Integra Resources Corp. (“Integra” or the “Company”)
(TSX-V: ITR; NYSE American: ITRG) is pleased to announce
an exploration program to expand the Oxide and Mixed resource at
its DeLamar Project while advancing the heap leach stage of the
project into permitting and development on a stand-alone basis. The
simple, low-cost, low-risk strategy to focus on the financial
engine of the Project, the heap leach, does not negate the strong
optionality of the project in multiple areas. Exploration efforts
going forward will target heap leachable material to expand the
heap leach life-of-mine.
Advancing the DeLamar gold-silver project
towards permitting and development of the heap leach stage as a
stand-alone mining operation, is a far lower cost, lower risk
option for the Company and its shareholders, creating strong
economic returns and rapid payback. In these inflationary times,
with increased scrutiny on permitting of all resource projects,
this is the optimal strategy for the Company and its shareholders,
as it vastly reduces execution risk.
“Integra’s 2022 DeLamar PFS highlighted an
abundance of optionality derived from a myriad of development
scenarios to advance the asset. The core financial engine of the
DeLamar project is the heap leach. Based on data provided in the
PFS, and despite the fact that the project was costed out during a
period of high inflation, the heap leach operation at DeLamar
showed solid returns with an after-tax NPV(5%) of US$314 million
and an after-tax IRR of 33% at US1,700/oz Au and US$21.50/oz Ag and
produces close to 1 M ozs of gold equivalent on its own. Leverage
to higher gold and silver prices amplifies the economics, with an
after-tax NPV(5%) of US$435 million and an after-tax IRR of 43% at
US$1,900 Au and US$24.03 Ag. During the 8-year heap leach
operation, the Project averages 136,000 ozs per year AuEq with a
site level AISC of US$814/oz Au Eq. The Company will advance
permitting of the heap leach operation while preserving the
optionality presented in the PFS in terms of other development
scenarios, once in production. The heap leach stand-alone strategy
will result in total project capital savings of over US$235 million
and a decrease in site level AISC of 15%. The strategy also
simplifies the future permitting, financing and construction plans
since permitting and financing the heap-leach as a stand-alone mine
without the mill initially, is viewed as a lower risk strategy.
When fully developed, DeLamar has the potential to become one of
the lowest cost and largest heap-leach mining operations in North
America that is not currently owned by a major producer.”
Mr. Salamis further states, “DeLamar’s robust
heap leach economics in the PFS can be further enhanced through the
addition of heap leachable Oxide and Mixed resources into future
mine plans, with obvious high potential Oxide resource additions
occurring near planned mining and processing infrastructure.
Heap-leachable resource expansion upside potential is clearly the
lowest-hanging-fruit on the project and provides the lowest cost
means of adding to future production profiles and mine life. Our
exploration team has identified numerous Oxide and Mixed
gold-silver targets over our large 5,220-hectare land package, the
most attractive being low-grade stockpiles at surface from mining
that occurred on site from the 1970s-1990s. Other targets occur on
extension from existing resources, hosting recent and historically
drilled intercepts that demonstrate bulk tonnage, gold-silver Oxide
and Mixed intercepts from 25 m to 100 m in thickness, at average
grades consistent with our currently contemplated PFS heap leach
gold-silver grades.”
The Company will continue to assess timing for
development of the mill and related operations based on market
factors and other variables in the future, once the heap-leach mine
is fully operational. Additional enhancements to the future
Non-oxide processing as well as potential high-grade gold-silver
from Florida Mountain will continue to be studied and explored;
however, incorporating these options after permitting for the heap
leach stage presents a much lower-risk investment scenario for the
Company and its shareholders. The ability to advance a simple,
low-capital intensity and highly economic heap leach stand-alone
gold-silver mine operation while preserving future optionality will
be the focus of permitting, development and exploration on the
Project in the near term.
2022: Focus on Heap Leach Mine
Development and Permitting
Permitting work at DeLamar has been initiated
and is focused on a fully developed stand-alone heap leach
gold-silver operation. Baseline study work is well underway to
support the submittal of a Plan of Operations in H1 2023. Integra
expects many ancillary benefits by focusing on the heap leach
stand-alone mine permitting, including:
- Mill expansion capital requirements
will no longer be a project requirement, leading to a savings of
over US$235 million on life of mine capital. In this scenario,
estimated site level AISC costs also drop from US$955/oz to
US$814/oz, on a co-product basis, thus significantly reducing
future financing risk.
- Funds generated from the successful
future operation of the heap leach will not be initially committed
to Non-oxide mill processing construction, but instead used to
reduce the payback period of the mine and deployed for other
purposes such as expanded resource development
- The heap leach stand-alone mine
will no longer require the permitting and construction of a mill or
a 97-hectare tailings storage facility, significantly reducing land
disturbance and permitting risk
- The amount of waste rock produced
from the heap leach stand-alone scenario will be far less.
- Significant reduction in tailings,
waste dumps and potential pit lakes.
- Development of the heap leach only
mine at DeLamar will lead to significant decreases in water and
power usage, further simplifying permitting and development.
Item |
Units |
Heap Leach |
HL and Mill |
Difference |
% Change |
Power |
MW |
15 |
25 |
10 |
-40 |
% |
Water for processing |
GPM |
526 |
1,100 |
574 |
-52 |
% |
Haul trucks |
Units |
11 |
16 |
5 |
-31 |
% |
Total Strip Ratio |
W:O |
1.35 |
2.21 |
0.86 |
-39 |
% |
Waste rock moved |
K Tonnes |
109,495 |
273,217 |
163,722 |
-60 |
% |
Net Operating Cost |
K US$ |
704,343 |
1,584,466 |
880,123 |
-56 |
% |
Pre-production Capital |
K US$ |
278,092 |
288,097 |
10,005 |
-3 |
% |
Sustaining Capital |
K US$ |
76,855 |
301,358 |
224,503 |
-74 |
% |
Total Capital |
K US$ |
354,947 |
589,455 |
234,508 |
-40 |
% |
Note: The numbers in the table above include
working capital, cash for bond, reclamation, and salvage value.
2022: Focus on Gold-Silver Oxide
Expansion, in proximity to Planned Infrastructure
As highlighted in the 2022 PFS study,
significant heap leachable Oxide and Mixed resource expansion
potential exists in many areas of the project. Internal models
generated by the Company demonstrate the tremendous leverage
associated with increasing the heap leachable gold-silver resource
and amplifying the mine plan accordingly. The Company has
identified the potential to add Oxide and Mixed gold-silver
mineralization for the Heap Leach in three areas: Florida Mountain
West, approximately 300 m from the planned open pit, BlackSheep,
adjacent to the Milestone open pit, and historic DeLamar low-grade
stockpiles that are situated adjacent to planned mining and
processing infrastructure.
Florida Mountain West:
West of Florida Mountain in the areas of Rich
Gulch and Blue Gulch, soil geochemistry and Induced Polarization
(“IP”) Chargeability has delineated a large, mineralized area of
which the upper has potential to provide additional Oxide and Mixed
resource for the proposed heap-leach operation. This consists of
several 50 m wide zones with a combined strike length of 2,000 m
with historical drilling in the area showing very encouraging
grades. Based on the historical drilling, the depth of partial to
complete oxidation is expected to range between 50 m and 70 m.
Historical drill results for Florida Mountain
West can be viewed by clicking on the link
below:https://integraresources.com/site/assets/files/2572/fm_west_drill_results.pdf
To view a map of Florida Mountain West, click on
the link
below:https://integraresources.com/site/assets/files/2572/florida_mountain_west_map.pdf
BlackSheep: Slaughterhouse Gulch and
Lucky Days
Exploration in the BlackSheep District, to the
north of DeLamar, is in its early stages. However, two extensive
areas of outcropping mineralization have been identified based on
soil geochemistry, IP Chargeability, and historical drilling. At
Slaughterhouse Gulch, a 2,000 m long by 70 m to 100 m wide
mineralized corridor has been delineated and is ready to be drill
tested. Similarly, at Lucky Days, a 1,000 m long by several
hundred-meter-wide zone of mineralization will be drill tested this
year to better define the mineralized structures prior to
delineating a resource.
Integra and historical drill results for
BlackSheep can be viewed by clicking on the link
below:https://integraresources.com/site/assets/files/2572/bs_south_drill_results_slg.pdf
To view a map of BlackSheep South, click on the
link
below:https://integraresources.com/site/assets/files/2572/blacksheep_south_map.pdf
DeLamar Low-grade
Stockpiles:
There is also an opportunity, through the
evaluation of the historical low-grade stockpiles and backfill, for
gold and silver to be processed using similar heap leach methods
outlined in the PFS. Kinross Gold Corp (“Kinross”), the previous
operator of the Project, halted production and began reclamation
efforts in 2001 at very low gold and silver prices as compared to
current prices. The average grade of the approximately 22 Million
tonnes (“Mt”) of mill feed processed during the life of the Nerco
Kinross operation was 1.2 g/t Au and 75 g/t Ag, with approximately
70Mt of lower-grade material being stockpiled in low-grade
stockpiles and pit back-fill. During the 20-year long mining
operation, Kinross mine staff clearly viewed that this material
might someday become economic at higher gold-silver prices and
improved low-grade gold-silver processing techniques.
The Company estimates that approximately 60Mt of
this run-of-mine low-grade waste could be available for processing
via heap-leaching, subject to further confirmatory studies. Based
on preliminary in-house calculations and limited historic drilling
of the low-grade stockpiles, the Company is optimistic that the
average grade of the low-grade dumps and back-fill is likely to be
above the 0.2 g/t AuEq used as the Heap Leach cut-off grade in
Integra’s recent PFS.
Kinross drilled into the eastern portion of
Waste Dump 1 (see map below). To view a drill results from this
historical drilling, click on the link
below:https://integraresources.com/site/assets/files/2572/waste_dump_1_drill_results.pdf
To view a map of the low-grade stockpiles at
DeLamar, click on the link
below:https://integraresources.com/site/assets/files/2572/del_low-grade_stockpile.pdf
To view a map of the low-grade stockpiles at
Florida Mountain, click on the link
below:https://integraresources.com/site/assets/files/2572/fm_low-grade_stockpile.pdf
2022: Further Study of High-grade at
Florida Mountain
The Company continues to pursue the high-grade
potential below Florida Mountain. To date, the Company has drilled
more than 110 intercepts of high-grade gold and silver at Florida
Mountain. The high-grade structures at Florida Mountain extend
7,000 m on strike in the North-South direction and to a depth of
400 m. The Company intends to complete surface drilling along this
strike length to further identify the location of high-grade shoots
that dip steeply below Florida Mountain.
The Company is in the process of compiling all
the high-grade drill intersects to date to further study continuity
at Florida Mountain and the potential for an Inferred Resource
Estimate.
Sampling and QA/QC
Procedure
Thorough QA/QC protocols are followed on the
Project, including insertion of duplicate, blank and standard
samples in the assay stream for all drill holes. The samples are
submitted directly to American Assay Labs in Reno, Nevada for
preparation and analysis. Analysis of gold is performed using fire
assay method with atomic absorption (AA) finish on a 1 assay ton
aliquot. Gold results over 5 g/t are re-run using a
gravimetric finish. Silver analysis is performed using ICP for
results up to 100 g/t on a 5 acid digestion, with a fire
assay, gravimetric finish for results over 100 g/t silver.
Qualified Person
The scientific and technical information contained in this news
release has been reviewed and approved by E. Max Baker Ph.D.
(F.AusIMM), Integra’s Vice President Exploration, of Post Falls,
Idaho, and Timothy D. Arnold (PE, SME), Integra’s Chief Operating
Officer, of Reno, Nevada. Each is a qualified person under NI
43-101.
Cautionary Note Regarding Non-GAAP
Financial Measures
Alternative performance measures in this news
release such as “cash cost”, “AISC” “free cash flow” are furnished
to provide additional information. These non-GAAP performance
measures are included in this news release because these statistics
are used as key performance measures that management uses to
monitor and assess performance of the Project, and to plan and
assess the overall effectiveness and efficiency of mining
operations. These performance measures do not have a standard
meaning within International Financial Reporting Standards (“IFRS”)
and, therefore, amounts presented may not be comparable to similar
data presented by other mining companies. These performance
measures should not be considered in isolation as a substitute for
measures of performance in accordance with IFRS.
Cash Costs
Cash costs include site operating costs (mining,
processing, site G&A), refinery costs and royalties, but
excludes head office G&A and exploration expenses. While there
is no standardized meaning of the measure across the industry, the
Company believes that this measure is useful to external users in
assessing operating performance.
All-In Sustaining Cost (“AISC”)
Site level AISC include cash costs and
sustaining capital, but excludes head office G&A and
exploration expenses. The Company believes that this measure is
useful to external users in assessing operating performance and the
Company’s ability to generate free cash flow from current
operations.
Free Cash Flow
Free cash flows are revenues net of operating
costs, royalties, capital expenditures and cash taxes. The Company
believes that this measure is useful to the external users in
assessing the Company’s ability to generate cash flows from the
Project.
About Integra Resources
Integra is a development-stage mining company
focused on the exploration and de-risking of the past producing
DeLamar gold-silver project in Idaho, USA. Integra is led by the
management team from Integra Gold Corp. which successfully grew,
developed and sold the Lamaque Project, in Quebec, for C$600m in
2017. Since acquiring the DeLamar Project, which includes the
adjacent DeLamar and Florida Mountain gold and silver deposits, in
late 2017, the Company has demonstrated significant resource growth
and conversion while providing robust economic studies in its
maiden preliminary economic assessment and now pre-feasibility
study. An independent technical report for the PFS on the DeLamar
Project has been prepared in accordance with the requirements of NI
43-101 and is available under the Company’s profile at
www.sedar.com and on the Company’s website at
www.integraresources.com.
ON BEHALF OF THE BOARD OF DIRECTORSGeorge
SalamisPresident, CEO and Director
CONTACT INFORMATIONCorporate Inquiries:
ir@integraresources.comCompany website:
www.integraresources.comOffice phone: 1 (604) 416-0576
Forward looking and other cautionary
statements
This news release contains “forward-looking
information” and “forward-looking statements” (collectively,
“forward-looking statements”) within the meaning of the applicable
Canadian securities legislation. All statements, other than
statements of historical fact, are forward-looking statements and
are based on expectations, estimates and projections as at the date
of this news release. Any statement that involves discussion with
respect to predictions, expectations, beliefs, plans, projections,
objectives, assumptions, future events or performance (often, but
not always using phrases such as “plans”, “expects”, “is expected”,
“budget”, “scheduled”, “estimates”, “forecasts”, “intends”,
“anticipates”, or “believes” or variations (including negative
variations) of such words and phrases, or state that certain
actions, events or results “may”, “could”, “would”, “might” or
“will” be taken, occur or be achieved) are not statements of
historical fact and may be forward-looking statements. In this news
release, forward-looking statements relate, among other things, to:
statements about the scope, timing and completion of the
Pre-feasibility study; estimates of metallurgical recovery rates
and the contribution of silver production to mining operations;
anticipated advancement of DeLamar and future exploration
prospects. These forward-looking statements, and any assumptions
upon which they are based, are made in good faith and reflect our
current judgment regarding the direction of our business.
Management believes that these assumptions are reasonable.
Forward-looking information involves known and unknown risks,
uncertainties and other factors which may cause the actual results,
performance, or achievements of the Company to be materially
different from any future results, performance or achievements
expressed or implied by the forward-looking information. Such
factors include, among others: risks related to the speculative
nature of the Company’s business; the Company’s formative stage of
development; the Company’s financial position; possible variations
in mineralization, grade or recovery rates; actual results of
current exploration activities; actual results of reclamation
activities; conclusions of future economic evaluations; business
integration risks; fluctuations in general macroeconomic
conditions; fluctuations in securities markets; fluctuations in
spot and forward prices of gold, silver, base metals or certain
other commodities; fluctuations in currency markets (such as the
Canadian dollar to United States dollar exchange rate); change in
national and local government, legislation, taxation, controls
regulations and political or economic developments; risks and
hazards associated with the business of mineral exploration,
development and mining (including environmental hazards, industrial
accidents, unusual or unexpected formation pressures, cave-ins and
flooding); inability to obtain adequate insurance to cover risks
and hazards; the presence of laws and regulations that may impose
restrictions on mining; employee relations; relationships with and
claims by local communities and indigenous populations;
availability of increasing costs associated with mining inputs and
labour; the speculative nature of mineral exploration and
development (including the risks of obtaining necessary licenses,
permits and approvals from government authorities); and title to
properties. Although the forward-looking statements contained in
this news release are based upon what management of Integra
believes, or believed at the time, to be reasonable assumptions,
Integra cannot assure its shareholders that actual results will be
consistent with such forward-looking statements, as there may be
other factors that cause results not to be anticipated, estimated,
or intended.
Forward-looking statements contained herein are
made as of the date of this news release and the Company disclaims
any obligation to update any forward-looking statements, whether as
a result of new information, future events or results, except as
may be required by applicable securities laws. There can be no
assurance that forward-looking information will prove to be
accurate, as actual results and future events could differ
materially from those anticipated in such statements. Accordingly,
readers should not place undue reliance on forward-looking
information.
Cautionary Note for U.S. Investors
Concerning Mineral Resources and Reserves
National Instrument 43-101 - Standards of Disclosure for Mineral
Projects ("NI 43-101") is a rule of the Canadian
Securities Administrators which establishes standards for all
public disclosure an issuer makes of scientific and technical
information concerning mineral projects. Technical disclosure
contained in this news release has been prepared in accordance with
NI 43-101 and the Canadian Institute of Mining, Metallurgy and
Petroleum Classification System. These standards differ from
the requirements of the U.S. Securities and Exchange Commission
(“SEC”) and resource information contained in this
press release may not be comparable to similar information
disclosed by domestic United States companies subject to the SEC's
reporting and disclosure requirements.
Neither the TSX Venture Exchange nor its
Regulation Services Provider (as that term is defined in the
policies of the TSX Venture Exchange) accepts responsibility for
the adequacy or accuracy of this release.
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