The Globe and Mail

Go to the Globe and Mail homepage

Jump to main navigationJump to main content

Press release from CNW Group

Curis to file Prefeasibility Study technical report & announces further development case scenarios for its Florence Copper Project

Tuesday, March 26, 2013

Curis to file Prefeasibility Study technical report & announces further development case scenarios for its Florence Copper Project08:30 EDT Tuesday, March 26, 2013VANCOUVER, March 26, 2013 /CNW/ - Curis Resources Ltd. ("Curis" or the "Company") announces that it will file the technical report for the Prefeasibility Study (PFS) on its Florence Copper Project in central Arizona, USA, on March 28, 2013.  The PFS projects low capital and operating costs and favorable economic potential for the Florence in-situ copper recovery operation.Results for the base case, utilizing a 70% copper recovery were announced on February 13, 2013.  This release provides further insight into two other important operating and capital cost reviews recently completed for 63% and 75% copper recoveries.  Positive economics are indicated in all cases as summarized in the table below.  Category Copper Recovery Sensitivity63%70%*75%Years of Commercial Production232526Years of Production on Arizona State Land121313Total Copper Produced (lb)1,510,000,0001,695,000,0001,830,000,000Initial Capital Costs ($)217 million208 million204 millionPayback of Capital (post-tax)3.2 years3.0 years2.9 yearsLife of Mine Direct Operating Cost ($/lb Cu Recovered)0.830.800.77Long term Copper Price ($)2.75/lb3.00/lb2.75/lb3.00/lb2.75/lb3.00/lbLife of Mine Total Production Cost ($/lb Cu Recovered) Net Present Value (NPV) at 7.5% discount ($)643 million757 million727 million849 million796 million922 millionPost-tax NPV at 7.5% discount ($)440 million518 million503 million585 million552 million638 millionInternal Rate of Return (pre-tax/post-tax)34% / 28%36% / 29%36% / 29%38% / 31%38% / 31%40% / 33%All results are presented in US currency.Both $2.75/lb and $3.00/lb copper price scenarios use a $3.50/lb price during the first 3 years of production.Capital costs include an average contingency of 20% percent, to which $11.3 million was added to cover the contingency that collar casingwould be required in the first year of well installation."These engineering evaluations illustrate the robustness of the project under changing economic and operating parameters, confirming both the economic and technical viability and the significant near term development opportunity associated with the Florence Copper Project" said Michael McPhie, President and CEO of Curis Resources Ltd.* In finalizing the results, it was recognized that pre-production costs associated with developing a production-grade pregnant leach solution would have to be included in the initial capital cost.  As a result, estimated initial capital cost has increased to $208 million for the base case from the estimated $196 million announced on February 13, 2013; the IRR at $2.75/lb copper decreased slightly to 29%; and adjustments in operating cost, total production cost, operating income and net cash flow after tax are less than 1%.The following are some key aspects and development plans included in the current PFS.An extraction plan that utilizes existing facilities and locates the well field,  copper processing plant, water management facilities and related infrastructure on the 160-acre ASLD lease area controlled by Curis for the first 9 years of operations.An annual production scenario averaging 55 million pounds of copper cathode for years 1 through 6, optimum production averaging 85 million pounds of copper cathode during years 7 through 21, and a decline thereafter.Copper recovery estimates based on metallurgical testwork undertaken by Metcon Research of Tucson, Arizona and supervised by Dr. Terence McNulty, PE, of T.P. McNulty and Associates, Inc. of Tucson, Arizona (see Curis News Release dated January 7, 2013).The results include costs relating to project site reclamation and water treatment.The study is based on 339,953,000 tons of probable mineral reserves grading 0.358% TCu at a cutoff grade of 0.05% TCu (see Curis News Release dated February 13, 2013).The PFS report is authored by M3 Engineering & Technology Corp. (U.S.), with input from a number of other specialized and experienced consulting and advisory firms in the areas of hydrology, geology, in-situ extraction, oxide metallurgy and cultural resources.  Independent qualified persons include Richard Zimmerman, RM-SME, of M3, and Dr. Terence McNulty, PE, of TP McNulty and Associates, who have reviewed this release.The Florence Copper ProjectThe Florence Copper Project is an advanced-stage copper development project located in central Arizona, and owned 100% by Curis. The project site hosts a shallowly buried porphyry copper deposit with a significant oxide mineral resource that is amenable to in-situ copper recovery and industry-standard solvent extraction and electrowinning (SX-EW) copper production. The Florence deposit was advanced to a prefeasibility study level of assessment and achieved full project permits when owned by BHP Copper (BHP) in the late 1990s.  Since acquiring the project in 2009, Curis and its consultants have advanced technical studies, culminating in the completion of the current PFS, as well as amending and updating the operational permits for the project through a well-defined and time-limited amendment process.Project Status and Near Term Development PlanCuris is awaiting approval from the Environmental Protection Agency (EPA) for an Underground Injection Control (UIC) permit for the Florence Copper Project Phase 1 Production Test Facility (PTF), and once received, and after completion of the administrative review process relating to the Aquifer Protection Permit issued by the Arizona Department of Environmental Quality (ADEQ), the Company plans to initiate formal construction and operations of the Phase 1 PTF.About CurisCuris Resources Ltd. is a mineral development company associated with Hunter Dickinson Inc., a diversified global mining company with a 25-year history of mineral development success.  Curis is focused on the acquisition, development and operation of high-quality next-generation copper properties in progressive jurisdictions around the world.  It is currently focused on advancing its 100% owned Florence Copper Project in Arizona, USA to near-term production.For more project-level information, sign up to receive News and Updates from the Florence Copper website.Michael McPhiePresident & CEONo regulatory authority has approved or disapproved of the information contained in this news release.CAUTION REGARDING FORWARD-LOOKING INFORMATIONThis release includes certain statements that may be deemed "forward-looking statements". All statements in this release, other than statements of historical facts, that address exploration drilling, test results, exploitation activities and events or developments that the Company expects to occur, are forward-looking statements. Although the Company believes that the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in the forward-looking statements.  Forward-looking statements are subject to known and unknown risks, uncertainties and other factors that may cause the Company's actual results, level of activity, performance or achievements to be materially different from those expressed or implied by such forward-looking statements. These include but are not limited to:uncertainties and costs related to the Company's exploration and development activities, such as those associated with continuity of mineralization, or determining whether mineral resources or reserves exist on a property;uncertainties related to the accuracy of our estimates of mineral reserves, mineral resources; expected production rates, the timing of expected production,  the geotechnical or hydrological nature of mineral deposits, and diminishing quantities or grades of mineral resources;uncertainties related to the ability to obtain necessary environmental, land use, and other licenses, permits, approvals, surface rights and title for development projects and delays due to third party opposition;uncertainties and delays related to judicial or regulatory proceedings; changes in, and the effects of, laws, regulations and government policies affecting our exploration, development and mining operations, particularly laws, regulations and policies in jurisdictions in which our projects are located, relating to environmental protection and associated compliance costs, land use, effective future tax rates, the protection of the health and safety of mine workers, and mineral rights ownership;changes in general economic, market or business conditions, the financial markets and in the demand and market price for copper, gold, and other minerals and commodities, such as diesel fuel, steel, concrete, electricity and other forms of energy, mining equipment, and fluctuations in exchange rates, particularly with respect to the value of the U.S. dollar and Canadian dollar, and the continued availability of capital and financing on terms acceptable to the Company;the ability of the Company to achieve fulfillment of all conditions for drawdown under its loan agreement with RK Mine Finance Trust I;the risk of inadequate insurance or inability to obtain insurance to cover all risks associated with the exploration, development or mining of the Company's projects;the risk of loss of key employees;changes in accounting policies and methods we use to report our financial condition, including uncertainties associated with critical accounting assumptions and estimates;environmental issues and liabilities associated with mining including processing ore; andlabour strikes, work stoppages, or other interruptions to, or difficulties in, the employment of labour in markets in which we operate mineral projects or mines, or environmental hazards, industrial accidents or other events or occurrences, including third party interference that interrupt the production of minerals in our mines.Investors are cautioned that any such statements are not guarantees of future performance and actual results or developments may differ materially from those projected in the forward-looking statements. For more information on the Company, a more detailed description of the assumptions used to develop the forward-looking statements and the risk factors that may cause actual results to differ materially from forward-looking statements, investors should review the Company's continuous disclosure filings, copies of which are available at Note to U.S. Investors Concerning Reserve EstimatesThe mineral reserves disclosed in this news release have been estimated in accordance with Canadian National Instrument 43-101 - Standards of Disclosure for Mineral Projects ("NI 43-101"), as required by Canadian securities regulatory authorities. The Company is not subject to the reporting requirements of section 13(a) of section 15(d) of the United States Securities Exchange Act of 1934, as amended (the "Exchange Act").  However, the Company's U.S. investors are cautioned that SEC Industry Guide 7 under the Exchange Act, as interpreted by Staff of the SEC, applies different standards in order to classify mineralization as a reserve.  As a result, the definitions of proven and probable reserves used in NI 43-101 differ from the definitions in the SEC Industry Guide 7.  Under SEC standards, mineralization may not be classified as a "reserve" unless the determination has been made that the mineralization could be economically and legally produced or extracted at the time the reserve determination is made.  Among other things, all necessary permits would be required to be in hand or issuance imminent in order to classify mineralized material as reserves under the SEC standards.  Accordingly, mineral reserve estimates contained in this news release may not qualify as "reserves" under SEC standards.  In addition, disclosure of "contained ounces" is permitted disclosure under Canadian regulations; however, the SEC only permits Exchange Act reporting companies to report reserves in ounces, and requires reporting of mineralization that does not qualify as reserves as in place tonnage and grade without reference to unit measures.SOURCE: Curis Resources Ltd.For further information: Susie Bell Manager, Investor Relations Tel: 604-684-6365 Email: