TNR Gold NSR Royalty Update - Los Azules Copper, Gold and Silver Project – McEwen Copper Reports Improved Copper Recovery
NEWS RELEASE
TNR Gold NSR Royalty Update - Los Azules Copper, Gold and
Silver Project – McEwen Copper Reports Improved Copper
Recovery
Vancouver, British Columbia – February 28, 2023: TNR Gold Corp. (TSX-V: TNR) (“TNR”, “TNR
Gold” or the “ Company”) is pleased to announce that McEwen Mining Inc. (“ McEwen Mining”) has
provided an update on the Los Azules copper, gold and silver project in San Juan, Argentina. TNR holds
a 0.4% net smelter returns royalty (“NSR Royalty”) (of which 0.04% of the 0.4% NSR Royalty is held on
behalf of a shareholder) on the Los Azules Copper Project. The Los Azules project is held by McEwen
Copper Inc. (“McEwen Copper”), a subsidiary of McEwen Mining.
The news release issued by McEwen Mining on February 22, 2024 stated:
“McEwen Copper Inc., 47.7% owned by McEwen Mining Inc. (NYSE: MUX) (TSX: MUX), is
pleased to announce results from the recently completed Phase 1 copper heap leaching
metallurgical tests undertaken at SGS Chile Limitada in Santiago, Chile. The test results were
produced utilizing conventional bio -heap leaching technology and genera ted an average
copper recovery of 76.0%. This represents an increase of 3.2% over the recovery rate used in
the June 2023 Preliminary Economic Assessment (PEA) for Los Azules. These test results
were reviewed by Jim Sorensen and Michael McGlynn at Samuel Engineering Inc., who are
responsible for the development and oversight of the metallurgical programs.
Metallurgical Testing Delivers a 3.2% Increase in Predicted Copper Recovery at Los Azules
Phase 1 Results
Based on the Phase 1 test results available at the time and prior historical column test work,
the PEA used an average copper recovery of 72.8% by employing conventional bio -heap
leaching technology (see results published June 20, 2023). Final results of Phase 1 show an
increase in the average recovery to 76.0% in approximately 230 days of leaching over the
planned 27-year life of the project. Average net acid consumption was also reduced by 8.3%
relative to the PEA.
The potential impact of the 3.2% increase in average recovery and 8.3% reduction in net acid
consumption can be illustrated by selectively adjusting the PEA Base Case financial model,
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which results in a life of mine copper cathode production increase of 172,000 tonnes and an
after-tax NPV(8%) increase of approximately $262 million. This disclosure should not be
taken to modify or update the conclusions of the PEA.
Deposit Mineralogy
Located in San Juan, Argentina, the Los Azules deposit consists primarily of secondary copper
mineralization (supergene zone of predominantly chalcocite), with minimal oxide copper
content. Additionally, there is a deeper primary copper (hypogene zone of p redominantly
chalcopyrite with some zones of significant bornite).
Metallurgical Testing Phases
Preliminary results from the Phase 1 program along with historical metallurgical testing at Los
Azules were used to support the 2023 Preliminary Economic Assessment (PEA), which
proposed an environmentally friendly heap leach alternative to a conventional copper
concentrator. The testing program is now advancing with two additional phases (2 & 3)
currently underway to support the Feasibility Study (FS). Drilling activities related to the current
study work started in 2021 and are continuing into 2024. The leach testing protocols are based
on conventional bio -leaching methods used extensively in commercial applications for
supergene copper mineralization. The current phases, 2 & 3, are being conducted at SGS
Chile and Alfred H. Knight (ASMIN Industrial Limitada) laboratories, both located in Santiago,
Chile.
The Phase 1 program was initiated using drill core from drilling programs completed prior to
2021, but not older than 2015, for a total of 21 column tests. Started in 2022, Phase 1 has now
been completed and final results received. Preliminary results of this work and prior historical
leach testing information were used for the PEA metallurgical assumptions.
The Phase 2 program utilizes drill core from the 2022-2023 drilling campaign and focuses on
deposit-wide variability testing, leaching protocol optimization and scalability. A total of 34
column tests are in progress, with results expected in Q2 2024.
The Phase 3 program is also started, utilizing additional drill core material from the ongoing
2023-2024 drilling program. Phase 3 testing is focusing on the material of the initial 5 -year
mine plan, as delineated in the PEA. A total of 33 additional column tests are planned as part
of this final confirmatory testing program, with results anticipated in Q4 2024.
The combined metallurgical programs comprise a total of 88 column tests to be used for the
FS metallurgical design basis and geo-metallurgical model.
Copper assaying is conducted using a sequential method to determine the relative amounts of
acid soluble (CuAS) and cyanide soluble (CuCN) copper mineralization (oxides and secondary
sulfides). When combined, these two partial assay methods are generally c onsidered readily
soluble copper (CuSOL), extractable with conventional heap leaching technologies. Copper
assayed that does not report to these two partial assay methods is classified as residual copper
(CuRES) and is considered copper that requires additional time or is potentially not recoverable
with conventional heap leaching technologies.
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The finalized results from the Phase 1 metallurgy program for tests completed at minus ½" and
¾" crush sizes confirmed that soluble copper (CuSOL) component recovery is 100% for all
leachable resources. The information in Figure 1 below shows the minus ¾" (19 mm) test
results. The PEA envisions a minus ¾" crush size for the heap leaching feed in the commercial
application.
Figure 1 – Soluble Copper Recovery Kinetics
The recovery results for the residual copper (CuRES) component shown in Figure 2 indicated
an average recovery of 25%, an increase of 10% from the 15% preliminary recovery
assumption used in the PEA. The additional residual copper recovery when applied to the
entire resource increases the overall average recovery from 72.8% to 76.0%.
Figure 2 – Residual Copper Recovery Kinetics
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Figure 3 below illustrates the increase in potential copper production throughout the mine life,
attributable to the improved recovery, in comparison with the PEA assumptions. The initial two
production years do not show additional recovered copper, as the design capacity of the
electrowinning plant considered in the PEA is fully utilized.
Figure 3 – Copper Cathode Production (PEA & Revised Model)
The sulfuric acid consumption has also been updated with the Phase 1 final results. The
averaged net sulfuric acid consumption reported in the PEA was 18 kilograms per ton of ore
processed. The finalized Phase 1 testing now indicates a reduction of 8.3% to 16.5 kilograms
per ton. The primary reason for the reduction of acid consumption is minimizing excess acid in
the leaching solutions and operating the columns at a pH closer to 2.0 pH than the historic
column work at 1.2 pH, which minimizes acid consumption by excess unmineralized gangue
material dissolution. This lowered acid requirement may also improve the project economics,
both NPV and IRR, by reducing the operating costs for copper produced and incr easing
revenue from the same tonnes mined.
Bioleaching Summary
Copper bioleaching has been a commercially applied technology at altitudes similar to the Los
Azules site and as much as 1,000 meters higher for several decades, in multiple locations
around the world. Testing is conducted in conventional leach test column s by inoculation of
the columns with naturally occurring bacterial ferrooxidans and thiooxidans prior to introduction
of the leach solution. Bacterial cultures for the inoculum were sourced from the testing
laboratories and adapted to the Los Azules leach material. Ferrooxidans convert the ferrous
iron in solution to ferric iron, while thiooxidans convert the sulfur produced in the copper sulfide
leaching activity to sulfuric acid/sulfate. Ferric iron is the key chemical component necessary
for leaching of copper sulfide material. Bioactivity in the tests is monitored by measurement of
the ferrous/ferric ratios and electrochemical oxidation potential in the leaching solutions.
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ABOUT MCEWEN COPPER
McEwen Copper is a well-funded, private company which owns 100% of the large, advanced-
stage Los Azules copper project, located in the San Juan province, Argentina. McEwen Copper
is a 47.7% owned private subsidiary of McEwen Mining, which is listed on NYSE and TSX
under the ticker MUX.
Los Azules is being designed to be distinctly different from conventional copper mines,
consuming significantly less water, emitting much lower carbon levels and progressing to be
carbon neutral by 2038, being powered by 100% renewable energy once in opera tion. The
project’s recently updated Preliminary Economic Assessment (PEA) projects a long life of
mine, low production costs per pound, a short payback period, high annual copper production,
and an after-tax IRR of 21.1%.
ABOUT MCEWEN MINING
McEwen Mining is a gold and silver producer with operations in Nevada, Canada, Mexico and
Argentina. In addition, it owns approximately 47.7% of McEwen Copper, which owns the large,
advanced stage Los Azules copper project in Argentina. The Company’s goal is to improve the
productivity and life of its assets with the objective of increasing the share price and providing
a yield. Rob McEwen, Chairman and Chief Owner, has a personal investment in the company
of US$220 million. His annual salary is US$1.”
The McEwen Mining press release appears to be reviewed and verified by a Qualified Person (as that
term is defined by National Instrument 43 -101 – Standards of Disclosure for Mineral Projects ) and the
procedures, methodology and key assumptions disclosed therein are those adopted and consistently
applied in the mining industry, but no Qualified Person engaged by TNR has done sufficient work to
analyze, interpret, classify or verify McEwen Mini ng’s information to determine the current mineral
resource or other information referred to in its press releases. Accordingly, the reader is cautioned in
placing any reliance on the disclosures therein.
“We are pleased that significant developments on the advancement of the Los Azules Copper Project
towards feasibility have led to the increased Stellantis holdings in McEwen Copper as a strategic partner
of this large copper, gold and silver project. In February 2023, Stellantis invested ARS $30 billion, and
with additional investment of ARS $42 billion made after the new preliminary economic assessment
(PEA) publication, has a total investment of ARS $72 billion. An aggregate of US $65 million in McEwen
Copper was also invested by Rio Tinto's Venture Nuton in 2022 and 2023,” stated Kirill Klip, TNR’s Chief
Executive Officer. “TNR Gold's vision is aligned with the leaders of innovation among automakers like
Stellantis, whose aim is decarbonizing mobility, and mining industry leaders such as Rob McEwen, whose
vision is ‘to build a mine for the future, based on regenerative principles that can achieve net zero carbon
emissions by 2038’.
“The green energy rEVolution relies on the supply of critical metals like copper; delivering "green copper"
to Argentina and the world will contribute to the clean energy transition and electrification of transportation
and energy industries.
“Strong team performance is accelerating the McEwen Copper Los Azules program. The Los Azules
Project PEA results highlighted the potential to create very robust leach project, while reducing
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environmental footprint, and greater environmental and social stewardship sets the Project apart from
other potential mine developments.
“It’s also very encouraging to see an updated independent mineral resource estimate that has increased
significantly.
“Together with Nuton, McEwen Copper is exploring new technologies that save energy, water, time and
capital, advancing Los Azules towards the goal of the leading environmental performance. The
involvement of Rio Tinto with its innovative technology, may also accelerate realizing the enormous
potential of the Los Azules Project.
“Los Azules was ranked in the top 10 largest undeveloped copper deposits in the world by Mining
Intelligence (2022). TNR Gold does not have to contribute any capital for the development of the Los
Azules Project. The essence of our business model is to have industry leaders like McEwen Mining as
operators on the projects that will potentially generate royalty cashflows to contribute significant value for
our shareholders.”
ABOUT TNR GOLD CORP.
TNR Gold Corp. is working to become the green energy metals royalty and gold company.
Our business model provides a unique entry point in the creation of supply chains for critical materials
like energy metals that are powering the energy rEVolution, and the gold industry that is providing a
hedge for this stage of the economic cycle.
Our portfolio provides a unique combination of assets with exposure to multiple aspects of the mining
cycle: the power of blue-sky discovery and important partnerships with industry leaders as operators on
the projects that have the potential to generate royalty cashflows that will contribute significant value for
our shareholders.
Over the past twenty-eight years, TNR, through its lead generator business model, has been successful
in generating high -quality global exploration projects. With the Company’s expertise, resources and
industry network, the potential of the Mariana Lithium Project and Los Azules Copper Project in Argentina
among many others have been recognized.
TNR holds a 1.5% NSR Royalty on the Mariana Lithium Project in Argentina, of which 0.15% NSR royalty
is held on behalf of a shareholder. Ganfeng Lithium’s subsidiary, Litio Minera Argentina (“LMA”), has the
right to repurchase 1.0% of the NSR royalty on the Mariana Project, of which 0.9% is the Company’s
NSR Royalty interest. The Company would receive CAN$900,000 and its shareholder would receive
CAN$100,000 on the repurchase by LMA, resulting in TNR holding a 0.45% NSR royalty and its
shareholder holding a 0.05% NSR royalty.
The Mariana Lithium Project is 100% owned by Ganfeng Lithium. The Mariana Lithium Project has been
approved by the Argentina provincial government of Salta for an environmental impact report, and the
construction of a 20,000 tons-per-annum lithium chloride plant has commenced.
TNR Gold also holds a 0.4% NSR Royalty on the Los Azules Copper Project, of which 0.04% of the 0.4%
NSR royalty is held on behalf of a shareholder . The Los Azules Copper Project is being developed by
McEwen Mining.
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TNR also holds a 7% net profits royalty holding on the Batidero I and II properties of the Josemaria Project
that is being developed by Lundin Mining. Lundin Mining is part of the Lundin Group, a portfolio of
companies producing a variety of commodities in several countries worldwide.
TNR provides significant exposure to gold through its 90% holding in the Shotgun Gold porphyry project
in Alaska. The project is located in Southwestern Alaska near the Donlin Gold project, which is being
developed by Barrick Gold and Novagold Resources. T he Company’s strategy with the Shotgun Gold
Project is to attract a joint venture partnership with a major gold mining company. The Company is
actively introducing the project to interested parties.
At its core, TNR provides a wide scope of exposure to gold, copper, silver and lithium through its holdings
in Alaska (the Shotgun Gold porphyry project) and royalty holdings in Argentina (the Mariana Lithium
project, the Los Azules Copper Project and the Batidero I & II properties of the Josemaria Project), and
is committed to the continued generation of in -demand projects, while diversifying its markets and
building shareholder value.
On behalf of the Board of Directors,
Kirill Klip
Executive Chairman
www.tnrgoldcorp.com
For further information concerning this news release please contact Kirill Klip +1 604-229-8129
Neither 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.
Cautionary Statement Regarding Forward-Looking Information
Except for statements of historical fact, this news release contains certain “forward -looking information”
within the meaning of applicable securities law. Forward -looking information is frequently characterized
by words such as “plan”, “expect”, “project”, “intend”, “believe”, “anticipate”, “estimate”, “will”, “could” and
other similar words, or statements that certain events or conditions “may” or “could” occur, although not
all forward-looking statements contain these identifying words. Specifically, for ward-looking statements
in this news release include, but are not limited to, statements made in relation to: TNR’s corporate
objectives, and future potential transactions being considered by the Special Committee and the Board.
Such forward-looking information is based on a number of assumptions and subject to a variety of risks
and uncertainties, including but not limited to those discussed in the sections entitled “Risks” and
“Forward-Looking Statements” in the Company’s inte rim and annual Management’s D iscussion and
Analysis which are available under the Company’s SEDAR+ profile on www.sedarplus.ca. While
management believes that the assumptions made and reflected in this news release are reasonable,
should one or more of the risks, uncertainties or other factors materialize, or should underlying
assumptions prove incorrect, actual results may vary materially from those described in forward-looking
information. In particular, there can be no assurance that: TNR will enter into one or more strategic
transactions, partnership or a spin-out, or be able to complete any further royalty acquisitions or sales of
royalty interests, or portions thereof; debt or equity financings will be available to TNR; or that TNR will
be able to achieve any of its corporate objectives. TNR relies on the confirmation of its ownership for
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mining claims from the appropriate government agencies when paying rental payments for such mining
claims requested by these agencies. There could be a risk in the future of the changing internal policies
of such government agencies or risk related to the third parties, in future, challenging the ownership of
such mining claims. Given these uncertainties, readers are cautioned that forward -looking statements
included herein are not guarantees of future performance, and such forward-looking statements should
not be unduly relied on.
In formulating the forward-looking statements contained herein, management has assumed that business
and economic conditions affecting TNR and its royalty partners, McEwen Mining Inc. , Ganfeng Lithium
and Lundin Mining will continue substantially in the ordinary course, including without limitation with
respect to general industry conditions, general levels of economic activity and regulations. These
assumptions, although considered reasonable by management at the time of preparation, may prove to
be incorrect.
Forward-looking information herein and all subsequent written and oral forward -looking information are
based on estimates and opinions of management on the dates they are made and are expressly qualified
in their entirety by this cautionary statement. Exce pt as required by law, the Company assumes no
obligation to update forward -looking information should circumstances or management’s estimates or
opinions change.