Cartier Delivers Positive PEA for Chimo Mine Project Post-Tax NPV5% of CAD$388M and 20.8% IRR
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For immediate release
Cartier Delivers Positive PEA for Chimo Mine Project
Post-Tax NPV5% of CAD$388M and 20.8% IRR
Highlights:
➢ Long term gold price of US$1,750/oz, Exchange rate of CAD $1.00 = US$0.77
➢ Post-tax NPV5% of CAD$388M and IRR of 20.8%
➢ Post-tax payback period of 2.9 years and mine life of 9.7 years
➢ Capex of CAD$341M
➢ Average all-in sustaining cost of US$755/oz
➢ Average annual production of 116,900 oz
➢ 4,500 tpd underground operation
➢ Average sorted grade of 4.55 g/t Au for mill feed
➢ Processing plant with capacity of 3,000 tpd and rate of recovery of 93.1%
➢ Sorting of mineralization increases the grade of material prior to milling operations and
recovery rate and also reduces costs of mill construction, material handling, milling and
restoration leading to a reduced environmental footprint of mine tailings and thus
increasing the social acceptability of the project
Val-d’Or, April 13, 2023 – Cartier Resources Inc. (TSX-V: ECR) (“Cartier”) is pleased to announce
the positive results of the Preliminary Economic Assessment (“PEA”), prepared in accordance with
National Instrument 43 -101 – Standard of Disclosure for Mineral Projects (“NI 43-101”), on the
Chimo Mine Project located 45 km east of the Val-d'Or mining camp.
« The results of the study demonstrate the economic viability of the project as well as several
optimization opportunities related to the characteristics of the project. Two drills are in operation on
the property and the results continue to increase the size of the gold zones with a view to continuing
to increase the project's resources . » commented Philippe Cloutier, President and CEO. Adding,
that: « strategic solutions are being studied to further push the development of the project. »
The study presents an underground mining operation with 280 employees that uses conventional
longitudinal and transverse longhole stoping at a mining rate of 4,500 tpd. Mined mineralized
material will be sorted using automated sensor-based sorting technology with an expected
concentration ratio of 1.85 and a recovery rate of 91.9%.
The sorted mineralized material would then be processed in a concentrator using a gravity
separator followed by a carbon -in-leach process with a capacity of 3,000 tpd for an estimated
recovery rate of 93.1%. The current plan of operations assumes an averag e annual production of
116,900 oz for a mine life of 9.7 years.
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Financial Analysis
The project requires C AD$341M of initial capital and C AD$160M of sustaining capital. Average
cash costs of US$647/oz and all-in sustaining cost of US$755/oz are expected over the mine life.
The financial analysis was performed using a 5% discount rate, a long -term gold price of
US$1750/oz, and an exchange rate of CAD$1.00:US$0.77. On a post-tax basis, the project
demonstrates an NPV5% of CAD$388M, an IRR of 20.8% and a payback period of 2.9 years. On a
pre-tax basis, the project demonstrates an NPV of CAD$672M, an IRR of 27.4% and a payback
period of 2.5 years.
A summary of project economics is presented in Table 1.
Table 1: Summary of Project Economics
Economical Parameters
Long term gold price (US$) 1750.00
Exchange rate (CAD$:US$) 1.00:0.77
Discount rate (%) 5
NSR Royalty on Chimo Mine property (%) 1
GMR Royalty on West Nordeau property (%) 3
Mining Parameters
Average grade mined (g/t) 2.7
Cut-off grade (g/t) 1.9
Mining rate (tpd) 4,500
Total tonnage mined (Mt) 15.8
Mine life (years) 9.7
Processing Parameters
Concentration ratio of mineralized material sorted - 1.85
Recovery rate of mineralized material sorted (%) 91.9
Average grade of sorted mineralized material (g/t) 4.6
Processing rate (tpd) 2,400
Processing capacity (tpd) 3,000
Total tonnage milled (Mt) 8.5
Production Parameters
Average annual production (oz/year) 116,900
Total production (oz) 1,157,710
Capital Costs
Initial capital (CAD$M) 341
Sustaining capital (CAD$M) 160
Closure and rehabilitation costs (CAD$M) 3
Salvage value (CAD$M) 5
Operating Costs
Total operating costs (CAD$/t milled) 107
Cash Costs
Average cash costs (US$/oz) 647
Average All-in sustaining cash costs (US$/oz) 755
Financial Analysis
Pre-tax NPV5% (CAD$M) 672
Pre-tax IRR (%) 27.4
Pre-tax payback period (years) 2.5
Post-tax NPV5% (CAD$M) 388
Post-tax IRR (%) 20.8
Post-tax payback period (years) 2.9
Profitability Index (Post-tax NPV5% / Initial Capital) - 1.14
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Sensitivity analysis was performed to see the impact on post-tax 5% NPV and post -tax IRR by
variating the gold price, operating costs, and capital costs. The results of the sensitivity analysis
are presented in Table 2, Table 3 and Table 4, the base case is highlighted in the tables.
Table 2: Gold Price Sensitivity
Variation Post-Tax NPV5% (CAD$M) Post-Tax IRR (%)
1,300 105 9.7
1,400 169 12.4
1,500 233 15.0
1,600 295 17.4
1,700 357 19.7
1,750 388 20.8
1,800 418 21.8
1,900 479 23.9
2,000 539 25.8
2,100 599 27.7
2,200 658 29.5
Table 3: Capital Cost Sensitivity
Variation Post-Tax NPV5% (CAD$M) Post-Tax IRR (%)
-50% 606 42.6
-40% 562 36.3
-30% 518 31.2
-20% 475 27.1
-10% 431 23.7
0% 388 20.8
10% 344 18.2
20% 301 15.9
30% 257 13.9
40% 213 12.0
50% 170 10.4
Table 4: Operating Cost Sensitivity
Variation Post-Tax NPV5% (CAD$M) Post-Tax IRR (%)
-50% 563 26.5
-40% 529 25.4
-30% 494 24.3
-20% 460 23.2
-10% 424 22.0
0% 388 20.8
10% 351 19.4
20% 314 18.1
30% 276 16.7
40% 238 15.2
50% 198 13.6
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Mineral Resources
The mineralization of the Chimo Mine Gold System consists of 29 gold zones that are part of 19
gold structures, themselves grouped into 3 gold corridors. The resources in effect as of August 22,
2022 for this gold system, combining the resources of the Ch imo Mine property with those of the
West Nordeau deposit, are presented below in Table 5. (FIGURE 1):
Table 5: Mineral Resource Estimate
Gold Corridor
Cut-off Grade
(g/t Au)
Indicated Resources Inferred Resources
Metric
Tonnes
(t)
Grade
(g/t Au)
Troy
Ounces
(oz Au)
Metric
Tonnes
(t)
Grade
(g/t Au)
Troy
Ounces
(oz Au)
North Gold
Corridor (>2,0) 1,119,000 3.85 139,000 1,714,000 3.54 195,000
Central Gold
Corridor (>1,5) 5,565,000 2.96 529,000 14,812,000 2.56 1,221,000
South Gold
Corridor (>2,0) 444,000 3.61 52,000 1,949,000 3.47 217,000
Total 7,128,000 3.14 720,000 18,475,000 2.75 1,633,000
NI 43-101 Mineral Resources Estimate for Chimo Mine and West Nordeau Gold Deposits, Québec,
Canada, Vincent Nadeau -Benoit, P.Ge o., Alain Carrier, P.Geo., M.Sc. and Marc R. Beauvais,
P.Eng., InnovExplo Inc., August 22nd, 2022.
Additional notes on the resource estimate
1. These mineral resources are not mineral reserves because their economic viability has not been
demonstrated. The quantity and grade of Inferred Resources reported in this Mineral Resource
Estimate is uncertain in nature and there can be no assurance that any or all of the Inferred Mineral
Resources can be converted to Indicated Mineral Resources with further exploration drilling.
2. The mineral resource estimate of complies with the standards and guidelines in effect of the
Canadian Institute of Mining, Metallurgy and Petroleum (CIM) as well as the NI 43-101 standard
for the publication of mineral resources.
3. The requirement of a reasonable prospect of eventual economic extraction is met by having a
minimum modeling width for mineralized zones, a cut-off grade based on reasonable inputs and an
economic binding volume that lends itself to a potential scenario of underground extraction for
undiluted in-situ resources. The constrained volume was achieved with the Deswik Stope
Optimizer (" DSO ") using a minimum mining volume of 10 m in width in the longitudinal orientation
of the gold zones, by 10 m in height and 2 m in thickness varying up to a maximum of
25 m x 100 m x 15 m. The optimization was carried out using the respective cut-off grade of each
of the gold corridors for the indicated and inferred resources. The results of the DSO were then
used for the resource estimate statement.
4. The resource estimate is presented for potential underground scenarios at a cut-off grade of
2.0 g/t Au for the North and South Gold Corridors and 1.5 g/t Au for the Central Gold Corridor. The
cut-off grade reflects the geometry and actual width of each of the gold corridors. The cut-off grade
was calculated using the following main parameters:
✓ Gold price of US $ 1,612 / oz;
✓ Exchange rate of US $ 1.34 / CAD $ per troy ounce;
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✓ Costs relating to the Central Gold Corridor for:
➢ Definition drilling of CAD $ 3 / t;
➢ Development, mining, transport and milling of CAD $ 50.75 / t;
➢ Environmental restoration of CAD $ 0.75 / t;
✓ Costs relating to the North and South Gold Corridors for:
➢ Definition drilling of CAD $ 6 / t;
➢ Development, mining, transport and milling of CAD $ 75.50 / t ;
➢ Environmental restoration of CAD $ 1.50 / t;
✓ For the Chimo Mine property (1% NSR): Triple Flag Precious Metals royalty cost of CAD
$ 20.96 / troy ounce;
✓ For the West Nordeau deposit (3% GMR): Globex Mining Enterprises Inc. royalty cost of
CAD $ 64.80 / troy ounce;
✓ General and administrative costs of 12 $ CAD / t.
5. For the Chimo Mine property, the estimate was carried out on 17 3D solids corresponding to the
structures constituting the Northern Gold Corridor (structures: 1A, 1B, 2, 3 and 4B), South
(structures: 6, 6B, 6C, 6P and 6P2) and Central (structures: 5B, 5B2, 5C, 5M, 5M2, 5N and 6N1)
of the Chimo Mine property whose minimum actual thickness is 2.40 m and the average thickness
is 7.42 m. For the West Nordeau deposit, 8 structures were modeled using a minimum real
thickness of 2.4 m, including 5 structures for the North Gold Corridor and 3 structures for the Central
Gold Corridor. The contents of the samples analyzed are used when they are available otherwise
in the absence of analytical content, a value of zero is assigned.
6. The density value of 2.90 g/cm3 (to 3.10 g/cm3) supported by measurements, was applied to all
gold structures.
7. The estimate for the Chimo Mine property was made from a database made up, as of September
1, 2020, of 3,658 holes totaling 290,419 m drilled, 18,612 deviation measurements as well as
81,413 samples analyzed for gold and collected over a core length of 88,035 m representing 30%
of the core length drilled. This database contains 2,383 blank and standard samples, inserted for
QA/QC by Cartier between November 1, 2016 and September 1, 2020. This database was
validated before starting the resource estimate. The estimate was carried out on 17 mineralized
structures, intersected by 67,103 m of drilling, having produced 8,611 different gold intersections.
The estimate of the West Nordeau deposit was made from a database consisting, as of July 12,
2022, of 154 drill holes totaling 55,097 m drilled, 6,873 deviation measurements as well as 18,973
samples analyzed for the gold and collected over a core length of 19,785 m representing 36% of
the core length drilled. This database contains 820 blank and standard samples, inserted for
QA/QC by previous operators: Chalice Gold Mines Limited and O3 Mining Inc. between March 11,
2017 and March 17, 2020. This database was validated before starting the resource estimate. The
estimate was carried out on 8 mineralized structures, intersected by 4,982 m of drilling, having
produced 802 different gold intersections.
8. High grade capping was carried out from statistical analysis data at each of the gold structures for
values varying between 30 g/t Au and 120 g/t Au from the grade of the composites, also using the
grade adjacent material or a value of zero when adjacent material has not been analyzed.
9. The underground openings (open or backfilled-cemented mine sites, drifts, raises and shafts) were
modeled from transverse and longitudinal sections as well as detailed historical geological and
mining plans. Historical underground production has been subtracted from the resource estimate.
10. The Chimo Mine resource estimate was performed using GEOVIA GEMS 6.8.2. Software, from
capped and composited analyses, constrained by the modeled structures. The ordinary kriging
method was used to interpolate the block model composed of blocks of dimension 5.0 m x 5.0 m x
5.0 m. For the West Nordeau deposit, gold resources were estimated using Leapfrog Edge
v.2021.2.5 software from capped and composite analyses, constrained by the modeled structures.
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The ordinary kriging method was used to interpolate a model with sub-blocks (size of a parent block
= 5.0 m x 5.0 m x 5.0 m).
11. The mineral resource estimate presented here is classified as indicated and inferred resources.
The indicated category is defined by a minimum of 3 drill holes located within a 25 m radius and
the inferred category is defined by a minimum of 2 drill holes located within a 65 m radius, where
there is reasonable continuity of geology and gold grades.
12. Ounce troy is metric tons multiplied by grade (g/t) and divided by the constant of 31.10348. The
number of tonnes has been rounded to the nearest thousand. Any discrepancy in the totals is due
to rounding effects. The rounding complies with the recommendations of NI 43-101.
13. The qualified persons are not aware of any problem related to the environment, permits, mining
titles or related to legal, fiscal, socio-political, commercial issues or any other relevant factor not
mentioned in this press release, that could have a significant impact on the 2022 mineral resource
estimate.
Mining
The PEA presents an underground mining operation that uses conventional longitudinal and
transverse longhole stoping at a mining rate of 4,500 tpd over a 9.7-year mine life. A total of 15.8
Mt of mineralized material at an average grade of 2.7 g/t in will be extracted from four different
mining sectors (FIGURE 2):
➢ Chimo Mine Main with 44% of ounces to be mined,
➢ Chimo Mine Extension (below Chimo Mine) with 11% of ounces to be mined,
➢ East Chimo Mine with 31% of ounces to mine and,
➢ West Nordeau with 14% of ounces to be mined.
The different sectors of the mine will be accessed via ramps and drifts to allow the efficient
circulation of mobile mining equipment and to satisfy ventilation requirements. The historic three-
compartment mineshaft of 914m depth will be rehabilitated to accommodate the installation of a
vertical conveyor. Mined mineralized material from the upper portions of the mine will be sent down
to the base of the vertical conveyor using material passes and mined material from the lower
portions of the mine will be hauled using underground diesel trucks to the same level.
Mineralized material will then be crushed using a jaw crusher and transported to the surface via the
vertical conveyor before being sorted using sensor-based sorting technology. Sorted waste will be
returned from surface using a network of waste passes and mixed with cement to be used as
backfill.
The mine will be owner -operated, and the mining fleet will be purchased via a lease financing
agreement. Supporting underground infrastructure includes, one main pumping station , two
ventilation and heating systems and one crushing station.
Processing
Mineralized material from the underground operation would be sorted using automated industrial
sorting technology based on RGB and XRT sensors before being transported to the processing
plant. The sorter is expected to operate with a concentration ratio of 1.85 a recovery rate of 91.9%.
The flow sheet (FIGURE 3) selected for the study, is based on historical metallurgical work which
was used in the present study to estimate the recovery rate estimated at 93.1%. The plant is
expected to process 2,400 tpd on average over the life of mine but has a processing capacity of
3,000 tpd.
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The process plant is a standard carbon -in-leach (CIL) technology with a gravity concentration for
gold recovery. The plant includes crushing, grinding, gravity concentration, classification, leach and
CIL, and detoxification before deposition into a tailings storage facility. The diagram of the treatment
process is illustrated in (FIGURE 3).
Infrastructure and Tailings
The infrastructure includes earthworks, power utilities, water and the buildings/structures
supporting the exploitation of the resource. A vertical conveyor will be used for primary hoisting of
the resource from underground. It dumps to a run -of-mine stockpile that feeds a crusher/sorter
system that is estimated to reject 45% of the hoisted material. The rejects are sent underground
through a fill raise and distributed underground for stope support. The upgraded material is stored
in a dome where it becomes feed to the processing plant. A confinement area will be constructed
to accommodate thickened tailings . FIGURE 4 presents the proposed site layout for the Chimo
Mine project.
Capital and Operating Costs
The project requires C AD$341M of initial capital as broken down in Table 6 and CAD$160M of
sustaining capital. Closure costs are estimated at CAD$3M with equipment salvage value
estimated at CAD$5M. Operating costs are estimated at CAD$107 per tonne milled. Average cash
costs of US$647/oz and all-in sustaining cost of US$ 755/oz are expected over the mine life . The
financial model also includes CAD$25M in working capital requirements.
Table 6: Capital Cost Breakdown
Item Initial Capital (CAD$M)
Mine development, infrastructure, and equipment 96.9
Processing plant 112.7
Surface infrastructure, environment, and equipment 92.5
Capitalized revenue (62.0)
Capitalized operating cost 101.1
Total 341.2
Conclusions and Recommendations
The PEA has demonstrated the economic viability the Chimo Mine project.
The recommendations describe the work for continued development of the project. This work
includes exploration drilling, delineation, and definition of mineralized zones in order to increase
the resources as well as their level of confidence. Recommendations also include industrial sorting
tests of mineralized material, metallurgical tests, engineering optimization (trade-off) studies and
environmental baseline characterization work.
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Independence and responsibilities
The PEA was prepared by independent consulting firms with their respective responsibilities broken
down in Table 7.
Table 7: Consulting Firms with Respective Responsibilities
Consulting Firm Area of Responsibility
InnovExplo Inc. • Mineral resource estimate
• Mine design and scheduling
• Mine capital and operating cost
estimates
• G&A cost estimates
• Financial analysis
A-Z Mining Professionals Ltd. • Surface infrastructure design
• Capital cost estimates
Bumigeme Inc. • Process plant design
• Process plant capital and operating
cost estimates
Responsible Mining Solutions • Tailings management facility design
• Capital cost estimates
Qualified Persons
Corporate
The geological information (scientific and technical in nature) of the Company in this news release
was reviewed by Mr. Gaétan Lavallière, P.Geo., Ph.D, Cartier’s Vice -President, and Mr. Ronan
Déroff, P.Geo, M.Sc., Senior Geologist, Project Manager and Geomatician, both qualified persons
as defined in NI 43-101. Mr. Lavallière approved the geological information (scientific and technical
in nature) contained in this press release.
Mineral Resources Estimate
The qualified persons independent of the issuer, responsible for estimating the mineral resources
of the Chimo Mine property and the Nordeau West deposit (effective as of August 22, 2022), within
the meaning of NI 43-101, are Mr. Vincent Nadeau-Benoit, P.Geo., Alain Carrier P.Geo., M.Sc, and
Marc R. Beauvais from the firm InnovExplo Inc. Mr. Nadeau-Benoit, Carrier and Beauvais declare
that they have read this press release and that the scientific and technical information relating to
the mineral resources estimate presented therein is correct.
Preliminary Economic Assessment
The qualified persons independent of the issuer, responsible for the Preliminary Economic
Assessment (this Press Release), within the meaning of NI 43 -101, are Mr. Marc R. Beauvais,
P.Eng. of InnovExplo, Mr. Eric Hinton, P.Eng. of A -Z Mining Professionals, Mr. Florent Baril of
Bumigeme et Mr. Eric Sellars, P. Eng. de Responsible Mining Solutions. Mr. Beauvais, Hinton,
Baril and Sellars declare that they have read this press release and that the scientific and technical
information relating to the resource estimate presented therein is correct.