TIDMGWMO
RNS Number : 1201T
Great Western Mining Corp. plc
10 October 2017
Great Western Mining Corporation PLC
("Great Western Mining", "GWM" or the "Company")
M2 Technical Scoping Study
Great Western Mining (AIM: GWMO) is pleased to provide the
following summary of a JORC compliant Technical Scoping Study
recently completed by WT Cohan & Associates Inc. ("WTC") over
the Company's M2 copper-gold prospect in Mineral County, Nevada,
USA. This independent study assesses the economic viability of
developing an open pit and underground mine, heap leach and solvent
extraction electro-winning facility ("SX-EW") at M2 which would
directly produce copper cathode from the mineral resources
identified at near surface and underground copper-gold
deposits.
Highlights:
o JORC compliant Indicated and Inferred Mineral Resource
Estimate:
16.99 million tonnes of 0.52% Cu
o Separate Mineral Resource Report prepared
o Sharktooth Exploration Target identified
o Two further M2 Exploration Targets identified
o Positive pre-tax margins produced in every economic case
examined
Chief Executive, David Fraser commented: "We are really pleased
that the Scoping Study has highlighted the economic potential of
the M2 prospect. The study demonstrates that the current resource
estimate produces positive pre-tax margins at current copper prices
and the significant upside potential from future resource upgrades.
The drill programmes on M2 and M4 (Target 4) planned for this
autumn are the first steps in unlocking this potential. Nevada is a
Tier 1 mining jurisdiction and there are only a limited number of
such low risk opportunities of this potential size in the developed
parts of the world. We will update shareholders as work continues
on M2 and M4."
Resources
Resources were independently calculated from the results of
drilling conducted by Great Western Mining in 2013 and 2014. The
mineral resources calculations are discussed in a separate report
prepared by WTC titled "Great Western Mining Corporation plc,
Estimate of Resources at M2 Project and Exploration Targets,
October 2017", which will shortly be available on the Company's
website: www.greatwesternmining.com.
The resources were calculated employing block modelling software
and using 15.24 metre square x 1.52 metre high blocks. A cut-off
grade of 0.20% copper was employed in the resource estimates.
Table 1: WTC Estimate of Indicated and Inferred Resources
Category Cut-Off Millions Grade Contained
Grade Tonnes Cu
Cu% (000's
Tonnes)
---------- -------- ---------- --------- ----------
M2 North
(M2N) 0.2% 8.21 0.48% Cu 39.03
---------- -------- ---------- --------- ----------
M2 South
(M2S) 0.2% 8.78 0.57% Cu 50.16
---------- -------- ---------- --------- ----------
Total 0.2% 16.99 0.52% Cu 89.2
---------- -------- ---------- --------- ----------
In addition, exploration targets were postulated, based upon
surface sampling, geologic mapping, and geophysical surveys both
privately held by GWM and available in the public domain.
Table 2: WTC Estimate of Exploration Targets
Area Tonnage Range Grade Range Contained
(Millions) (% Cu) Cu Range (000's
Tonnes)
----------- -------------- ------------ ------------------
Sharktooth 87.0 - 116.0 1.00 - 1.75 870.01 - 2,031.80
Peak
----------- -------------- ------------ ------------------
Between 32.15 - 42.87 0.52 - 0.60 170.48 - 257.22
M2 and
M4
----------- -------------- ------------ ------------------
Between 3.63 - 4.54 0.52 - 0.56 19.02 - 25.42
M2N and
M2S
----------- -------------- ------------ ------------------
The target postulated to exist between the M2 resource area and
M4 (Target 4) prospect area has been extrapolated from the results
of surface sampling, geologic mapping, geophysical surveys and the
results of the drilling completed at M2. The target postulated to
exist between M2 North and M2 South is based upon the results of
the drilling completed at both deposits, surface geophysical
surveys, geologic mapping of the area and the close proximity (300
metres) between the two identified deposits. The Sharktooth Peak
target was extrapolated from geologic cross sections prepared by
Donald G Strachan (Strachan, 2014). The assumed tenor of the target
was also provided by Mr. Strachan.
Economic Modelling
The economic modelling consisted of four cases, with the base
case (Case I) employing the currently estimated indicated and
inferred resources. The assumptions employed in all the cases are
given below. The minimum values of target masses and tenors were
employed in the modelling as they are the result of rigorous
calculations, while the maximum values are assumptions.
Case Assumptions
Case Assumptions
I The currently identified Mineral Resources would be exploited
by open pit mining, heap leaching, solvent extraction and electro
winning at the mine site. The project life is 13 years. The
mineable resources are 16.140 million tonnes grading 0.48% copper
in two separate open pit mines. Open pit slopes at 56(o) and the
waste to ore ratio is 1.74:1. The mining rate is 4,970 tonnes per
day of ore and 8,850 tonnes per day of waste and the processing
rate is 3,550 tons per day of ore feed.
II An Exploration Target is identified between M2 North and M2
South containing 3.63 million tonnes grading 0.52% Cu. The total
Mineral Resource and Exploration Target quantity is 20.62 million
tonnes grading 0.52% copper. The mineable quantity is 19.59 million
tonnes grading 0.48% copper. Exploitation is by mining a single
open pit, heap leaching, solvent extraction and electro winning at
the mine site. The project life is 14 years. Open pit slopes at
56(o) and the waste to ore ratio is 1.51:1. The mining rate is
5,600 tonnes per day of ore and 8,450 tonnes per day of waste and
the processing rate is 3,990 tonnes per day of ore feed.
III An Exploration Target is identified between M2 North &
M2 South and M4 (Target 4), containing 32.15 million tonnes grading
0.52% copper. The postulated total quantity of mineralization
comprises 52.77 million tonnes grading 0.52% copper, including the
quantities estimated in Cases I and II. The mineable quantity is
50.13 million tonnes grading 0.48% copper. Exploitation is by open
pit mining, heap leaching, solvent extraction and electro winning
at the mine site. The project life is 19 years. Open pit slopes at
56(o) and the waste to ore ratio is 1.26:1. The mining rate is
8,000 tonnes per day of ore and 10,000 tons per day of waste and
the processing rate is 8,000 tonnes per day of ore feed.
IV An Exploration Target is identified under Sharktooth Peak,
which would be suitable for underground mining by block caving,
containing 32 million tonnes grading 1.00% copper. The postulated
total quantity of mineralization comprises 139.8 million tonnes
grading 0.82% copper, including the quantities estimated in Cases
I, II and III. The mineable quantity is 132.8 million tonnes
grading 0.72% copper. Exploitation is by open pit and underground
mining, heap leaching, solvent extraction and electro winning at
the mine site. The project life is 23 years. Open pit slopes at
56(o) and the open pit waste to ore ratio is 1.26:1. The total
mining rate is 16,500 tonnes per day of ore and 10,000 tons per day
of waste and the processing rate is 16,500 tonnes per day of ore
feed.
Mining recovery and dilution were assumed to be 95% and 10%,
respectively for open pit mining and 95% and 15% respectively for
underground mining. The process recovery was assumed to be 90% in
all cases, based upon previously completed metallurgical tests.
The projected daily copper production exceeds that recommended
for the application of EMEW electro winning cells. Therefore,
conventional solvent exchange - electro winning ("SX-EW")
technology, employing an EW tank house, process has been
incorporated in the study. Furthermore, because of the large
amounts of power required for electro-winning, the construction of
a power line, 29.8 kilometres long, connecting with an existing
line near Rhodes Marsh, to the mine site has been included in the
study. The possibility of generating power at the site was
investigated, but was found to be costlier than the use of
commercial power and amortizing the powerline over the life of each
operation.
Due to the large volume of traffic, hauling ore to a leach site
at Marietta would be costly and impractical. Therefore, all
processing operations would be located at the mine site.
Financial Analysis
Capital and operating cost data were obtained from references
available in the public domain, including U.S. Government
publications. All costs and metal prices are in constant 2017 U.S.
dollars. A contingency 10% was applied to both capital and
operating costs.
The performance was modelled at copper prices of $3.00 per pound
and in increments of $0.25 per pound up to a maximum price of $4.00
per pound of recovered copper. The estimated unit capital and
operating costs compare well with those of exiting similar
operations. It has been assumed that a selling cost of 1% of the
copper price would be incurred.
Financial Performance
Analyses of before tax cash flows of all the cases returned the
results given in Table No.3. A discount rate of 8% was employed in
determining the Net Present Value ("NPV") of Case I.
Table 3: WTC Estimate of Before Tax Financial Performance
Copper Price,
$/lb: 3.00 3.25 3.50 3.75 4.00
Case:
I IRR, % 1.0 5.0 8.0 11.0 14.0
NPV, $000's -36,662 -18,401 -140 18,120 36,381
Cash Flow,
$000's 12,629 50,465 88,300 126,136 163,971
Cash Flow,
II $000's 60,527 106,359 152,190 198,022 243,854
Cash Flow,
III $000's 302,425 419,727 537,028 654,330 771,631
Cash Flow,
IV $000's 2,537,666 3,007,967 3,478,267 3,948,568 4,418,868
Qualified Person
Mr. Bill Cohan is a principal of WT Cohan & Associates Inc.
of Grand Junction, Colorado. His qualifications are set out
below:
-- Registered Professional Engineer in the State of Colorado (No.11954)
-- Registered Member of the Society of Mining Engineers of the
American Institute of Mining and Metallurgical Engineers
-- Member of the Canadian Institute of Mining & Metallurgy
-- Mining graduate from the South Dakota School of Mines and Technology
Mr Cohan has sufficient experience, relevant to the style of
mineralisation and type of deposit under consideration and to the
activity which he is undertaking, to qualify as a Competent Person
as defined in the 2012 Edition of the 'Australasian Code for
Reporting of Exploration Results, Mineral Resources and Ore
Reserves' and as a Qualified Person as defined in the Note for
Mining and Oil & Gas Companies which form part of the AIM Rules
for Companies.
Mr. Cohan has reviewed and approved the information contained
within this announcement.
This announcement contains inside information as stipulated
under the Market Abuse Regulations (EU) no. 596/2014 ("MAR").
ENQUIRIES:
Great Western Mining +44 207 933 8795 (via Walbrook)
Corporation Plc
David Fraser, Chief
Executive
Davy (Nomad, ESM
Adviser & Joint
Broker)
John Frain +353 1 679 6363
Beaufort Securities
Ltd (Joint Broker)
Jon Belliss
Elliot Hance +44 207 382 8300
Walbrook PR (UK +44 207 933 8795
PR and IR) greatwesternmining@walbrookpr.com
Paul Cornelius
Nick Rome
Cautionary Statement
This study conforms to the Australasian Code for the Reporting
of Exploration Results, Mineral Resources and Ore Reserves ("JORC
Code") and has employed accepted engineering practice. However,
this scoping study ("Study") is preliminary in nature and has
relied upon assumptions that may later prove to be invalid. As
such, this Study conforms to the American National Standards
Institute ("ANSI") standards for a Class I Feasibility Study,
having an accuracy range of +50% to -30%.
The Study has assumed that future exploration would discover
additional deposits, defined as Exploration Targets. It is
emphasised that the potential quantities and grades of the
Exploration Targets are conceptual in nature. Insufficient
exploration has been completed to define a Mineral Resource and it
is uncertain that future exploration will result in the estimation
of a Mineral Resources at either target area.
The Study referred to in this report is based upon low-level
technical and economic assessments, and is insufficient to support
the estimation of Ore Reserves or to provide assurance of an
economic development case at this stage, or to provide certainty
that the conclusions of the Study will be realised.
Glossary
Cut-Off Grade The level below which material
within an orebody does not
contain sufficient value to
economically justify processing
into a final salable form.
--------------------- ---------------------------------------------------------------------------------
Down Dip Parallel to or in general direction
of the dip of a bed, rock stratum,
or vein.
--------------------- ---------------------------------------------------------------------------------
An Exploration Target is a
Exploration Target statement or estimate of the
exploration potential of a
mineral deposit in a defined
geological setting where the
statement or estimate relates
to mineralisation for which
there has been insufficient
exploration to estimate a resource.
--------------------- ---------------------------------------------------------------------------------
Grade Quantity of metal per unit
weight of host rock.
--------------------- ---------------------------------------------------------------------------------
Host rock The rock containing a mineral
or an ore body.
--------------------- ---------------------------------------------------------------------------------
Indicated Mineral The term "indicated mineral
Resource resource" refers to that part
of a mineral resource for which
tonnage, densities, shape,
physical characteristics, grade
and mineral content can be
estimated with a reasonable
level of confidence. It is
based on exploration, sampling
and testing information gathered
through appropriate techniques
from locations such as outcrops,
trenches, pits, workings and
drill holes. The locations
are too widely or inappropriately
spaced to confirm geological
and/or grade continuity but
are spaced closely enough for
continuity to be assumed;
--------------------- ---------------------------------------------------------------------------------
Inferred Mineral The term "inferred mineral
Resource resource" refers to that part
of a mineral resource for which
quantity and grade or quality
can be estimated based on geological
evidence and limited sampling
and reasonably assumed, but
not verified, geological and
grade continuity. The estimate
is based on limited information
and sampling gathered through
appropriate techniques from
locations such as outcrops,
trenches, pits, workings and
drill holes.
--------------------- ---------------------------------------------------------------------------------
JORC JORC stands for Australasian
Joint Ore Reserves Committee
(JORC), which is sponsored
by the Australian mining industry
and its professional organisations.
The Code for Reporting of Mineral
Resources and Ore Reserves
(the JORC Code) is widely accepted
around the world as the definitive
standard for the reporting
of a company's resources and
reserves.
--------------------- ---------------------------------------------------------------------------------
Mineral Resource The term "mineral resource"
refers to a concentration or
occurrence of natural, solid,
inorganic or fossilized organic
material in or on the Earth's
crust in such form and quantity
and of such a grade or quality
that it has reasonable prospects
for economic extraction. The
location, quantity, grade,
geological characteristics
and continuity of a mineral
resource are known, estimated
or interpreted from specific
geological evidence and knowledge.
--------------------- ---------------------------------------------------------------------------------
Mineralisation A natural occurrence in rocks
or soil of one or more metal
yielding minerals.
--------------------- ---------------------------------------------------------------------------------
Mineral Reserves Mineral reserves are resources
or Ore Reserves known to be economically feasible
for extraction. Reserves are
either Probable Reserves or
Proved Reserves. A Probable
Ore Reserve is the part of
indicated, and in some circumstances,
measured mineral resources
that can be mined in an economically
viable fashion.
--------------------- ---------------------------------------------------------------------------------
Parts Per Million. This is a way of expressing very dilute concentrations of
ppm substances. Just
as per cent means out of a hundred, so parts per million or ppm means out of a
million. Usually
describes the concentration of something in water or soil.
--------------------- ---------------------------------------------------------------------------------
Reverse Circulation Reverse Circulation Drilling
Drilling (RC) is a technique which allows
for full recuperation of the
soil and rock samples, without
any wall contamination. Performed
by using a triblade, tricone
or a down-hole hammer, the
samples are evacuated through
the face of the bit into the
inside tube of a dual wall
drill steel so that they never
come in contact with the borehole
wall.
--------------------- ---------------------------------------------------------------------------------
This information is provided by RNS
The company news service from the London Stock Exchange
END
MSCMMMGGVLGGNZM
(END) Dow Jones Newswires
October 10, 2017 02:00 ET (06:00 GMT)
Great Western Mining (LSE:GWMO)
Historical Stock Chart
From Apr 2024 to May 2024
Great Western Mining (LSE:GWMO)
Historical Stock Chart
From May 2023 to May 2024