VANCOUVER, Feb. 19, 2015 /CNW/ - Bear Creek Mining (TSX
Venture: BCM / BVL: BCM) ("Bear Creek" or the "Company") is pleased
to provide an update on the Feasibility Study ("FS") for the Corani
Silver-Lead-Zinc deposit, Puno, Peru. The FS is expected to be released by the
end of Q1 2015 and will update and further optimize the
November 2011 Corani FS, in which a
deposit containing 270M ounces silver and 4.8 billion pounds of
combined Lead and Zinc in Proven and Probable Reserves was
described. The updated FS will establish an optimized reserve
focusing on return on investment within a mine plan utilizing
current metal price expectations, and optimized processing and
construction designs that will lessen the project footprint.
The updated FS is expected to produce significant savings in CapEx
allowing a cushion for ramp-up and working capital requirements not
included in the 2011 study. Most importantly, the FS will
incorporate the following modifications:
- Testing has established that dry-stacking of the tailings is
feasible, entirely eliminating the need for a conventional tailings
dam. A significant CapEx reduction is expected as the tailings dam
facility in the previous FS was $95M.
Sustaining CapEx will also significantly decrease as tailings dam
lifts will be eliminated. As a result of now utilizing filtration,
OpEx is expected to remain constant or slightly increase.
- As a result of eliminating the tailings dam, the "South fresh
water" dam and storage facility are no longer required, which
represented a $30M CapEx in the 2011
FS.
- Back filling of the pit with tailings beginning in
approximately Year 5 will further reduce OpEx.
- Re-sizing of the crusher and SAG mill is expected to reduce
CapEx while maintaining the through-put capacity at 22,500 tpd
- Project layouts, specifically waste dump and concentrator
locations, have been modified to provide for shorter haulage
distances. The new project layout is within the surface rights
already purchased by the Company.
- Additional analysis of the metallurgical test work will
facilitate planning the mine sequencing so that the best
metallurgical performing ore is mined first with stockpiling of
lower-recovery material for future processing. As a result, it is
anticipated that metallurgical recoveries will exceed those
forecasted in the 2011 FS.
Now that the above parameters have been determined to have a
strong positive impact on the project performance, revised ore
reserves and resources calculations, optimized mine sequencing, and
collection of final equipment quotes are being completed for the
final financial model. Importantly, the design and operating
improvements are expected to require only a modification of the
existing approved Environmental and Social Impact Assessment
without public hearings as the enhancements are located within the
previously approved project footprint. In addition, the
modifications improve the final permitting timelines and mine
closure processes primarily through the elimination of the tailings
dam and the introduction of dry stacking of tailings followed by
in-pit tailings disposal; practices that have been successfully
implemented in similar mines in Peru.
Andrew Swarthout, CEO and
President stated "We continue to be very encouraged by the
conclusions from test work and optimization studies.
Significant reductions in CapEx have been identified while
maintaining the 22,500 tpd through-put with silver-base metals
recoveries potentially better than those estimated in the previous
FS. Overall CapEx is expected to remain in the range of the
2011 FS as the FS is intended to serve as a basis for a final
decision by a financial institution to finance the development of
the Corani project, and, as such, will include not only financing
costs but post production working capital requirements, and a
typical mine/concentrator ramp-up schedule. We are confident
that Corani, as one of the largest undeveloped silver-base metal
mines in the world, will be able to produce 14M opy silver at a
negative cash cost per ounce silver (net of by-product credits for
years one through five) and low quartile costs for LOM as indicated
by the 2011 FS. The project will produce high-quality
lead-silver and zinc concentrates during a period of depleting
supplies of such concentrates. The completion of the
Feasibility Study will describe a "shovel-ready" mining project for
advancement into financing discussion and a one-year permitting
timeline."
SANTA ANA - In other news, the Company participated to a
preliminary hearing called by the ICSID tribunal in January 2015, which addressed an agenda comprised
of largely procedural matters. Following the preliminary
hearing, the ICSID tribunal issued a Procedural Order No. 1
addressing the procedural issues discussed during the preliminary
hearing. A summary of the tribunal's material decisions
follows:
- Bear Creek will submit its memorial on the merits containing a
full set of its arguments, witness statements, expert witness
statements and supporting documentation by May 29, 2015;
- The Government of Peru will
have 130 days to prepare a counter-memorial respond to Bear Creek's
memorial and introduce objections to the jurisdiction of the ICSID
tribunal (if any);
- Bear Creek and Peru will then
each have the opportunity to submit another round of pleadings;
and
- The final hearings before the ICSID arbitration tribunal will
take place in Washington D.C. on
September 8 - 14, 2016.
As indicated continuously since the rescinding of Bear Creek's
rights in 2011, the Company remains open to negotiating a
settlement and willing to re-engage in discussions that took place
before the GOP suspended talks in August 2014. Meanwhile, the
Company is vigorously preparing its case for international
arbitration.
JOSE MARIA GOLD PROJECT – As previously reported, BCM
decided to seek an appropriate partner to advance this highly
prospective district in order to preserve the Company's cash. The
Company is now pleased to report that an earn-in agreement has been
completed with a private Peruvian gold producer to explore and
develop this high-grade, gold-quartz vein system (see news release
dated April 08 2014). The
Company has signed a binding LOI with Analytica Mineral Services
S.A.C. ("AMS"); a proven Peruvian tunneling contractor and gold
producer. AMS will complete 2,000 meters of tunneling and
cross-cuts in the vein systems within one year, at its sole cost,
in order to earn a 51% undivided interest in the mineral
concessions. AMS will also make its pro-rata share of the
underlying option agreement payments totaling $115,000 in 2015 and $2.1M over the term of the 5-year
option. Following AMS earning its 51% interest, the two
parties will form a joint venture agreement with standard
terms.
Mr. Swarthout commented "This earn-in arrangement is very
beneficial to BCM's shareholders. While the Jose Maria
District exhibits potential for high grade gold ore bodies, the
exploration risk is quite high. The agreement with AMS allows
significant exploration expenditures to be made by a qualified
partner while Bear Creek maintains considerable exposure to any
success; the same strategy employed on its La Yegua and Sumi joint
venture agreements."
All scientific and technical information contained in this news
release has been reviewed and approved by Andrew Swarthout, P.Geo, the Chief Executive
Officer of the Company, who is a "qualified person" within the
meaning of National Instrument 43-101 ("NI 43-101").
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.
Cautionary Note regarding Technical and Scientific
Disclosure and Forward-Looking Statements:
Please refer to the NI 43-101 technical report dated
December 22, 2011 entitled "Corani
Project, Form 43-101F1 Technical Report, Feasibility Study"
available under the Company's profile at www.sedar.com, as well as
the Company's news releases dated November
9, 2011 and January 4, 2012,
for further details of the mineral reserves, mineral resources and
the Feasibility Study in respect of the Company's Corani
project.
Cautionary Note regarding Forward-Looking
Statements:
This document contains "forward-looking information" within
the meaning of Canadian securities legislation and "forward-looking
statements" within the meaning of the United States Private
Securities Litigation Reform Act of 1995. This information and
these statements, referred to herein as "forward-looking
statements" are made as of the date of this news release or as of
the date of the effective date of information described in this
news release, as applicable. Forward-looking statements relate to
future events or future performance and reflect current estimates,
predictions, expectations or beliefs regarding future events and
include, without limitation, statements with respect to: (i)
modifications, if any, and timing of the ESIA; (ii) the planned
development of the Corani project or any of the Company's other
projects, including the timing thereof, and (iii) preparation of a
updated Feasibility Study, including the timing thereof. Any
statements that express or involve discussions with respect to
predictions, expectations, beliefs, plans, projections, objectives,
assumptions or future events or performance (often, but not always,
using words or phrases such as "expects", "anticipates", "plans",
"projects", "estimates", "envisages", "assumes", "intends",
"strategy", "goals", "objectives" or variations thereof or stating
that certain actions, events or results "may", "could", "would",
"might" or "will" be taken, occur or be achieved, or the negative
of any of these terms and similar expressions) are not statements
of historical fact and may be forward-looking
statements.
All forward-looking statements are based on the Company's or
its consultants' current beliefs as well as various assumptions
made by and information currently available to them. These
assumptions include, without limitation: (i) the presence of and
continuity of metals at the project at modeled grades; (ii) the
capacities of various machinery and equipment; (iii) the
availability of personnel, machinery and equipment at estimated
prices; (iv) exchange rates; (v) metals and minerals sales prices;
(vi) appropriate discount rates; (vii) tax rates and royalty rates
applicable to the proposed mining operation; (viii) financing
structure and costs; (ix) anticipated mining losses and dilution; *
metals recovery rates, (xi) reasonable contingency requirements;
and (xiii) receipt of regulatory approvals on acceptable terms and
in the timeframes expected by the Company, including, without
limitation, in relation to a modified ESIA or updated Feasibility
Study, if any. Although management considers these assumptions to
be reasonable based on information currently available to it, they
may prove to be incorrect. Many forward-looking statements are made
assuming the correctness of other forward looking statements, such
as statements of net present value and internal rate of return,
which are based on most of the other forward-looking statements and
assumptions herein. The cost information is also prepared using
current values, but the time for incurring the costs will be in the
future and it is assumed costs will remain stable over the relevant
period.
By their very nature, forward-looking statements involve
inherent risks and uncertainties, both general and specific, and
risks exist that estimates, forecasts, projections and other
forward-looking statements will not be achieved or that assumptions
do not reflect future experience. We caution readers not to place
undue reliance on these forward-looking statements as a number of
important factors could cause the actual outcomes to differ
materially from the beliefs, plans, objectives, expectations,
anticipations, estimates assumptions and intentions expressed in
such forward-looking statements. These risk factors may be
generally stated as the risk that the assumptions and estimates
expressed above do not occur, but specifically include, without
limitation, risks relating to variations in the mineral content
within the material identified as mineral reserves and mineral
resources from that predicted; variations in rates of recovery and
extraction; developments in world metals and minerals markets;
risks relating to fluctuations in the Canadian dollar relative to
other currencies; increases in the estimated capital and operating
costs or unanticipated costs; difficulties attracting the necessary
work force; increases in financing costs or adverse changes to
global market conditions and the terms of available financing, if
any; tax rates or royalties being greater than assumed; changes in
development or mining plans due to changes in logistical, technical
or other factors, changes in project parameters as plans continue
to be refined; risks relating timing and to receipt of regulatory
approvals; adverse changes to government approval processes; the
effects of competition in the markets in which the Company
operates; operational and infrastructure risks; and the additional
risks described in the Company's Annual Information Form, annual
financial statements and management's discussion and analysis for
the year ended December 31, 2013 and
in the feasibility study entitled "Corani Project, Form 43-101F1
Technical Report, Feasibility Study" filed by the Company on
December 22, 2011 filed on the SEDAR
website in Canada (available at
www.sedar.com). The foregoing list of factors that may affect
future results is not exhaustive.
When relying on our forward-looking statements, investors and
others should carefully consider the foregoing factors and other
uncertainties and potential events. The Company does not undertake
to update any forward-looking statement, whether written or oral,
that may be made from time to time by the Company or on behalf of
the Company, except as required by law.
SOURCE Bear Creek Mining Corporation