Rockhaven Announces Robust PEA with Post-Tax $378M NPV(5%) and 37% IRR for its Klaza Gold-Silver Project, Southern Yukon
1016 – 510 West Hastings Street
Vancouver, BC V6B 1L8
604-687-2522
www.rockhavenresources.com
*Gold equivalent values for mining purposes assume base case metal prices and recoveries used in the PEA and are calculated using the following
formula: AuEQ=1*Au+Ag/107.82+Pb/4.14+Zn/4.68
Rockhaven Announces Robust PEA with Post-Tax $378M NPV(5%) and 37% IRR
for its Klaza Gold-Silver Project, Southern Yukon
July 13, 2020 - Rockhaven Resources Ltd. (TSX-V:RK) (“Rockhaven”) is pleased to
announce the results of an updated Preliminary Econom ic Assessment (“PEA”) for its
100%-owned and road-accessible Klaza Deposit, located in the Dawson Range Gold Belt
of southern Yukon.
PEA Highlights:
Highlights from the PEA, with a base case gold price of US$1 ,450/oz and an exchange
rate of C$1.00 equa l to US$0.7 2 are as follows (all figures in Canadian Dollars unless
otherwise stated):
Pre-Tax NPV(5%) of $529 million and an IRR of 45%, and a Post-Tax NPV(5%) of
$378 million and an IRR of 37%;
Using a +/- 20% sensitivity analysis for gold price, Post-Tax NPV(5%) of $540
million and 49% IRR at US$1,740/oz gold and a Post-Tax NPV(5%) of $211
million and 24% IRR at US$1,160/oz gold;
12-year mine life producing total payable metals of approximately 750,000
ounces gold and 13.8 million ounces silver;
Initial capital costs of $ 244 million, which includes $ 32 million in contingency
costs. Life-of-mine (“LOM”) sustaining capital costs total $114 million;
Average LOM operating cash cost of US$613/oz AuEQ* and total all -in
sustaining cost of US$875/oz AuEQ*;
Annual payable metal production exceeds 100,000 ounces AuEQ in years three
through seven; and,
Only the upper portions of three out of eleven known mineralized zones are
included in Mineral Resources evaluated by this PEA, and there is excellent
potential for value enhancement through additional exploration.
“This study demonstrates that Rockhaven’s Klaza Deposit could support a mine with a
long life and robust economics ,” stated Matt Turner, President and CEO of Rockhaven .
“Since the last economic study was completed in 2016, closer spaced drilling has better
defined the upper portions of the deposit, resulting in higher average grades in a superior
resource category. We are very pleased with the results of this PEA and look forward to
continuing to add val ue through additional discoveries whi le advancing the deposit
through Pre-Feasibility. At its current ~C$3 5 million market capitalization, Rockhaven
offers investors one of the most compelling valuations in the sector.”
AMC Mining Consultants (Canada) Lt d. (mineral resource, mining, infrastructure and
financial analysis) was contracted to conduct the PEA in cooperation with Blue Coast
Metallurgy Ltd. (metallurgy and processing), Knight Piesold Ltd (tailings and waste
2
management). The PEA is based on the updated Mineral Resource estimate from the
Klaza Deposit (see Klaza Property Technical Report dated June 5, 2018).
The reader should be cautioned that the PEA is preliminary in nature. It includes Inferred
Mineral Resources that are considered too specul ative geologically to have the economic
considerations applied to them that would enable them to be categorized as Mineral
Reserves. There is no certainty that the results of the PEA will be realized.
Economic Results and Sensitivities
Tables I and II sh ow economic results with varying metal prices and assumptions, and
summarize projected production.
Table I: Klaza Combined Open Pit and Underground Mining – Key Economic
Assumptions and Results
Klaza Unit Value
Total Mineralized Rock Mined kt 7,464
Gold Grade1 g/t 3.4
Silver Grade1 g/t 79
Lead Grade1 % 0.6%
Zinc Grade1 % 0.7%
AuEQ Grade2 g/t 4.43
Gold Recovery1 % 95%
Silver Recovery1 % 90%
Lead Recovery1 % 80%
Zinc Recovery1 % 80%
Gold Price US$/oz 1,450
Silver Price US$/oz 17.00
Lead Price US$/lb 0.95
Zinc Price US$/lb 1.00
Payable Gold Metal3 oz 751,472
Payable Silver Metal3 Moz 13.8
Payable Lead Metal3 Mlbs 50.0
Payable Zinc Metal3 Mlbs 50.1
Payable Gold Equivalent Oz 980,561
Total Net Revenue $M 1,975
Initial Capital Costs $M 244
Sustaining Capital Costs $M 114
Operating Costs (Total)4 $/t 111.8
Operating Cash Cost (AuEQ2) US$/oz AuEQ 612.6
Total All In Sustaining Cost (AuEQ2) US$/oz AuEQ 875.3
3
Mine Life Yrs 12
Payback Period (Pre-tax) Yrs 3.9
Payback Period (Post-tax) Yrs 4.2
Cumulative Net Cash Flow (pre-tax) $M 783
Pre-tax NPV(5%) $M 529
Pre-tax IRR % 45
Post-tax NPV(5%) $M 378
Post-tax IRR % 37
1. LOM average
2. Gold equivalent values for mining purposes assume base case metal prices and recoveries used in the PEA a nd are calculated
using the following formula: AuEQ=1*Au+Ag/107.82+Pb/4.14+Zn/4.68
3. Overall payable % includes treatment, transport, refining costs and selling costs
4. Includes mine operating costs, milling, and mine G&A
Table II: Klaza Economic Sensitivity Analysis (Post-tax)
-20% BASE CASE +20%
Variable Unit Value NPV IRR Value NPV IRR Value NPV IRR
Gold US$/oz $1,160 $211 24% $1,450
$378 37%
$1,740 $540 49%
Silver US$/oz $13.60 $343 35% $17.00 $20.40 $407 39%
Mining Cost $/t $44.1 $417 39% $55.14 $66.2 $334 34%
Processing Cost $/t $33.3 $406 39% $41.30 $50.0 $344 35%
LOM Capital $M $286 $456 60% $380 $429 $280 23%
Capital and Operating Costs
The Klaza project has been envisioned as a combined open-pit and underground mining
operation. Open-pit mining is anticipated to be completed by a contract mining company
while the underground operation will be owner -operator with the equipment owned and
personnel employed by Rockhaven.
Grid electrical power will provide the majority of the e lectrical power to the project over
the life of the mine. An on-site camp is envisioned to house mine and mill personnel.
Table III: Total Capital Cost Estimate
Description Cost ($M)
Underground development 115
Flotation tailings storage & residue tailings storage 17
Underground mine infrastructure 21
Mobile equipment 32
Processing plant 103
Surface infrastructure 16
Capital indirects 10
Contingency 32
Additional 5% sustaining for equipment rebuilds 12
Total capital cost 358
4
Initial capital 244
Sustaining capital 114
Table IV: Total Operating Cost Estimate
Description Cost ($/t)
Mining cost 55.14
Processing cost 41.64
General and Administration cost 15.00
Total operating cost 111.78
Mining
Open-pit mining is anticipated to commence in Year 1 and produce a total of 1,181 kt of
mineralized rock over three years. Peak open-pit production will be 598 kt in Year 2. A
total of 6,283 kt of mineralized rock is anticipated to be produced from underground
operations over the 12-year mine life, beginning in Year 1. Peak underground production
will be 688 kt in Years 5 through 7.
Underground mining will be accomplished using mechanized longhole open stoping on
25 m sub-levels. A minimum stope width of 3.0 m was used in this study with dilution of
0.25 m in the hanging wall and 0.1 m in the footwall. Underground access will be
achieved via four separate declines for the each of the four main zones. The Central
Klaza decline will start from the base of the open-pit.
Waste rock will be used to backfill underground stopes as they are mined and to construct
the tailings dams. The remainder will be disposed of in waste dumps on surface.
Processing & Metallurgy
The Klaza process consists of comminution by crushing followed by semi -autogenous
grinding and ball milling, with the ground product feeding a conventional sequential
flotation circuit producing lead, zinc and arsenopyrite concentrates. The arsenopyrite
concentrate is treated by pressure oxidation (POX), followed by cyanide leaching of the
POX residue to recover the gold. Precious metals are also leached from the lead
concentrate to increase the overall gold recovery to doré and enhance saleability of the
concentrate. Final products from this process are precious -metal-rich lead and zin c
concentrates as well as gold and silver as doré.
The processing plant will operate year -round at a rate of approximately 1, 900 tonnes per
calendar day, and will achieve full throughput by Year 2. The average LOM feed grade is
projected to be 3.40 g/t Au, 79 g/t Ag, 0.6% lead and 0.7% zinc.
Base metal c oncentrates will be dewatered and containerized for shipment to smelters.
Flotation tailings will be thickened and sent to a conventional tailings impoundment, and
5
the leached pressure oxidation residue wi ll flow through cyanide destruction and be sent
to a double-lined hydromet residue storage facility.
Although this study assumes a relatively small 250 tpd onsite POX circuit would be used,
an arsenopyrite concentrate could be produced for shipment to a smelter in Nevada or
China. This was not considered in this study at this time but will be investigated as the
project advances.
Process water will primarily be sourced from underground dewatering and surface run -
off, with make-up from the nearby Klaza River as necessary.
Metallurgical testwork to support the PEA has been conducted on several composites
from the Western Klaza, Central Klaza and Western BRX zones, as well as a Project -
Wide Composite comprising a blend of material from these zones. Testwor k included
grinding, flotation and pressure oxidation work.
Opportunities to Enhance Value
This updated PEA reaffirms Rockhaven’s commitment to enhancing value at the Klaza
project through engineering studies and resource expansion and definition . It h as
highlighted several key areas that can provide significant opportunities to further enhance
the value of the Klaza project. These opportunities include:
Infill drilling to better define areas of high-grade mineralization within the current
inferred resource area;
Additional drilling to better define and expand the Central BRX Zone which has
seen limited work to date relative to the other zones;
Additional drilling of potential near surface bulk tonnage target s within the
Eastern BRX Zone, which has yielded high gold recoveries through cyanidation;
Additional drilling beneath current Mineral Resources, where the deposit remains
open at depth;
Detailed drilling of other known mineralized structures in order to model and
include these into future mineral resource estimations; and,
Further metallurgical studies and investigation of potential smelter contracts for
an arsenopyrite concentrate as an alternative to the on-site POX circuit that is
currently envisioned.
Mineral Resources
The basis for the PEA is the Mineral Resource estimate completed by AMC Mining
Consultants (Canada) Ltd. in the NI 43 -101 report with an effective date of June 5, 2018
entitled "Technical Report Describing Updated Diamond Drilling , Metallurgical Testing
and Mineral Resources on th e Klaza Property, Yukon, Canada” which is filed on
SEDAR.
A summary of this resource estimate is shown in Table V:
Table V: Mineral Resource Estimate Summary, June 5, 20181,5
6
Tonnes
Grade Contained Metal
Au Ag Pb Zn AuEQ4 Au Ag Pb Zn AuEQ4
(kt) (g/t) (g/t) (%) (%) (g/t) (koz) (koz) (klb) (klb) (koz)
Indicated3 4,457 4.8 98 0.7 0.9 6.3 686 14,071 73,268 92,107 907
Inferred3 5,714 2.8 76 0.6 0.7 3.9 507 13,901 77,544 89,176 725
1 CIM Definition Standards (2014) were used for reporting the Mineral Resources. Using drilling results to December 31, 2017. The
Qualified Persons are Adrienne Ross, P.Geo. of AMC Mining Consultants (Canada) Ltd, and Nicholas Ingvar Kirchner, FAusIMM,
MAIG. of AMC Mining Consultants Pty Ltd.
2 Near surface Mineral Resources are constrained by an optimized pit shell at a metal prices of US$1,400/oz Au, US$19/oz Ag,
US$1.10/lb Pb, and US$1.25/lb Zn at an exchange rate of $0.80 US to $1.00 Canadian.
3
Cut-off grades applied to the pit-constrained and underground resource are 1.0 g/t and 2.3 g/t AuEQ respectively.
4 Gold equivalent values for the Mineral Resources assume US$1,400/oz Au, US$19/oz Ag, US$1.10/lb Pb, and US$1.25/lb Zn, and
variable recoveries for the different metals.
5 Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability.
The Klaza Gold-Silver-Lead-Zinc Project
The Klaza property is 100% owned by Rockhaven Resources Ltd . and covers an area of
287 km 2. It is favourably located within the southern part of Yukon’s Dawson Range
Gold Belt, in an area that hosts a n historical gold mine, rich placer gold deposits and key
infrastructure such as road access.
The Klaza property is located 50 km west of the village of Carmacks and is road
accessible by a two -wheel drive road from the K londike Highway. Rockhaven’s
exploration since it acquired the project in late 2009 has included over 100,000 m of
diamond drilling and 24,000 m excavator trenching.
Drilling at the Klaza property has identified eleven main mineralized zones and numerous
subsidiary structures which have a cumulativ e mineralized strike length greater than 10
km. The zones are hosted within a 1.8 km -wide structural corridor consisting of Mid -
Cretaceous granitic country rocks. Low to intermediate sulphidation veins host go ld,
silver, lead and zinc mineralization.
Qualified Persons
A Technical Report supporting the PEA in accordance with National Instrument 43 -101
will be filed on SEDAR (www.sedar.com) within 45 days.
The PEA was prepared under the direction of AMC Mining Consultants (Canada) Ltd. by
independent industry consultants, all of whom are Qualified Persons (QP) under terms of
NI 43-101 and have reviewed the technical content of this press release and approved its
dissemination. QPs contributing to the PEA are listed in the following table.
Qualified Person Position Company Sections of Report
7
Dr A Ross, P.Geo.(BC),
P.Geol.(AB) Principal Geologist AMC Mining Consultants
(Canada) Ltd.
1 (part), 11 ,12, 14 (part) 25
(part), 26 (part), 27 (part)
Mr I Kirchner, FAusIMM,
MAIG Principal Geologist AMC Mining Consultants
Pty Ltd. 1 (part) and 14 (part)
Mr C Martin, C.Eng. Principal Metallurgist Blue Coast Metallurgy Ltd. 1 (part), 13, 17 (part), 19, 25
(part), 26 (part), 27 (part)
Mr M Dumala, P.Eng. (BC) Senior Engineer and
Partner
Archer, Cathro & Associates
(1981) Limited.
1 (part), 3 (part), 4-10, 23, 24,
25 (part), 26 (part), 27 (part)
Mr G Methven, P.Eng. (BC) Principal Mining
Engineer
AMC Mining Consultants
(Canada) Ltd.
1 (part), 2, 3 (part), 15, 16
(part), 20, 21 (part), 22, 25
(part), 26 (part), 27 (part)
Mr M Molavi, P.Eng. (BC) Principal Mining
Engineer
AMC Mining Consultants
(Canada) Ltd.
1 (part), 18, 25 (part), 26
(part)
Mr D Warren, P.Eng. (BC) Principal Mining
Engineer
AMC Mining Consultants
(Canada) Ltd.
1 (part), 16 (part), 21 (part),
25 (part) 26 (part), 27 (part)
Mr B Borntraeger, P.Eng.
(BC)
Specialist
Geotechnical Engineer
/ Associate
Knight Piésold Ltd. 1 (part), 17 (part), 26 (part)
All other technical information, not pertaining to the PEA, in t his news release has been
reviewed and approved by Matthew R. Dumala , P.Eng., of Archer, Cathro & Associates
(1981) Limited and Rockhaven’s designated QP.
The Qualified Persons under the terms of N ational Instrument 43-101 have reviewed the
technical content of this press release for the Klaza property and h ave approved its
dissemination.
About Rockhaven
Rockhaven Resources Ltd. is a mineral exploration company focused on growth through the
advancement of its K laza project. For additional information concerning Rockhaven or its
Klaza project please visit Rockhaven’s website at www.rockhavenresources.com.
Matthew Turner
President, CEO and Director
Rockhaven Resources Ltd.
T:604-687-2522
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 RELEASE.