Mercator Gold plc is pleased to announce that THEMAC Resources Group Limited (“THEMAC”) has released the results of the preliminary economic assessment (“PEA”) commissioned from SRK Consulting (US), Inc. for the Copper Flat copper-molybdenum-gold-silver project (“Copper Flat”) in New Mexico, USA.
As previously announced, THEMAC has agreed to acquire Mercator’s exclusive option over a 100% interest in Copper Flat (“the Sale”). THEMAC is listed on the TSX Venture Exchange under the symbol MAC.H.
- PEA completed by SRK with robust results:
- Mine life 17 years.
- Payback within 2 years from start of production.
- Life-of-mine (“LoM”) operating costs US$1.41/lb copper equivalent, excluding gold and silver credits.
- Average production of approx. 36 million lbs copper and 628,000 lbs molybdenum per annum over first 13 years of operations.
- Further average production over four years of approximately 15 million lbs copper and 335,000 lbs molybdenum per annum.
- NPV (6%) US$144 million.
- IRR (post-tax) 23%.
- Initial capital US$179 million and sustaining capital over the LoM of US$112 million.
- Mine closure costs of US$40 million.
- A boost to the project economics is anticipated once gold and silver values are incorporated into the financial model and as aspects of the proposed mining operation are optimised.
- The updated Copper Flat Mineral Resource estimate by SRK (announced by THEMAC on May 25, 2010) now includes molybdenum.
- Upon completion of the Sale, THEMAC will proceed with a prefeasibility study, and pending positive economic results at that stage, onto a full feasibility study.
- Project permitting is already underway and all project costs are being met by THEMAC.
- A full announcement made by THEMAC on 8 July 2010 may be viewed here.
About the Sale
Copper Flat is a former producing mine with substantial infrastructure still in place. As a result of the sale Mercator will acquire a substantial interest in THEMAC and will therefore retain a substantial interest in Copper Flat’s future development.
Completion of the Sale is subject to, inter alia, the completion by THEMAC of a minimum C$5 million equity financing, and regulatory and shareholder approval.
Mercator is a diversified mineral and renewable energy development company creating value for its shareholders through a process of finding value, adding value and realising value.
Mercator has an experienced management team with expertise in the structuring and execution of value accretive transactions.
For further information please contact:
|Mercator Gold plc|
|Michael Silver, Chairman||Tel:||+44 (0) 20 7929 1010|
|Patrick Harford, Managing Director||+1 646 239 9087|
|Daniel Stewart & Company plc|
|Oliver Rigby||Tel:||+44 (0) 20 7776 6550|
|Old Park Lane Capital plc|
|Forbes Cutler||Tel:||+44 (0) 20 7518 2603|
|Director of Corporate Broking|
|Bankside Consultants Ltd||Tel:||+44 (0) 20 7367 8888|
|Barry Kaplan Associates|
|Larry Kaplan||Tel:||+1 732 747 0702|
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