February 8, 2011 - Nevada Copper Corp. (TSX: NCU) ("Nevada Copper") Nevada Copper is pleased to provide an update on progress of the Definitive Feasibility Study ("DFS"), the start of which was announced on November 25, 2010. The DFS team, led by Tetra Tech Inc., is building upon previous Preliminary Economic Assessments completed in March 2008 and December 2009 (both filed on SEDAR). The DFS is scheduled for completion by June 30, 2011.
Tetra Tech's team in December focussed on updating the mineral estimate and completing a number of trade-off studies prior to commencement of detailed engineering. The recently completed definition drilling program totalling 50,000 meters was very successful in achieving its objective of moving additional mineral resources into the Measured and Indicated categories as well as discovering "stacked" mineralization below the existing North deposit. The DFS will use this updated resource estimate to develop mine plans and, ultimately, a categorized mining reserve.
The trade-off studies covered such areas as staging of mine development from underground and the larger scale open-pits; tailings storage alternatives; reviewing potential production rates; methods of accessing the underground East and E2 deposits and ore transport from underground comparing decline versus shaft options; for the open pits, truck vs. in-pit crushing and conveying; and power supply alternatives.
With the results of the trade-off studies, Nevada Copper has directed Tetra Tech to proceed with detailed engineering and costing on the basis of the following project development parameters:
Phased Project Development
For purposes of the DFS, Nevada Copper has elected to evaluate a phased project development build-out to allow for earlier production from an underground operation located entirely on private, patented claims. The earlier Phase 1 underground mine and mill operation can be developed economically on its own and would not be dependent upon subsequent phases of the project. A subsequent Phase 2 would involve two open pits, which would require additional environmental design, amendments to local and State permits and Federal approvals. This phased plan means that the stand-alone underground project could be in operation as early as late 2013 while additional environmental studies are performed to secure Federal approvals for Phase 2.
Nevada Copper believes that Phase 1 operations will generate early cash flows that will provide lower cost financing options for the larger Phase 2 development and construction.
Phase 1 - Underground Operation on Private Land
- Phase 1 development includes a 8,000 ton per day mine/mill operation with ore feed from the high grade East and E2 underground deposits. Phase 1 mining and milling rates will be optimized and determined as part of the DFS.
- Phase 1 operation is highly attractive because of its small environmental footprint with the development contained entirely within private patented mining claims - requiring no Federal permits. This phase would require State and County permits only and result in faster permitting and earlier initial copper production. Final permits for the Phase 1 development are expected to be received by the third quarter of 2012.
- Ore from the East and E2 deposits will be transported to surface by two vertical shafts -- one to each of the deposits, which will also be linked underground by a conveyor-equipped decline. Compared to access via a decline, this configuration allows for the earliest possible access to the ore zones, maximizes operational flexibility and minimizes the potential for cost overruns due to any adverse near-surface ground conditions.
Phase 2 - Open Pit Mine/Mill on Private and BLM Land
- A Phase 2 expansion includes a 60,000 tons per day open pit mine feeding a separate mill facility with grind size optimized for maximum copper recovery from the open pit ores. Phase 2 mining and milling rates will be optimized and determined as part of the Definitive Feasibility Study. The mining sequence will likely start with pre-stripping of the North Deposit and later move towards the coincident mining of both the North and South Deposits.
- Phase 2 would require BLM Plan of Operations and an Environmental Impact Statement since the project would extend onto unpatented claims held by Nevada Copper on BLM lands. Phase 2 development timeline allows for more time for detailed engineering and environmental design associated with the larger open pits, mine rock storage facilities, tailings storage facilities and the groundwater studies needed to support County, State and Federal permitting.
Phase 2 approvals are expected to be received approximately 27 months after submission of a complete BLM Plan of Operations. The BLM Plan of Operations is targeted for submission in Q3 of 2012.
Annual copper production for Phase 1, based on previous studies, is expected to be up to 120 million pounds with a life-of-mine average of approximately 90 million pounds. At full production, including Phases 1 and 2, annual copper production, based on previous studies, is expected to be up to 270 million pounds with a life-of-mine average of approximately 190 million pounds. The DFS will confirm the actual annual copper production schedule based on the sequencing of Phase 1 and 2 mine production, mining rates, mill recoveries and mill feed grades.
Other key elements of the DFS are discussed below:
- Water Rights. Nevada Copper already owns water rights well in excess of Phase 1 requirements and is currently working on the acquisition, or lease of, additional water rights that would be adequate for the larger combined operation.
- Tails Storage. For maximizing the potential for water recycling, dry stacked tailings has been selected for Phase 1, and dewatered tails for the larger Phase 2 expansion.
- Power Supply. Supply of line power to the Project will require upgrading of existing distribution lines and substations. Energy availability nearby in the City of Yerington is considered sufficient, with upgrading, for Phase 1 power requirements. A high voltage power line is located 5 miles east of the property is the likely source of energy for the larger Phase 2 requirements. On-site natural gas generation is also under consideration with existing natural gas lines in place approximately 8 miles west of the Project.
- Concentrates Transportation. Copper concentrates will be transported by truck to a rail loading facility located close to Yerington and then by Union Pacific rail to a west coast port. Direct truck-to-port transportation is being evaluated as a backup in times where there may be rail disruptions. The overall transportation plan is under development by specialist consultants and will be incorporated into the DFS.
- Segregated Magnetite Tailings. The process flow sheets for both Phase 1 and 2 require magnetic separation of magnetite before the copper flotation circuits. The magnetite tails will be segregated for future processing and, although not considered in this DFS, possible future sale of an iron magnetite concentrate. Nevada Copper will initiate further studies to determine how best to extract value from this considerable high grade resource.
Robert McKnight, Executive Vice President of Nevada Copper, comments, "We are very pleased with progress on the feasibility study to date. This work has focussed on various trade-off studies and finalizing an updated mineral resource estimate as a basis for the DFS reserve estimate. Work now will advance to detailed work on all aspects of the staged mine development platform, mine and mill design, equipment selection, developing mine production schedules, development of capital & operating costs and provision for the related project infrastructure requirements. Meantime, State permits allowing for the start on underground access to the East and E2 deposits are expected by the end of the first quarter, 2011."
Tetra Tech are an engineering, environmental and permitting and construction services company with over 12,000 staff working in over 30 countries. Tetra Tech's mining services are provided by 4,000 staff from offices in the US, Canada, Peru, Chili, Panama, Colombia, Argentina, UK, China, Australia, India, and Africa. Tetra Tech's services span the full life cycle of the mining industry. This includes frontend assessments and feasibility studies; engineering and environmental evaluations and permitting, geotechnical engineering around underground and surface mining, including tailings impoundments and heap leach facilities; process metallurgy; EPCM; closure and reclamation and post-closure operation and monitoring.
The Pumpkin Hollow project is under the supervision of Gregory French, CPG #10708, a Qualified Person as defined in Canadian National Instrument 43-101, who is responsible for the preparation of the technical information in this news release.
For additional information about Nevada Copper please visit our website at www.nevadacopper.com.
NEVADA COPPER CORP.
Giulio T. Bonifacio, President & CEO
This news release includes certain statements that may be deemed "forward-looking statements". All statements in this release, other than statements of historical facts, including the likelihood of commercial mining, possible future copper grades, recoveries and production rates, and possible future financings are forward-looking statements. Although Nevada Copper believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in the forward-looking statements. Factors that could cause actual results to differ materially from those in forward-looking statements include unsuccessful exploration results, changes in metals prices, changes in the availability of funding for mineral exploration, unanticipated changes in key management personnel and general economic conditions. Mining is an inherently risky business. Accordingly the actual events may differ materially from those projected in the forward-looking statements. Mineral resources that are not mineral reserves do not have demonstrated economic viability. For more information on Nevada Copper and the risks and challenges of its business, investors should review Nevada Copper's annual filings that are available at www.sedar.com.
For further information call:
|Eugene Toffolo, Corporate Communications|
Toll free: 1-877-648-8266
|Robert McKnight, P.Eng.|
Executive Vice President