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News
Entrée Gold Updates Preliminary Economic Assessment for the Ann Mason Project
September 9, 2015
Updated Mineral Resource Estimate, Improved Mine Plan and Metallurgical Response Are Highlighted
The 2015 PEA incorporates the results of the Company's recent in-fill drill program and a new resource estimate. Approximately 95% of the mineralization constrained within the ultimate PEA pit ("Phase 5") is now classified as either Measured or Indicated resources with the remaining 5% as Inferred resources. The 2015 PEA also includes preliminary results of a detailed metallurgical program, designed to better characterize the metallurgical processes and recoveries in the 2015 PEA and to support a future Pre-Feasibility study.
Similar to the previously reported PEA ("2012 PEA"; filed
2015 PEA
Highlights:
- Base Case* pre-tax NPV (7.5% discount rate) of
$1,158 million , internal rate of return ("IRR") of 15.8%. - Base Case* post-tax NPV (7.5% discount rate) of
$770 million , IRR of 13.7%. - Development capital costs of approximately
$1.35 billion , including$103 million contingency. - Pre-production development of three years.
- Mine production for 21 years, followed by four years of reclamation (Life of Mine or "LOM").
- Average LOM cash costs (net of by-product sales) pre-tax of
$1.49 /lb copper (cash cost including tax is$1.74 /lb copper) (see Non-U.S. GAAP Performance Measurement below). - Average LOM all-in sustaining costs ("AISC") (net of by-product sales) pre-tax of
$1.57 /lb copper (AISC including tax is$1.81 /lb copper) (see Non-U.S. GAAP Performance Measurement below). - Net average pre-tax undiscounted cash flow over Years 1 to 21 of approximately
$298 million per year (and post-tax of$238 million per year). - LOM payable production of approximately:
- 5.1 billion pounds of copper,
- 46 million pounds of molybdenum,
- 0.4 million ounces of gold, and
- 8.8 million ounces of silver.
- Average annual payable production of approximately:
- 241 million pounds of copper,
- 2.2 million pounds of molybdenum,
- 20,000 ounces of gold, and
- 421,000 ounces of silver.
- Strip ratio of 2.01:1 waste to mineralized material (including pre-strip).
- LOM average copper recovery of 92%.
- Copper concentrate grading 30% with no penalty elements identified.
*Base Case uses
The 2015 PEA is preliminary in nature and includes Inferred mineral resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves, and there is no certainty that the 2015 PEA will be realized. Mineral resources that are not mineral reserves do not have demonstrated economic viability.
The Base Case discounted cash flows in the 2015 PEA are provided both pre-tax and post-tax, and are prepared in compliance with National Instrument 43-101 - Standards of Disclosure for Mineral Projects ("NI 43-101") of the Canadian Securities Administrators. The 2015 PEA was completed by
CHANGES FROM 2012 PEA
The 2015 PEA incorporates a number of optimization enhancements, specifically:
- An updated mineral resource estimate: A 40-hole in-fill drill program, completed in early 2015, successfully converted a significant amount of Inferred resources to Measured and Indicated, with the overall tonnes and grade remaining similar to that reported in the 2012 PEA. As a result of this drilling, 95% of the mineral resources constrained within the Phase 5 pit are now classified as either Measured or Indicated resources, with the remaining 5% classified as Inferred resources.
- An improved mine plan: An increased mill throughput of 120,000 tpd (versus the 2012 PEA's 100,000 tpd) allows better utilization of the lower grade mill feed resulting in a more logical mining sequence and better mine fleet capital utilization. The capital increase to support the larger throughput is approximately 5% higher than that reported in the 2012 PEA, offset by a 12.5% increase in average annual copper production, a nearly 10% increase in average annual post-tax free cash flow and a 12% increase in Project NPV.
- Leasing applied to a portion of the mining fleet: Leasing allows some of the upfront capital to be spread throughout the mine life as an operating cost, thereby reducing the initial equipment capital requirements and improving Project cashflow.
- Improved metallurgical response: A detailed program of metallurgical testwork and geometallurgical definition is underway, using approximately 1,700 kilograms of core from over 500 individual sample locations throughout the main mineralogical domains. Preliminary results indicate average recoveries and concentrate grades are comparable to those reported in the 2012 PEA, but can be achieved with a simplified reagent scheme and at a coarser primary grind size. The new process parameters will result in significant savings in processing operating costs-per-tonne (
$5.13 /tonne in the 2012 PEA versus$4.59 /tonne in the 2015 PEA).
Table 1 summarizes differences in the economic outputs between the 2012 PEA and the 2015 PEA.
Table 1. Variance of the 2012 PEA to the 2015 PEA.
Parameter | 2012 PEA 100,000 tpd |
2015 PEA 120,000 tpd |
% Change | |||
Pre-tax IRR | 14.8 | % | 15.8 | % | +6.7 | % |
Pre-tax NPV7.5% | $1,106 M | $1,158 M | +4.7 | % | ||
Pre-tax Payback | 6.4 years | 6.4 years | 0 | % | ||
After-tax IRR | 12.6 | % | 13.7 | % | +8.7 | % |
After-tax NPV7.5% | $690 M | $770 M | +11.6 | % | ||
After-tax Payback | 7.1 years | 6.9 years | -2.8 | % | ||
Initial CAPEX (Including contingency) | $1.28 B | $1.35 B | +5.5 | % | ||
Total CAPEX (Including sustaining and contingency) | $1.85 B | $1.54 B | -16.8 | % | ||
Average annual copper production | 214 M lbs | 241 M lbs | +12.6 | % | ||
LOM Copper Production | 5.1 B lbs | 5.1 B lbs | 0 | % |
Note: The Base Case in both the 2015 PEA and the 2012 PEA use a
Table 2 summarizes the metal price sensitivity of the main economic outputs of the 2015 PEA.
Table 2. Sensitivity of Ann Mason 2015 PEA key financial outputs (Post-Tax).
Low Case | Base Case | High Case | |||||
Copper | $/lb | $ | 2.75 | $ | 3.00 | $ | 3.25 |
Molybdenum | $/lb | $ | 9.00 | $ | 11.00 | $ | 13.00 |
Silver | $/oz | $ | 15 | $ | 20 | $ | 25 |
Gold | $/oz | $ | 1,100 | $ | 1,200 | $ | 1,300 |
Post Tax NPV (5%) | $ Million | $ | 815 | $ | 1,379 | $ | 1,928 |
Post Tax NPV (7.5%) | $ Million | $ | 339 | $ | 770 | $ | 1,189 |
Post Tax NPV (10%) | $ Million | $ | 30 | $ | 366 | $ | 694 |
IRR | % | 10.3 | 13.7 | 16.8 | |||
Payback Period | Years | 8.7 | 6.9 | 5.7 | |||
Net Average Annual Free Cash Flow (Post Tax) | $ Million | 189 | 238 | 287 |
Note: The Base Case metal prices are based on a review of current analyst consensus reports and recent SEDAR filings for similar reports.
MINING OPERATION
A large open pit mine is envisioned for Ann Mason, involving the development of five pit phases over a three year period of pre-production, plus a 21 year production life, feeding the mill at a rate of 120,000 tpd. Mining will use conventional rotary drilling, blasting, and loading with large cable shovels and 363-tonne trucks. The total mill throughput in the 2015 PEA is estimated to be 877 million tonnes ("Mt"), of which
Some material previously categorized as waste has now been upgraded to mill feed, as a result of the recent drilling and the new resource model. The LOM waste to mineralization strip ratio is now 2.01:1 (including pre-strip) compared to 2.16:1 in the 2012 PEA. Pit slopes are variable depending on the geotechnical parameters of the rock types and range from 50 degrees in the overlying volcanic rocks, to 37 degrees in rocks that host the porphyry mineralization.
UPDATED MINERAL RESOURCE ESTIMATE
Entrée has completed an updated mineral resource estimate for the Ann Mason deposit, which includes the first reported Measured resources for the deposit and converts a large percentage of the previously reported Inferred mineralization to both Indicated and Measured categories. The overall mineral resource estimate is pit-constrained (see discussion below) and is classified as approximately 20% Measured, 49% Indicated (69% Measured plus Indicated) and 31% Inferred resources. The "near-surface" portion of this mineral resource forms the basis of the 2015 PEA and is constrained by the Phase 5 Pit. Mineral resources within the Phase 5 pit are now classified 44% as Measured and 51% as Indicated (95% as Measured plus Indicated) with only 5% remaining as Inferred.
Highlights:
- Updated Mineral Resource Estimate (0.2% Copper Cut-off):
- Measured Resources - 412 million tonnes averaging 0.33% copper, containing approximately 3.04 billion pounds of copper
- Indicated Resources - 988 million tonnes averaging 0.31% copper, containing approximately 6.85 billion pounds of copper
- Measured plus Indicated Resources - 1,400 million tonnes averaging 0.32% copper, containing approximately 9.89 billion pounds of copper
- Inferred Resources - 623 million tonnes averaging 0.29% copper, containing approximately 3.99 billion pounds of copper
- The overall size and grade of the deposit has not changed significantly from the last reported resource estimate (refer to news release dated
October 24, 2012 ). The recent in-fill drilling program was primarily restricted to the Phase 5 pit and was focussed on converting Inferred resources to Measured and Indicated categories. As a result, mineralization still remains open in several directions. - By-product molybdenum, gold and silver were also estimated and are reported in Table 3 below.
Table 3 shows the updated mineral resources at a range of copper cut-offs. The 0.2% copper cut-off base case is highlighted. The effective date of the resource estimate is
Table 3. Ann Mason Deposit Mineral Resources -
Measured Mineral Resources | |||||||||
Grade | Contained Metal | ||||||||
Cutoff (Cu%) |
Tonnage (Mt) |
Cu (%) |
Mo (%) |
Au (g/t) |
Ag (g/t) |
Cu (Mlb) |
Mo (Mlb) |
Au (Moz) |
Ag (Moz) |
0.10 | 508 | 0.30 | 0.006 | 0.03 | 0.57 | 3,367.5 | 67.2 | 0.41 | 9.37 |
0.15 | 470 | 0.32 | 0.006 | 0.03 | 0.60 | 3,263.7 | 64.2 | 0.40 | 9.08 |
0.20 | 412 | 0.33 | 0.006 | 0.03 | 0.64 | 3,037.6 | 58.1 | 0.37 | 8.46 |
0.25 | 329 | 0.36 | 0.007 | 0.03 | 0.69 | 2,621.8 | 47.8 | 0.32 | 7.32 |
0.30 | 237 | 0.40 | 0.007 | 0.03 | 0.76 | 2,065.6 | 35.5 | 0.25 | 5.76 |
0.35 | 153 | 0.44 | 0.007 | 0.04 | 0.82 | 1,465.9 | 23.6 | 0.18 | 4.05 |
Indicated Mineral Resources | |||||||||
Grade | Contained Metal | ||||||||
Cutoff (Cu%) |
Tonnage (Mt) |
Cu (%) |
Mo (%) |
Au (g/t) |
Ag (g/t) |
Cu (Mlb) |
Mo (Mlb) |
Au (Moz) |
Ag (Moz) |
0.10 | 1,347 | 0.27 | 0.006 | 0.03 | 0.58 | 8,051.0 | 172.2 | 1.15 | 25.01 |
0.15 | 1,182 | 0.29 | 0.006 | 0.03 | 0.62 | 7,608.2 | 156.3 | 1.08 | 23.40 |
0.20 | 988 | 0.31 | 0.006 | 0.03 | 0.66 | 6,853.3 | 128.5 | 0.97 | 21.00 |
0.25 | 730 | 0.35 | 0.006 | 0.03 | 0.72 | 5,572.2 | 95.0 | 0.77 | 16.83 |
0.30 | 485 | 0.38 | 0.006 | 0.04 | 0.78 | 4,089.8 | 64.1 | 0.55 | 12.13 |
0.35 | 290 | 0.42 | 0.006 | 0.04 | 0.84 | 2,696.1 | 39.6 | 0.36 | 7.84 |
Measured and Indicated Mineral Resources | |||||||||
Grade | Contained Metal | ||||||||
Cutoff (Cu%) |
Tonnage (Mt) |
Cu (%) |
Mo (%) |
Au (g/t) |
Ag (g/t) |
Cu (Mlb) |
Mo (Mlb) |
Au (Moz) |
Ag (Moz) |
0.10 | 1,855 | 0.28 | 0.006 | 0.03 | 0.58 | 11,418.5 | 239.4 | 1.56 | 34.38 |
0.15 | 1,652 | 0.30 | 0.006 | 0.03 | 0.61 | 10,871.9 | 220.6 | 1.48 | 32.47 |
0.20 | 1,400 | 0.32 | 0.006 | 0.03 | 0.65 | 9,890.9 | 186.6 | 1.33 | 29.46 |
0.25 | 1,059 | 0.35 | 0.006 | 0.03 | 0.71 | 8,194.0 | 142.8 | 1.09 | 24.15 |
0.30 | 722 | 0.39 | 0.006 | 0.03 | 0.77 | 6,155.4 | 99.6 | 0.80 | 17.90 |
0.35 | 442 | 0.43 | 0.006 | 0.04 | 0.84 | 4,162.0 | 63.2 | 0.53 | 11.89 |
Inferred Mineral Resources | |||||||||
Grade | Contained Metal | ||||||||
Cutoff (Cu%) |
Tonnage (Mt) |
Cu (%) |
Mo (%) |
Au (g/t) |
Ag (g/t) |
Cu (Mlb) |
Mo (Mlb) |
Au (Moz) |
Ag (Moz) |
0.10 | 966 | 0.24 | 0.007 | 0.02 | 0.54 | 5,071.7 | 138.5 | 0.75 | 16.85 |
0.15 | 781 | 0.27 | 0.007 | 0.03 | 0.59 | 4,601.8 | 118.9 | 0.66 | 14.93 |
0.20 | 623 | 0.29 | 0.007 | 0.03 | 0.66 | 3,987.2 | 96.2 | 0.58 | 13.16 |
0.25 | 400 | 0.33 | 0.007 | 0.03 | 0.71 | 2,874.1 | 60.8 | 0.40 | 9.14 |
0.30 | 217 | 0.37 | 0.007 | 0.03 | 0.75 | 1,775.4 | 33.0 | 0.23 | 5.25 |
0.35 | 117 | 0.41 | 0.007 | 0.03 | 0.78 | 1,065.4 | 18.1 | 0.13 | 2.95 |
Notes:
- Mineral resources are reported within a constraining pit shell developed using Whittle™ software. Assumptions include commodity prices of
$3.74 /lb for copper,$13.23 /lb for molybdenum,$1,495 /oz for gold, and$23.58 /oz for silver; process recoveries of 92% for copper, 50% for molybdenum, 50% for gold, and 55% for silver; mining cost of$1.09 /tonne +$0.02 /bench below 1605 metres,$5.82 /tonne for processing, and$0.30 /tonne for G&A. - Assumptions include 100% mining recovery.
- An external dilution factor was not considered during this resource estimation.
- Internal dilution within a 20 metre x 20 metre x 15 metre
SMU (selective mining unit) was considered. - The 0.4% net smelter returns royalty held by
Sandstorm Gold Ltd. was not considered during the preparation of the conceptual pit. - Mineral resources that are not mineral reserves do not have demonstrated economic viability.
Mineral Resource Estimation - Technical Discussion
The Ann Mason drill hole database was reviewed by
- Entrée drilled 78 holes representing 53% of the metres drilled, including 40 holes as part of the recent in-fill drilling program.
- Historical operator,
Anaconda Copper Mining Company , drilled 104 holes representing 40% of the metres drilled. - Historical operators,
PacMag Metals Limited andMount Isa Mines Limited , drilled a total of 16 holes representing 7% of the metres drilled.
Entrée applied a leading-practice QA/QC program consisting of blanks, standards and duplicates and check samples for all samples from their drill programs. Entrée also implemented a re-assay program of the legacy drill samples following the same QA/QC procedure. No significant grade biases or transcription errors were identified. Entrée collected 5,016 wax-coat water immersion specific gravity ("SG") measurements from Anaconda and Entrée holes. Checks made at an independent laboratory showed no significant biases in the SG measurements.
Deposit geology, structure, alteration and sulphide zoning have been reinterpreted and modelled based on the integration of all of the historic data with current drilling results.
The mineral resource estimate was prepared by
A block model was constructed in Vulcan™ software with block dimensions of 20 metres × 20 metres x 15 metres high. Copper, gold, silver, and molybdenum grades were interpolated into the blocks by ordinary kriging in three passes. Blocks were classified based on a combination of factors including the number of holes used for each block and the distance to the nearest composites. Validation of the estimated block model revealed no significant global or local grade biases.
Outlier analysis was completed on the copper, molybedenum, gold, and silver composites. Capping thresholds with the 0.15% grade shell are as follows: copper, 0.6%; molybdenum, 0.09%; gold, 0.27 g/t; silver, 4.6 g/t. Outlier restrictions were also applied to copper values outside of the 0.15% grade shell.
To assess reasonable prospects for eventual economic extraction,
The Whittle™ pit optimiser software was utilized to prepare a conceptual pit design, constrained within property boundaries, with inputs on mining, processing, G&A, transportation and smelting and refining. Preparation of the pit was based on economic and technical assumptions listed below. These assumptions were used in the 2012 PEA and
- Metal prices of:
$3.74 /lb copper,$13.23 /lb molybdenum,$1,495 /oz gold and$23.58 /oz silver. - Metallurgical recovery assumptions of 92% for copper, 50% for molybdenum, 50% for gold and 55% for silver.
- Operating costs of
$1.09 /tonne for mining (plus$0.02 /bench below 1605 metres)*;$5.82 /tonne for processing; and$0.30 /tonne for G&A. - Smelting, refining and transportation costs per tonne concentrate of
$80.00 ,$0.08 and$88.00 , respectively. - Pit slopes of 52 degrees in the overlying volcanics and 44 degrees in the porphyry units.
- Mineral resources were tabulated within the pit at a cut-off grade of 0.20% copper. This is above an operating breakeven cut-off grade (approximately 0.11% copper) that covers mining, process and G&A costs.
*The
PROCESSING AND METALLURGY
Entrée has retained SGS Minerals Services in
A summary of results from the locked cycle tests completed to date on the domain composites is presented in Table 4. The first two tests, LCT-1 and LCT-2, were run at a primary grind target of 170 micrometres. This target was lowered in LCT-3 and LCT-4 to optimize the copper recovery. In addition, a rougher scavenger flotation stage was added to further reduce losses to the rougher tailings stream. The results show very similar metal recoveries as those used in the 2012 PEA; however, the recent flotation testwork has shown that a coarser grind size (P80 155 micrometres) than previously used in the 2012 PEA (P80 120 micrometres) can be used with a minor impact on average copper recovery. This has significantly improved the process operating costs by lowering power requirements, as well as decreasing the consumption of grinding media and liners in the ball mill. Further reduction in operating costs has also been achieved through simplification of the reagent scheme.
Table 4. Locked Cycle Test Results from the 2015 SGS Metallurgical Program.
Test # | LCT-1 | LCT-2 | LCT-3 | LCT-4 |
Conditions | ||||
Feed Composite | Cpy | Py | Cpy | Bn |
Target 1° Grind P80, micrometres | 170 | 170 | 155 | 155 |
Target 2° Grind P80, micrometres | 25 | 25 | 25 | 25 |
Rougher Scavenger | no | no | yes | yes |
Final Concentrate | ||||
Copper Grade, % | 28.0 | 26.9 | 27.4 | 31.5 |
Copper Recovery, % | 90.9 | 84.2 | 92.2 | 91.3 |
Molybdenum Grade, % | 0.28 | 0.20 | 0.27 | 0.58 |
Molybdenum Recovery, % | 58.1 | 39.2 | 63.0 | 75.0 |
Gold Grade, g/t | 1.47 | 0.95 | 1.28 | 3.03 |
Gold Recovery, % | 41.3 | 44.0 | 49.7 | 66.4 |
Silver Grade, g/t | 36.5 | 22.9 | 31.6 | 65.0 |
Silver Recovery, % | 69.6 | 32.5 | 50.6 | 64.2 |
(Feed Composites: Cpy=Chalcopyrite; Py=Pyrite-Chalcopyrite, Bn=Bornite-Chalcopyrite)
In addition, grindability work has confirmed that the feed material is of moderate hardness, with average Bond Rod Work Index and Bond Ball Work Index values of 15.6 kWh/t and 15.5 kWh/t, respectively.
Metallurgical Projection
Locked cycle flotation testing has demonstrated that a simple flotation flow sheet with moderate grinds, three stages of cleaning, and low reagent additions is able to generate a saleable copper concentrate, with no penalty elements identified.
The proposed flowsheet for the processing plant consists of a conventional SAG/Ball milling circuit to generate a flotation feed product P80 of approximately 155 micrometres. The flotation circuit would produce separate copper and molybdenum concentrate products for dewatering and shipment to third party smelters. LOM average mill feed would consist primarily of material from the chalcopyrite (46%) and bornite (41%) domains, with a lesser amount from the pyrite zone (13%). Table 5 presents a summary of the metallurgical projection for the Ann Mason deposit. Grades and recoveries are based on the results of the locked-cycle flotation tests from the 2011 Metcon and 2015 SGS testwork programs.
Table 5. Projected Grades and Recoveries for the Copper and Molybdenum Concentrates.
Grade | Recovery (%) | |||||||
Product | Cu % |
Mo % |
Au g/t |
Ag g/t |
Cu | Mo | Au | Ag |
Copper Concentrate | 30.0 | 0.1 | 1.65 | 36.0 | 92.0 | 17.1 | 57.0 | 55.0 |
Molybdenum Concentrate | 2.5 | 50.0 | 0.6 | 15.0 | 0.1 | 50.0 | 0.2 | 0.2 |
The potential for producing a separate molybdenum concentrate is currently being investigated at SGS, and larger scale testing is required in order to generate accurate grade and recovery estimates, as a consequence of the low sample head grade. An estimated molybdenum recovery of 50% is used in the 2015 PEA and is based on early-stage separation testwork carried out in 2012. In addition, payable by-product levels of gold and silver have also been identified in the copper concentrate, similar to the 2012 PEA.
CAPITAL COSTS
The pre-production capital cost estimate includes the open pit mine capital expenditures, capitalized pre-production stripping, a 120,000 tpd processing plant, infrastructure (including a tailings facility, power improvements, water and roads), environmental costs, owner's and indirect costs and contingency. The open pit mine equipment is assumed leased; therefore, only the down-payment portion is considered in the mine capital costs. The lease cost occurring within the pre-production period is also capitalized.
Sustaining capital cost includes the down payment portion of LOM mine equipment replacement, tailings expansions, infrastructure upgrades and reclamation costs.
Development capital costs for the 2015 PEA show a slight increase (5.5%) over the 2012 PEA capital (
Initial capital and sustaining capital costs for the 2015 PEA, summarized below in Table 6, were estimated using current (Q2 2015) data and pricing .
Table 6. Summary of Ann Mason 2015 PEA capital cost estimates.
Capital Cost ($ Millions) | |||||
Category | Pre-Production and Year 1 Capital |
Sustaining Capital (Years 2-21) |
Total Capital | ||
Open Pit | 450.6 | 88.7 | 539.3 | ||
Processing | 452.2 | 4.5 | 456.7 | ||
Infrastructure | 180.7 | 24.5 | 205.1 | ||
Environmental | 2.1 | 68.5 | 70.6 | ||
Owner's and Indirect Costs | 162.7 | 1.6 | 164.3 | ||
Contingency | 102.8 | 3.2 | 106.0 | ||
Total | 1,351.0 | 191.0 | 1,542.0 |
Note: Total reported values in table are rounded.
OPERATING COSTS
Total Years 1-21 operating costs for the Project are estimated to be
Table 7. Summary of Ann Mason 2015 PEA operating cost estimates.
Operating Costs (Year 1 - 21) | |||
Category | $/tonne Mined |
$/tonne Mill Feed |
$/tonne Cu Concentrate |
Mining (mill feed and waste) | 1.50 | 4.13 | 455 |
Processing | --- | 4.59 | 506 |
G&A | --- | 0.26 | 29 |
Subtotal On-Site Costs | --- | 8.98 | 990 |
Transportation, Port Costs, Shipping | --- | 0.87 | 96 |
Royalties | --- | 0.07 | 7 |
Total Pre-Tax Operating Cost | --- | 9.92 | 1,093 |
Taxes | --- | 1.42 | 157 |
Total Post-Tax Operating Cost | --- | 11.34 | 1,250 |
ENVIRONMENTAL
Over the past several years, Entrée has continually focussed on advancing environmental studies and permitting for Ann Mason. Baseline environmental studies, including Biology (vegetation and wildlife), Cultural Resources, and Waters of
PERMITTING
Permits required for the development of Ann Mason include an approved Mining Plan of Operations from the BLM, Water Pollution Control and Reclamation Permits from the
Results of the baseline environmental studies will form part of an Environmental Impact Study ("EIS") of the Project, as required by the National Environmental Policy Act ("NEPA"). Once Entrée completes a Pre-Feasibility Study of the
ANN MASON NEAR-TERM DEVELOPMENT AND EXPLORATION PLANS
With the release of a positive updated PEA study, Entrée has now completed several of the longer lead time items required to advance to a Pre-Feasibility level on the Project. Future work should include a small amount of additional drilling to convert the remaining Inferred blocks within the Phase 5 pit to Measured and Indicated resources and to potentially extend mineralization within the current pit design to further reduce the strip ratio. The main additional studies required prior to Pre-Feasibility include:
- Geotechnical, condemnation, water monitoring and exploration drilling.
- Environmental studies (socio-economic, air quality, acid rock drainage, hydrogeological).
- Engineering studies (mining, process, geotechnical, infrastructure, tailings, reclamation, operating and capital cost estimation, etc.).
Several other high-priority targets on the
On the near-surface Blue Hill oxide target (1.5 kilometres northwest of the Ann Mason deposit), copper oxide mineralization extends from surface to a maximum depth of 185 metres (average approximately 125 metres), over an area of 800 by 500 metres and remains open to the northwest and southeast. Inferred mineral resources were previously reported in
- Combined oxide and mixed domain: 72.13 Mt averaging 0.17% copper (0.10% copper cut-off).
- Sulphide domain: 49.86 Mt averaging 0.23% copper at a base case 0.15% copper cut-off.
Drilling of the underlying sulphide target remains sparse, but has identified a target more than one kilometre in width which remains open in most directions with potential for expansion. Blue Hill has not been incorporated into the current PEA study, however, through additional drilling there is potential for the Blue Hill oxide copper project to be incorporated into the overall mine plan.
2015 PEA PREPARATION AND QUALIFIED PERSONS
The 2015 PEA was completed independently by
Robert Cinits, P.Geo., Vice-President Corporate Development with Entrée, a Qualified Person as defined by NI 43-101, approved the technical information in this news release.
A technical report supporting the 2015 PEA and updated mineral resource estimate will be filed on SEDAR within 45 days.
Non-U.S. GAAP Performance Measurement
"Cash Costs" and all-in sustaining cost (or "AISC") are non-U.S. GAAP Performance Measurements. These performance measurements are included because these statistics are widely accepted as the standard of reporting cash costs of production in
ABOUT ENTRÉE GOLD INC.
Entrée
Additionally, as a joint venture partner with a carried interest on a portion of the Oyu Tolgoi mining project in
This news release contains forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995 and forward-looking information within the meaning of applicable Canadian securities laws.
Forward-looking statements include, but are not limited to, statements with respect to the estimation of mineral resources; the realization of mineral resource estimates; anticipated future production, capital and operating costs; cash flows and mine life; potential size of a mineralized zone; potential expansion of mineralization; potential reduction of strip ratio; completion of a Pre-Feasibility study on the Project; potential development of the
In certain cases, forward-looking statements and information can be identified by the use of words such as "plans", "expects" or "does not expect", "is expected", "budgeted", "scheduled", "estimates", "forecasts", "intends", "anticipates", or "does not anticipate" or "believes" or variations of such words and phrases or statements that certain actions, events or results "may", "could", "would", "might" "will be taken", "occur" or "be achieved". While the Company has based these forward-looking statements on its expectations about future events as at the date that such statements were prepared, the statements are not a guarantee of Entrée's future performance and are subject to risks, uncertainties, assumptions and other factors which could cause actual results to differ materially from future results expressed or implied by such forward-looking statements and information. Such factors and assumptions include, amongst others, that the size, grade and continuity of deposits and resource and reserve estimates have been interpreted correctly from exploration results; that the results of preliminary test work are indicative of what the results of future test work will be; that the prices of copper, gold, molybdenum and silver will remain relatively stable; the effects of general economic conditions, changing foreign exchange rates and actions by government authorities; the availability of funding on reasonable terms; the impact of changes in interpretation to or changes in enforcement of laws, regulation and government practices, including laws, regulation and government practices with respect to mining, foreign investment, royalties and taxation; the terms and timing of obtaining necessary environmental and other government approvals, consents and permits; the availability and cost of necessary items such as skilled labour, transportation, power, water, and appropriate smelting and refining arrangements; uncertainties associated with legal proceedings and negotiations; and misjudgements in the course of preparing forward-looking statements.
In addition, there are also known and unknown risk factors which may cause the actual results, performances or achievements of Entrée to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements and information. Such factors include, among others, risks related to international operations, including legal and political risk; risks associated with changes in the attitudes of the governments to foreign investment; discrepancies between actual and anticipated production, costs, mineral reserves and resources and metallurgical recoveries; global financial conditions; changes in project parameters as plans continue to be refined; inability to upgrade Inferred mineral resources to Indicated or Measured mineral resources; inability to convert mineral resources to mineral reserves; conclusions of economic evaluations; future prices of copper, gold, silver and molybdenum; failure of plant, equipment or processes to operate as anticipated; accidents, labour disputes and other risks of the mining industry; delays in obtaining government approvals, permits or licences or financing or in the completion of development or construction activities; environmental risks; title disputes; limitations on insurance coverage; as well as those factors discussed in the section entitled "Risk" in the Company's most recently filed Management's Discussion and Analysis and in the Company's Annual Information Form for the financial year ended
Manager Investor Relations
604-687-4777 or Toll Free: 866-368-7330
604-687-4770 (FAX)
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