TORONTO, ONTARIO -- (Marketwire) -- 02/26/13 -- Energizer Resources Inc. (TSX: EGZ)(OTCBB: ENZR)(FRANKFURT: YE5) ("Energizer" or the "Company") is pleased to report the results of the Preliminary Economic Assessment Technical Update ("PEA") for its Molo graphite deposit ("Molo" or the "Project"), located in Madagascar.
The PEA Technical Report Update is currently being compiled by DRA Mineral Projects ("DRA") of Johannesburg, South Africa. A Canadian National Instrument 43-101 technical report relating to the PEA will be filed on SEDAR within 45 days of this news release.
Craig Scherba, President & COO commented: "We have completed our stated objective to deliver both a NI 43-101 resource and a PEA on the Molo Project. This PEA provides the necessary information to the market for quantified evaluation of the Molo deposit.
"Preliminary test work conducted by South Africa's national mineral research organization, Mintek, demonstrated that we were able upgrade our concentrates to purities between 98% and 98.6% graphitic carbon. We are now moving forward with additional metallurgical testing as part of a full Feasibility Study which will look to enhance beneficiation to obtain battery grade material with target purity levels of greater than 99%. This work, along with the optimization of flake size distribution through pilot plant test work, should positively affect the blended graphite sale price and flake size distribution. As such, we believe this PEA to be conservative."
Summary of the PEA Study Results (Economic parameters refer to real numbers with the exception of the post-tax NPV and post-tax IRR; $USD)
----------------------------------------------------------------------------Pre-tax NPV (10% Discounted, real) $421,464,000Pre-tax IRR (Real) 48%Post-tax NPV (10$ Discounted, real) $341,803,000Post-tax IRR (Real) 41%Payback 3.0 yearsMine life 20 yearsGraphite sale price $1564 per tonneAverage Head Grade 8.50%Average annual ore mined 1,169,749 tonnes per annumAverage stripping ratio 1.65Average mill recovery 89%Average annual production 84,000 tonnes per annumCapital cost $162,043,315Mining cost $4.76 per tonne mined (Initial LOM)Processing cost $22.29 per tonne milledTransportation cost (FOB port) $105.00 per tonne concentrate----------------------------------------------------------------------------
Note: DRA is working towards meeting the requirements of a Preliminary Economic Assessment as defined in National Instrument 43-101 - Standards of Disclosure for Mineral Projects ("NI 43-101"). The economic analysis relevant to the optimal pit model contained in the technical report is based on Indicated Resources (as defined in NI 43-101), and is preliminary in nature. Inferred Resources are considered too geologically speculative to have mining and economic considerations applied to them and to be categorized as Mineral Reserves (as defined in NI 43-101). Mineral resources that are not mineral reserves do not have demonstrated economic viability. There is no certainty that the reserves development, production, and economic forecasts on which the PEA is based will be realized. The capital expenditure estimate is based on a +/- 25% cost accuracy and does not include any ancillary costs outside of actual production of possible investment in infrastructure related assets. According to the Ontario Securities Commission, a PEA is held to be accurate to +/- 50% accuracy.
