Magna tables PEA to revitalise former Inco nickel and copper mine
TSX-V-listed Magna Mining has tabled an updated preliminary economic assessment (PEA) to revitalise a former Inco nickel and copper mine, in Sudbury.
The PEA for the Crean Hill project, published on Tuesday, envisions another 13 years of underground mining at the asset, which Magna acquired two years ago.
The PEA focuses on a high-margin, underground-only mine plan, said COO Jeff Huffmann in a statement.
A new ramp will allow rapid access to initial, near-surface, mining areas and dewatering will be carried out from the historic #2 shaft.
“A low capital approach of establishing a new surface portal will provide quick access to the resource, allowing us to offset capital costs with early revenues.”
As a brownfield site, Crean Hill has a preproduction capital cost of C$27.7-million, following a 15-month advanced exploration programme.
The preproduction period capital will be paid back in the first year of commercial production and all the capital costs, including the advanced exploration programme capital, will be paid off within the second year of commercial production.
The PEA is based on an average underground production rate of 2 200 t/d, consisting of 1 650 t/d of higher-margin primary feed and 550 t/d of lower-grade feed.
The study also benefits from increased certainty on third-party processing terms.
The PEA base case generates an aftertax net present value of C$194.1-million and an internal rate of return of 129%.
“The project timeline has been derisked by having environmental permits approved and in-hand, as well as more detailed stope planning and sequence optimization. The PEA metal pricing assumptions have been updated to reflect a more conservative long-term nickel price. We are excited and encouraged by the results of this PEA and look forward to continuing to advance the Crean Hill project,” said Huffmann.
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