NGEx Resources Inc. announced that it has started a Preliminary Feasibility Study («PFS») on its 100% owned Josemaría Project in San Juan Province. The Company has retained SRK Consulting (Canada) Inc. and Ausenco Engineering Canada Inc. to complete a PFS which will evaluate the potential to develop an open pit mine and adjacent process plant to exploit the Josemaría deposit. The PFS will benefit from the extensive work already completed on the project and is expected to be finished by the first quarter of 2019.
Josemaría is currently part of the Company’s Project Constellation Preliminary Economic Assessment («Constellation PEA») which evaluated a combined project starting with an open pit mine at Josemaría, followed by underground development of the Company’s nearby Los Helados Deposit. The Constellation PEA demonstrates a robust, long-life project that represents one potential development scenario for the Company’s projects. It also highlighted the quality and strengths of the Josemaría deposit including:
- A near surface supergene enrichment zone that contains an Indicated Resource of 150 million tonnes at 0.56% copper and 0.38 grams per tonnes gold for a copper equivalent (CuEq) grade of 0.76% (0.6% CuEq cut-off)
- Its potential to produce an annual average of 185,000 tonnes of copper, 345,000 ounces of gold and 1.2 million ounces of silver in the first 5 years of production;
- Straightforward metallurgy producing a high-quality copper concentrate with high gold and silver content;
- A low strip ratio;
- Nearby water supply from aquifers in Argentina; and
- A well defined permitting regime and strong support for mining development from the San Juan provincial and National authorities in Argentina
NGEx’s CEO, Wojtek Wodzicki stated, «We are very excited to begin a study that we expect will highlight the full potential of the Josemaría project. We expect the study to build on earlier work and to demonstrate the potential for a straightforward, low strip, open pit operation, producing a high-quality precious metal-rich copper concentrate. It is envisioned that the mine and all associated infrastructure will be located in the mining friendly province of San Juan. The PFS economics are expected to benefit from the recently proposed decrease in the Argentine corporate tax rate from the 35% used in the Constellation PEA to 25% starting January 1st, 2020. Additionally, NGEx’s attributable share of the net present value of the PFS project will be 100% compared to 60% of the Constellation PEA project following our buyout of our Japanese partner’s interest in Josemaría in 2017. A further important consideration is that the PFS will target mining all the Josemaría resource rather than the 37% contemplated by Project Constellation. The quality of the existing data means that the PFS can be fast tracked and we expect to present the results of the study by early 2019. Once the PFS is complete, we intend to move the project forward as quickly as possible towards permitting and development.»
