Anglesey Mining PLC Optimisation Study on Parys Mountain Mine Project

 
TIDMAYM 
 
Anglesey Mining plc ("AYM") is pleased to announce a major development on the 
path forward for the advancement of its Parys Mountain copper, zinc, lead, gold 
and silver project, located on the island of Anglesey in North Wales. 
 
Under a Project Development and Cooperation Agreement ("Agreement") entered 
into with QME Mining Technical Services, a division of QME Ltd, ("QME"), QME 
will, at no cost to AYM, carry out an agreed programme of design, engineering 
and optimisation studies relating to the future development of Parys Mountain. 
 
Over the period to the end of June 2019, QME will carry out a detailed review 
of various development and mining alternatives for Parys Mountain. The primary 
objective is to determine the optimum production plan for Parys Mountain, 
utilising all available and potential means of accessing both the indicated 
resources and inferred resources, (as currently defined and estimated by Micon 
International) at various "cut-off" grades. 
 
Anglesey Chief Executive, Bill Hooley, said: "We consider this to be a very 
important and positive step forward in the development of the Parys Mountain 
mine. QME is experienced in underground mine development and has developed and 
recruited the necessary skills in mine planning to deliver local and relevant 
underground mining expertise to Parys Mountain that will assist Anglesey to 
move forward with the development of the Parys Mountain project at no direct 
cash cost to Anglesey or dilution of its shareholders." 
 
AYM has agreed to grant QME various rights and options relating to the future 
development of Parys Mountain. On completion of the optimisation study and 
delivery to AYM of the results thereof: 
 
(i)         AYM will award QME, on an exclusive basis, contracts for the 
development of the decline and underground mine development, including 
rehabilitation of the shaft. This will be done on terms to be agreed following 
a decision by AYM to proceed with the development of Parys Mountain; 
 
(ii)        In the event Anglesey and QME are not able to agree terms AYM may 
offer such contracts to third parties, subject to a right of first refusal in 
favour of QME, and subject to a payment by AYM to QME, upon the award of such 
contracts to a third-party, of a break-fee; and 
 
(iii)       In addition, AYM will grant to QME the right and option, upon 
completion of a Prefeasibility Study ("PFS"), to undertake at QME's cost and 
investment, the mine development component of the Parys Mountain project, 
including decline and related underground development and shaft development, 
with a scope to be agreed, to the point of commencement of production, in 
consideration of which QME would earn a 30% undivided joint venture interest in 
the Parys Mountain project. 
 
Parys Mountain - 2017 Scoping Study Recommendations 
 
In July 2017 a Scoping Study on Parys Mountain, was prepared by Micon 
International Limited (Micon) and Fairport Engineering Ltd. The Scoping Study 
envisages a mining rate of 1,000 tonnes per day, to produce an average annual 
output of 14,000 tonnes of zinc concentrate at 57% Zn, 7,200 tonnes of lead 
concentrate at 52% Pb and 4,000 tonnes of copper concentrate at 25% Cu, over an 
initial mine life of eight years. 
 
Following completion of the positive 2017 Scoping Study, Anglesey has been 
working to progress the Parys Mountain project towards production.  The 2017 
Scoping Study recommended further work as interim steps towards undertaking a 
PFS, including more detailed mine planning and design, more engineering 
studies, additional metallurgical test work and a review of tailings management 
and environmental and planning permissions, all of which will require new and 
further financing. The Agreement with QME announced today is a major component 
of this and is a very positive development that will significantly advance the 
Parys Mountain project 
 
Optimisation Studies and Revised Mine Plan 
 
The 2017 Scoping Study was based on mining only the 2.1 million tonnes of 
indicated resources reported by Micon in 2012. Micon had reported a further 4.1 
million tonnes of inferred resources which were not incorporated into the 
Scoping Study. Development of even half of these inferred resources not 
included in the Scoping Study, would significantly increase the projected life 
of the Parys Mountain mine with potential positive outcomes on the project 
economics. 
 
Under the Agreement QME will examine a revised mine model with the objective of 
incorporating some of the inferred resources, including part of the 
higher-grade Engine Zone inferred resources, into the earlier years of the mine 
plan with the intention of bringing forward cashflows and increasing the life 
of the mine to at least 10 years. 
 
The 2017 Scoping Study was based on the initial development and production from 
the White Rock zone using a newly developed decline eventually leading to 
development of the deeper Engine zone and then the rehabilitation and use of 
the Morris Shaft as a hoisting facility. 
 
The QME review will examine whether different approaches to accessing the 
orebodies, particularly by early dewatering, rehabilitation and recommissioning 
of the Morris Shaft, could provide early access to the higher-grade Engine zone 
resources. This should have a beneficial effect upon both the net present value 
of the operation and the pay-back period. 
 
It is expected that these optimisation studies will be completed by the middle 
of 2019 and, subject to financing being available, would then form the basis 
for commissioning of a Preliminary Feasibility Study to lead to an overall 
project financing package. 
 
Following delivery of the optimisation studies pursuant to the Agreement, and 
the subsequent completion of a PFS, QME will have the option to undertake at 
QME's investment, the mine development component of the Parys Mountain project, 
including decline and related underground development and shaft development, in 
consideration of which QME would earn a 30% undivided joint venture interest in 
the Parys Mountain project, thereby significantly reducing AYM's capital cost 
requirements. 
 
About QME 
 
QME Limited, founded in 1987 by its current Managing Director Peter McParland, 
is based in Navan, County Meath, Ireland from which it operates several 
divisions and provides a wide range of services in the fields of both mine 
development and mine operations to the local and international mining 
community. 
 
QME Mining Technical Services division undertakes contract mining projects and 
employs an 'in-house' team of highly experienced operations managers, 
underground supervisors, miners, fitters and electricians. QME has carried out 
both large- and small-scale underground mine development contracts, providing 
all technical evaluation and budgeting services, personnel, management, 
equipment and maintenance. 
 
Current and past clients include: Boliden Tara Mines, Navan, Ireland; Dalradian 
Gold Limited, Curraghinalt, Northern Ireland; Lafarge Holcim, Glensanda Super 
Quarry, Scotland; Lundin Mining Galmoy Mine, Ireland; Vedanta Lisheen Mine, 
Ireland; Irish Base Metals Ltd., Tynagh Mine and Gortdrum Mine, Ireland; Saint 
Gobain, Gyproc, Ireland; Northgate Exploration Ltd, Canada; and Campbell 
Resources, Canada. 
 
QME Equipment Division is a large provider of new and re-manufactured 
underground and open pit mining equipment to the international mining industry 
worldwide, employing a highly skilled workforce of mechanical and technical 
staff with the capability to repair or fully overhaul a wide range of mining 
equipment. 
 
About Anglesey Mining plc 
 
Anglesey is carrying out feasibility and development work at its 100% owned 
Parys Mountain copper, zinc, lead deposit in North Wales, UK with a reported 
resource of 2.1 million tonnes at 6.9% combined base metals in the indicated 
category and 4.1 million tonnes at 5.0% combined base metals in the inferred 
category. 
 
Anglesey holds a 6% interest and management rights to the Grangesberg Iron 
project in Sweden, together with a right of first refusal to increase its 
interest by a further 51%. Anglesey also holds 12% of Labrador Iron Mines 
Holdings Limited which holds direct shipping iron ore deposits in Labrador and 
Quebec. 
 
For further information, please contact: 
 
 
Bill Hooley, Chief Executive [phone] 
 
Danesh Varma, Finance Director [phone] 
 
For further information on QME, please contact: 
 
Peter McParland, Managing Director QME: [phone] www.qme.ie 
 
 
 
END 
 

(END) Dow Jones Newswires

November 26, 2018 02:00 ET (07:00 GMT)