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Definitive Feasibility Study Demonstrates Robust Economics of Namib Lead Zinc Silver Mine
North River Resources has announced the completion of the Definitive Feasibility Study for its brownfield Namib Lead Zinc Silver Mine in Namibia.
Highlights:
· Maiden Mineral Ore Reserve of 585,000 tonnes at 6.2% zinc, 2.9% lead, and 46ppm silver
· Robust economic model with strong IRRs at consensus metal prices
· Further significant cost savings and improvements to the economic model are anticipated as the project moves to the implementation phase
· 13 month schedule to bring mine back into production
· Annual throughput of 250,000 tonnes at an average grade of 9% (Pb+Zn) producing 19,100 tonnes of metal in concentrate
· 280,000 ounces per annum silver by-product
· Initial mine life of 3.5 years (including ramp up and ramp down) and resources equivalent to five years of mine life
· The resource expansion programme is continuing and it is anticipated that the mine life will grow further over the coming year
North River Managing Director Martin French said, “The DFS is a major milestone for NLZM and North River. The Study has gone through an exhaustive process and the project economics are strong. While the mine-life is short, so is the pay-back, as much of the major infrastructure is already in place at NLZM. From known geology, there are good indications that the mine life may be extended, while many deeper and near-mine regional areas have yet to be explored. We are therefore hopeful that the value of the project will grow over the coming year and beyond. Underground drilling continues and a near-mine exploration programme is planned to commence next year. The Company is now advanced on working up the Project Execution Plan for NLZM. The Board will soon formerly review the DFS and implementation planning.”
The DFS was signed off by CSA Global (UK) Ltd who were responsible for the compilation of the Study, as well as the geology and mineral resource estimates. Bara Consulting Ltd updated the mine design and schedule previously undertaken by Snowden Group and subsequently produced a Mineral Reserve Statement. Tenova Mining and Minerals were principally responsible for the sections on Mineral Processing and Metallurgy.
The DFS confirms that the project is technically low risk and economically robust. The strong post-tax IRR (>50% over the life of mine) and short payback period justify the development of the project. Following a successful drilling programme, total underground resources are now 1.25 million tonnes, equivalent to a five year life of mine. Further underground drilling continues to progress well, with a regional exploration programme due to start soon. North River believes NLZM will, in due course, support a significantly longer mine life.
Two cash flow models were produced; one based only on the initial reserve, the other considering all resources as a life of mine plan. The cash-flow model provided the overall project financial forecast after taxation.
