UNDERGROUND MINING

Curipamba open pit polymetallic mine to yield NPV of $259 million

Mine will produce gold, silver, lead, copper and zinc

 Mine will produce gold, silver, lead, copper and zinc

Mine will produce gold, silver, lead, copper and zinc

The Curipamba open pit polymetallic mine in Ecuador will yield a net present value (NPV) of US$259 million at an 8% discount rate, a Prefeasibility Study from Advantus Mining and Salazar Resources has found.

The mine will produce gold, silver, lead, copper, and zinc.

The open pit mine will have a mine life of 10 years, with an after-tax Internal Rate of Return of 32%. Initial capital cost of the mine will be US$248 million, with a payback period of 2.6 years.

Initial processing capacity will be 1,850 tonnes per day. Mill throughput was increased from 1,750 to 1,850 TPD after stockpiling was minimised.

The open pit mine will begin operations 18 months after pre-production waste movement has begun.

The mine's processing plant contains a comminution circuit of a two-stage crushing circuit followed by ball milling. Sequential flotation circuits will produce copper, zinc, and lead concentrate.

Tailings storage will both contain tailings and process water. Waste rock and overburden will be held in separate containers.

Advantus and Salazar conducted a separate PEA for underground mining operations at the El Domo deposit, which found an after-tax NPV at an 8% discount rate of US$49 million. The underground operations will have the same milling rate of 1,850 TPD.

Total development for underground mining will cost US$42 million. Underground operations will use the same tailings facility and processing plant as the open pit mine.

Mining at the underground deposit will happen after reserves at the open pit are exhausted after year 10. The companies believe the underground deposit has a mine life of four years.

An updated mineral reserves statement for the open pit project founded proven and probable reserves to total 6,478,000 tonnes at 1.93% copper for 124,900 tonnes of copper, at 0.2% lead for 16,200 pounds of lead, at 2.49% zinc for 161,400 tonnes of zinc, 2.52 g/t gold for 525,000 ounces of gold, and 46 g/t silver for 9,517,000 ounces of silver.

The underground mine plan will mine indicated resources of 2.0 million tonnes at 2.48% copper, 2.18% zinc, 1.25 g/t of gold, 28.1 g/t of silver, and 0.13% lead.

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