#USA #Alaska #Trilogy Metals #Bornite Copper #Preliminary Economic Assessment

Trilogy Metals Releases Positive PEA for Bornite Project

Trilogy Metals Inc. has recently disclosed the positive outcomes of its Preliminary Economic Assessment (PEA) for the Bornite Copper Project, situated in the Ambler Mining District of Northwestern Alaska. The project represents a collaboration between Trilogy Metals and South32 Limited, equally owned entities operating under the name Ambler Metals LLC. This assessment indicates a strong economic foundation for the proposed mining operation, sparking interest among stakeholders.

Economic Viability and Production Highlights

The PEA reveals that the Bornite Project could yield an impressive 1.9 billion pounds of copper spread over a 17-year mine lifespan. Additionally, there is potential to prolong operations associated with the Upper Kobuk Mineral Projects (UKMP) beyond 30 years, signifying a robust future for the site.

Key financial metrics from the study include a pre-tax Net Present Value (NPV) of $552 million at an 8% discount rate, alongside a strong Internal Rate of Return (IRR) of 23.6%. After taxes, the NPV still stands at approximately $394 million, with an IRR of 20%. These figures reinforce the project's fiscal attractiveness in the current metal market.

Project Details and Methodology

The Bornite PEA articulates plans for a large-scale underground mining operation, designed to process 6,000 tonnes of material daily. The assessment assumes the re-use of infrastructure from Trilogy's Arctic Project, once operations there conclude.

The PEA employs a long-term copper price estimate of $4.20 per pound, a figure that reflects current market conditions. It is essential to note that while the PEA provides a promising initial assessment, the related mineral resources remain classified as inferred, underscoring the speculative nature of such early-stage economic analyses.

Tony Giardini, President and CEO of Trilogy Metals, expressed optimism regarding the results, emphasizing the unexplored potential across a 100-kilometer volcanogenic massive sulphide belt that could extend the Arctic project’s lifespan. He stated that even with existing resources, the findings demonstrate the feasibility of sustaining mining activities within the region for an extended period.

Financial Projections and Cost Structure

The financial summary of the Bornite PEA includes detailed assessments of production costs and capital investments:

• - Operating Costs: Total of $98.91 per tonne milled
• - Initial Capital Investment: Estimated at $503.8 million
• - Sustaining Capital: Projected to be around $363.1 million
• - Mine Closure and Reclamation Costs: Estimated at $81.2 million

A breakdown of the expected production output indicates 109,061 thousand pounds of payable copper annually at a projected cash cost of $2.76 per pound, confirming the mines’ operational viability.

Future Considerations and Stability of Mineral Resources

While the PEA outlines significant production capabilities, it also acknowledges inherent uncertainties regarding mineral resources. Inferred resources are particularly speculative and financial viability must be reassessed as exploration continues. Full details of the mineral resource estimates will be made available in the company's technical report due in the forthcoming weeks.

Trilogy Metals will provide additional context on these findings in an upcoming conference call scheduled for January 15, 2025, at 1:00 PM Pacific Time. The call promises to be an informative session detailing the implications of these results for both the company and the broader mining community.

Conclusion

In summary, the positive findings of the Bornite Copper Project Preliminary Economic Assessment position Trilogy Metals favorably amongst mining companies in North America. As exploration progresses and market conditions fluctuate, the viability and potential of the Bornite project could lead to significant advancements in copper production, underpinning the importance of this resource in various industries poised for sustainable growth.