ELKO, Nevada, March 24, 2020 /PRNewswire/ -- U.S. Gold Corp.
(NASDAQ: USAU) today is pleased to announce that it has internally
updated the economics of the Copper King deposit to reflect the
recent rise in gold prices. Mine Development Associates'
(MDA) Preliminary Economic Assessment (PEA), dated December 5, 2017 which was based upon
$1275 gold and $2.80 copper prices.
Gold prices have risen substantially since the Copper King PEA
was published. U.S. Gold Corp. used $1600 gold and $2.80 copper for its internally updated economic
calculation, which was completed in early March, 2020.
Highlights of the updated internal calculations show:
Investment Highlights based on PEA
- At $1600 gold and $2.80 copper, based on preliminary data, Copper
King is projected to generate Pre-Tax Cash Flow of $510.54 million
- The Net Present Value (NPV), based on preliminary data, at a 5%
discount rate, is projected to be $321.60
million
- The Pre-Tax Internal Rate of Return (IRR) based on preliminary
data, is projected to be 52%
- At $1600 gold, Copper King
deposit economics are 80% gold and 20% copper
The updated internal analysis can be viewed at:
https://www.usgoldcorp.gold/properties/copper-king/pea-highlights/1600-update
Mr. Timothy Janke, U.S. Gold
Corp. Director states, "The Copper King deposit is a project of
merit. With gold recently above the $1600 level, we thought it appropriate to review
what the updated potential Copper King economics look like at
$1600 gold and $2.80 copper. We modified the PEA cash flow
model to reflect metal prices for the above listed economic
results. We did not change the economic resource from the PEA
which was based on $1250 Au and
$2.25 Cu. At $1600 Au, the ore tonnage increases from
133Mt to 170Mt. The contained gold
equivalent ounces increase from 1.30 million to 1.48
million. With my experience as a mine engineer, I believe the
resource increase at $1600 Au easily
allows a doubling of the proposed PEA processing rate; from 10,000
tons per day to 20,000 tons per day, while still maintaining an
11-year project mine life. We also believe this could be
likely extended through additional exploration, as the deposit is
still open for further growth at depth, to the south-east and
west. CAPEX is estimated to increase by approximately 60% from
the original PEA figure for the doubling of throughput."
Mr. Edward Karr, President &
CEO states, "The Copper King project gives our shareholders
tremendous leverage to a rising gold price. We are very
excited with these internal updates. When we put this internal
analysis together a few weeks ago, gold was nicely above
$1600. Now with the recent
global volatility, gold has sold off sharply and is back below
$1500. Although it has still
been an extremely challenging time for many junior exploration and
development companies, U.S. Gold Corp. shareholders can know we
have a very valuable asset in Copper King. All of us believe the
Company's market price is substantially undervalued at today's
level. We are currently looking at various proposals to move the
Copper King project to a Pre-Feasibility Study (PFS) level and will
keep the market updated. With a projected annualized Internal
Rate of Return (IRR) of 52% at $1600
gold, many institutions have expressed an interest in future
project finance. We believe the current zero interest rate
environment will be with us for some time and global investors will
be looking to deploy capital in projects such as Copper King that
can offer potential considerable annualized returns."
About U.S. Gold Corp.
U.S. Gold Corp. is a publicly traded, U.S. focused gold
exploration company. U.S. Gold Corp. has a portfolio of exploration
properties. Copper King is located in Southeast Wyoming and has a Preliminary
Economic Assessment (PEA) technical report, which was completed by
Mine Development Associates. Keystone and Maggie Creek are exploration properties on the
Cortez and Carlin Trends in Nevada. For more information about U.S.
Gold Corp., please visit www.usgoldcorp.gold
Safe Harbor
Certain statements in this press release are forward-looking
within the meaning of the Private Securities Litigation Reform Act
of 1995. These statements may be identified by the use of
forward-looking words such as "anticipate," "believe," "forecast,"
"estimated," and "intend," among others. These forward-looking
statements are based on U.S. Gold Corp.'s current expectations, and
actual results could differ materially from such statements. There
are a number of factors that could cause actual events to differ
materially from those indicated by such forward-looking statements.
These factors include, but are not limited to, risks arising
from: the prevailing market conditions for metal prices and mining
industry cost inputs, environmental and regulatory risks, risks
faced by junior companies generally engaged in exploration
activities, whether U.S. Gold Corp. will be able to raise
sufficient capital to implement future exploration programs, and
other factors described in the Company's most recent Annual Report
on Form 10-K, Quarterly Reports on Form 10-Q, and Current Reports
on Form 8-K filed with the Securities and Exchange Commission,
which can be reviewed at www.sec.gov. The Company has
based these forward-looking statements on its current expectations
and assumptions about future events. While management considers
these expectations and assumptions to be reasonable, they are
inherently subject to significant business, economic, competitive,
regulatory, and other risks, contingencies, and uncertainties, most
of which are difficult to predict and many of which are beyond the
Company's control. The Company makes no representation or warranty
that the information contained herein is complete and accurate and
we have no duty to correct or update any information contained
herein.
Cautionary Note to U.S. Investors Concerning Mineral
Resources
We may use certain terms such as "measured," "indicated," or
"inferred" mineral resources, which are defined in Canadian
Institute of Metallurgy guidelines, the guidelines widely followed
to comply with Canadian National Instrument 43‐101‐‐ Standards of
Disclosure for Mineral Projects ("NI 43‐101"). We advise U.S.
investors that these terms are not recognized by the United States
Securities and Exchange Commission (the "SEC"). The estimation of
measured and indicated resources involves greater uncertainty as to
their existence and economic feasibility than the estimation of
proven and probable reserves under the SEC's disclosure
rules. 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. Mineral
resources that are not mineral reserves do not have demonstrated
economic viability. U.S. investors are cautioned not to assume that
measured or indicated mineral resources will be converted into
reserves. Inferred mineral resources have a high degree of
uncertainty as to their existence and their economic and legal
feasibility. It cannot be assumed that all or any part of an
inferred mineral resource exists, or is economically or legally
viable. Under Canadian rules, estimates of "inferred mineral
resources" may not form the basis of feasibility studies,
pre‐feasibility studies or other economic studies, except in
prescribed cases, such as in a preliminary economic assessment
under certain circumstances. 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. Note that a preliminary economic assessment is
preliminary in nature, and it includes Inferred mineral resources
that are considered too speculative geologically to have the
economic considerations applied that would enable them to be
classified as mineral reserves, and there is no certainty that the
preliminary assessment will be realized.
For additional information, please contact:
U.S. Gold Corp. Investor Relations:
+1 800 557 4550
ir@usgoldcorp.gold
www.usgoldcorp.gold
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SOURCE U.S. Gold Corp.