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, MSMGF-O) 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 byproduct 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. Byproduct 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 revenue 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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