Adex Mining Inc. ("Adex" or the "Company") (TSX VENTURE: ADE) is
pleased to announce the results of the scoping study on the Fire
Tower Zone ("FTZ") at its Mount Pleasant Mine Property ("Mount
Pleasant" or the "Property") located in southwestern New Brunswick,
Canada. The FTZ is the site of a past-producing tungsten-molybdenum
underground mining operation during the 1980s.
The results of the scoping study indicate that the FTZ project
is financially robust, with an unlevered pre-tax internal rate of
return ("IRR") estimated at 27.1%. The after-tax IRR is estimated
at 19.8%. Similarly, the net present value ("NPV") of the FTZ
project, using a discount rate of 8%, is CAD $164.6 million and CAD
$83.7 million on a pre-tax and after-tax basis, respectively.
"We're very excited by these results of the FTZ scoping study,"
said Kabir Ahmed, President and CEO of Adex. "The scoping study is
a key step in assessing the economic potential of the
tungsten-molybdenum bearing Fire Tower Zone, and an important
decision-making tool in determining whether to proceed to
definitive feasibility work and a production decision on the
Property."
The results were prepared by Aker Metals, a division of Aker
Solutions Canada Inc., and part of Aker Solutions ASA, a major
multinational engineering consulting firm contracted by Adex to
complete the FTZ scoping study. The full scoping study report will
be completed by Aker Metals within the next few weeks. The total
preproduction capital cost is estimated to be CAD $130,780,000,
with an additional sustaining capital of CAD $5,750,000 to be spent
during the production lifespan of the mine.
Based on the product prices that follow, the operation is
projected by the scoping study to generate CAD $1.160 billion in
revenue over the 13 year life of the mine. Product pricing used in
the scoping study is based on a market study prepared by the
Company's independent consultants, Thibault & Associates Inc.
("TAI"), which also managed the gravity concentration test program
and carried out the process design work. Operating costs are
estimated to total CAD $599,602,000.
The product pricing for the financial analysis is as
follows:
- APT (ammonium paratungstate): US$215/MTU WO3
- Molybdenum: US$23.17/lb MoO3
- The currency exchange rate for the financial analysis is as
follows: US$:CAD$ 1.00:1.057
According to the results of the scoping study:
- the existing underground mine at the FTZ, which is currently
flooded, can be dewatered, refurbished and prepared for production
in 35 weeks
- the overall project duration from start of the Definitive
Feasibility Study (DFS) to the start of production is estimated at
29 months
- the surface infrastructure will likely require very little
work since the existing roads and buildings are serviceable and
will require only minor upgrading.
In addition, a 10 megawatt electric power substation exists, as
does the associated secondary voltage distribution system.
Should the FTZ project proceed to production, underground mining
will be carried out utilizing a Vertical Crater Retreat method that
had been successfully employed by the previous operator. The mine
is designed to be capable of producing 840,000 tonnes per year at a
rate of 2400 tonnes per day (tpd).
The flow sheet for the process, to produce ammonium
paratungstate (APT) and a molybdenum sulphide concentrate, includes
gravity separation for pre-concentration of oxide minerals (tin and
tungsten), flotation of sulfide minerals (arsenic and molybdenum)
and hydrometallurgical processing of the concentrates to comply
with end user specifications. The development of grinding, gravity
separation and flotation unit operations for optimum tungsten and
tin recovery is based on bench scale testing. The remainder of the
process, including the APT hydrometallurgical circuit and
molybdenum concentrate leaching circuit, is predicated on
conventional industrial practice.
The annual mill throughput is estimated to be 788,000 tonnes, at
an average rate of 2200 tpd. The recovery of APT is estimated at
75% and the recovery of a molybdenum sulphide concentrate is
estimated at 76%.
Given the scoping study's positive economic assessment of the
FTZ project, the Company intends to carry out pilot plant work as
part of the DFS in order to confirm metallurgical parameters,
process flow sheet details, and to more accurately define reagent
consumption and costs.
The scoping study is based on the resource estimate announced in
the Company's press release dated October 23, 2008 completed by SRK
Consulting (Canada) Ltd. ("SRK") in conjunction with the
preparation of an independent NI 43-101 Technical Report currently
being completed by Watts, Griffis and McOuat Limited ("WGM"), all
under the supervision of Trevor Boyd, P.Geo., the Company's
Geological Consultant.
The scoping study and the economic analyses contained therein
are preliminary in nature and contain inferred mineral resources
that are considered too speculative geologically to have economic
considerations applied to them that would enable them to be
categorized as mineral reserves and there is no certainty that the
results of the scoping study will be realized with more detailed
work. Mineral resources that are not mineral reserves do not have
demonstrated economic viability.
Qualified Person
John Rogers, P.Eng., Project Manager for Aker Metals and an
independent qualified person as defined by NI 43-101, supervised
the preparation of the scoping study and the technical information
contained in this press release in compliance with NI 43-101.
ABOUT AKER SOLUTIONS:
Aker Solutions is a leading global provider of engineering and
construction services, technology products and integrated
solutions. The businesses within Aker Solutions comprise several
industries, including Oil & Gas, Refining & Chemicals,
Mining & Metals and Power Generation. The Aker Solutions group
is organised in a number of separate legal entities. Aker Solutions
is used as the common brand/trademark for most of these entities.
The parent company in the group is Aker Solutions ASA. Aker
Solutions has aggregated annual revenues of approximately NOK 50
billion and employs approximately 23,000 people in about 30
countries. With its Metals Headquarters based in Santiago, Chile,
Aker Solutions has other Metals offices located in Toronto, Canada;
Tucson, Arizona, U.S.A.; combined with regional metals capabilities
in Perth, Brisbane and Melbourne, Australia; Mumbai, India and
Stockton-on-Tees, U.K. The Metals Division of Aker Solutions
provides a global capability to serve its clients across the full
project cycle from studies through to design engineering,
procurement, construction, commissioning and startup. Specialized
expertise spans: precious metals, nickel, copper, molybdenum, iron
ore, zinc, uranium, evaporites and industrial minerals.
ABOUT ADEX
Adex Mining Inc. is a Canadian junior mining company with an
experienced management team. The Company is focused on developing
its flagship Mount Pleasant Mine Property, a multi-metal project
that is host to promising tungsten-molybdenum and
tin-indium-zinc-copper mineralization. Located in Charlotte County,
New Brunswick, the Mount Pleasant Mine Property is situated
approximately 80 kilometres south of Fredericton, the provincial
capital, and is 65 kilometres from the United States border. The
common shares of Adex trade on the TSX Venture Exchange under the
stock symbol "ADE."
FORWARD-LOOKING STATEMENTS
Certain statements in this press release may constitute
"forward-looking" statements which involve known and unknown risks,
uncertainties and other factors which may cause actual results,
performance or achievements of Adex, its subsidiary or the industry
in which they operate to be materially different from any future
results, performance or achievements expressed or implied by such
forward-looking statements. When used in this press release, the
words "estimate", "believe", "anticipate", "intend", "expect",
"plan", "may", "should", "will", the negative thereof or other
variations thereon or comparable terminology are intended to
identify forward-looking statements. Such statements reflect the
current expectations of the management of Adex with respect to
future events based on currently available information and are
subject to risks and uncertainties that could cause actual results,
performance or achievements to differ materially from those
expressed or implied by those forward-looking statements. These
risks and uncertainties are detailed from time to time, including,
without limitation, under the heading "Risk Factors", in reports
filed by Adex with the Alberta, British Columbia and Ontario
Securities Commissions which are available at www.sedar.com and to
which readers of this press release are referred for additional
information concerning Adex, its prospects and the risks and
uncertainties relating to Adex and its prospects. New risk factors
may arise from time to time and it is not possible for management
to predict all of those risk factors or the extent to which any
factor or combination of factors may cause actual results,
performance and achievements of Adex to be materially different
from those contained in forward-looking statements. Although the
forward-looking statements contained in this press release are
based upon what management believes to be reasonable assumptions,
Adex cannot assure investors that actual results will be consistent
with these forward-looking statements. Given these risks and
uncertainties, investors should not place undue reliance on
forward-looking statements as a prediction of actual results.
The forward-looking information contained in this press release
is current only as of the date of the press release. Adex does not
undertake or assume any obligation to release publicly any
revisions to these forward-looking statements to reflect events or
circumstances after the date hereof or to reflect the occurrence of
unanticipated events, except as required by law.
No securities commission or regulatory authority has approved or
disapproved the contents of this press release.
The TSX Venture Exchange does not accept responsibility for the
adequacy or accuracy of this press release.
Contacts: Adex Mining Inc. Kabir Ahmed President, Chief
Executive Officer and Director 1-866-508-2339 (ADEX) Email:
investorrelations@adexmining.com Website: www.adexmining.com
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