JUNEAU, ALASKA -- (Marketwired) -- 04/03/13 -- An independent analysis of Chieftain Metals' recent Feasibility Study for the proposed Tulsequah Chief mine demonstrates the project is far from "robust" as claimed by Chieftain and suffers from a number of questionable assumptions, unreasonably optimistic predictions, and an overall "best case" type analysis. The Feasibility Study also excludes normal capital costs like sales taxes and financing expenses, and ignores key information such as the strong opposition to the project from the Taku River Tlingit First Nation (TRTFN), unacknowledged environmental liabilities, and Chieftain management's history of bankruptcies.
"When you read beyond Chieftain's hype and vague promises to 'optimize' operations and costs, it is clear the Tulsequah Chief simply isn't a viable mine. It is strongly opposed by the Taku River Tlingit First Nation and poses major risks to investors, Southeast Alaska's most productive salmon fishery and the local community," said Chris Zimmer of Rivers Without Borders. "The Feasibility Study is based on optimistic assumptions about metals prices, the ore deposit, and development schedules. Chieftain admits it has no smelters lined up and that contaminants in the ore will make it difficult to market the copper concentrates. In addition, the mine may require expensive long-term water treatment that Chieftain has not prepared for."
On January 28, 2013 Chieftain released a Technical Report compiled by JDS Engineering, which summarizes the Feasibility Study recently completed for the Tulsequah Chief. The mine site is on the Tulsequah River, just upstream of its confluence with the Taku River and the Alaska/BC border. Today Rivers Without Borders (RWB) is releasing an assessment of the Tulsequah Chief project. This report, written by mining analyst Joan Kuyek, is based on reviews of publicly available documents, information not included in the JDS Technical Report, and an independent technical and economic analysis commissioned by RWB from James R. Kuipers, P.E., a registered professional mining engineer with over 30 years of experience.
"Chieftain's Technical Report is based on a 'best case' analysis which simply isn't a prudent way to analyze a complex project like the Tulsequah Chief," said Zimmer. "The reliance upon 'probable' rather than more certain 'proven' mineral reserves suggests a lack of confidence in the ore reserves. This is a recipe for another bankruptcy and continued acid mine drainage pollution of the region's most productive salmon river."
Examples of significant problems with the mine proposal as announced in the JDS Technical Report include:
-- The Technical Report does not disclose the November 18, 2012 Joint Clan Mandate (JCM) from the TRTFN which "opposes the currently proposed Tulsequah Chief Project" and "is directing the TRTFN Leadership to act on this JCM Mandate and take all necessary steps to ensure that the Tulsequah Chief project, as currently proposed, is not developed on Taku River Tlingit Territory."
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