Nevada Copper files Pumpkin Hollow open pit prefeasibility study

The technical report describes the Pumpkin Hollow property and its advancement based on a phased development approach of the underground and open pit deposits as stand-alone projects. The technical report includes a prefeasibility study for the stand-alone underground project initially completed in 2017, and a newly completed prefeasibility study for the open pit project at Pumpkin Hollow. The underground project is currently in construction, with initial production forecast for the end of 2019, while the open pit project is in a study phase of development. Development options and timing of the open pit project construction and operations remain flexible.

The open pit PFS demonstrates enhanced economics for Nevada Copper’s open pit project as Nevada Copper continues to advance the open pit project towards an ultimate construction decision. The open pit PFS continues to apply the company’s philosophy of phased development and low-capital intensity growth. The open pit project has all the material permits required for mine construction and operations.

Open pit PFS highlights

• Further improved project economics versus previous studies:
  ° Project IRR increased to 23% pre-tax (21% post-tax)
  ° NPV7.5% of $1,042 million pre-tax ($829 million post-tax)
  ° EBITDA C$252 million per annum life of mine average (excluding ramp-up period)
  ° Peak annual copper production of 111,000 tonnes (244Mlbs)
  ° Copper grades of 0.69% CuEq over first five years
  ° C1 Cash Costs of $1.73/lb net of byproduct credits
  ° Continued focus on low operational risk, including traditional mining methods and dry stack tailings
  ° Life of mine over 19 years
• Demonstrated scope for deposit expansion:
  ° The 2018 drilling has successfully extended the deposit, to the north and west
  ° Open pit inferred resources have increased as a result of the new resource estimate
  ° As previously announced in connection with the 2019 exploration program, further drilling is planned to test the full extent of the open pit deposit and to seek to upgrade inferred resources for inclusion in the open pit mine plan
• Favorable upfront cost, simplified build and phased expansion:
  ° Initial capex of $672 million
  ° Low capital intensity of $9,544/annual tonne CuEq production
  ° Phased production growth comprising an initial production scale of 37kstpd with expansion to 70kstpd and flexibility over timing of expansion
  ° Potential to fund ongoing development work and construction through future cash flows from the stand-alone underground project at Pumpkin Hollow, reducing need to access equity capital markets
• Attractive whole of property (stand-alone underground project and stand-alone open pit project) economics:
  ° Combined IRR of 24% pre-tax (22% post-tax)
  ° Combined NPV of $1,320 million pre-tax ($1,062 million post-tax)
  ° Combined CuEq production of 150,000 tonnes (330Mlbs) per annum at peak production.

Matt Gili, President and Chief Executive Officer, commented: “We are very pleased with the new PFS for our open pit project at Pumpkin Hollow. The results clearly illustrate the potential to put this large, open pit project into production with a further improved internal rate of return and continued low capital and operating costs.

“The 2018 completed drill program included in the open pit PFS has successfully extended the open pit mineralization. Importantly, it also highlights the need for further drilling to test the full extent of the deposit and to continue expanding and upgrading the open pit resources.

“We continue to apply our strategy of pursuing low-capital intensity and staged production growth to generate shareholder returns. This same philosophy was applied in the development of the underground project, which we expect to commence production in Q4 2019. The study’s focus of generating project value through an improved internal rate of return, has resulted in a higher grade driven mine plan. This means we expect the open pit project to be more robust with regards to lower copper prices, while also affording potential flexibility for mining more of the mineral resource under differing market conditions.”