NorthIsle Copper and Gold Inc. | TSX.V: NCX
NorthIsle Copper and Gold Inc. | TSX.V: NCX
15th Floor – 1040 West Georgia Street | Vancouver, BC | V6E 4H1
www.northisle.ca | [email protected] | Tel: 604-638-2515
September 13, 2017 TSX Venture Exchange symbol: NCX
NORTHISLE COPPER AND GOLD INC. ANNOUNCES
POSITIVE PEA BASE CASE RESULTS:
$550.4 million After-Tax NPV (8%) and 14.3% IRR
VANCOUVER, B.C. – NorthIsle Copper and Gold Inc. (“NorthIsle” or the “Company”) is pleased
to announce the results of its Preliminary Economic Assessment (“PEA”), prepared by M3
Engineering & Technology Corp. , for its 100% owned North Island Copper and Gold
Project located in northern Vancouver Island British Columbia (“Project”). The results of
the PEA demonstrate the potential techn ical and economic viability of the P roject
constructed as an open-pit mine, with a concentrator processing nominally 75,000 tonnes
per day.
PEA HIGHLIGHTS:
• After tax NPV 8% of CAD $550.4 million, 14.3% IRR, 22-year mine life
• Life of Mine (LOM) metal production of 1.8 billion pounds of copper, 1.7 million ounces of
gold and 55 million pounds of molybdenum
• Annual production of 82 million pounds of copper, 79 thousand ounces of gold and 3
million pounds of molybdenum
• Initial capital costs of CAD $1.34 billion plus sustaining capital of $139 million
• Direct cash cost of production per pound of copper net of gold, molybdenum and pyrite
concentrate is CAD $1.17
“We are very pleased with the results of our maiden PEA ,” said Jack McC lintock, President of
NorthIsle. “This PEA shows the Project can be built and operated with excellent returns based on
conservative metal prices. There are a number of areas of potential impro vements that could
improve the Project further including advanced metallurgical studies to improve metal recoveries,
evaluating higher production rates, evaluating the use of the Island Copper pit for tailings disposal
and evaluating the potential for rhenium credits in the molybdenum concentrate . There remains
excellent potential to add tonnes to our resource base. Drilling this summer demo nstrated that
our Hushamu deposit remains open for a significant expansion of its resource. In addition, there
are several partially explored copper – gold exploration targets, any one of which could contribute
significantly to the resource base of the Project.”
PEA BASE CASE ECONOMIC RESULTS
Parameter Unit Base Case
Capital Cost CAD$ $1,344 million
Sustaining Capital CAD$ $139 million
NSR CAD$/ore tonne $17.61
Average Op Cost/tonne CAD$ $8.66
After tax Net Revenue CAD$ $2,349 million
After tax NPV 8% CAD$ $550 million
After tax IRR and pay back 14.3% and 5.1 years
Metal Price Cu US$ per pound $3.10
Au US$ per ounce $1,300
Mo US$ per pound $9.00
Pyrite concentrate US$ per tonne $86
Exchange rate US$ / CAD$ 0.75
PEA SUMMARY PRODUCTION STATISTICS
Category Units LOM
Tonnes Milled Mt 600
Average grade Cu % 0.18
Au gpt 0.24
Mo % 0.008
Tonnes produced Py MT 14.1
Throughput tpy 75,000
Mine Life years 22
Net Cash Cost* CAD$ $1.17
*Net direct cash costs that represent the cash cost incurred at each processing stage from mining through
to recoverable metal delivered to market less net by -product credits. Direct cash costs cover mining, ore
freight and milling costs, mine site administration and general expenses, concentrate freight, smelting and
smelter general and administrative costs, marketing costs (freight and selling).
NorthIsle Copper and Gold Inc. | TSX.V: NCX
15th Floor – 1040 West Georgia Street | Vancouver, BC | V6E 4H1
www.northisle.ca | [email protected] | Tel: 604-638-2515
INITIAL CAPITAL EXPENDITURES (CAD$ MILLIONS)
Mine $149.2
Pre-Production $125.6
Process $1,024.9
Owner’s Cost $44.5
Total $1,344.2
OPERATING COSTS
The mine operating costs were calculated to average CAD$ 2.02 per tonne moved.
Area Unit Cost (CAD$/t moved)
Drilling 0.13
Blasting 0.27
Loading 0.27
Hauling 0.67
Support 0.54
Mine General 0.14
Total Cost 2.02
The process operating costs were calculated to average CAD$ 4.88/tonne ore.
Area CAD$/tonne ore
Salaries & Wages 0.54
Power 1.55
Liners 0.34
Grinding Media 1.06
Reagents 0.85
Maintenance Parts & Repairs 0.44
Supplies & Services 0.10
Total Cost 4.88
NorthIsle Copper and Gold Inc. | TSX.V: NCX
15th Floor – 1040 West Georgia Street | Vancouver, BC | V6E 4H1
www.northisle.ca | [email protected] | Tel: 604-638-2515
MINING
Preliminary mine designs have been developed for Red Dog and Hushamu deposits based upon
Indicated and Inferred Resources. Resource models were imported to Minesight® mine planning
software where a Lerchs Grossman algorithm was applied to an NSR model to determine possible
pit limits.
The mine plan was developed to mine Red Dog concurrently with Hushamu in the early years of
the mine life until Red Dog Resources were depleted. The assumed processing rate is 75,000 t/d.
The overall mining rate peaks at 64 million t/a in the initial years averaging 54 million t/a over the
first 12 years of the total mine life of 22 years. The effective strip ratio after stockpile reclaim was
0.72:1.
The mine will be a conventional truck and shovel o peration with electrified pit operations at
Hushamu. Waste rock will be placed during construction and operation within the Tailings
Management Facility (TMF). A low-grade stockpile will be located at the pit rim on the northwest
side of Hushamu. An overburden stockpile will be located adjacent to the low-grade stockpile for
use in reclamation of the TMF at the end of the mine life.
The total resources processed in the conceptual mine plan are shown in the following Tables.
Mineral Resources Included in the Mine Plan
Indicated Resources ROM t x 1000 Cu % Au g/t Mo %
Hushamu Starter Pit 80,097.0 0.24 0.27 0.007
Hushamu Phase 1 Expansion 97,217.0 0.20 0.18 0.007
Hushamu Phase 1.5 Expansion 119,509.0 0.18 0.28 0.011
Hushamu Phase 2 Expansion 109,134.0 0.17 0.25 0.008
Red Dog 50,549.0 0.22 0.32 0.005
Total 456,506.0 0.20 0.25 0.008
Inferred Resources ROM t x 1000 Cu % Au g/t Mo %
Hushamu Starter Pit 2,530.0 0.12 0.15 0.015
Hushamu Phase 1 Expansion 12,802.0 0.13 0.12 0.010
Hushamu Phase 1.5 Expansion 40,554.0 0.14 0.22 0.012
Hushamu Phase 2 Expansion 84,859.0 0.14 0.21 0.008
Red Dog 2,152.0 0.17 0.27 0.003
Total 142,897.0 0.14 0.20 0.009
NorthIsle Copper and Gold Inc. | TSX.V: NCX
15th Floor – 1040 West Georgia Street | Vancouver, BC | V6E 4H1
www.northisle.ca | [email protected] | Tel: 604-638-2515
INFRASTRUCTURE
The nearby town of Port Hardy is a main distribution centre for the north end of Vancouver Island.
It has an airport with 3 daily flights to Vancouver, a hospital, schools and a college. All parts of
the North Island Project are accessible from Port Hardy through a network of logging roads.
A marine load out structure and a 138 KVA BC Hydro substation exist at the reclaimed Island
Copper Mine, approximately 27 km from the North Island mine site. One of BC’s largest wind farm
complexes is situated adjacent to the northwest end of the property and the 138 KV power line
connecting the wind farm to the main BC power grid passes immediately north of the North Island
Project.
ECONOMIC ANALYSIS
Economic evaluations were generated incorporating forecasts for metal prices using the long
term (Base Case), the SEC price and Spot Price. The spot price case is from September 6,
2017.
Parameter Unit Base Case SEC Spot Price
Copper US$ per lb $3.10 $2.50 3.12
Gold US$ per oz $1300 $1,213.12 1,333.10
Molybdenum US$ per lb $9.00 $7.03 7.14
Pyrite US$ per tonne $86 $86 $86
Exchange rate 0.75 0.75 0.75
Economic Result (After tax)
Net Revenue CAD$ M 2,349 1,339 2,342
NPV 8% CAD$ M 550 34 549
IRR % 14.3 8.4 14.3
Pay back Years 5.1 7.9 5.0
The Preliminary Economic Assessment (“PEA”) is preliminary in nature and includes inferred mineral resources that are considered
too speculative geologically to have the economic considerations applied to them that would allow them to be categorized as mineral
reserves and there is no certainty that the preliminary economic assessment will be realized. Mineral resources that are not mineral
reserves do not have demonstrated economic viability.
OPPORTUNITIES TO ENHANCE VALUE
The Project opportunities include advanced metallurgical studies to improve copper , gold
and molybdenum recoveries from current li fe of mine averages of 77.5% for copper ,
38.4% for gold (in the copper concentrate) and 59.5% for molybdenum; optimize primary
and rougher concentrate regrind sizes; determine the potential for rhenium credits in the
molybdenum concentrate; evaluate the use of the Island Copper pit for tailings disposal
in conjunction with a waste storage site to reduce overall CAPEX, OPEX, and societal
risk; and to evaluate higher production rates of 85 to 90 kptd. In addition, there are several
partially explored copper – gold exploration targets, any one of which could contribute
significantly to the resource base of the Project.
NorthIsle Copper and Gold Inc. | TSX.V: NCX
15th Floor – 1040 West Georgia Street | Vancouver, BC | V6E 4H1
www.northisle.ca | [email protected] | Tel: 604-638-2515
TECHNICAL REPORT
A National Instrument 43-101 (NI 43-101) compliant technical report entitled "North Island Project
PEA" prepared by the following Qualified Persons will be filed by the Company within 45 days of
this release on www.sedar.com:
• Laurie Tahija, of M3 Engineering – Recovery Methods
• Daniel Roth, P.Eng of M3 Engineering – Project Infrastructure; Capital and Operating Costs;
Economic Analysis
• Brian Game , P. Geo. – Principal of GeoMinEx Consultants – Geology, Exploration and
Environmental
• Thomas W. Shouldice, P.Eng of TS Technical Services Ltd. – Mineral Processing and
Metallurgical Testing
• Phil Burt, P. Geo. – CEO of Burt Consulting Services – Mineral Resource Estimates
• John Nilsson, P. Eng – Mining Methods
• Ben Wickland, P.Eng of Golder Associates Ltd. – Tailing Infrastructure
The Qualified Persons have reviewed and approved the scientific, technical, and economic
information obtained in this news release.
COMPANY OVERVIEW
NorthIsle Copper and Gold Inc. is a Vancouver based junior resource company committed to the
development of the North Island Project on Northern Vancouver Island. The North Island Project
is a 33,149 -hectare block of mineral titles 100% owned by NorthIsle stretching 50 kilometres
northwest from the now closed Island Copper Mine of BHP Billiton, which is located 10 km south
of Port Hardy. The North Island Project contains the Hushamu and Red Dog Deposits and five
other partially explored copper-gold porphyry occurrences.
On behalf of NorthIsle Copper and Gold Inc.
“John McClintock”
John McClintock
President, CEO and Director
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.
This news release contains forward-looking statements. These forward-looking statements are based upon the reasonable beliefs of
Northisle and its management as of the date of this news release; however, forward-looking statements involve risks and uncertainties
and are based upon factors that may change and assumptions that may prove, with the passage of time, to be incorrect as a result of
exploration and other risk factors associated with mineral explor ation and development that are beyond the control of Northisle.
Accordingly, undue reliance should not be placed upon such statements. If factors materially change or assumptions are materi ally
incorrect, the actual results, performance or achievements of Northisle may be materially different from any future results,
performances or achievements expressed or implied by such forward-looking statements. Northisle does not undertake any obligation
to update or revise any forward -looking statements to reflect n ew information, future events or otherwise, excep t as required by
applicable law.