Lion One Announces Issuance of Tender for Tuvatu Mining Contract and Receipt of Competing Bids for EPC Contract
Lion One Announces Issuance of Tender for Tuvatu
Mining Contract and Receipt of Competing Bids for EPC
Contract
North Vancouver, British Columbia--(Newsfile Corp. - June 26, 2017) -
Lion One Metals Limited
(TSXV: LIO) (ASX: LLO)
(OTCQX: LOMLF) (FSE: LY1)
(
the
"Company")
is pleased to announce important news on the continued progress of the
development of its 100% owned and fully permitted Tuvatu Gold Project in Fiji.
The Company has issued a tender for
underground mining services and has received competing bids for the EPC contract and fabrication of the Tuvatu processing
plant and construction of the supporting infrastructure.
The Company expects to award the Underground Mining Contract following agreement of final terms and conditions. The Mining
Contract will be for an initial period of 18 months to perform the following activities:
Enlarge the exploration portal and construct a new production portal
Slash the existing exploration decline
Complete the majority of the decline and level development including ventilation raises
Stope production in available levels
The Company also announces that in addition to the ongoing detailed engineering design by Yantai Jinpeng Engineering (see
news release dated May 9, 2017), it has received three competing bids for final engineering, procurement, and construction
(EPC) services for the Tuvatu processing plant and supporting infrastructure.
The bids are for the construction of a new 210,000
tonne per annum carbon-in-leach (CIL) gold ore processing facility to be fabricated in China to western standards and Fijian
Building Code.
In addition to the processing plant, the EPC contract is expected to include the following supporting
infrastructure:
The dry stack tailings storage
Primary diesel power generation system
Assay lab
Water supply and water treatment infrastructure
Truck shop, warehouse, dry, and other operations infrastructure
Central administration complex
It is envisaged that the EPC contract will be signed as soon as agreement is achieved on final terms and conditions to allow
work to proceed quickly. The Company is currently completing the final bulk earthworks design as it intends to start excavation
on the mill site to be followed by commencement of mining.
"These developments have run concurrently with our efforts to conclude funding arrangements for the project and will enable full-
scale mining, stockpiling, and underground development to begin in tandem with critical path components of the EPC contract",
said Lion One CEO Walter Berukoff. "We look forward to providing further guidance with respect to scheduling in due course".
Exploration and infill drilling continues with two drills on site.
Assay results are pending in the next few weeks.
About Tuvatu
The Tuvatu Gold Project is located 17 km from the Nadi International Airport on the main island of Viti Levu in Fiji. Discovered in
1987, Tuvatu is a high grade, low sulphidation, epithermal gold deposit hosted inside a South Pacific style volcanic caldera.
The
deposit occurs along the Viti Levu lineament, Fiji's own corridor of high grade gold deposits. Tuvatu is situated upon a 5 hectare
footprint inside a larger 384 hectare mining lease. The project contains numerous high grade prospects proximal to Tuvatu, at
depth, and up to 1.50 km along strike from the resource area, giving near-term production potential and further discovery upside
inside of one of Fiji's underexplored volcanic goldfields.
Tuvatu was advanced by previous owners through underground exploration and development from 1997 through to the
completion of a feasibility study in 2000.
Acquired by Lion One in 2011, the project has over 100,000 meters of drilling
completed to date in addition to 1,600 meters of underground development.
In January 2016 the Hon. Prime Minister of Fiji, Mr. V. Bainimarama, formally presented the previously granted Tuvatu Mining
Lease to Lion One.
This concluded the permitting process for the development of an underground gold mine and processing
plant at Tuvatu, demonstrating strong government support for Fiji's 85 year-old gold mining industry.
As per its independent June 1, 2015 NI 43-101 PEA Technical Report on the Tuvatu Gold Project, the Company envisages a low
cost underground gold mining operation producing 352,931 ounces of gold at head grades of 11.30 g/t Au over an initial 7 year
mine life.
This includes production of 262,000 ounces at 15.30 g/t through to the end of year three.
Estimated cash cost is
US$567 per ounce with all-in sustaining cost of US$779 per ounce. Total capex of US$48.6 million includes a contingency of
US$6.1 million with an 18 month preproduction schedule and 18 month payback on capital.
At a US$1,200 gold price, the
project generates net cash flow of US$112.66 million and an IRR of 52% (after tax).
The Company is not basing its production
decision on a feasibility study of mineral reserves demonstrating economic and technical viability; as a result there is increased
uncertainty and economic and technical risks associated with its production decision.
Ian Chang, M.A.Sc., P.Eng., Chief Development Officer, is the Qualified Person ("QP") responsible for Tuvatu Mine
development. Stephen Mann, Managing Director, member of The Australasian Institute of Mining and Metallurgy, is the Qualified
Person ("QP") responsible for the Tuvatu Mine exploration program.
For more information on Lion One including technical reports please visit the Company's website at
www.liononemetals.com
or
the SEDAR website at
www.sedar.com
.
On behalf of Lion One Metals Limited
"Walter H. Berukoff"
Chief Executive Officer
For further information please contact
Stephen Mann, Managing Director (Perth, Australia) Tel: 604-973-3007
Hamish Greig, Vice President (North Vancouver, BC) Tel: 604-973-3008
Joe Gray, Investor Relations (North Vancouver, BC) Tel: 604-973-3004
Toll Free IR Line (North America) Tel: 1-855-805-1250
Email:
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accuracy of this release.
This press release may contain "forward-looking information" within the meaning of applicable Canadian securities
legislation. All statements, other than statements of historical fact, included herein are forward looking information. Generally,
forward-looking information may be identified by the use of forward-looking terminology such as "plans", "expects" or "does
not expect", "proposed", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not
anticipate", or "believes", or variations of such words and phrases, or by the use of words or phrases which state that certain
actions, events or results may, could, would, or might occur or be achieved. This forward-looking information reflects Lion
One Metals Limited's current beliefs and is based on information currently available to Lion One Metals Limited and on
assumptions Lion One Metals Limited believes are reasonable. These assumptions include, but are not limited to, the actual
results of exploration projects being equivalent to or better than estimated results in technical reports, assessment reports,
and other geological reports or prior exploration results. Forward-looking information is subject to known and unknown risks,
uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of Lion One
Metals Limited or its subsidiaries to be materially different from those expressed or implied by such forward-looking
information. Such risks and other factors may include, but are not limited to: the early stage development of Lion One Metals
Limited, general business, economic, competitive, political and social uncertainties; the actual results of current research
and development or operational activities; competition; uncertainty as to patent applications and intellectual property rights;
product liability and lack of insurance; delay or failure to receive board or regulatory approvals; changes in legislation,
including environmental legislation, affecting mining, timing and availability of external financing on acceptable terms; not
realizing on the potential benefits of technology; conclusions of economic evaluations; and lack of qualified, skilled labor or
loss of key individuals. Although Lion One Metals Limited has attempted to identify important factors that could cause actual
results to differ materially from those contained in forward-looking information, there may be other factors that cause results
not to be as anticipated, estimated or intended. Accordingly, readers should not place undue reliance on forward-looking
information. Lion One Metals Limited does not undertake to update any forward-looking information, except in accordance
with applicable securities laws.