Metal
Co
(Mlbs)
|
In-Pit
|
0.5
|
124.6
|
0.017
|
45
|
Below-Pit
|
1.5
|
57.8
|
0.025
|
32
|
Total
Inferred
|
|
182.4
|
0.019
|
77
|
(1)
|
Resources stated as
contained within a pit shell developed using a metal price of
US$3.00/lb Cu, mining costs of US$2.00/tonne, milling costs of
US$11/tonne, G&A cost of US$5.00/tonne, 87% metallurgical
recoveries and an average pit slope of 43 degrees.
|
(2)
|
Mineral Resources are
not Mineral Reserves and do not have demonstrated economic
viability. There is no certainty that all or any part of the
Mineral Resources will be converted into Mineral
Reserves.
|
(3)
|
It is reasonably
expected that the majority of Inferred mineral resources could be
upgraded to Indicated mineral resources with additional
exploration.
|
The estimated cobalt mineral resource is presented in Table
1. In addition to the cobalt resource, Table 2 presents the
Bornite Project's existing copper mineral resource which is also
supported by the Technical Report.
Table 2: Estimate of Copper Mineral Resources for the Bornite
Deposit
Type
|
Cut-off
(Cu%)
|
Tonnes
(million)
|
Average
Grade
Cu
(%)
|
Contained
Metal
Cu
(Mlbs)
|
In-Pit
|
0.5
|
40.5
|
1.02
|
913
|
Total
Indicated
|
|
40.5
|
1.02
|
913
|
In-Pit
|
0.5
|
84.1
|
0.95
|
1,768
|
Below-Pit
|
1.5
|
57.8
|
2.89
|
3,683
|
Total
Inferred
|
|
141.9
|
1.74
|
5,450
|
(1)
|
Resources stated as
contained within a pit shell developed using a metal price of
US$3.00/lb Cu, mining costs of US$2.00/tonne, milling costs of
US$11/tonne, G&A cost of US$5.00/tonne, 87% metallurgical
recoveries and an average pit slope of 43 degrees.
|
(2)
|
Mineral Resources are
not Mineral Reserves and do not have demonstrated economic
viability. There is no certainty that all or any part of the
Mineral Resources will be converted into Mineral
Reserves.
|
(3)
|
It is reasonably
expected that the majority of Inferred mineral resources could be
upgraded to Indicated mineral resources with additional
exploration.
|
Cobalt Resource Estimate
Open pit resources are contained within a pit shell that was
generated based on a 0.5% copper cut-off grade by AGP Mining
Consultants Inc., and the underground resource is material below
the pit shell calculated at a higher cut-off grade of 1.5%
copper. Note that although the data supports estimates of
copper resources in both the Indicated and Inferred categories, the
volume and distribution of available cobalt sample data is
considered insufficient to support the estimate of cobalt resources
in the Indicated category and, as a result, all of the estimated
cobalt resource remains in the Inferred category.
Initial sample data is composited to 2m intervals. Estimates are made into model
blocks measuring 5m x 5m x 5m, using
ordinary kriging. The cobalt resource model was validated
using a combination of a visual review and statistical comparisons
with models generated using other estimation methods. Cobalt
resources in the Inferred category occur within a maximum distance
of 100m from a drill hole and exhibit
reasonable confidence in the grade and continuity of
mineralization.
At a base case 1.5% copper cutoff grade, the Bornite Project is
estimated to contain below-pit Inferred Resources of 57.8 million
tonnes at 2.89% copper. Preliminary work shows that although cobalt
is broadly associated with copper mineralization, cobalt does not
have a one-to-one correlation. It mostly occurs as a cloud of
cobaltiferous pyrite in and around the copper mineralization.
Additional information is provided in the Technical Report, a
copy of which is available on the Company's website at
www.trilogymetals.com and under the Company's profiles on SEDAR at
www.sedar.com and EDGAR at www.sec.gov.
Qualified Person
Andrew W. West, a Certified
Professional Geologist, and the Exploration Manager for Trilogy
Metals Inc., is a Qualified Person as defined by National
Instrument 43-101. Mr. West has reviewed and verified the technical
information in this news release and approves the disclosure
contained herein.
About Trilogy Metals
Trilogy Metals Inc. is a metals exploration and development
company focused on exploring and developing the Ambler mining
district located in northwestern Alaska. It is one of the richest and
most-prospective known copper-dominant districts located in one of
the safest geopolitical jurisdictions in the world. It hosts
world-class polymetallic volcanogenic massive sulphide ("VMS")
deposits that contain copper, zinc, lead, gold and silver, and
carbonate replacement deposits which have been found to host high
grade copper mineralization. Exploration efforts have been focused
on two deposits in the Ambler mining district - the Arctic VMS
deposit and the Bornite carbonate replacement deposit. Both
deposits are located within the Company's land package that spans
approximately 143,000 hectares. The Company has an agreement with
NANA Regional Corporation, Inc., a Regional Alaska Native
Corporation that provides a framework for the exploration and
potential development of the Ambler mining district in cooperation
with local communities. Our vision is to develop the Ambler mining
district into a premier North American copper producer.
Cautionary Note Regarding Forward-Looking
Statements
This press release includes certain "forward-looking
information" and "forward-looking statements" (collectively
"forward-looking statements") within the meaning of applicable
Canadian and United States
securities legislation including the United States Private
Securities Litigation Reform Act of 1995. All statements, other
than statements of historical fact, included herein, including,
without limitation, future demand for and price of cobalt, the
future price of copper, the estimation of mineral reserves and
mineral resources, the realization of mineral reserve and mineral
resource estimates, the timing and amount of estimated future
production, costs of production, capital expenditures, costs and
timing of the development of projects, the potential future
development of the Bornite Project, the future operating or
financial performance of the Company, planned
expenditures and the anticipated activity at the UKMP
Projects, are forward-looking statements. Forward-looking
statements are frequently, but not always, identified by words such
as "expects", "anticipates", "believes", "intends", "estimates",
"potential", "possible", and similar expressions, or statements
that events, conditions, or results "will", "may", "could", or
"should" occur or be achieved. These forward-looking statements may
include statements regarding perceived merit of properties;
exploration plans and budgets; mineral reserves and resource
estimates; work programs; capital expenditures; timelines;
strategic plans; market prices for precious and base metals; or
other statements that are not statements of fact. Forward-looking
statements involve various risks and uncertainties. There can be no
assurance that such statements will prove to be accurate, and
actual results and future events could differ materially from those
anticipated in such statements. Important factors that could cause
actual results to differ materially from the Company's expectations
include the uncertainties involving success of exploration,
development and mining activities, permitting timelines,
requirements for additional capital, government regulation of
mining operations, environmental risks, unanticipated reclamation
expenses; mineral reserve and resource estimates and the
assumptions upon which they are based; capital estimates; prices
for energy inputs, labour, materials, supplies and services the
interpretation of drill results, the need for additional financing
to explore and develop properties and availability of financing in
the debt and capital markets; uncertainties involved in the
interpretation of drilling results and geological tests and the
estimation of reserves and resources; the need for cooperation of
government agencies and native groups in the development and
operation of properties as well as the construction of the access
road; the need to obtain permits and governmental approvals; risks
of construction and mining projects such as accidents, equipment
breakdowns, bad weather, non-compliance with environmental and
permit requirements, unanticipated variation in geological
structures, metal grades or recovery rates; unexpected cost
increases, which could include significant increases in estimated
capital and operating costs; fluctuations in metal prices and
currency exchange rates; and other risks and uncertainties
disclosed in the Company's Annual Report on Form 10-K for the year
ended November 30, 2017 filed with
Canadian securities regulatory authorities and with the United
States Securities and Exchange Commission and in other Company
reports and documents filed with applicable securities regulatory
authorities from time to time. The Company's forward-looking
statements reflect the beliefs, opinions and projections on the
date the statements are made. The Company assumes no obligation to
update the forward-looking statements or beliefs, opinions,
projections, or other factors, should they change, except as
required by law.
Cautionary Note to United States Investors
This press release has been prepared in accordance with the
requirements of the securities laws in effect in Canada, which differ from the requirements of
U.S. securities laws. Unless otherwise indicated, all resource and
reserve estimates included in this press release have been
prepared in accordance with Canadian National Instrument 43-101
Standards of Disclosure for Mineral Projects ("NI 43-101") and the
Canadian Institute of Mining, Metallurgy and Petroleum (CIM)—CIM
Definition Standards on Mineral Resources and Mineral Reserves,
adopted by the CIM Council, as amended ("CIM Definition
Standards"). NI 43-101 is a rule developed by the Canadian
Securities Administrators which establishes standards for all
public disclosure an issuer makes of scientific and technical
information concerning mineral projects. Canadian standards,
including NI 43-101, differ significantly from the requirements of
the United States Securities and Exchange Commission (SEC), and
resource and reserve information contained herein may not be
comparable to similar information disclosed by U.S. companies. In
particular, and without limiting the generality of the foregoing,
the term "resource" does not equate to the term "reserves". Under
U.S. standards, mineralization may not be classified as a "reserve"
unless the determination has been made that the mineralization
could be economically and legally produced or extracted at the time
the reserve determination is made. The SEC's disclosure standards
normally do not permit the inclusion of information concerning
"measured mineral resources", "indicated mineral resources" or
"inferred mineral resources" or other descriptions of the amount of
mineralization in mineral deposits that do not constitute
"reserves" by U.S. standards in documents filed with the SEC.
Investors are cautioned not to assume that all or any part of
"measured" or "indicated resources" will ever be converted into
"reserves". Investors should also understand that "inferred mineral
resources" have a great amount of uncertainty as to their existence
and great uncertainty as to their economic and legal feasibility.
Under Canadian rules, estimated "inferred mineral resources" may
not form the basis of feasibility or pre-feasibility studies except
in rare cases. Disclosure of "contained ounces" in a resource is
permitted disclosure under Canadian regulations; however, the SEC
normally only permits issuers to report mineralization that does
not constitute "reserves" by SEC standards as in-place tonnage and
grade without reference to unit measures. The requirements of NI
43-101 for identification of "reserves" are also not the same as
those of the SEC, and reserves reported by Trilogy Metals in
compliance with NI 43-101 may not qualify as "reserves" under SEC
standards. Arctic does not have known reserves, as defined under
SEC Industry Guide 7. Accordingly, information concerning
mineral deposits set forth herein may not be comparable with
information made public by companies that report in accordance with
U.S. standards.
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SOURCE Trilogy Metals Inc.