CALGARY, ALBERTA -- (Marketwire) -- 01/04/13 -- BACANORA MINERALS LTD. (TSX VENTURE: BCN) ("Bacanora" or the "Company") is pleased to announce the results of a Preliminary Economic Assessment ("PEA") on the Company's Cajon Borate deposit in Sonora, Mexico.
Highlights of the PEA for a potential colemanite mine and production facility with a mining rate of 231,100 tonnes averaging 10.5% B2O3 per annum to yield 50,000 tonnes of 40-42% colemanite concentrate per year over a 25 year mine life suggest annual revenue of $US25 million for an IRR of 248.5% with a 4 year pay back. Capital costs are estimated at $US7.25 million and average operating costs at $US170/tonne. Net Present Value ("NPV") of the project, discounted at 8%, is $US113 million, assuming an average colemanite concentrate price of $US500/tonne. The preliminary economic assessment includes forward looking information including, but not limited to assumptions concerning colemanite prices, cash flow forecasts, project capital and operating costs, commodity recoveries, mine life and production rates. Readers are cautioned that actual results may vary from those presented. Further testing will need to be undertaken to confirm economic feasibility of the El Cajon deposit. Readers are further cautioned that mineral resources that are not mineral reserves do not have demonstrated economic viability.
Preliminary Financial Highlights
----------------------------------------------------------------------------Open Pit Mine Production per annum 231,100 tonnes @ 10.5% B2O3----------------------------------------------------------------------------Colemanite concentrate production per annum 50,000 tonnes @ 42% B2O3----------------------------------------------------------------------------Revenue ($US500/tonne of colemanite concentrate) per annum $25 million----------------------------------------------------------------------------NPV (8% Discount) $US113 million----------------------------------------------------------------------------Internal rate of return (IRR) 248.5%----------------------------------------------------------------------------Average Operating costs $US170 per tonne----------------------------------------------------------------------------Total Initial Capital Costs $US7.25 million----------------------------------------------------------------------------Expected Mine Life 25 years----------------------------------------------------------------------------Pay Back of Capital Costs 4 year----------------------------------------------------------------------------
The Cajon deposit forms part of the Magdalena Borate Project, which is 100% owned by Bacanora's wholly-owned subsidiary, Minera Sonora Borax S.A. de C.V., subject to a 3% royalty in favor of an arm's length third party and a 3% gross overriding royalty in favor of Mr. Colin Orr-Ewing, a director of Bacanora.
Three main borate zones have been located on the Magdalena project area: El Cajon; Bellota and Pozo Nuevo. Other targets include the recently discovered Represo colemanite prospect and the Escuadra occurrence.
