AIM:
MARLTSX-V: MARL 17 January 2017 |
Granite House, La Grande Rue,St. Martin, Guernsey
,GY1 3RS Channel Islands |
Hot Maden High Grade Gold-Copper Project- PEA
Results with a Positive IRR of 153%
Mariana Resources Limited ('Mariana' or 'the
Company'), the TSX.V and AIM (MARL) listed exploration and
development company with projects in Turkey, South America, and
Ivory Coast, is pleased to announce a highly favourable outcome for
a Preliminary Economic Assessment ("PEA" or the "Study") of the
high grade Hot Maden gold-copper project in NE Turkey. The PEA was
prepared in accordance with Canadian National Instrument 43-101
Standards of Disclosure for Mineral Projects ("NI 43-101") by
independent mining consultant firm RungePincockMinarco Limited
("RPM").
Highlights of the Study (100% Project
Basis)
- Conceptual development for Hot Maden assumes an all underground
mining operation from a decline and utilizing mechanized transverse
and longitudinal long hole open stoping with engineered fill mining
methods. Mining and processing rates of 0.8 million tonnes per
annum ("Mtpa"), 1.0 Mtpa, and 1.2 Mtpa were considered, with the
base case mining scenario being established at 1.0 Mtpa.
- Total metal production of 2.6 Million ounces ("Moz") of gold
and 142,000 tonnes ("t") of copper over a total project life of 9
years for the base case mining scenario. Metallurgical testwork,
through flotation and concentration, completed to date on the high
grade Main Zone mineralisation has indicated high recoveries of
both gold and copper. A variable processing recovery, dependant on
grade, has been applied in the PEA resulting in a project weighted
average recovery of 88% Au and 90% Cu. The current Hot Maden plant
flow sheet assumes the production of two concentrates on site - one
standard copper-gold concentrate, and a second gold-bearing pyrite
concentrate.
- Post-tax discounted NPV for the base case mining scenario (1.0
Mtpa) of US$1.37 billion ("B") excluding pre-development
exploration costs (8% discount rate).
- Post-tax IRR for the base case mining scenario of 153%
excluding acquisition costs.
- Total Capex (Initial + Sustaining) of US$261M
Note that the PEA is preliminary in nature as it
includes inferred mineral resources that are considered too
speculative geologically to have the economic considerations
applied to them that would enable them to be categorized as mineral
reserves. Mineral resources that are not mineral reserves do
not have demonstrated economic viability, and as such there is no
certainty that the preliminary assessment and economics will be
realized. A NI-43-101- technical report for the Hot Maden PEA will
be filed on SEDAR (www.sedar.com) within 45 days and also be posted
on Mariana's website
(www.marianaresources.com).
The Hot Maden project is 70:30 Joint Venture
between Turkish partner Lidya Madencilik Sanayi ve Ticaret A.S.
("Lidya") and Mariana Resources Ltd.
Chief Executive Officer Glen Parsons today
commented:
"The potential value is finally revealed from
the high grade Au-Cu Hot Maden project with these PEA results from
RPM. We have always believed Hot Maden to be a world class
deposit and, with a potential post-tax NPV for the base case mining
scenario of $1.37B and post-tax IRR of 153%, this is certainly
proven correct. The high grade nature of this resource and
relatively low capital (CAPEX) and operating (OPEX) costs should
result in the delivery of considerable cashflow and a short payback
period (around 2.1 years, including underground mine development)
on initial investment.
Despite Hot Maden's rapid advancement from
discovery to PEA in just 20 months, the decision by the
Lidya/Mariana (70/30) joint venture to rapidly move to development
is justified with the value of the project for shareholders
reflected in the significant cash flow generative ability through
the life of this initial current resource. The result is expected
to be a low cost, low environmental footprint, but highly
profitable mine.
A further 20,000m of drilling is budgeted and planned for this
new year and we must remember that exploration drilling continues
to focus on the discovery of new gold-copper resources at Hot
Maden, especially to the south of the Main Zone within the old
"Russian Mining Area.
The Joint Venture will also continue to work on
the technical studies and optimisations required to underpin the
Preliminary Feasibility Study ("PFS"), which is anticipated to be
completed during Q3, 2017. The PFS will provide higher confidence
level mine designs, mineral processing scenarios, and costings for
the Hot Maden Project. Therefore this result could change
over time based on the updated prices, resource and
assumptions.
I look forward to updating the market on
developments, as 2017 will continue to be a busy period for
Mariana."
PEA ParametersKey parameters utilized in
the Hot Maden PEA are indicated in the table below:
Hot Maden - PEA Mining Base Case |
|
Mining Method |
Underground: underhand, mechanised transverse and
longitudinal long hole open stoping with engineered paste fill |
Underground Minable Quantities |
7Mt at 11 g/t gold and 1.9% Cu |
Annual Throughput |
0.8 Mtpa, 1.0 Mtpa, and 1.2 Mtpa were evaluated. Base
case established at 1.0 Mtpa |
Project Life of Mine |
9 years |
Gold Metal Price |
USD 1,250/tr. oz |
Copper Metal Price |
USD 2.75/lb |
Gold Recoveries |
Variable recovery based on the grade (project weighted
average recovery of 88%) |
Copper Recoveries |
Variable recovery based on the grade (project weighted
average recovery of 90%) |
Total Gold Ounces Produced |
2.6M tr. oz |
Total Copper Tonnes Produced |
142kt |
Upfront CAPEX |
USD 169M |
LOM Project CAPEX |
USD 261M |
Mining Operating Costs |
USD 31.05/t |
Processing Operating Costs |
USD 15.13/t |
G+A Operating Costs |
USD 10.18/t |
Net Smelter Return Cut-off Grades (NSR) |
The project was evaluated at a range of NSR COG's from
USD50/t to USD200/t. The base case economic outcome was identified
at an NSR of USD 100/ in situ tonnes (this equates to an
approximate Resource cut-off grade of 3.3g/t AuEq*) |
Smelting / Refining & Transport Charges |
Copper concentrate - TC:USD 101/dmt, Cu RC:USD
0.101/lb payable Cu, 1% copper grade deduction, 96.65% copper
payability, Au RC:USD 8.5/tr. oz., 1 g/t grade deduction, 97.5%
gold payability; transport to port :USD 8.50/wmt, port:USD
10/wmt and shipping:USD 55/wmt.Pyrite concentrate - TC
:USD 30/dmt, Payment : USD100/dmt and 50% of gold content;
transport to buyer :USD 5/wmt. |
Royalties |
2.6% State Royalties, 2% NSR Sandstorm |
Corporate Tax Rate |
20 |
% |
Geology and Mineral ResourcesThe high
grade gold-copper mineralisation at Hot Maden occurs within a
N-NE-trending fault zone (the "Hot Maden Fault Zone") and is
sub-vertical in nature. At least two styles of gold-copper
mineralisation are evident within the Main Zone: i) the
predominant, multiphase quartz-sulphide (pyrite-chalcopyrite) +/-
hematite/jasperoid breccia bodies, and ii) semi-massive to massive
sulphides (pyrite-chalcopyrite). Host rocks are dominantly
andesites and andesitic breccias. Overall, the highest-grade gold
mineralisation (typically >15 g/t Au but locally >100 g/t Au)
at Hot Maden lies along the eastern margin of the Main Zone.
Drilling is ongoing but the current dimensions of the Main Zone are
a strike extent of 300 m from north to south, a true width of
between 50m and 70m, and a vertical extension from near surface to
>300m depth. Stratabound Zn(-Pb) (sphalerite-galena)
mineralisation also flanks the Main Zone to the east and locally to
the west. In the new Southern Vein Field discovery, host rocks are
dominantly dacitic breccias and gold-copper mineralisation is
associated with quartz-sulphide-bearing veins and vein
breccias.
On July 25, 2016, Mariana reported an updated
Mineral Resource for the Hot Maden project. This Resource
Estimate was prepared by independent mining consultants
RungePincockMinarco, and was based on assay results received for
holes up to, and including, HTD-62. The Mineral Resource Estimate
for Hot Maden included contributions from both the Main Zone and a
new Southern Discovery, and comprises (on a 100% basis):
|
Hot Maden Mineral Resource Estimate - Main
Gold-Copper Zone (2 g/t AuEq Cut-off) |
|
|
Indicated Mineral Resource |
Domain |
Tonnes |
Au |
Cu |
Zn |
AuEq |
Au |
Cu |
AuEq |
|
t |
g/t |
% |
% |
g/t* |
Ounces |
Tonnes |
Ounces** |
Main Zone LG |
463,000 |
1.1 |
1.1 |
0.3 |
2.4 |
17,000 |
5,000 |
36,000 |
Main Zone HG |
4,501,000 |
3.9 |
1.9 |
0.2 |
6.3 |
570,000 |
87,000 |
908,000 |
Main Zone UHG |
2,086,000 |
32.7 |
3.5 |
0.1 |
36.9 |
2,195,000 |
73,000 |
2,476,000 |
Mixed Gold-Zinc |
17,000 |
7.5 |
3.1 |
3.6 |
11.2 |
4,000 |
1,000 |
6,000 |
Peripheral Lodes |
60,000 |
2.1 |
0.4 |
0.4 |
2.5 |
4,000 |
|
5,000 |
Total |
7,127,000 |
12.2 |
2.3 |
0.2 |
15.0 |
2,790,000 |
166,000 |
3,431,000 |
|
|
Inferred Mineral Resource |
Domain |
Tonnes |
Au |
Cu |
Zn |
AuEq |
Au |
Cu |
AuEq |
|
t |
g/t |
% |
% |
g/t* |
Ounces |
Tonnes |
Ounces** |
Main Zone LG |
395,000 |
1.7 |
0.9 |
0.03 |
2.8 |
21,000 |
4,000 |
35,000 |
Main Zone HG |
31,000 |
3.9 |
1.6 |
0.1 |
5.8 |
4,000 |
|
6,000 |
Main Zone UHG |
6,000 |
39.1 |
2.1 |
0.01 |
41.6 |
7,000 |
|
8,000 |
Mixed Gold-Zinc |
4,000 |
1.7 |
0.4 |
2.4 |
2.2 |
|
|
|
Peripheral Lodes |
282,000 |
3.2 |
0.9 |
0.1 |
4.3 |
29,000 |
2,000 |
38,000 |
Total |
718,000 |
2.7 |
0.9 |
0.1 |
3.8 |
62,000 |
7,000 |
88,000 |
|
Hot Maden - Southern Gold-Copper Zone
(2 g/t AuEq Cut-off) |
|
|
Inferred Mineral Resource |
Domain |
Tonnes |
Au |
Cu |
Zn |
AuEq |
Au |
Cu |
AuEq |
|
t |
g/t |
% |
% |
g/t* |
Ounces |
Tonnes |
Ounces** |
South Zone LG |
396,000 |
2.8 |
0.7 |
0.0 |
3.6 |
35,000 |
3,000 |
46,000 |
South Zone HG |
583,000 |
5.3 |
0.7 |
0.0 |
6.1 |
98,000 |
4,000 |
114,000 |
Main Zone UHG |
224,000 |
22.2 |
1.0 |
0.0 |
23.4 |
160,000 |
2,000 |
169,000 |
Mixed Gold-Zinc |
44,000 |
9.0 |
1.0 |
3.2 |
10.2 |
13,000 |
|
15,000 |
Peripheral Lodes |
104,000 |
1.9 |
0.3 |
0.0 |
2.2 |
6,000 |
|
7,000 |
Total |
1,352,000 |
7.2 |
0.7 |
0.1 |
8.1 |
313,000 |
10,000 |
351,000 |
*Au Equivalence (AuEq) calculated using a 100
day moving average of $US1,215/ounce for Au and $US2.13/pound for
Cu as of May 29, 2016. No adjustment has been made for
metallurgical recovery or net smelter return as these remain
uncertain at this time. Based on grades and contained metal for Au
and Cu, it is assumed that both commodities have reasonable
potential to be economically extractable.
- *-The formula used for Au equivalent grade is: AuEq g/t = Au +
[(Cu % x 22.0462 x 2.13)/(1215/31.1035)] and assumes 100 %
metallurgical recovery.
- **-Au equivalent ounces are calculated by mulitplying Mineral
Resource tonnage by Au equivalent grade and converting for ounces.
The formula used for Au equivalent ounces is: AuEq Oz = [Tonnage x
AuEq grade (g/t)]/31.1035
In addition, a maiden Inferred Mineral Resource
for the hanging wall zinc zone of 2.8MT @ 4.0% Zn (2% Zn
cut-off) was reported. However, this zinc resource has not been
considered in the current PEA, although future technical studies
will consider the potential economics of mining this mineralised
zone.
Mining Method and Mineral Processing
Mining of the wide, near vertical gold-copper mineralisation in the
Hot Maden Main Zone is expected to be undertaken through
underground mining using underhand, mechanised transverse and
longitudinal long hole open stoping (LHOS) with engineered fill
mining techniques. The Stopes are mined using an underhand
extraction sequence (Top Down) utilising a primary/secondary stope
extraction methodology to exploit the grade profile, which
diminishes with depth.The Hot Maden project is divided into two
main areas, North and South. The northern area consists of the
wider portion of the ore body and as a result is modelled
predominantly transverse LHOS to maintain the production rate. Some
stopes less than 20m long and/or wide have been developed
longitudinally.
The southern portion of the mineralisation is
thinner and has been modelled in a longitudinal LHOS layout. This
has been carried out so as to reduce the amount of capital
development required for access to this mineralisation.
Access to the north and south areas are by
independent declines. The northern decline is accessed by a box cut
portal whereas the southern portal is an adit into the hill.
The PEA reviewed 0.8 Mtpa, 1.0 Mtpa and 1.2 Mtpa
production profiles at a range of NSR COG's from USD50/t to
USD200/t. NSR was used instead of the gold equivalent used in the
Mineral Resource to capture the full value of all mining blocks due
to the relationship and variability in grade, processing
recoveries, concentrate recoveries and post gate costs. The base
case mining scenario was identified as 1.0 Mtpa, however, an
achievable optimum economic outcome was identified at a production
rate of 1.2Mtpa and NSR cut-off-grade of USD 100/ in situ tonnes
(this NSR cut-off equates to an approximate 3.3g/t AuEq cut-off
grade).
A variable processing recovery, dependant on
grade, has been applied in the PEA resulting in a project weighted
average recovery of 88% Au and 90% Cu. The current Hot Maden plant
flowsheet has been demonstrated on Life of Mine (LOM) composites
with the production of two concentrates - a typical copper gold
rich concentrate (~25% Cu and 85 g/t Au) and a gold-bearing pyrite
concentrate. The flowsheet is currently being tested on 'Ultra High
Grade' (UHG) composites. The incorporation of a gravity
concentrator has been included for gold ores in excess of 100 g/t
Au.
Economics Summary- Throughput Analysis at
cut-off NSR US$100/t
Mining Scenario |
Throughput |
Total CAPEX |
After-tax NPVAt 8% Discount |
After-tax IRR |
Payback (Incl. Development - Yrs) |
Mine Life |
|
|
|
|
|
|
|
Conservative |
0.8 Mtpa |
USD 251M |
USD 1.28 B |
130 |
% |
2.2 |
11 |
Base Case |
1.0 Mtpa |
USD 261M |
USD 1.37 B |
153 |
% |
2.1 |
9 |
Upside |
1.2 Mtpa |
USD 271M |
USD 1.42 B |
173 |
% |
2.0 |
8 |
Processing and Infrastructure Capital
CostsThe processing plant and associated site infrastructure is
estimated to cost USD 80.1 million including contingency and
owner's costs. Off-site infrastructure is estimated to cost USD
45.2 million including contingency.
Overall, the processing and infrastructure costs
are estimated at USD 125.3 million.
Project Economics and Sensitivities
The project is most sensitive to changes in
Metal price (namely combined Copper and Gold prices), most
significantly Gold price, processing recovery and mining
recovery.
**ENDS**
Qualified PersonsThe independent
qualified persons responsible for preparing the Hot Maden PEA are
Mr Joe McDiarmid, MAusIMM(CPMin) of RungePincockMinarco Limited,
and Dr Andrew James Haigh Newell, MAusIMM(CPMet), MIEA (CP) of
RungePincockMinarco Limited. All of the aforementioned qualified
persons have reviewed and approved the contents of this news
release.
The technical and scientific information contained in this news
release has been reviewed and approved for release by Eric Roth,
the Company's Qualified Person as defined by National Instrument
43-101 and for the purposes of AIM rules. Mr Roth is the
Company's Chief Operating Officer and Executive Director and holds
a Ph.D. in Economic Geology from the University of Western
Australia, is a Fellow of the Australian Institute of Mining and
Metallurgy (AusIMM), and is a Fellow of the Society of Economic
Geologists (SEG). Dr Roth has 25 years of experience in
international minerals exploration and mining project
evaluation.
Forward Looking Statements: Some
statements in this news release contain forward-looking information
or forward-looking statements for the purposes of applicable
securities laws. These statements include, among others, statements
with respect to proposed exploration and development activities and
their timing, resource estimates and potential mineralisation, the
PEA, including estimates of capital and sustaining costs,
anticipated internal rates of return, mine production, estimated
recoveries, mine life, estimated payback period and net present
values, opportunities to enhance the value of the Hot Maden and
other plans and objectives of Mariana Resources Ltd. These
statements address future events and conditions and, as such,
involve known and unknown risks, uncertainties and other factors,
which may cause the actual results, performance or achievements to
be materially different from any future results, performance or
achievements expressed or implied by the statements. Such factors
include, among others and in addition to those described elsewhere
in this release, delays in obtaining or inability to obtain
required government or other regulatory approvals, permits or
financing, the risk of unexpected variations in mineral resources,
grade or recovery rates, of failure of plant, equipment or
processes to operate as anticipated, of accidents, labour disputes,
and unanticipated delays in completing other development
activities, the risk that estimated costs will be higher than
anticipated and the risk that the proposed mine plan and recoveries
will not be achieved, equipment breakdowns and bad weather, the
timing and success of future exploration and development
activities, exploration and development risks, mineral resources
are not as estimated, title matters, third party consents,
operating hazards, metal prices, political and economic factors,
competitive factors and general economic conditions. In making the
forward-looking statements, the Company has applied several
material assumptions including, but not limited to, the assumptions
that: required approvals, permits and financing will be obtained;
the proposed exploration and development will proceed as planned;
with respect to mineral resource estimates, the key assumptions and
parameters on which such estimates are based; that the proposed
mine plan and recoveries will be achieved, that capital costs and
sustaining costs will be as estimated, and that no unforeseen
accident, fire, ground instability, flooding, labour disruption,
equipment failure, metallurgical, environmental or other events
that could delay or increase the cost of development will occur,
and market fundamentals will result in sustained metals and
minerals prices. The Company expressly disclaims any intention or
obligation to update or revise any forward-looking statements
whether as a result of new information, future events or otherwise
except as otherwise required by applicable securities
legislation.
The Company has concluded it has a reasonable
basis for providing the forward-looking statements included in this
announcement. The detailed reasons for that conclusion are outlined
throughout this announcement. The Company confirms that it is not
aware of any new information or data that materially affects the
information included in the announcements and that all material
assumptions and technical parameters underpinning the resource
estimates continue to apply and have not materially changed.
|
|
|
Glen Parsons (CEO) |
Mariana Resources
Ltd |
+61 2 9437 4588 |
Eric Roth (COO) |
Mariana Resources
Ltd |
+56 9 8818 1243 |
Karen Davies (IR) |
Mariana Resources Ltd
(Canada) |
+1 604 314 6270 |
Rob Adamson |
RFC Ambrian Limited
(Nomad) |
+61 2 9250 0041 |
Will Souter |
RFC Ambrian Limited
(Nomad) |
+61 2 9250 0050 |
In U.K. |
|
|
Oliver Stansfield |
Brandon Hill Capital
(UK Broker) |
+44 20 3463 5061 |
Jonathan Evans |
Brandon Hill Capital
(UK Broker) |
+44 20 3463 5016 |
Camilla Horsfall |
Blytheweigh (Financial
PR) |
+44 20 7138 3224 |
Megan Ray |
Blytheweigh (Financial
PR) |
+44 20 7138 3203 |
About Mariana ResourcesMariana Resources Ltd is an AIM
(MARL) and TSXV (MRA) quoted exploration and development company
with an extensive portfolio of gold, silver and copper projects in
South America and Turkey.
Mariana's most advanced asset is the Hot Maden
gold-copper project in north east Turkey, which is a joint venture
with its Turkish JV partner Lidya (30% Mariana and 70% Lidya)
and rapidly advancing to development. An updated mineral
resource estimate (detailed table below) of 3.43 Moz gold
Equivalent (Indicated Category) and 0.09 Moz gold Equivalent
(Inferred Category) (100% basis) in the main resource zone as well
as a maiden 351,000 Moz gold Equivalent (Inferred Category) (100%
basis) in the new southern discovery zone was reported for Hot
Maden on July 25, 2015. Elsewhere in Turkey, Mariana holds a 100%
interest in the Ergama gold-copper project.
In southern Argentina, the Company's core
gold-silver projects are Las Calandrias (100%), Sierra Blanca
(100%), Los Cisnes (100%), Bozal (100%). These projects are part of
a 160,000+ Ha land package in the Deseado Massif epithermal
gold-silver district in mining-friendly Santa Cruz Province.
In Suriname, Mariana has a direct holding of
10.2% of the Nassau Gold project. The Nassau Gold Project is a
28,000 Ha exploration concession located approximately 125 km south
east of the capital Paramaribo and immediately adjacent to Newmont
Mining's 4.2Moz gold Merian project. In Peru and Chile,
Mariana is focusing on acquiring new opportunities which complement
its current portfolio.
Safe HarbourThis press release contains certain
statements which may be deemed to be forward-looking
statements. These forward-looking statements are made as at
the date of this press release and include, without limitation,
statements regarding discussions of future plans, the realization,
cost, timing and extent of mineral resource estimates, estimated
future exploration expenditures, costs and timing of the
development of new deposits, success of exploration activities,
permitting time lines, and requirements for additional
capital. The words "plans", "expects", "budget", "scheduled",
"estimate", "forecasts", "intend", "anticipate", "believe", "may",
"will", or similar expressions or variations of such words are
intended to identify forward-looking statements.
Forward-looking statements are subject to known and unknown risks,
uncertainties, assumptions and other factors that may cause actual
results to vary materially from those expressed or implied by such
forward-looking statements, including, but not limited to: the
effects of general economic conditions; the price of gold, silver
and copper; misjudgements in the course of preparing
forward-looking statements; risks associated with international
operations; the need for additional financing; risks inherent in
exploration results; conclusions of economic evaluations; changes
in project parameters; currency and commodity price fluctuations;
title matters; environmental liability claims; unanticipated
operational risks; accidents, labour disputes and other risks of
the mining industry; delays in obtaining governmental approvals or
in the completion of development or construction activities;
political risk; and other risks and uncertainties described in the
Company's annual financial statements for the most recently
completed financial year which is available on the Company's
website at www.marianaresources.com . Although we believe
that the expectations reflected in such forward-looking statements
are based upon reasonable assumptions and have attempted to
identify important factors that could cause actual results to
differ materially from those contained in forward-looking
statements, there may be other factors that cause results not to be
as anticipated, estimated or intended. There can be no
assurance that such statements will prove to be accurate, as actual
results and future events could differ materially from those
anticipated in such forward-looking statements. Accordingly,
readers are cautioned not to place undue reliance on
forward-looking statements. We do not undertake to update any
forward-looking statements, except in accordance with applicable
securities laws.
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.
Attachments:
http://www.globenewswire.com/NewsRoom/AttachmentNg/8a6033f7-8d3b-4587-8ab9-b2acc9c6bf25
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