Trevali discovers new zone at New Brunswick project
After an early bump Trevali Mining (TSE: TV) shares pared gains on Wednesday after announcing exploration drilling at its 100% owned Stratmat property in New Brunswick has discovered a new copper-gold zone.
In early afternoon trade the Vancouver-based junior was changing hands at $1.31 on the Toronto Exchange, affording the company a $370 million market value.
The counter is up 28% year-to-date on the back of rising zinc prices and after raising the necessary funds last year to recommence production at the Caribou mine and mill complex located in the Bathurst mining camp.
The company’s Caribou zinc-lead-copper-silver-gold project is made up of the Stratmat, Halfmile and Caribou deposits.
“The fact that after approximately 50-years of property-wide exploration the Trevali exploration team, using the latest exploration technology, can model, predict, target and discover significant new blind massive sulphide mineralization is highly encouraging and bodes well for ongoing future discoveries at Stratmat and within the Bathurst Mining Camp,” said Mark Cruise, Trevali’s President and CEO.
“While our focus and efforts are firmly concentrated on near-term re-start of mining operations at our 3,000 tonne-per-day Caribou Zinc Mine, new discoveries and expansion of our resource base will remain a key driver in our goal to grow the Company’s presence in the region,” Cruise said.
According to the Caribou Preliminary Economic Assessment – the company’s first National Instrument 43-101 compliant mine plan for the project – released in May initial construction could start this quarter with an expedited restart at Caribou in Q2 2015.
Pre-production initial capital costs are pegged at $36m with a semi-autogenous grinding (SAG) mill already on site for existing infrastructure of 3,000 tonnes per day plant, a geochemical laboratory and tailings treatment facility.
The PEA outlines a 6.2 million tonne resource grading 6.11% zinc, 2.49% lead, 0.34% copper, 67.9 g/t silver, and 0.86 g/t gold.
Life of mine (6.3 years) average annual production is estimated at 93 million pounds of zinc, 33 million pounds of lead, 3 million pounds of copper, 730,000 ounces of silver and a some 1,500 ounces of gold.
Cash costs for Caribou came in at $0.46 per pound zinc equivalent with total site operating cost of $74.77 per tonne milled.
Trevali, which took ownership of the complex in 2012 after acquiring Maple Minerals in an all-stock deal valued at $22 million, said approximately 300 permanent fulltime positions will be created resulting and $57 million in direct royalties and tax payments.
Trevali can also haul ore from its 100%-owned Halfmile deposit located 20 kilometers south, while it builds up underground mine infrastructure at Caribou. Trial mining at Halfmile was conducted in 2012 and the ore was shipped to Glencore Xstrata’s Brunswick #12 mine for processing.
In Peru, the company is actively producing zinc and lead-silver concentrates from its Santander mine and 2,000-tonne-per-day metallurgical plant.