Independent Preliminary Economic Assessment FOR Atlas Salt’S Great Atlantic Project Supports State-of-the-Art “SALT Factory” Vision
TSXV: SALT
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AtlasSalt.com
INDEPENDENT PRELIMINARY ECONOMIC ASSESSMENT
FOR ATLAS SALT’S GREAT ATLANTIC PROJECT SUPPORTS
STATE-OF-THE-ART “SALT FACTORY” VISION
St. John’s, Newfoundland and Labrador, January 30, 2023 – Atlas Salt (the “Company” or “Atlas” –
TSXV: SALT; OTCQB: REMRF) is pleased to announce the results of a n independent Preliminary
Economic Assessment (PEA) and updated Mineral Resource estimate prepared by SLR Consulting (Canada)
Ltd. (SLR) on its 100%-owned Great Atlantic Salt Project located on the west coast of Newfoundland. Great
Atlantic is the premier undeveloped salt deposit situated in the heart of a large regional U.S./Canadian road salt
market facing a significant domestic production shortfall.
Highlights:
• Pre-tax internal rate of return (IRR) of 22%; NPV(8) of $909 million; payback in 4.2 years after
commencement of operations;
• Base case of 2.5 million tonnes per year (Mtpa) production for a 30-year mine life with a mine
and processing design to accommodate expansion up to 4 million tonnes per year and capable of
extending the mine life beyond the 30-year standard production model;
• Low-cost production - utilizing a Q4 2022 cost basis of $23.81 per tonne FOB;
• Expansion of Mineral Resource estimate including first-time declaration of Indicated Mineral
resources (187 million tonnes @ 96.4% salt) with Inferred Mineral resources of 999 million tonnes @
95.6% salt;
• State-of-the-art, environmentally friendly design featuring the first major salt mine in North America
accessible through declines, providing all the attendant benefits of scalability and economic
efficiencies;
• Recently completed drill hole CC-9, collared 250 meters east of hole CC-4 (refer to Jan. 11, 2023
news release), was not incorporated into the PEA. Results from this hole and other data from the
2022 drill campaign will be included in the upcoming Feasibility Study currently being prepared
by SLR;
• Further to its news release of May 19, 2022, Atlas has entered into discussions regarding Great
Atlantic with interested parties including potential suitors. With an independent PEA now in hand,
management expects these discussions to accelerate with the focus on possible outcomes aimed at
maximizing shareholder value.
Mr. Rowland Howe, Atlas President, commented: “In my 30+ years in this industry I have not come across
a salt project as unique as Great Atlantic given its combination of size, shallowness, and logistical
advantages. This robust PEA confirms our vision for the project.”
Mr. Howe added, “Even assuming a conservative flat production rate at 2.5 million tonnes over only 30
years, the cash flow model provides a base case evaluation that is quite compelling. Significant additional
value can be attributed to the project given that mine infrastructure is designed for up to 4 million tonnes
production with ample resources to extend production beyond 30 years. Future additional infrastructure
could push annual production even higher. Long life cash flow comes at a premium.”
SLR Technical Summary
Overview
The PEA considers developing Great Atlantic into an underground operating mine capable of producing 2.5
Mtpa of rock salt with key mine access and plant infrastructure designed for 4.0 Mtpa. Construction of the mine
would occur over three years, with access to the deposit via twin declines. Extraction of rock salt would occur
using the room and pillar method, with continuous mining equipment. Salt would be processed to a specific
size and grade using a crushing and screening plant located within the mine, and then brought to surface via
conveyor belts. An overland conveyor would transport the rock salt from the mine area to the existing Turf
Point port for loading onto ships destined for Canadi an and American markets, as well as serve the local
Newfoundland market. The PEA is a step towards a Feasibility Study which is currently underway by SLR.
Mineral Resources
Canadian Institute of Mining, Metallurgy and Petroleum (CIM) Definition Standards for Mineral Resources
and Mineral Reserves (CIM (2014) definitions) were used for Mineral Resource classification. The updated
Mineral Resource currently includes 187.2 Mt of Indicated material plus 999.4 Mt of Inferred material. Error!
Reference source not found. provides a summary of the Great Atlantic Mineral Resource estimate prepared
by SLR, with an effective date of January 6, 2023 . The Mineral Resource estimate does not incorporate
information from hole CC-9, with salt analysis pending, announced in an Atlas Salt news release dated January
11, 2023.
Notes:
1. CIM (2014) definitions were followed for Mineral Resources.
2. Bulk density is 2.16 t/m3.
3. Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability.
4. Reasonable prospects for eventual economic extraction were demonstrated by reporting within
mineable shapes at a cut-off grade of 90% NaCl resulting in composite resource grades exceeding
95%.
Mining
Mining designs, development plans, and schedules have been prepared for a fully electric, mechanized room
and pillar mining operation. Salt will be mined using continuous miners and hauled by truck to a lump breaker
and conveyor system to move material to a crushing and screening plant located underground. The PEA is
based upon the initial production of 2.5 Mtpa of rock salt product with mine infrastructure capacity to expand
to 4.0 Mtpa.
The mining designs contained in the PEA are based, in part, on Inferred Mineral Resources. Approximately
39% of the mine plan is based on Indicated Mineral Resources, with the remainder being Inferred Mineral
Resources. Inferred Mineral Resources are considered too geological ly speculative to have economic
considerations applied to them that would enable them to be categorized as Mineral Reserves. There is no
certainty that the production forecasts on which the PEA is based will be realized.
The mine will be accessed through two declines driven to 250 m below surface where the plant and related
infrastructure will be located. One decline will provide fresh air into the mine and be used for vehicle access,
while the other will exhaust air and contain an overhead conveyor to transport finished rock salt product to
surface. Twin declines will be extended from the 250 Plant Level to the first production level at 300 m below
surface, continuing to the lower levels as require d. The primary mine related infrastructure including
maintenance shops, vehicle charging bays, and gear storages will be located on the 300 Level.
Internal declines will be developed as necessary to sustain the initial production rate of 2.5 Mtpa over an initial
30-year mine life. A total of six production level s supported with six internal declines and level -specific
infrastructure will be constructed to support mining activities on each level. Room and pillar production mining
will be executed in four cuts of five metres height, resulting in a maximum room height of 20 m. Rooms will
be 16 m wide, separated by 25 m square pillars. The square pillars will be in a regular pattern and overlie one
another from level to level. Each mining level will be separated by 20 m thick horizontal sill pillars.
Al major equipment used in the mine will be battery electric or plugged electric, with minimal diesel-powered
equipment in the mine.
Processing
Processing of the salt will take place at a crushing and screening plant located within the mine. The rock salt
produced will be suitable for use as a deicing product, conforming to specification ASTM -D632, with a
minimum NaCl grade of 95%. There are no chemical processes or reagents involved in the production of rock
salt, other than an anti-caking agent that is added to the product immediately before shipping. After rock salt
has been processed, it will be transported to the surface via conveyor belts. On surface, a series of conveyor
belts will transport the rock salt from the mine site to the port.
Infrastructure
The Great Atlantic operation will include both on and off-site infrastructure. On-site infrastructure has been
configured to minimize the mine site surface footprint. Components of the on-site infrastructure include:
• Temporary salt storage area
• Decline access area
• Surface buildings such as administration, warehouse, fuel bay, dry facility, maintenance shop
• Salt storage building
• Material handling systems
• Electrical substation and distribution
• Ventilation system for the mine
• Surface water management system
• Gatehouse and fencing
Notably, a tailings management facility is not required for the Project, as all material that is processed will be
sold as rock salt.
Off-site infrastructure has been designed to take advantage of some of the existing facilities available in the
immediate area, including the port, historical haul road, and a NL Power electrical substation. Planned off-site
infrastructure includes the following:
• Overland conveyor connecting the mine to the port, including:
o Overall length of approximately two kilometres, with both bridge and tunnel sections
accommodating access for existing town infrastructure
o All sections of the conveyor belt will be covered to minimize noise and dust
• Retrofitting of the existing storage building located at the port to handle rock salt
• Addition of a new building and material handling system at the port to expand the capacity of
covered material storage
• Refurbishment of the existing ship loader facility
• Transmission line connection to NL Power’s substation located in the town of St. George’s
Environment and Community Engagement
Environmental base line studies of the project area have been completed by GEMTEC Consulting Engineers
and Scientists Limited (GEMTEC) throughout 2022 in preparation for the registration of the project under the
environmental review process. Consultations with local community and affected groups are ongoing. Atlas
has retained the services of an experienced communications consultant to assist and facilitate informed
community input into the project development.
Marketing
As part of the PEA and ongoing Feasibility Study, Atlas and SLR have commissioned independent assessments
of marketing and logistics. These independent assessments have formed the basis of the assumptions used in
the PEA.
Rock salt produced from Great Atlantic will initially target the regional deicing markets in eastern Canada and
the U.S. East Coast. It is estimated that this market requires between 11.0 Mtpa and 16.0 Mtpa of rock salt in
any given year, sourced from domestic and international suppliers, with the demand highly correlated to
weather conditions. The primary customers of rock salt are government entities which use a tender system for
the annual supply of deicing salt. Secondary customers include commercial deicing operators.
Government entities include municipalities, Departments of Transportation (DoT), counties, and other
provincial or state entities, while commercial operators may vary from distribution companies for retail
purchase, or contractors who purchase rock salt for de-icing commercial and private properties.
Cash Flow Model Basis
SLR has prepared a cash flow model that is based on a 30-year mine plan with a production rate of 2.5 Mtpa.
It is noted that the Mineral Resource base will allow for a much longer mine life. The mine schedule includes
a three-year ramp up period, with year one production of 1.5 Mtpa, year two production of 2.0 Mtpa, and year
three reaching steady-state production of 2.5 Mtpa.
The cash flow model comprises estimates of capital costs, operating costs, an assessment of revenue, and
estimate of project economic metrics such as net present value, internal rate of return, and payback period.
Economic metrics were assessed both on a pre and post-tax basis.
SLR has assumed that construction of the mine would commence in 2025, with salt production commencing
in 2028. To bring salt prices to a 2028 base date, SLR has applied a 4.0% annual increase to the price of salt,
which is consistent with other publicly available technical reports on existing salt operations in North America.
Beyond 2028, SLR has applied a 2.0% annual increase to the price of salt. In terms of costs, SLR has applied
2.0% annual inflation to capital and operating costs.
Capital Costs
Capital costs for the Project have been estimated based on first principles build ups, factored estimates, and
quotes for major equipment and supplies. The capital cost estimate conforms to an AACE Class 5 estimate, as
of the fourth quarter of 2022 . Capital costs are divided between pre-production capital (representing years
leading up to salt production) and sustaining capital. Costs are divided into areas including mining, processing,
infrastructure, off-site infrastructure, indirect costs, owner’s costs, and contingency. The capital cost estimate
is presented in Error! Reference source not found..
Notes:
1. Capital costs include escalation.
Operating Costs
Operating costs for the Project have been estimated based on first principles build ups, estimations of labour
quantities and remuneration, productivity, and consumption assumptions. The operating cost estimate is as of
the fourth quarter of 2022. Operating costs are divided into disciplines including mining, processing, general
and administration, and port operations. SLR has assumed that the port would be owned and operated by a
third-party and accessible based on commercial terms. The operating cost estimate is presented in Error!
Reference source not found..
Notes:
1. The columns LOM – Initial 30 Year Plan, Steady State Annual Average, and LOM Unit Costs
include escalation.
Pricing and Revenue Assumptions
SLR has assumed a weighted average price of rock salt based on a market analysis review completed by a third-
party, as well as taking into consideration the shipping and logistics costs of getting the salt to destination ports.
SLR’s revenue analysis is based on pricing FOB Turf Point and is based on the fourth quarter of 2022. The
Project is subject to a royalty payable to Vulcan Minerals Inc., in the amount of 3% of net production revenue.
A summary of revenue assumptions is presented in Error! Reference source not found..
Economic Outcomes
The resulting economics of the Project are presented in Error! Reference source not found..
Next Steps
Upon completion of the PEA, Atlas intends to release a supporting NI 43 -101 compliant report posted to
SEDAR within 45 days of this news release. Other ongoing work towards Feasibility Study completion
includes the following:
• Geotechnical field program to support key assumptions related to mine access and design
• Updated geological modeling based on the most recent drilling (Drill Hole CC-9), which is not
incorporated into the current Mineral Resource estimate
• Continued progress in the areas of environmental baseline monitoring
• Continued stakeholder engagement
• Ongoing work with potential vendors and suppliers
• Targeting completion of the Feasibility Study in the first half of 2023
Qualified Persons
This news release describes an updated Mineral Resource estimate, and a PEA plan and cash flow based upon
geological, engineering, technical and cost inputs developed by SLR Consulting (Canada) Ltd. A National
Instrument 43-101 Technical Report (NI 43 -101) will be filed on SEDAR within 45 days . The technical
information in this news release has been prepared in accordance with the Canadian regulatory requirements
set out in NI 43-101 and reviewed and approved by EurGeol Dr. John G. Kelly, P.Geo., FIMMM, MIQ, David
M. Robson, P.Eng., MBA, Lance Engelbrecht, P.Eng., Derek J. Riehm, M.A.Sc., P.Eng., and Graham G. Clow,
P.Eng. each of whom is a “qualified person” under National Instrument 43-101 – Standards of Disclosure for
Mineral Projects ("NI 43-101").
The technical information in this news release has been prepared in accordance with the Canadian regulatory
requirements set out in National Instrument 43 -101 and reviewed on behalf of the company by Patrick J.
Laracy, P.Geo., CEO of Atlas Salt and a qualified person.
Project Map
About Atlas Salt
Bringing the Power of SALT to Investors: Atlas Salt owns 100% of the Great Atlantic salt deposit strategically
located in western Newfoundland in the middle of the robust eastern North America road salt market. The
project features a large homogeneous high-grade resource located immediately next to a deep-water port. Atlas
is also the largest shareholder in Triple Point Resources as it pursues development of the Fischell’s Brook Salt
Dome approximately 15 kilometers south of Great Atlantic in the heart of an emerging Clean Energy Hub.
We seek Safe Harbor.
For information, please contact:
Patrick J. Laracy, CEO
(709) 754-3186
MarketSmart Communications Inc.
Adrian Sydenham
Toll-free: 1-877-261-4466
Forward-Looking Statements
This press release includes certain “forward -looking information” and “forward-looking statements”
(collectively “forward-looking statements”) within the meaning of applicable Canadian securities legislation.
All statements, other than statements of historical fact, included herein, without limitation, statements
relating to the future operating or financial performance of the Company, are forward-looking statements.
Forward-looking statements are frequently, but not always, identified by words such as “expects”,
“anticipates”, “believes”, “intends”, “estimates”, “potential”, “possible”, and similar expressions, or
statements that events, conditions, or results “will”, “may”, “could”, or “should” occur or be achieved.
Forward-looking statements in this press release relate to, among other things: completion, delivery and
timing of the referenced assessments and analysis and assumptions related thereto including access to
existing infrastructure. Actual future results may differ materially. There can be no assurance that such
statements will prove to be accurate, and actual results and future events could differ materially from those
anticipated in such statements. Forward-looking statements reflect the beliefs, opinions and projections on
the date the statements are made and are based upon a number of assumptions and estimates that, while
considered reasonable by the respective parties, are inherently subject to significant business, technical,
economic, and competitive uncertainties and contingencies. Many factors, both known and unknown, could
cause actual results, performance or achievements to be materially different from the results, performance or
achievements that are or may be expressed or implied by such forward-looking statements and the parties
have made assumptions and estimates based on or related to many of these factors. Such factors include,
without limitation: the timing, completion and delivery of the referenced assessments and analysis. Readers
should not place undue reliance on the forward-looking statements and information contained in this news
release concerning these times. Except as required by law, the Company does not assume any obligation to
update the forward-looking statements of beliefs, opinions, projections, or other factors, should they change,
except as required by law.
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Exchange) accepts responsibility for the adequacy or accuracy of this release.