www.orvana.com
Orvana Minerals Corp. is a mining company with an active gold mine, the Don Mario, in eastern Bolivia. The Don Mario property had estimated proven and probable reserves of 1.5 million tonnes grading 8.74 grams of gold per treated tonne in the Lower Mineralized Zone.
Orvana Minerals unveils feasibility study results for Copperwood
Orvana Minerals Corp. (TSE:ORV) unveiled Tuesday results from a feasibility study on its Copperwood copper project in Upper Peninsula, Michigan, USA.
The study, which looked at a 13-year underground mining operation that uses conventional drill-and-blast methods, estimated that at the lowest modeled copper price of $2.50 a pound, and a silver price of $17.50 an ounce, net present value at an eight percent discount rate amounts of $30.8 million.
After-tax internal rate of return was calculated at 11 percent, with a payback period of 6.2 years.
Using current prices of $3.50 per pound of copper and $27.50 per ounce of silver, net present value jumps to $313.08 million, with an IRR of 32.6 percent and a payback period of 3.8 years.
The fully-diluted mineable reserves for the project are 23.14 million short tons of 1.46% copper and 3.98 grams per tonne (g/t) silver proven and 7.09 million short tons of 1.21% copper and 2.44 g/t silver probable, for a total of 30.2 million short tons of 1.41% copper, or 852 million pounds, and 3.63 g/t silver.
"The results of this feasibility study demonstrate the viability of this copper project," said VP of operations, Jim Jacques.
"A review of the mine plan resulted in redesign of entries and pillar dimensions to allow for a higher percentage of extraction on advance and a lower percentage of pillar recovery on retreat.
"The redesign of the mine plan reduces dilution, improves grade, and results in a higher percentage of resource being mined."
Production for the 13-year mine life is expected at about 1.5 million short tons of copper concentrate, averaging about 28,000 short tons of copper concentrate per year at the 7,500 short tons of ore per day capacity.
Copper will be extracted using conventional flotation. Life-of-mine direct operating cash costs are $1.26 per pound, net of the silver credit, the company said.
The copper recovery rate was estimated at 86 percent, with a copper concentrate grade of 24 percent, and a silver grade in concentrate of 40.4 g/t.
Pre-production capital costs were projected at $213.52 million, including contingencies.
A net smelter return royalty, which will be determined quarterly, ranges from two to four percent on a sliding scale, based on inflation-adjusted copper prices.
Certain permit applications for the project are in progress, and will be granted by the Michigan Department of Environmental Quality.
Copperwood is a stratiform copper deposit. Orvana has options to lease mineral rights on the other stratiform copper deposits within the Western Syncline that include 43-101-compliant indicated resources of 25.0 million metric tonnes of 1.40% copper (771 million pounds) and inferred resources of 36.1 million metric tonnes of 1.30% copper (1,033 million pounds).
Shares of Orvana rose 1.75 percent on Tuesday, to trade at $1.16 as of 2:23pm ET.
