A preliminary economic study on the Maskwa nickel-copper deposit in eastern Manitoba says higher metal prices have justified a higher resource figure.
Mustang Minerals (MUM-V) commissioned the study by consulting firm Micon International, which revised a February 2005 resource estimate by Scott Wilson Roscoe Postle. The Micon study used a higher nickel price and included by-product credits from platinum, palladium and cobalt, which strengthened the project’s economics and brought the cutoff grade down.
Micon’s new estimate of the indicated resource is 8 million tonnes grading 0.64% nickel and 0.13% copper; an additional inferred resource is estimated at 1 million tonnes grading 0.46% nickel and 0.09% copper. By-product grades — considered only to have an inferred level of certainty in both tonnages — were 0.02% cobalt, 0.16 gram platinum and 0.6 gram palladium per tonne in the indicated resource and 0.02% cobalt, 0.09 gram platinum and 0.36 gram palladium in the inferred resource.
The resource indicates potential for a 9-year mine life in an open pit producing about 1 million tonnes annually. The pit’s stripping ratio works out to 3.7.
An operation at Maskwa would have a conventional flotation mill shipping concentrate. It would produce about 4,700 tonnes nickel and 1,100 tonnes copper annually and could be built for about $64.5 million.
The economic study was based on a nickel price of US$7 per lb. (US$15,400 per tonne) and a copper price of US$2 per lb. (US$4,400 per tonne). Those prices indicate annual revenues around $88 million and a discounted cash flow analysis at a 10% discount rate puts the net present value at $90 million. Production costs are estimated at US$2.62 per lb. (US$5,780 per tonne).
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