| Mon 2 Sep 2019, 8:02 | | EUROPA METALS LIMITED - EUZ : Hole TOD-023D Successfully Completed at the Toral Zn, Pb & Ag Project, Spain: 2. Target high grade areas within the defined resource to further the Company's understanding of the project, |
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EUZ : Hole TOD-023D Successfully Completed at the Toral Zn, Pb & Ag Project, Spain: 2. Target high grade areas within the defined resource to further the Company's understanding of the project,
with the aim of increasing confidence in the resource estimate to delineate a portion of the deposit into
the Indicated resource category; and
3. Obtain a significant sample for metallurgical testwork by independent consultants to determine the
potential Zn, Pb and Ag concentrate composition from Toral. This sample will provide additional data to
assist process plant design and discussions with potential offtake parties.
Rig mobilisation
The rig and associated operating crew was supplied by Sondeos y Perforaciones Industriales de Bierzo SA
and was overseen by the Company's on-site exploration team. The campaign was conducted using a single
drilling rig with assays sent for independent analysis on a rolling basis.
Addison Mining Services Limited ("AMS") has been retained to carry out a revised independent resource
update in accordance with JORC (2012) following completion of the campaign has been concluded.
Wardell Armstrong LLP has been engaged to conduct the metallurgical testwork from a representative sample
taken from the drilling.
Economic highlights from selected conceptual development scenario
Estimated economic forecasts for Toral based on the current level of work (+/-30%) from the December 2018
Scoping Study comprise:
* US$110 million net present value (NPV) using a discount rate of 8%;
* 24.4% internal rate of return (IRR);
* Estimated US$33 million CAPEX for a proposed 450ktpa design capacity plant, including associated
auxiliary costs, with infrastructure being situated near portal entrance on the north side of the deposit;
* Estimated total CAPEX of US$110 million;
* US$25 per tonne indicative OPEX processing cost at steady state conditions;
* US$36 per tonne indicative OPEX mining cost utilising mechanised cut and fill; and
* 15-year production plan, with significant potential for extension.
Basis for announcing economics
The factors that lead the Company to believe that it has a reasonable basis for announcing a production target
and forecast financial information are detailed in the Scoping Study and can be summarised as follows:
Three conceptual underground mining development and production scenarios were considered and developed
throughout the Scoping Study, resulting in the identification of a preferred scenario, highlights from which are
set out below:
* decline ramp access to the north of the deposit, targeting mine production within the higher-grade core
towards the centre of the planned mining blocks;
* entry to mine via a principal decline reaching various levels;
* series of internal mining inclined ramps constructed to access levels;
* mechanised cut and fill (MCAF) mining method proposed;
* 4x4 metre mine standard development size;
* a ventilation raise would be drilled (raise-bored) to provide both adequate ambient conditions;
underground and a second, emergency means of access/egress into the mine;
* ore transported to a flotation process plant by conveyor or haul truck from the mine and crushed to a
suitable product for milling;
* milled ore floated by standard flotation technology to provide lead and zinc concentrate, with silver
probably reporting to the lead concentrate for sale as a combined product; and
* 4% Zn Eq cut-off used with potential for mine life extension.
JORC (2012) resource estimate
The Scoping Study was based on a previously announced JORC (2012) resource estimate comprising 16
million tonnes in the Inferred category @ 7.5% Zn equivalent (Pb, Ag), 3.9% zinc, 3.1% lead and 24g/t silver
equating to 640,000 tonnes of zinc, 510,000 tonnes of lead and 13 million ounces of silver*.
Cut-off Contained Contained
Ag Troy
Tonnes Zn Eq Zn Eq Zn Pb Ag Zn Pb
Density g/cm3 Oz
4% Zn Eq (Millions) (Pb)% (PbAg)% % % g/t Tonnes Tonnes
(Millions)
(PbAg)% (000s) (000s)
December
2018 16 2.8 7 7.5 3.9 3.1 24 640 510 13
Resource
*Zn Eq (PbAg)% is the calculated Zn equivalent incorporating silver credits as well as lead; (Zn Eq (PbAg)%
= Zn + Pb*0.96 + Ag*0.022). Zn equivalent calculations were based on 3-year trailing average price statistics
obtained from the London Metal Exchange and London Bullion Market Association giving an average Zn price
of US$2,500/t, Pb price of US$2,100/t and Ag price of US$17/oz. Announced on 10 December 2018.
United Kingdom
2 September 2019
Date: 02/09/2019 08:00:00
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