VANCOUVER, BRITISH COLUMBIA--(Marketwired - Dec 5, 2016) - Excelsior Mining Corp. (TSX VENTURE:MIN) (3XS.F) (EXMGF) ("Excelsior" or the "Company") is pleased to announce the results of a comprehensive Feasibility Study ("FS") on the North Star Deposit of the Gunnison Copper Project, located in Cochise County, southeastern Arizona. The project is designed as a copper in-situ recovery ("ISR") mine using solvent extraction-electrowinning ("SX-EW").
Highlights of the FS (United States dollars)
Net Present Value ("NPV") of $1.172 billion pre-tax and $807 million post-tax at 7.5% discount rate using a life of mine ("LOM") copper price of $2.75/lb; Internal Rate of Return ("IRR") of 48% pre-tax and 40% post-tax; Initial construction capital costs of $46.9 million includes 20% contingency, 16% EPCM, freight, mobile equipment, owner's costs and capital spares; includes 20% contingency, 16% EPCM, freight, mobile equipment, owner's costs and capital spares; Payback period for initial capital of 2.3 years pre-tax and 2.8 years post-tax; Average life of mine operating costs of $0.65/lb; All-In Cost (LOM capital costs plus operating costs) of $1.23/lb; 42 million pounds of copper added to the Probable Reserve; Life of Mine: 24 years of commercial production; Staged production profile: initial production rate of 25 million pounds of copper cathode per annum using the existing Johnson Camp Mine ("JCM") facilities, followed by an intermediate expansion stage to 75 million pounds per annum and final expansion stage to full production of 125 million pounds per annum (includes the construction of an acid plant at full production). The staged production profile makes possible the funding of future expansions out of cash flow.
Commenting on this news, President & CEO, Stephen Twyerould said, "The release of our Feasibility Study completes the last major technical milestone prior to receipt of operating permits. We have once again delivered a very robust product with outstanding economics. Excelsior's entire team can take pride in this outcome and our belief that the Gunnison Copper Project will be the next new copper mine in the United States."
Twyerould added, "Because of the special characteristics of the North Star deposit, and by extension our ability to employ the in-situ mining method, the project economics remain exceptionally strong even at low copper prices. As demonstrated in the table above, the high margin enjoyed by the Gunnison Copper Project is our critical advantage and the key to our risk management."
The FS was completed by M3 Engineering & Technology Corporation ("M3") of Tucson, AZ and is effective as of December 5, 2016. The technical report (the "Report") summarizing the results of the FS, and prepared in accordance with National Instrument ("NI") 43-101, will be filed on SEDAR and Excelsior's website within 45 days of this news release. Results of the FS disclosed in this press release are in United States Dollars.
Financial Analysis
As highlighted in the tables below, the FS demonstrates excellent project economics. Based on an initial production rate of 25 million pounds per annum, the FS base case generates a post-tax NPV of $807 million (at a cash flow discount of 7.5%), an IRR of 40.1% and a payback period for initial capital of 2.3 years. This financial analysis is based on a number of assumptions which will be fully set out in the Report.
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