Ecuador court gives green light for Silvercorp, Salazar’s El Domo project
The ruling removes the last major obstacle for the $250 million project, located 150 km northeast of Guayaquil.
NorZinc Ltd. (TSX: NZC) has released a new, positive preliminary economic assessment (PEA) for its 100%-owned Prairie Creek zinc-lead-silver project 200 km west of Fort Simpson in the Northwest Territories. The PEA uses an updated resource estimate, a higher mining rate of 2,400 t/d, and a mine plan with a life 20.3 years. Initial capex is pegged at $368 million.
Resources were calculated for the Main Quartz zone, stockwork and stratabound massive sulphides. Together they have measured and indicated resources of 9.8 million tonnes grading 139 ppm silver, 8.8% lead and 9.7% zinc (22.7% zinc-equivalent). The inferred resource is 6.4 million tonnes grading 150 ppm silver, 6.7% lead and 12.9% zinc (24.1% zinc-equivalent).
The PEA outlines a majorly de-risked project with world class potential, says NorZinc. The after-tax net present value with an 8% discount is $299 million and an after-tax internal rate of return of 17.7%.
With an initial capex of $368 million (including $35 million contingency), the study outlines total direct costs of $251 million (mining $51 million, site preparation $1 million, processing plant $41 million, paste tailings plant $28 million, surface infrastructure $41 million, and all-season road $89 million). There are also indirect costs and owner’s costs totalling $82 million.
The Prairie Creek mine would have a life of 20.3 years with a payback of 4.8 years. Average annual payable production would be 2.6 million oz. of silver, 122 million lb. of zinc, and 101 million lb. of lead. Sustaining and closure costs are pegged at $332 million.
The PEA was prepared using a silver price of $24 per oz., a zinc price of $1.20 per lb., and a lead price of $1.05 per lb.
NorZinc said it is beginning work on the feasibility study immediately to examine ways to improve capital and operating costs. Talks are underway for concentrate offtake agreements.
Mine operating permits were received from the MacKenzie Valley Land and Water Board in 2013 and renewed in 2020. Modifications have been made to the application to reflect the higher mining rate, but the final permits are expected by the end of March 2022.
(This article first appeared in the Canadian Mining Journal)
