Positive Feasibility Study for El Pilar Copper Project
TORONTO, ON - Stingray Copper Inc. reported the results of the definitive Feasibility Study (the "Study") on the Corporation's 100% owned El Pilar oxide copper project located in Sonora, Mexico. Based on the positive results of the Study, the Board of Directors of the Corporation has approved the project for development as a low cost, open pit mine with a solvent extraction and electro-winning plant to treat oxide mineral reserves, subject to financing. M3 Engineering & Technology Corporation of
Peter Mordaunt, Chairman and CEO of Stingray states: "Our objectives, milestones and time table established 2 years ago have been realized both on time and on budget. The results of this Feasibility Study are in line with our conceptual ideas both technically and economically from the start of this detailed work. Oxide copper projects of this size are indeed rare today and the positive conclusions from the Study demonstrate the economics of the project quite clearly. Specifically, low capital and operating costs are characteristic of oxide copper deposits and El Pilar is no exception. Although the financial landscape of the copper industry has changed significantly since the start of work at El Pilar, the demand for copper has remained strong. Stingray's ultimate objective of becoming a mid-tier copper producer in
The basis of the M3 Feasibility Study is the use of a mining contractor in the open pit and owner operated primary crushing, conveying and stacking of ore onto a heap leach pad, followed by solvent extraction and electro-winning (SX-EW) to produce cathode copper. As estimated by Independent Mining Consultants, Inc. of Tucson, Measured and Indicated Mineral Resources are calculated at 276.3 million tonnes ("Mt") averaging 0.31% total copper ("TCu") calculated at a cut off of 0.20% TCu or 344.9 Mt averaging 0.28% TCu calculated at a cut off of 0.15% TCu . Copper mineralization remains open and continues to the south. Within this Resource, Proven and Probable Mineral Reserves planned for mining over a period of 14 years are calculated by IMC to be 229.7 Mt averaging 0.31% TCu calculated at a cut off of 0.15% TCu. The mine-life waste to ore stripping ratio is estimated at 1.61:1.
For this Study, IMC developed a 14 year mine plan and schedule. At the process plant design criteria, the project is expected to produce 35,000 tonnes of copper cathode per year, or 77 million pounds of copper per year, which is achieved during the first 3 years of the project. For economic and practical reasons, the maximum mine and crushing/conveying ore capacity was designed at 17 Mt per year. At this capacity, the average copper cathode production would be 68.3 million pounds per year over 14 years. This production schedule forms the basis for the financial model.
The project's primary crushing plant reaches maximum design, able to deliver 17 million tonnes of ore per year to the heap leach facility designed by Golder Associates, Inc. or approximately 48,000 tonnes per day in year 3. The project is expected to produce 956 million pounds of copper cathode over the 14 year life of mine. The cathode product should meet LME Grade "A" copper cathode specifications (99.99+% copper).
Stingray determined that a copper price of $2.25 per pound was to be used by M3 for the Study. This price is less than the 60:40 formula price that was determined by M3 and was deemed more appropriate and conservative.
The Initial Capital Cost (+/- 15%) for the base case at El Pilar is estimated to be $209 million. This includes a co-generation acid/power plant and the use of a mining contractor. Sustaining capital of $30.9 million is estimated over the life of mine. A cash reserve of $12.8 million is also included in the financial model. The operating cash cost for the project is calculated at $1.20 per pound of copper.
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