MONTREAL, QUEBEC -- (Marketwire) -- 03/22/13 -- Augyva Mining Resources Inc. ("Augyva or the Company") (TSX VENTURE: AUV) is pleased to announce that it has received the results of a Preliminary Economic Assessment ("PEA") prepared by Met-Chem Canada Inc. ("Met-Chem") for the Company's 35% owned Duncan Lake Iron Project (the "Duncan Lake Project") in northern Quebec. Augyva and Century Iron Mines Corporation (TSX: FER) ("Century") are joint venture partners on the Duncan Lake Project.
DUNCAN LAKE PROJECT PEA KEY ESTIMATED RESULTS BASED ON 100% OWNERSHIP OF THE PROJECT:
-- Net Present Value ("NPV") of $4.1 billion (pre-tax) at 8% discount;-- Internal Rate of Return ("IRR") of 20.1% (pre-tax);-- Payback 4.2 years-- Mine life 20 years at 12 million tonnes per year ("Mtpy") pellet production-- Initial project capital $3.8 billion-- Average site operating cost $59.17/tonne of pellet-- Accuracy of the estimate +/- 35%
The PEA is based on the production of 12 Mtpy of acid pellets (66.3% Fe, 5.1% SiO2) year-round from the Duncan Lake deposits 3 and 4 (see Augyva news release dated August 27, 2012 for greater details). Mined resources will be transported to the concentrator located near deposit 3. Concentrate will be pumped from the concentrator 135 km by pipeline to the pellet plant close to the town of Chisasibi on the shore of James Bay, near Stromness Island. Pellets will be stored close to the pellet plant and the Duncan Lake dedicated port, and then shipped to ports in Europe and China, during the 4 month ice-free period. The project is planned as a mixed local and fly-in/fly-out operation, with camps in Radisson and at the proposed pellet and port facilities near Chisasibi.
Peter R. Jones CEO of Augyva said, "The mining plan produces 12 million tonnes/annum of seasonally shipped pellets generating an attractive project NPV and IRR". He also said, "This project is independent of the complexities of existing rail lines and ports and I look forward to the next phases of evaluation and development".
In-pit resources were estimated from the optimal economic pits that were defined using the operating cost and sales prices (defined below) and based on the August 2012 Met-Chem resource models. The in-pit resources include measured, indicated and inferred resource categories. A total of 800 Mt of resources will be mined over a 20 year period from deposits 3 and 4 using 400 short ton haul trucks and 37 m3 hydraulic excavators. Other mining highlights include:
-- Average annual resource production, 41 Mt grading 24.8% T Fe;-- Average stripping ratio, 1.8:1 (1.3:1 for the first five years);-- Average open pit haulage distance, 4.0 km to crusher, 3.8 km to waste stockpiles.
Mineral processing estimates were based on metallurgical test work performed on representative samples of the Duncan Lake Project by SGS Lakefield facilities and COREM Laboratory. Results from the following tests were used as the basis for the PEA:
-- JK Drop-weight;-- Bond Low-energy impact and Bond abrasion tests;-- SAG Mill Comminution conducted on seven different lithologies;-- Bond rod mill and Bond ball mill grindability tests conducted on seven different lithologies;-- Coarse cobbing with a dry magnetic drum;-- Davis tube tests.