VANCOUVER, BC, March 30,
2023 /CNW/ - Taseko Mines Limited (TSX: TKO) (NYSE
American: TGB) (LSE: TKO) ("Taseko" or the "Company") is pleased to
announce the results of recent technical work and updated economics
for its 100%-owned Florence Copper Project, located in Arizona, U.S.A (the 'Florence Copper Project"
or "Florence Copper"). The Company has filed a new technical report
entitled "NI 43-101 Technical Report – Florence Copper Project,
Pinal County, Arizona" dated
March 30, 2023 (the "Technical
Report") on SEDAR. The technical report was prepared in accordance
with NI 43-101 and incorporates updated capital and operating costs
for the commercial production facility and refinements made to the
operating models, based on the Production Test Facility ("PTF")
results.
The technical work completed by Taseko in recent years has been
extensive and has de-risked the project significantly. The PTF
operated successfully over an 18-month period and provided a
valuable opportunity to test operational controls and strategies
which will be applied in future commercial operations. In addition,
a more sophisticated leaching model has been developed and
calibrated to the PTF wellfield performance. This detailed modeling
data, along with updated costing, has been used to update
assumptions for the ramp up and operation of the commercial
wellfield and processing facility.
Project Highlights:
- Net present value of US$930
million (after-tax, at an 8% discount rate)
- Internal rate of return of 47% (after-tax)
- Payback period of 2.6 years
- Operating costs (C1) of US$1.11
per pound of copper
- Annual production capacity of 85 million pounds of LME grade
"A" cathode copper
- 22 year mine life
- Total life of mine production of 1.5 billion pounds of
copper
- Total estimated initial capital cost of US$232 million remaining
- Long-term copper price of US$3.75
per pound
Stuart McDonald, President &
CEO of Taseko, stated, "Despite global cost inflation in recent
years, the Florence Copper Project continues to demonstrate robust
economics and remains one of the lowest capital intensity copper
development projects in the world. The operational experience
and technical information that we gained through the PTF testwork
has been invaluable and we're well positioned to build and operate
the commercial-scale ISCR facility. The new Technical Report
includes updated capital cost estimates based on detailed
engineering and recent contractor and vendor quotations. The main
cost increases relate to construction labour and wellfield drilling
costs which impact both initial and sustaining capital costs."
"The inflationary environment we have been in has also driven
copper prices higher. With a lack of new mines being developed
today and copper's critical role in the global energy transition,
the long-term price outlook remains very attractive for copper
producers. The low-carbon, low impact production method at Florence
Copper is expected to make it a preferred supplier of green, low
carbon copper in the US domestic market. With procurement of
long-lead items well advanced, we are ready to commence
construction of the commercial facility following the issuance of
the final UIC permit in the coming months," Mr. McDonald
concluded.
In-Situ Copper Recovery
("ISCR")
The extraction method proposed for the Florence Copper Project
is ISCR. ISCR extracts copper by injecting a weak sulfuric acid
solution, referred to as raffinate, through targeted portions of
the mineral deposit using an array of injection wells. The
raffinate passes through natural fractures and voids in the deposit
and dissolves the copper mineralization. The copper laden solution,
known as pregnant leach solution ("PLS"), is collected in recovery
wells where it is pumped to the surface for processing. Copper is
extracted from the PLS using solvent extraction and electrowinning
("SX/EW") techniques producing a saleable copper cathode
product.
Production Test Facility
("PTF")
Florence Copper operated a demonstration scale ISCR facility
referred to as the PTF, where leaching under commercial operating
conditions was completed between December
2018 to June 2020. The PTF
facilities included an ISCR wellfield, an SX/EW processing plant,
an acidic reverse-osmosis water treatment plant, a water
impoundment, run-off pond, and associated infrastructure. The PTF
wellfield was comprised of four injection wells, nine recovery
wells, seven observation wells, and four multilevel sampling
wells.
The purpose of the PTF was to demonstrate hydraulic control and
confirm the oxide ore zone behaves hydrologically as an equivalent
porous media thereby ensuring protection of underground sources of
drinking water. Secondly, the PTF provided an opportunity to test
operational controls and strategies to inform future commercial
scale operations.
The PTF well field is located on the northern portion of the
deposit specifically selected in a challenging hydrogeological
position to demonstrate hydraulic control. The well field is
situated at the edge of a graben with major faults running though
the surrounding area. The location was also selected to represent
the ore to be leached at the start of commercial production.
The well field was designed using the same well spacing and
construction methods as those planned for the commercial-scale ISCR
facility. Hydraulic performance data generated during PTF testing
and operations have provided important information supporting the
design and operations planning for the commercial-scale well
field.
Leaching of the PTF wellfield began in December 2018 and continued under commercial
operating conditions until June 2020,
after which fresh acid addition was stopped and the leaching phase
was ramped down and concluded with the shutdown of the process
plant by end of October 2020. The PTF
well field was then subsequently transitioned into a rinsing phase
which is currently still in progress.
The PTF was successful in demonstrating that copper could be
produced feasibly and also that hydraulic control of process
solutions in the ISCR well field could be established and
maintained to ensure protection of underground sources of drinking
water. It has also further confirmed that the oxide ore zone
behaves hydraulically as an equivalent porous media.
PTF operations provided valuable data to test operational
controls and strategies to inform future commercial scale
operations. Employment of strategies such as reverse flow, use of
inflatable packers to target areas of the formation, and varying
acid application rates through increased raffinate injection flows
and or acid strengths all proved to be beneficial tools to
effectively manage the leaching operation.
Sweep Efficiency
Sweep efficiency is defined as the fraction of the pore space
contacted or 'swept' by the injected solution as it flows from
injection to recovery well. Sweep efficiency increases over time as
leaching progresses and more ore is contacted by process solutions.
The ultimate sweep efficiency achieved over the duration of
leaching indicates the proportion of the ore from which copper will
be recovered.
The geophysical monitoring for the central recovery well found
that all of the monitored ore zone was contacted by leach solutions
in the first five weeks of leaching and achieved 90% overall. This
result confirms the projected long-term sweep efficiency of 90%
used in the model.
Overall Recovery Plan
The total copper recovery to cathode is projected to be 65.8% at
an estimated acid consumption of 6.0 lbs/lb copper. PLS grade
feeding the SX/EW plant will average 1.7 g/L of copper over the
life of the project.
SX/EW Plant Operations
The SX/EW process plant operations commenced in mid-March 2019, following a four-month initial
leaching period, and was shut down in October 2020, four months after fresh acid
addition to raffinate was stopped resulting in a subsequent
depletion of PLS copper grades feeding the plant. For the entire
PTF operational run, the plant operated at a high average
availability of 99.9% and produced a total of 1.1 million pounds of
high-grade copper cathode product from the ISCR leach
solutions.
Reserves and Resources
Proven and Probable Reserve Estimate
(Effective
December 31, 2022)
Category
|
Tons
(millions)
|
Total Cu
(%)
|
Recoverable
Copper (B lbs)
|
Proven
|
258
|
0.35
|
1.8
|
Probable
|
63
|
0.40
|
0.5
|
Total
|
320
|
0.36
|
2.3
|
1.
|
Mineral Reserves follow
CIM Definition Standards for Mineral Resources and Mineral Reserves
(2014).
|
2.
|
Mineral Reserves are
contained within Florence Copper's Mineral Resources.
|
3.
|
Mineral Reserves are
assumed to be extracted using ISCR extraction methods using the
following assumptions: $3.05 Cu price, $31,600/acre for core hole
abandonment, $240,400/acre for cultural mitigations in identified
Cultural Sites, $149,600 + $263/foot well drilling costs, $160/ton
acid cost, $45.30/ton acid applied for well field operating costs,
1.2% surface losses, $0.10/lb Cu for electrowinning cost, $0.12/lb
Cu G&A cost, $0.69/ton reclamation cost, $0.02/lb Cu shipping
cost, 7% NSR royalties on ALSD land, 3% NSR royalties on freehold
land, and 2.5% royalties on net profit.
|
4.
|
Mineral Reserves are
reported without a cut-off grade and on a fully diluted basis to
reflect the nature of the ISCR extraction method
proposed.
|
5.
|
Tonnage factors of 13.5
ft3/ton and 13.13 ft3/ton have been applied corresponding to 8%
porosity in the upper oxide zone and 5% porosity in the lower oxide
and transition zones.
|
6.
|
Numbers may not add due
to rounding.
|
Florence Project Oxide Mineral Resources
(Effective
December 31, 2022)
Category
|
Tons
(millions)
|
Total Copper
(%)
|
Total Copper (B
lbs)
|
Measured
|
292
|
0.34
|
2.0
|
Indicated
|
71
|
0.39
|
0.6
|
M+I
|
363
|
0.35
|
2.5
|
Inferred
|
42
|
0.32
|
0.3
|
1.
|
Mineral Resources
follow CIM Definition Standards for Mineral Resources and Mineral
Reserves (2014).
|
2.
|
Mineral Resources are
reported inclusive of Mineral Reserves.
|
3.
|
Mineral Resources that
are not Mineral Reserves do not have demonstrated economic
viability.
|
4.
|
Mineral Resources are
confined to the Oxide and Transition zones inside a "reasonable
prospects of eventual economic extraction" boundary assuming ISCR
extraction methods using the following assumptions: $3.50 Cu price,
$31,600/acre for core hole abandonment, $240,400/acre for cultural
mitigations in identified Cultural Sites, $149,600 + $263/foot well
drilling costs, $160/ton acid cost, $45.30/ton acid applied for
well field operating costs, 1.2% surface losses, $0.10/lb Cu for
electrowinning cost, $0.12/lb Cu G&A cost, $0.69/ton
reclamation cost, $0.02/lb Cu shipping cost, 7% NSR royalties on
ALSD land, 3% NSR royalties on freehold land, and 2.5% royalties on
net profit.
|
5.
|
Mineral Resources are
reported without a cut-off grade to reflect the nature of the ISCR
extraction method proposed.
|
6.
|
Tonnage factors of 13.5
ft3/ton and 13.13 ft3/ton have been applied corresponding to 8%
porosity in the upper oxide zone and 5% porosity in the lower oxide
and transition zones.
|
7.
|
Numbers may not add due
to rounding.
|
Qualified Persons and 43-101
Disclosure
The report has been prepared for Taseko Mines Limited, a
producing issuer, under the supervision of Richard Tremblay, P.Eng., MBA, Richard Weymark, P.Eng., MBA, and Robert Rotzinger, P.Eng. Mr. Tremblay is
employed by the Company as Sr. Vice President Operations, Mr.
Weymark is Vice President Engineering and Robert Rotzinger is Vice President Capital
Projects. All three are "Qualified Persons" as defined in National
Instrument 43–101 Standards of Disclosure for Mineral Projects ("NI
43–101").
Mr. Tremblay, Mr. Weymark and Mr. Rotzinger have reviewed and
approved the technical content of this news release.
Additional information regarding data verification, exploration
information, known legal, political, environmental or other risks
can be found in the Technical Report dated March 30, 2023, titled 'NI 43-101 Technical
Report – Florence Copper Project, Pinal
County, Arizona' which is available on SEDAR.
Note to United States
Investors
This news release has been prepared in accordance with the
requirements of the securities laws in effect in Canada, which differ from the requirements of
United States securities laws.
Canadian reporting requirements for disclosure regarding mineral
properties are governed by National Instrument 43-101 - Standards
of Disclosure for Mineral Projects of the Canadian Securities
Administrators ("NI 43-101"). Taseko's estimates of "proven mineral
reserves", "probable mineral reserves", "measured mineral
resources", "indicated mineral resources" and "inferred mineral
resources" have been prepared in accordance with these NI 43-101
requirements.
Effective February 2019, the
United States Securities and Exchange Commission ('SEC') adopted
amendments to its disclosure rules to modernize the mineral
property disclosure requirements for issuers like Taseko whose
securities are registered with the SEC under the Exchange Act and
as a result, the SEC now recognizes estimates of "measured mineral
resources", "indicated mineral resources" and "inferred mineral
resources". In addition, the SEC has amended its definitions of
"proven mineral reserves" and "probable mineral reserves" to be
"substantially similar" to the corresponding definitions under the
CIM Standards, as required under NI 43-101. For this reason,
information contained in this news release regarding the Company's
Florence Copper Project may not be comparable to similar
information made public by United
States companies subject to the reporting and disclosure
requirements under the United
States securities laws and the rules and regulations
thereunder.
For further information on the differences between the
disclosure requirements for mineral properties in the United States and NI 43-101, please refer
to the company's Annual Information Form, a copy of which has been
filed under Taseko's profile on SEDAR at sedar.com and the
company's Form 40-F, a copy of which will be filed on EDGAR at
edgar.com.
Note: All currency amounts are stated in US dollars. Measurement
units used in this release are in imperial (US).
The Technical Report includes inferred mineral resources that
are considered too speculative geologically to have economic
considerations applied to them that would enable them to be
categorized as mineral reserves, and there is no assurance that the
Technical Report will be realized. Investors are encouraged to read
the full text of the Technical Report which has been filed on SEDAR
and will be also filed on EDGAR (www.sec.gov) and made available on
the Taseko website.
Stuart McDonald
President and CEO
No regulatory authority
has approved or disapproved of the information contained in this
news release.
|
CAUTION REGARDING FORWARD-LOOKING
INFORMATION
This document contains "forward-looking statements" that were
based on Taseko's expectations, estimates and projections as of the
dates as of which those statements were made. Generally, these
forward-looking statements can be identified by the use of
forward-looking terminology such as "outlook", "anticipate",
"project", "target", "believe", "estimate", "expect", "intend",
"should" and similar expressions.
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 included but are not limited
to:
- uncertainties related to the financial results of the Technical
Report prepared for the Florence Copper Project, including net
present value and internal rates of return, estimated capital and
operating costs and the ability of Florence Copper to secure the
financing to proceed with the development of the Florence Copper
Project;
- uncertainties about the future market price of copper and the
other metals that we produce or may seek to produce;
- changes in general economic conditions, the financial markets,
inflation and interest rates and in the demand and market price for
our input costs, such as diesel fuel, reagents, 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;
- uncertainties resulting from the war in Ukraine, and the accompanying international
response including economic sanctions levied against Russia, which has disrupted the global
economy, created increased volatility in commodity markets
(including oil and gas prices), and disrupted international trade
and financial markets, all of which have an ongoing and uncertain
effect on global economics, supply chains, availability of
materials and equipment and execution timelines for project
development;
- uncertainties about the continuing impact of the novel
coronavirus ("COVID-19") and the response of local, provincial,
state, federal and international governments to the ongoing threat
of COVID-19, on our operations (including our suppliers, customers,
supply chains, employees and contractors) and economic conditions
generally including rising inflation levels and in particular with
respect to the demand for copper and other metals we produce;
- inherent risks associated with mining operations, including our
current mining operations at Gibraltar, and their potential impact on our
ability to achieve our production estimates;
- uncertainties as to our ability to control our operating costs,
including inflationary cost pressures at Gibraltar without impacting our planned copper
production;
- the risk of inadequate insurance or inability to obtain
insurance to cover material mining or operational risks;
- uncertainties related to estimates of expected or anticipated
capital and operating costs, expenditures and economic returns on
our development projects, including the impact of inflation on the
estimated costs related to our other development projects;
- the risk that the results from our operations of the Florence
Copper production test facility ("PTF") and ongoing engineering
work including updated capital and operating costs not prove
correct in a full production scenario, resulting in lower than
expect production results, increased costs, and reduced economics
on commercial production than described in the Technical
Report;
- Florence Copper's ability to be a preferred supplier of green,
low carbon copper;
- uncertainties related to the accuracy of our estimates of
Mineral Reserves (as defined below), Mineral Resources (as defined
below), production rates and timing of production, future
production and future cash and total costs of production and
milling;
- the risk that we may not be able to expand or replace reserves
as our existing mineral reserves are mined;
- the availability of, and uncertainties relating to the
development of, additional financing and infrastructure necessary
for the advancement of our development projects, including with
respect to our ability to obtain any remaining construction
financing potentially needed to move forward with commercial
operations at Florence Copper;
- our ability to comply with the extensive governmental
regulation to which our business is subject;
- uncertainties related to our ability to obtain necessary title,
licenses and permits for our development projects and project
delays due to third party opposition, particularly in respect to
Florence Copper that requires one key regulatory permit from the
U.S. Environmental Protection Agency ("EPA") in order to advance to
commercial operations;
- our ability to deploy strategic capital and award key contracts
to assist with protecting the Florence Copper project execution
plan, mitigating inflation risk and the potential impact of supply
chain disruptions on our construction schedule and ensuring a
smooth transition into construction once the final permit is
received from the EPA;
- uncertainties related to unexpected judicial or regulatory
proceedings;
- changes in, and the effects of, the laws, regulations and
government policies affecting our exploration and development
activities and mining operations and mine closure and bonding
requirements;
- our ability to collect payments from customers, extend existing
concentrate off-take agreements or enter into new agreements;
- environmental issues and liabilities associated with mining
including processing and stock piling ore;
- labour strikes, work stoppages, or other interruptions to, or
difficulties in, the employment of labour in markets in which we
operate our mine, industrial accidents, equipment failure or other
events or occurrences, including third party interference that
interrupt the production of minerals in our mine;
- environmental hazards and risks associated with climate change,
including the potential for damage to infrastructure and stoppages
of operations due to forest fires, flooding, drought, or other
natural events in the vicinity of our operations;
- litigation risks and the inherent uncertainty of litigation,
including litigation to which Florence Copper could be subject
to;
- our actual costs of reclamation and mine closure may exceed our
current estimates of these liabilities;
- our ability to meet the financial reclamation security
requirements for the Gibraltar
mine and Florence Copper Project;
- the capital intensive nature of our business both to sustain
current mining operations and to develop any new projects,
including Florence Copper;
- our reliance upon key management and operating personnel;
- the competitive environment in which we operate;
- the effects of forward selling instruments to protect against
fluctuations in copper prices, foreign exchange, interest rates or
input costs such as fuel;
- the risk of changes in accounting policies and methods we use
to report our financial condition, including uncertainties
associated with critical accounting assumptions and estimates; and
Management Discussion and Analysis ("MD&A"), quarterly reports
and material change reports filed with and furnished to securities
regulators, and those risks which are discussed under the heading
"Risk Factors".
Such forward looking statements or information related to the
Technical Report include but are not limited to statements or
information with respect to the internal rate of return, the annual
production, the net present value; the life of mine, the estimated
capital costs, estimated operating costs, projected metallurgical
recoveries, plans for further development, securing the required
permits, the market price of copper and other base metals or other
statements that are not statements of fact.
For further information on Taseko, investors should review the
Company's annual Form 40-F filing with the United States Securities
and Exchange Commission www.sec.gov and home jurisdiction filings
that are available at www.sedar.com, including the "Risk Factors"
included in our Annual Information Form.
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SOURCE Taseko Mines Limited