C2-202, Level 2, Office Block C, La Croisette, Grand Baie, 30517, Mauritius The above media statement and accompanying material for media use are issued by ALPHAMIN RESOURCES CORP. ALPHAMIN ANNOUNCES CONTROL BUDGET ESTIMATE
C2-202, Level 2, Office Block C, La Croisette, Grand Baie, 30517, Mauritius
The above media statement and accompanying material for media use are issued by
ALPHAMIN RESOURCES CORP.
ALPHAMIN ANNOUNCES
CONTROL BUDGET ESTIMATE
MAURITIUS – February 6, 2017 –
is pleased to announce that it has
Budget Estimate (“CBE”) for
Democratic Republic of Congo.
HIGHLIGHTS
• Increase in proven and probable reserves to 4.67 Mt @ 3.58% Sn containing 167.3 Kt of tin
• Increase in LoM to 150 months (
• Optimised process flow sheet
increase in tin recoverie s to 73%
• Cash margin per tonne of tin sold of some US$ 11,040, resulting in LoM annual average EBITDA of
approximately US$ 110 million (constant 2017 terms)
• Robust economic performance indicators:
o Net Present Value
o Real, after tax , P
o Payback period
The completion of the FEED program and associated CBE confirms the robust economic metrics
the Bisie Project and the development of
and a new premier global tin producing
completion of the FEED and CBE phase marks another important
the Project towards becoming the first
A comprehensive process for estimating capital costs was followed and the
the potential to remain strongly profitable at lowe r tin
The completed FEED and CBE increase
167.3 Kt of tin while also increasing the
flow sheet resulted in 6% higher annual average plant throughput rates, and an increase in tin recoveries to 73%
A cash margin of some US$ 11,040 per tonne of tin sold
approximately US$ 110 million (constant 2017 terms)
performance indicators of a N et Present Value
49.1%. The projected payback period is
“The FEED program’s emphasis was to reduce the imple mentation and operational risks associated with the
Project wherever possible, and resulted in necessar y increases in certain capital and operatin
NEWS RELEASE
202, Level 2, Office Block C, La Croisette, Grand Baie, 30517, Mauritius
interview requests, please contact the
The above media statement and accompanying material for media use are issued by
ALPHAMIN RESOURCES CORP. without embargo unless an embargo is indicated above
ALPHAMIN ANNOUNCES COMPLETION OF DETAILED DESIGN AND
CONTROL BUDGET ESTIMATE
– Alphamin Resources Corp. (AFM: TSXV, “Alphamin” or the “Company”)
announce that it has completed the Front-End Engineering Design (“FEED”)
for its 80.75% owned Bisie Tin Project (“Bisie” or the “Project”)
Increase in proven and probable reserves to 4.67 Mt @ 3.58% Sn containing 167.3 Kt of tin
150 months ( 12.5 years)
process flow sheet resulting in 6% higher annual average plant throughput rates, and an
s to 73%
Cash margin per tonne of tin sold of some US$ 11,040, resulting in LoM annual average EBITDA of
approximately US$ 110 million (constant 2017 terms)
Robust economic performance indicators:
Net Present Value 8% US$ 402.2 million
, P roject IRR 49.1%
17 months from 1 st tin production
The completion of the FEED program and associated CBE confirms the robust economic metrics
the development of the Alphamin Bisie Tin Project into North Kivu’s first commercial mine,
producing mine. Boris Kamstra, Chief Executive Officer of Alphamin
completion of the FEED and CBE phase marks another important and exciting milestone as Alphamin advances
first industrial mine in DRC’s North Kivu Province.”
process for estimating capital costs was followed and the CBE results show that the
the potential to remain strongly profitable at lower tin prices, as well as at increased prices for key cons umables.
and CBE increase proven and probable reserves to 4.67 Mt at
while also increasing the life of mine (LoM) to 150 months or 12.5 years . The
in 6% higher annual average plant throughput rates, and an increase in tin recoveries to 73%
ash margin of some US$ 11,040 per tonne of tin sold is foreseen, yielding a LoM annual average EBITDA of
110 million (constant 2017 terms) . Alphamin is also pleased with the r
et Present Value (8%) of US$ 402.2 million as well as real, after tax,
ayback period is 17 months from the first tin production at the Alphamin Bisie Tin Mine.
The FEED program’s emphasis was to reduce the imple mentation and operational risks associated with the
Project wherever possible, and resulted in necessar y increases in certain capital and operatin
NEWS RELEASE
For more media information or
interview requests, please contact the Stone team
[email protected] or +2711 4470168
1
COMPLETION OF DETAILED DESIGN AND
Alphamin Resources Corp. (AFM: TSXV, “Alphamin” or the “Company”)
(“FEED”) and Control
the “Project”) in the
Increase in proven and probable reserves to 4.67 Mt @ 3.58% Sn containing 167.3 Kt of tin
resulting in 6% higher annual average plant throughput rates, and an
Cash margin per tonne of tin sold of some US$ 11,040, resulting in LoM annual average EBITDA of
The completion of the FEED program and associated CBE confirms the robust economic metrics and potential of
into North Kivu’s first commercial mine,
Boris Kamstra, Chief Executive Officer of Alphamin explains: “The
milestone as Alphamin advances
CBE results show that the Project has
prices, as well as at increased prices for key cons umables.
3.58% Sn containing
. The optimised process
in 6% higher annual average plant throughput rates, and an increase in tin recoveries to 73% .
LoM annual average EBITDA of
pleased with the r obust economic
real, after tax, Project IRR of
at the Alphamin Bisie Tin Mine.
The FEED program’s emphasis was to reduce the imple mentation and operational risks associated with the
Project wherever possible, and resulted in necessar y increases in certain capital and operatin g costs. The
The above media statement and accompanying material for media use are issued by
ALPHAMIN RESOURCES CORP. without embargo unless an embargo is indicated above
2
improved mine design, process flow sheet optimisati on, and an improved tin price outlook, have enhance d the
forecast economic performance indicators and overal l robustness of Bisie significantly, despite the
aforementioned cost increases,” explains Kamstra.
“These improvements along with the continued strong support from provincial and national government an d the
local communities confirm our view that Bisie forms the ideal foundation on which to build a mining company and
associated infrastructure for mining in the tin-ric h province of North Kivu. This mining project prese nts Alphamin
shareholders with an attractive opportunity to part icipate in one of the highest grade known tin depos its in the
world,” says Kamstra.
Kamstra explains “This CBE is by definition conserv ative and based on tenders, quotes and detailed est imates.
Given the paucity of commercial operations and oper ating data in the area estimates used have been of
necessity conservative. Once the Bisie mine is full y operational there is considerable scope to improv e
operational efficiencies and recoveries from the as sumptions used in this study as well as to reduce c osts,
particularly in the areas of logistics. In addition, the exploration and resource delineation drilling that will continue
after the Bisie mine is established is, given the open-ended nature of the existing Reserves upon which this CBE
is based, expected to increase the Reserve inventory and thus LOM.”
The project team has recently completed the optimis ation of the mine and process plant design for Bisi e, which
has resulted in the following changes to the mine d esign. The fundamental mining method has not change d but,
the layout and mine design parameters have changed notably from the updated feasibility study issued i n June
2016.
The mine design was developed based on the revised criteria, including a reduction in cut off grade from 1.8% to
1.4% due to a far higher tin price, that resulted i n a 30% increase in ore tonnes mined, a 10% increas e in tin
tonnes mined, and a LoM extension of 2.5 years. The capital footprint has been defined as mine develop ment
and associated infrastructure that will take place up to and including December 2018. This includes approximately
64,000 tonnes of ore from the ore drive development , which will be stockpiled prior to plant commissio ning.
Stoping will commence outside the capital footprint.
The Mineral Resource estimates were updated in May 2016. The Mineral Resource estimate contains 19 600
tonnes of tin of Measured Mineral Resources, 188 40 0 tonnes of tin in Indicated Mineral Resources and 22 800
tonnes of tin in Inferred Mineral Resources declare d at a 0.5% tin cut-off grade. The Mineral Reserve estimate
contains 15 896 tonnes tin in the Proven Reserve ca tegory and 151 448 tonnes tin in the Probable Reser ve
category at a 1.4% tin cut-off grade.
Contractors will mine the Mpama North orebody using proven underground mechanised mining methods to
deliver ore to the process plant at an expected rate of 25 - 35ktpm. A comprehensive programme of metallurgical
testing was executed to support the CBE. An overall metallurgical recovery of 80% was achieved under
laboratory conditions. Factoring in operating conditions, operator skill levels, and an element of conservatism, an
overall recovery of 73% has been applied in the eva luation of the Project economics. The process desig n is
based on recovery of tin into concentrate through conventional gravity separation methods. The Bisie Tin Project
process plant design capacity is 360 - 400ktpa.
Alphamin is committed to develop the first large commercial tin mine in the eastern DRC that will produce conflict-
free tin concentrate, while promoting community dev elopment, safety, health and environmentally sound
practices. “The Bisie operation will supply conflic t-free tin from eastern DRC and the Alphamin operat ion will be
The above media statement and accompanying material for media use are issued by
ALPHAMIN RESOURCES CORP. without embargo unless an embargo is indicated above
3
the manifestation of what conflict mineral advocacy and legislation aimed to achieve. Alphamin’s confl ict-free tin
concentrate and social initiatives should therefore be of interest to international trading and smelti ng companies
and multinational brands which use tin in their pro ducts, including laptops, mobile and smart phones a nd cars,”
explains Kamstra.
“The complexities of certifying tin concentrates as conflict free also make the product less appealing to armed
groups and so reduces the risk of threats to the mi ne or transporters with the intention to forcefully gain
occupation of the mine site or appropriate final pr oduct,” he says. Alphamin is a member of the Confli ct-Free
Sourcing Initiative, a global end-user grouping of companies who develop conflict-free certification standards and
protocols, and is also a member of the International Tin Research Institute which is involved in global conflict-free
sourcing initiatives.
In April, 2016 a Memorandum of Understanding was si gned between Alphamin and the Walikale Community to
collaborate in creating the Lowa Alliance. The Lowa Alliance will invest, along with the community itself and other
development partners including the Government of the DRC, in 120 projects over the initial five years, which will
include schools and technical training, primary hea lth care services, agriculture and fish-farming, sm all scale
renewable energy, small and micro enterprise, community infrastructure, town zoning and road articulation to help
manage growth, and women’s empowerment.
Alphamin through its exploration and development phase has already created 480 new jobs, invested in road and
telecommunications infrastructure to unlock the iso lated Walikale territory, developed 25 participator y local
development plans representing the long-term needs of the 14,000 households living closest to the mine , and
recently completed the construction of a quality primary school with solar powered lighting. An artisanal and small
scale miner (ASM) strategy is being implemented to work with all levels of government to optimize ince ntives for
ASM miners to work legally off the Alphamin concess ion, reduce impunity for illegal activity and assur e optimal
security for operations, personnel and local residents.
Alphamin is responsible for consistent monitoring of all community initiatives, including the artisanal strategy, and
will work with all involved stakeholders to assure respect for and compliance with the Voluntary Princ iples on
Security and Human Rights guidelines. Alphamin, therefore has a robust and proactive programme of community
outreach and engagement in place.
Alphamin has completed the required environmental s tudies and is in full compliance with IFC Performan ce
Standards and Equator Principles. Comprehensive man agement plans have been developed to mitigate the
potential negative environmental impacts of the Pro ject.
FOR MORE INFORMATION, PLEASE CONTACT:
Boris Kamstra
Chief Executive Officer
Grand Baie, Mauritius
Alphamin Resources Corp.
Tel: +230 269 4166
E-mail: [email protected]
Neither the TSX Venture Exchange nor its regulation services provider (as that term is defined in the policies of
the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this News Release.
FIN
The above media statement and accompanying material for media use are issued by
ALPHAMIN RESOURCES CORP. without embargo unless an embargo is indicated above
4
EXPLANATORY AND MORE DETAIL ED INFORMATION
KEY OUTPUTS OF FEED & CBE PHASE
Upon completion of the Updated Feasibility Study (“ UFS”) in June 2016, the Project team appointed DRA
Projects as EPCM contractor on a limited scope basis. The Project team has recently completed the optimisation
of the mine and process plant design for Bisie, which has resulted in the following changes
MINE DESIGN
The mine design was reviewed by geotechnical and su blevel caving specialists, and although the fundame ntal
mining method has not changed, the layout and mine design parameters have changed notably from the updated
feasibility study. The Life of Mine (LoM) design ha s been developed based on the revised criteria and illustrated
below.
Figure 1: Mpama North Life of Mine Design and Layout
These revised criteria have resulted in a 30% increase in ore tonnes mined, a 10% increase in tin tonn es mined,
and a LoM extension of 2.5 years.
The capital footprint has been defined as mine deve lopment and associated infrastructure that will take place up
to and including December 2018. This includes approximately 64 000 tonnes of ore drive development which will
be stockpiled prior to plant commissioning. Stoping will commence outside the capital footprint.
The above media statement and accompanying material for media use are issued by
ALPHAMIN RESOURCES CORP. without embargo unless an embargo is indicated above
5
Figure 2: Mining Capital Footprint
PROCESS PLANT DESIGN
The original flow sheet was further developed with the support of an additional test work campaign:
• Engineering of the comminution circuit remained pre dominantly unchanged. The pre-concentration
circuit remains the same as in the UFS with Gekko jigs employed for the task.
• Shaking tables were added as cleaners to both spiral gravity concentration circuits allowing for, amongst
other things, high grade bypasses directly to the final product.
• The oxide flotation stream in the low grade regrind circuit was replaced with a bank of shaking tables as
flotation test work was unable to produce saleable grade products at acceptable recoveries.
• The sulphide flotation remains unchanged and is critical for final product contamination control.
• A low intensity magnetic separator remains in the c ircuit to remove any free iron added to the process
during the various grinding processes.
The optimised process flow sheet has been simplifie d to produce only a single high grade product and t he
dewatering system for the product stream has been changed from plate and frame filters to vacuum filters due to
the coarse high grade gravity concentrate produced early in the process plant.
The above media statement and accompanying material for media use are issued by
ALPHAMIN RESOURCES CORP. without embargo unless an embargo is indicated above
6
Figure 3: Bisie Process Flow Sheet
These optimisations have resulted in a 6% higher an nual average plant throughput rate, and an increase in tin
recoveries to 73%
ESTIMATED CAPITAL COSTS
The capital cost estimate has an accuracy level of -10% to 10%, is stated in Q1 2017 terms, and was compiled on
the following basis:
• Equipment and material quantities were based on the design as depicted below:
The above media statement and accompanying material for media use are issued by
ALPHAMIN RESOURCES CORP. without embargo unless an embargo is indicated above
7
Figure 4: 3D View of Overall Block Plan
• Mining and process plant components were priced usi ng quotations from reputable South African supplier s
and vendors.
• Foreign currency elements of quoted prices were converted to United States Dollars, using the following key
rates of exchange:
• USD1 : ZAR13.60
• USD1 : AUD1.30
• USD1 : EUR0.90
• All applicable duties and taxes have been included in the capital cost estimate with the exception of Value
Added Tax (which has however been included in the Project peak funding requirement)
The above media statement and accompanying material for media use are issued by
ALPHAMIN RESOURCES CORP. without embargo unless an embargo is indicated above
8
CBE – OPERATING HIGHL IGHTS AND PROJECT PERFORMANCE
ECONOMIC ASSUMPTIONS
Tin price $ 21 400/t (1)
Oil price $54/barrel
Delivered cost of diesel $1.50/litre
Explosives cost $3 400/t
(1) Current equivalent of ITRI’s long run equilibrium tin price of US$ 22,500/t (2020 terms)
PRODUCTION ASSUMPTIONS
Plant throughput Up to 36ktpm
Plant recovery 73%
OPERATING COSTS (US$ per tonne tin)
Activity CBE (1) UFS (1)
Mining (2) 2 909 1 951
Processing (3) 348 584
Site infrastructure 1 394 1,208
• Power 961 744
• Other 433 464
Sustaining capital cost (4) 297 130
Administration and general 1 253 1 102
• Community development (including
LOWA alliance) 245 220
• Health, Security & IT 243 186
• Other 765 696
Logistics cost 1 081 1 036
Treatment charges (5) 1 555 1 385
Cash cost of tin produced 8 837 7 396
Export duties & fees (6) 529 748
DRC Government royalty (7) 416 340
Marketing commissions (7) 577 451
Cash cost of tin sold 10 359 8 935