A feasibility study for
The study, by Micon International, puts a 14.5% internal rate of return and a $16.2-million net present value (NPV) on the project, the NPV based on a discount rate of 10%.
It estimated the capital cost at $118.5 million, with the biggest ticket — $48.6 million — on the mill. A mining fleet is likely to cost $18.9 million; pre-stripping about $10.8 million; and infrastructure, tailings disposal, and a high-compression thickener about $18.5 million together. Owner’s costs, the construction contract, and a contingency reserve make up the remaining $21.7 million.
The mine would have a life of just under seven years and would take out a probable reserve of 11.3 million tonnes at average grades of 0.33% nickel, 0.35% copper, 0.02% cobalt, 0.33 gram platinum, 0.37 gram palladium and 0.19 gram gold per tonne. The pit designed around the reserve is 250 metres deep and has a stripping ratio slightly over 5:1.
The reserve is part of an indicated resource of 12.4 million tonnes at 0.35% nickel, 0.37% copper, 0.02% cobalt, 0.35 gram platinum, 0.39 gram palladium and 0.2 gram gold per tonne. There is another 1.8 million tonnes outside the designed pit, which runs 0.37% nickel, 0.41% copper, 0.03% cobalt, 0.36 gram platinum, 0.39 gram palladium and 0.22 gram gold. Most of that material is at depth, suggesting a large push-back of the pit would be necessary to take it out.
Micon’s estimate of operating costs is $22.55 per tonne, of which $10.80 is mining and stripping and $11.75 processing and overhead.
Micon’s price estimates put the net smelter return on 1 tonne of ore at $44.10. The figure was based on nickel at US$12,080 per tonne (US$5.48 per lb.), copper at US$2,950 per tonne (US$1.34 per lb.), cobalt at US$20.05 per lb., platinum at US$805.30 per oz., palladium at US$225.20 per oz., and gold at US$438.30 per oz. All those prices were averages over a 5-year decay to long-term historical median prices.
The Canadian dollar was assumed to stay around US82.
Based on those prices and exchange rates, Ursa is assuming a fairly conservative net-back of about 50% of the gross metal value.
Ursa Major and partner
The other partner,
T.N.M. Snapshot
Shakespeare Feasibility Study
OWNERSHIP: Ursa Major Minerals, 86%; Falconbridge, 14%; North American Palladium to earn 52% out of Ursa share.
RESERVE: 11.3 M t, 0.33% nickel, 0.35% copper, 0.02% cobalt, 0.33 g/t platinum, 0.37 g/t palladium, 0.19 g/t gold
MINE: Open pit, 4,500 t/day, stripping ratio 5:1
PLANT: Conventional flotation
CAPITAL COST: $118M
PRODUCTION COST: $22.55/t
ECONOMICS: IRR 14.5%, NPV $16.2M at 10% (after tax)
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