Talon Metals Announces Results of Initial PEA and Follow-Up Exploration Plans at the Tamarack High Grade Nickel-Copper-Cobalt Project
Talon Metals Announces Results of Initial PEA and
Follow-Up Exploration Plans at the Tamarack High Grade
Nickel-Copper-Cobalt Project
Road Town, Tortola, British Virgin Islands--(Newsfile Corp. - November 12, 2018) - Talon Metals Corp. (TSX: TLO)
(
"Talon"
or
the
"Company"
) is pleased to announce that it has completed an initial Preliminary Economic Assessment (the
"
Initial
PEA
")
over a subset of the mineral resource estimate within the Tamarack Zone (located at the Tamarack North Project, Minnesota,
USA).
The Company is also pleased to announce its plan to follow-up on nearby high-grade Ni-Cu-Co intercepts to determine
the extent of mineralization that appears open in all directions. Talon currently has the right to acquire up to a 60% interest in the
Tamarack Project on the satisfaction of certain terms and conditions.
"
We completed the Initial
PEA as a basis for negotiating a right to acquire up to a 60% interest in the Tamarack Project
"
,
said
Henri van Rooyen, CEO of Talon.
"
High
nickel
grade
s
, exc
ellent metallurgical recoveries
, exploration potential
and
good
infrastructure are synonymous with the Tamarack North Project.
In a world of ever decreasing nickel grades and deeper
nickel mines, the Tamarack North Project
Initial PEA
demonstrates
robust economics with pessimistic ($6.75/lb Ni),
base
case
($8/lb Ni) and
incentive pricing
($9.5
0
/lb Ni)
after-tax Internal Rates of Return (
"IRR"
) of
28%, 39% and
48%
,
respectively.
[1]
We have also used this opportunity to conceptualize and model the adoption of
"
Best Available
Technologies
"
to protect the environment and
minimize any potential future mine footprint
and impact
.
Furthermore, we have
started a metallurgical test program to simplify the
Initial
PEA
flowsheet with the
additional
objective of including the
remaining mineral resource estimate in the next iteration of the mine plan
.
Most of all, we are excited about the potential for
expanding the Massive Sulphide Unit
(
"MSU"
)
as outlined by Dr. Etienne Dinel below."
"
G
iven the
se
positive results,
combined with the
immediate
exploration potential
, we see tremendous value in our recently
announced deal with Kennecott
, a subsidiary of
the Rio Tinto Group
,
whereby we
negotiated the right to
take over
operatorship and
increase
our
ownership position in the project
to a majority stake
,"
said Sean Werger, President of Talon.
Dr. Etienne Dinel, VP Geology for Talon said the following:
"
In working closely with Kennecott over the last four years, we have
refined an effective combination of
geological
and
geophysic
al
method
s
,
both
surface and downhole
,
that
have
successful
ly
been
used to substantially increase the
M
SU
resource
at
the
Tamarack
Project
.
These
methods will be repeated outside
of
the Tamarack
Z
one
to effectively
design drill hole targets for intercepting
MSU
, which
,
if successful, will have a profound
imp
act on any future mine plan
.
As is shown on the map in Figure 1 below
:
1
.
A high conductance Downhole Electromagnetic ("DHEM") Maxwell plate at 587 m from surface, below the 138 Zone will
be followed up to determine if a 300 m western flank of MSU exists to the west of the mineral resource estimate.
This
plate is supported by an MSU vein directly below, intercepted by drill hole 12TK0160 from 587.2 m to 597.4 m, grading
2.05% Ni, 3.10% Cu, 350 ppm Co, 0.66 g/t Pt, 0.43 g/t Pd and 0.29 g/t Au (Refer to Annex A and B);
2
.
An approximately 340 m (1,115 ft) gap in MSU between two MSU intercepts from drill hole 08TK0062 and drill hole
08TK0068 (Refer to Annex A and B) remains to be drilled following the modelling of a DHEM conductor;
3
.
At the Tamarack Zone and the 138 Zone, massive sulphide settling occurred along the Fine Grained Orthocumulate
Olivine ("FGO") keel that resembles the hull of a boat where massive sulphide settling may have occurred.
We have
approximately 1 km (0.6 miles) of the keel with two areas that display a similar widening of the keel (modelled from
gravity and magnetic surveys as well as contouring using drill holes) where massive sulphide settling may have
occurred.
Drill hole 12TK0164 located approximately 900 m (2,950 ft) to the south of the 138 Zone intercepted MSU
grading 3.67% Ni, 1.97% Cu, 814 ppm Co, 0.12 g/t Pt, 0.11 g/t Pd and 0.10 g/t Au from 473.43 m to 476.32 m in the
flank of the FGO keel (Refer to Annex A and B);
4
.
We have surface EM supported by drill intercepts of high grade Ni-Cu-Co mineralization over a
n
78,000
m
2
(
19
acre
)
area
to the north
-
east of
the Tamarack Zone between
90 m (
295 feet
)
and
195 m (
640 feet
)
from surface
.
"
Figure 1 below illustrates the areas initially targeted for further exploration:
To view an enhanced version of
Figure 1
, please visit:
https://orders.newsfilecorp.com/files/2443/41001_db6a9a5c34e9d976_002full.jpg
Figure
1
:
Plan view of the Tamarack and 138 Zones as well as
the 164 Zone
and the CGO Bend
targeted for further exploration
"Massive sulphides and mixed massive sulphides (
"MMS"
) have been intercepted in
95
drill holes over a distance of
8 km
(5 miles)
, with the most northern drill hole in the 480 Zone (Tamarack North Project)
and the most southern drill hole in the
Neck (Tamarack South Project)
-
refer to
Figure 2 b
elow
.
We plan to test surface geophysical techniques with deep
penetration potential to evaluate the exploration potential outside of the Tamarack, 138 and 164 Zone
s
as well as the CGO
Bend."
To view an enhanced version of
Figure 2
, please visit:
https://orders.newsfilecorp.com/files/2443/41001_db6a9a5c34e9d976_003full.jpg
Figure
2
:
Long Section (Looking West) of the Tamarack Intrusive Complex showing MSU and MMS intercepts as
well as the approximate location of the Tamarack North resource estimate: Effective February 15, 2018
, which is the
first of
nine initial exploration targets
"As the Initial PEA mine plan was developed using
conservative
long-term commodity prices
[2]
and metallurgical projections
to calculate the
Net Smelter Return
("
NSR
"
)
cut-off, most of the inferred mineral resource estimate tonnage in the Semi-
Massive Sulphide Unit (
"SMSU"
) and all of the tonnage in the 138 Zone have been excluded from this Initial PEA mine plan
(refer
to
Figure 3 below). These conservative metallurgical projections were due to insufficient metallurgical data in the low-to-
medium head grade range encountered in the inferred mineral resource. We have since commissioned a metallurgical test
program to simplify the flowsheet and reagent regime and to evaluate samples from the inferred mineral resource. The
simplified flowsheet will help to reduce the capital and operating
costs
for a given plant throughput and maximize the recovery
of all sulphide minerals to minimize environmental liabilities.
The objective of this metallurgical test program is to include
most of the mineral resource estimate in the next iteration of the mine plan," said Oliver Peters, Talon Metallurgist and
President of MetPro Management Inc. who started work on the Tamarack Project in 2016.
To view an enhanced version of
Figure 3
, please visit:
https://orders.newsfilecorp.com/files/2443/41001_db6a9a5c34e9d976_004full.jpg
Figure
3
: Long section (looking west) of the
Initial PEA
conceptual
mine plan development
and stopes in relation to the
wireframes for resource domains
"
By potentially adding the portion of the
mineral resource estimate
that is
currently excluded from the Initial PEA mine plan
,
we hope to
increase the production rate, mine life and consequently the Net Present Value (
"NPV"
) of the Tamarack Project,"
said Vince Conte, CFO of Talon.
"This work, if successful, will result in the publishing of an updated PEA."
Mineral Resource
On March 26, 2018, Talon published a technical report (the
"March 2018 Technical Report"
) that provided an updated
independent mineral resource estimate (effective date of February 15, 2018), which was used as the basis of the Initial PEA.
Table
1
: Tamarack North Resource Estimate: Effective February 15, 2018
Domain
Resource
Classification
Tonnes
(000)
Ni
(%)
Cu
(%)
Co
(%)
Pt
(g/t)
Pd
(g/t)
Au
(g/t)
*Calc
NiEq (%)
SMSU
Indicated
Resource
3,639
1.83
0.99
0.05
0.42
0.26
0.2
2.45
Total
Indicated
Resource
3,639
1.83
0.99
0.05
0.42
0.26
0.2
2.45
SMSU
Inferred
Resource
1,107
0.90
0.55
0.03
0.22
0.14
0.12
1.25
MSU
Inferred
Resource
570
5.86
2.46
0.12
0.68
0.51
0.25
7.24
138 Zone
Inferred
Resource
2,705
0.95
0.74
0.03
0.23
0.13
0.16
1.38
Total
Inferred
Resource
4,382
1.58
0.92
0.04
0.29
0.18
0.16
2.11
All resources reported at a 0.83% NiEq cut-off.
No modifying factors have been applied to the estimates.
Tonnage estimates are rounded to the nearest 1,000 tonnes.
Metallurgical recovery factored in to the reporting cut-off.
* NiEq% = Ni%+ Cu% x $3.00/$8.00 + Co% x $12.00/$8.00 + Pt [g/t]/31.103 x $1,300/$8.00/22.04 + Pd [g/t]/31.103 x
$700/$8.00/22.04 + Au [g/t]/31.103 x $1,200/$8.00/22.04.
Initial PEA Results
The basis of design of the Initial PEA, which was completed on a portion of the upper SMSU, the lower SMSU and the MSU are
summarized in Table 2 below. The Initial PEA is preliminary in nature.
The Initial PEA includes inferred mineral resources.
Inferred mineral resources are considered too speculative geologically to have economic considerations applied to them that
would enable them to be categorized as mineral reserves.
There is no certainty that the Initial PEA will be realized.
Table
2
: Basis of Design
: Initial PEA
*
No
Parameter
Description
1
Approach and Mandate
Implement Best Available Technologies to protect the environment
while creating a catalyst for establishing long-term, sustainable
industry
2
Mine Access Method
5 meter Diameter Shaft
3
Mine Methods
Transverse Drift-and-Fill (MSU) and Transverse Open Stoping (SMSU)
4
Type of Metallurgical Process
Bulk rougher and scavenger flotation followed by separate cleaning of
the rougher and scavenger concentrates
5
Separation of Tailings
Bulk scavenger tailings are treated in a desulphurization stage to
produce a low-mass high sulphur stream and high-mass low sulphur
tailings
6
Backfill
Cemented paste backfill in a primary-secondary sequence utilizing all
high sulphur and 37% of low sulphur tailings
7
Co-disposed Filtered Tailings Facility ("
CFTF
")
Filtered low sulphur tailings (at 80%-85% solids content) will be co-
disposed with waste rock in a lined surface facility. The liner system of
the facility will consist of a composite liner overlain by a drainage layer.
Contact water from the facility will be collected using a perimeter ditch
and conveyed to a water treatment plant. Upon closure, the CFTF will
be encapsulated by a composite cover.
8
Life of Mine ("LOM") Feed**
SMSU Indicated:
1.706 mt at 2.48% Ni, 1.22% Cu, 0.06% Co, 0.37 g/t
Pt, 0.25 g/t Pd, 0.18 g/t Au, 3.34%
NiEq
∆
SMSU Inferred:
0.175 mt at 2.50% Ni, 1.14% Cu, 0.06% Co, 0.30
g/t Pt, 0.22 g/t Pd, 0.14 g/t Au, 3.27% NiEq
∆
MSU Inferred:
0.506 mt at 5.35% Ni, 2.23% Cu, 0.11% Co, 0.63 g/t Pt,
0.47 g/t Pd, 0.23 g/t Au, 6.88% NiEq
∆
Total Inferred:
0.681mt at 4.62% Ni, 1.95% Cu, 0.10% Co, 0.54 g/t Pt,
0.40 g/t Pd, 0.21 g/t Au, 5.957 NiEq
∆
9
Mine life (excluding construction period)
7 years (6.4 years excluding partial years)
10
Mill Treatment Capacity
1,390 tpd
11
Ni Recovery to Ni Concentrate
85.0 % Ni
12
Cu Recovery to Cu Concentrate
84.4 % Cu
13
Overall Cu Recovery
94.5 % Cu
14
Ni Concentrate Grades
14.5 % Ni, 0.8 % Cu, 0.38 % Co
15
Cu Concentrate Grades
28.9 % Cu, 2.23 g/t Au
16
Ni Concentrate Production
79.5 ktpa (dry)
17
Cu Concentrate Production
18.3 ktpa (dry)
18
Payable Ni Production
23.3 million lbs per year; 127.5 million lbs over LOM
19
Payable Cu Production
11.1 million lbs per year; 66.8 million lbs over LOM
20
Revenue split
80% Ni, 16% Cu, 4% Co
21
Existing Project Infrastructure
Paved highway, grid power, railway line across site, port
22
Sustainable Development
There may be the potential for a solar garden on top of CFTF to
generate clean energy post-mining
* See Initial PEA for further details in respect of the above table
** Resources included in the Life of Mine Mill Feed were evaluated by calculating the NSR, using the following metal prices:
$6.75/lb Ni, $2.75/lb Cu, $20/lb Co, $1,100/oz Pt, $800/oz Pd and $1,200/oz Au. Relevant functions were applied such as metal
recovery curves, smelting and refining terms, transportation costs and State royalties.
The calculated NSR was then compared
to the operating cost per tonne to determine inclusion or exclusion of resource into the mine plan based on value addition or
destruction. These costs are US$117/tonne for the SMSU and US$157/tonne for the MSU.
∆
NiEq% = Ni%+ Cu% x $2.75/$6.75 + Co% x $20.00/$6.75 + Pt [g/t]/31.103 x $1,100/$6.75/22.04 + Pd [g/t]/31.103 x
$800/$6.75/22.04 + Au [g/t]/31.103 x $1,200/$6.75/22.04.
Capital and Operating Costs
Capital costs for the Tamarack North Project were estimated by DRA Americas for the mine, process and surface facilities, and
by Golder Associates Ltd. for the CFTF.
All cost estimates have been forecast in US dollars using constant, second quarter
2018 dollars, (i.e. in "real" dollars), without provision for inflation or escalation, and are subject to change if new information is
received or circumstances change.
The total estimated capital cost is US$182.51M (which includes an estimated US$10.0M mill salvage credit), of which
US$174.31M is the initial cost required during the first 2 years and 7 months prior to the start of production.
The amounts include
indirect costs and amounts for contingency.
Contingency varies by line item, averages 20% for the initial cost of the mine and
23.5% for the initial cost of the process and surface facilities, and totals US$29.38M.
Capital costs are detailed in the following table.
Table
3
:
Capital costs
U.S. dollars millions
Initial
capital
cost
Sustaining
capital cost
Total
Mine
72.44
21.38
93.83
Process and Surface Facilities
90.85
1.57
92.43
Sale of moveable equipment and mill at end of mine life
-
(10.00)
(10.00)
Closure costs
-
6.25
6.25
Working capital
11.01
(11.01)
-
Total*
174.31
8.20
182.51
* Totals may not add due to rounding
The average operating costs per tonne milled for the seven year mine life is US$118.23 per tonne milled and is detailed in the
table that follows.
Table
4
:
Operating cost per tonne
Mining
US$/tonne
$63.94
Processing
US$/tonne
$18.87
Product handling
US$/tonne
$22.92
CFTF
US$/tonne
$2.50
General and administrative
US$/tonne
$10.00
Total
US$/tonne
$118.23
C1 cash costs are US$2.20 per lb of payable nickel.
Capital intensity is $17,200 per annual tonne of payable nickel or
approximately $13,700 per annual tonne of payable nickel equivalent (excluding the impact of ramp-up/partial years in the first
and last year of the mine plan).
Economic Analysis
At base case metal prices, the Tamarack North Project has an after-tax NPV of US$210M using a discount rate of 7% and an
after-tax IRR of 39%. Payback from start of construction is 1.9 years on a pre-tax basis and 2.1 years after-tax.
All amounts are
in U.S. dollars.
The
Initial PEA
illustrates a high a
fter-tax IRR, low C1 cash costs, low capital intensity and a quick payback.
Metal prices used for the base case as well as for sensitivity cases are summarized in the tables that follow.
Base case prices
were based on analyst consensus long-term prices.
"Low" was used to estimate a pessimistic scenario.
Incentive pricing is
based on the price required to incentivize new mines to meet the projected increased demand for battery metals such as nickel
and cobalt during the next decade.
Table
5
:
Assumed
M
etal
P
rices
Unit
Low
Base case
Incentive pricing
Ni
US$/lb
$6.75
$8.00
$9.50
Cu
US$/lb
$2.75
$3.00
$3.25
Co
US$/lb
$20.00
$30.00
$40.00
Pt
US$/oz
$1,100
$1,100
$1,100
Pd
US$/oz
$800
$800
$800
Au
US$/oz
$1,200
$1,200
$1,200
After-tax and pre-tax NPV and IRR, C1 cash cost per pound of payable nickel and payback period from start of production in
years for each pricing scenario is summarized in the table that follows.
Table
6
: After-tax and Pre-tax NPV in US$ Millions, After-tax and Pre-tax IRR
,
C1 Cash Costs
and Payback Period
Using
Low,
Base Case and
Incentive
Metal Price Assumptions
After-tax
Pre-tax
Metal price scenario
Metal price scenario
Low
Base
Incentive
Low
Base
Incentive
Discount
rate
NPV 7%
130
210
287
163
261
354
NPV 8%
119
195
268
150
244
332
NPV 10%
98
168
234
127
212
292
IRR
27.9%
38.8%
48.3%
32.2%
44.6%
55.3%
C1 Cash Cost per lb of payable Ni
$2.47
$2.20
$1.93
$2.47
$2.20
$1.93
Payback from start of
production
in years
2.6
2.1
1.8
2.5
1.9
1.6
The sensitivity of the base case after-tax NPV and after-tax IRR was tested assuming changes in metal prices, operating costs,
grade and capital costs in a range of +/-30% around the base case as shown in the following two figures.
To view an enhanced version of
Figure 4
, please visit:
https://orders.newsfilecorp.com/files/2443/41001_db6a9a5c34e9d976_005full.jpg
Figure
4
: Sensitivity of Base Case after
-
tax NPV to changes in metal prices,
grade,
operating costs and capital costs
To view an enhanced version of
Figure 5
, please visit:
https://orders.newsfilecorp.com/files/2443/41001_db6a9a5c34e9d976_006full.jpg
Figure
5
:
Sensitivity of Base Case After
-
tax IRR to changes in metal prices,
grade,
operating costs and capital costs
Conclusions
and Recommendations
The present mine plan is based on a subset of the mineral resource estimate within the Tamarack Zone as outlined in Table 2,
which comprises a majority of the MSU, the lower SMSU and only a portion of the upper SMSU as further illustrated in Figure 3
above. The Initial PEA results are strong, yielding a 28% after-tax IRR using a nickel price of $6.75/lb and a copper price of
$2.75/lb. The base case after-tax IRR of 39% ranks amongst the best globally. The incentive pricing after-tax IRR is 48%.
There are several short-term opportunities to increase the Tamarack North Project NPV and therefore the following are
recommended:
Define a flowsheet and conditions capable of treating all of the MSU, SMSU, and 138 Zone mineralization while at the
same time simplifying the present flowsheet;
Increase the MSU mineral resource by exploring the open MSU extensions in the Tamarack Zone, the CGO Bend and
potential MSU mineralization in the 164 Zone through geophysical and drilling methods;
Use ore sorting to preconcentrate the MSU by separating sediment/MSU and CGO/MSU midlings;
Determine the optimal stope sizes in the SMSU;
Update the production schedule to maximize early cash flows while maintaining a consistent plant feed;
Consider the production of nickel and cobalt sulphates from sulphide concentrates in order to sell directly to battery
manufacturers.
The Company intends to complete a pre-feasibility study once, among other things, the extent of the mineralization that will be
accessed through, and processed by, the same surface infrastructure has been delineated.
The technical report referenced herein (the Initial PEA) will be filed on SEDAR (
www.sedar.com
) and on the Company's website
(
www.talonmetals.com
) within 45 days.
Quality Assurance, Quality Control and Qualified Persons
For the purposes of the Initial PEA and this press release, the Qualified Persons
("QP")
, as such term is defined in NI 43-101
are as follows:
The mineral resource estimate contained in this news release was prepared by or under the supervision of Mr. Brian Thomas
(P.Geo.), who is a geologist independent of Talon and an employee of Golder Associates Ltd.
In addition, Mr. Thomas has
reviewed the sampling, analytical and test data underlying such information and has visited the site and reviewed and verified
the QA/QC procedures used by Kennecott Exploration Company at the Tamarack North Project and found them to be consistent
with industry standards. In Golder's opinion, the mineral resource estimate disclosed herein has been prepared in accordance
with CIM best practice guidelines. For further detail please see the Technical Report entitled "Second Independent Technical
Report on the Tamarack North Project - Tamarack, Minnesota", dated March 26, 2018, authored by DRA, which is available
under the Company's issuer profile on SEDAR (
www.sedar.com
).
The mining method, including mine development, mine plan, mine capex and opex were developed by Mr. Daniel M. Gagnon, P.
Eng., Sr. Mining Engineer and VP Mining and Geology for DRA Americas and is independent of the Company.
The overall Initial PEA was compiled (with inputs from other QPs as indicated) by Mr. Tim Fletcher, P. Eng., a Senior Project
Manager with DRA Americas who is independent of the Company.
The economic analysis, including pre-tax and after-tax financial results and sensitivity analysis was completed Ms. Silvia Del
Carpio, P.Eng, MBA, Financial Analyst for DRA Americas a who is independent of the Company.
The conceptual design of the CFTF was completed by Mr. Kebreab Habte, P.Eng., a Senior Geotechnical Engineer with Golder
Associates Ltd. who is independent of the Company.
The requirements for the backfill paste recipe and underground distribution methodology were reviewed by Mr. Leslie Correia,
Pr. Eng., Engineering Manager for Paterson & Cooke Canada Inc.
The QP who contributed to the identification of, and preliminary estimate of cost for, environmental permitting as affects the
economic analysis presented in the Initial PEA referenced in this news release is Mr. Thomas Radue (P.E.), who is an engineer
independent of Talon and an employee of Barr Engineering Co. Mr. Radue has visited the site and reviewed and verified the
definition of additional baseline and detailed environmental study requirements used by Talon for the Tamarack North Project
and found it to be consistent with industry standards.
About Talon
Talon is a TSX-listed company focused on the exploration and development of the Tamarack Nickel-Copper-Cobalt Project in
Minnesota, USA (which comprises the Tamarack North Project and the Tamarack South Project). The Company has a well-
qualified exploration and mine management team with extensive experience in project management.
For additional information on Talon, please visit the Company's website at
www.talonmetals.com
or contact:
Sean Werger
President
Talon Metals Corp.
Tel: (416) 500-9891
Email:
Forward-Looking Statements
This news release contains certain "forward-looking statements". All statements, other than statements of historical fact that
address activities, events or developments that the Company believes, expects or anticipates will or may occur in the future are
forward-looking statements. These forward-looking statements reflect the current expectations or beliefs of the Company based
on information currently available to the Company. Such forward-looking statements include, among other things, statements
relating to the results of the Initial PEA with respect to estimates of mineral resource quantities, the mining method, the basis of
design of the Initial PEA, capital and operating costs, NPV, IRR, payback, cash costs, prospective drill targets, objectives in
respect of metallurgical testing, targets, goals, objectives and plans, including plans for follow-up exploration and metallurgical
test work and the timing thereof, the impact of adding other remaining mineral resources to the mine plan, the intent to prepare a
new PEA, as well as assumptions in respect of metal pricing.
Forward-looking statements are subject to significant risks and uncertainties and other factors that could cause the actual results
to differ materially from those discussed in the forward-looking statements, and even if such actual results are realized or
substantially realized, there can be no assurance that they will have the expected consequences to, or effects on the Company.
Factors that could cause actual results or events to differ materially from current expectations include, but are not limited to:
failure to establish estimated mineral resources, the grade, quality and recovery of mineral resources varying from estimates, the
uncertainties involved in interpreting drilling results and other geological data, inaccurate geological and metallurgical
assumptions, including with respect to the size, grade and recoverability of mineral reserves and resources, uncertainties
relating to the financing needed to further explore and develop the properties or to put a mine into production and other factors
including exploration, development and operating risks, uncertainties with economic estimates, capital and operating costs,
mine plan and development issues.
Any forward-looking statement speaks only as of the date on which it is made and, except as may be required by applicable
securities laws, the Company disclaims any intent or obligation to update any forward-looking statement, whether as a result of
new information, future events or results or otherwise. Although the Company believes that the assumptions inherent in the
forward-looking statements are reasonable, forward-looking statements are not guarantees of future performance and
accordingly undue reliance should not be put on such statements due to the inherent uncertainty therein.
The mineral resource figures disclosed in this news release are estimates and no assurances can be given that the indicated
levels of nickel, copper, cobalt, platinum, palladium and gold will be produced. Such estimates are expressions of judgment
based on knowledge, mining experience, analysis of drilling results and industry practices. Valid estimates made at a given time
may significantly change when new information becomes available. While the Company believes that the resource estimates
disclosed in this news release are accurate, by their nature resource estimates are imprecise and depend, to a certain extent,
upon statistical inferences which may ultimately prove unreliable. If such estimates are inaccurate or are reduced in the future,
this could have a material adverse impact on the Company.
Mineral resources are not mineral reserves and do not have
demonstrated economic viability. Inferred mineral resources are estimated on limited information not sufficient to verify
geological and grade continuity or to allow technical and economic parameters to be applied. Inferred mineral resources are too
speculative geologically to have economic considerations applied to them to enable them to be categorized as mineral
reserves. There is no certainty that mineral resources can be upgraded to mineral reserves through continued exploration.
Annex A
Table
A-
1:
Assay Results of Historical
Drill Hole
Intercepts Pertinent to the
Explanation
of the
Exploration Potential in the 138 Zone and the 164 Zone
To view an enhanced version of
Table A-1
, please visit:
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