After hitting new all-time highs, palladium might be ready for even more gains, with some analysts pointing to the $1,700 level as a reality
Spot palladium reached a new record high of $1,664.34 early on Monday. Palladium’s December futures also hit a new record high, touching $1,642.90 an ounce level
At the time of writing, December futures were at $1,631.10, up 0.38% on the day
(Kitco News) –
After hitting new all-time highs, palladium might be ready for even more
gains, with some analysts pointing to the $1,700 level as a reality.
Spot palladium reached a new record high of $1,664.34 early on Monday. Palladium’s December futures
also hit a new record high, touching $1,642.90 an ounce level. At the
time of writing, December futures were at $1,631.10, up 0.38% on the
day.
Higher gold prices, rising on rising Middle East tensions and a
breakdown in the U.S.-China trade talks, have also been helping
palladium, analysts said.
“Palladium’s move higher is very much a correlation to gold. Gold
moved up quite nicely on Monday. Also, we had a silver rally as well as
platinum. Palladium followed suit. The precious metals moved higher most
likely on mentions from Fed officials of potentially more interest rate
cuts,†head of global strategy at TD Securities Bart Melek said on
Monday.
On Monday, markets were digesting the U.S. decision to send more
troops to the Gulf region following the drone attacks on Saudi Arabia’s
oil facilities on September 14. This came almost immediately after the
U.S. imposed sanctions on Iran, including the country’s central bank on
Friday.
Other significant precious metals drivers have been U.S. President
Donald Trump’s statement on Friday that he is not interested in just a
partial deal with China and Chinese officials proceeding to cancel their
visit to U.S. farmers.
Healthy demand
Palladium has also been supported by healthy demand, limited supply,
higher equities and liquidity concerns, according to UBS strategist Joni
Teves.
“The combination of healthy demand, constrained supply, and
challenging liquidity conditions is likely driving prices higher here.
Our understanding is that there were some additional supplies earlier in
the year mainly from release in pipeline stocks, which likely drove the
easing in forwards in H1. But still-healthy demand implies that those
stocks should have been well absorbed,†Teves wrote on Monday.
The new high surged past palladium’s significant resistance barrier
of $1,620, which means more upside, including $1,700 is possible, said
Commerzbank AG commodity analyst Carsten Fritsch.
“It already exceeded the zone of massive resistance at 1,600/1,620 on
Friday, opening up scope for a further rise to $1,700. There has been
no evidence of late of any significant investor interest in palladium.
Net long positions have climbed only marginally, while ETF holdings have
remained at a low level,†Fritsch wrote.
Downside risks
Some downside risks remain for palladium this year, including the unresolved U.S.-China trade war.
“A breakdown of U.S.-China trade talks, deterioration in economic
data and a pullback in equities from the highs, therefore, presents
downside risks for palladium over the remainder of the year. The rally
to all-time-high palladium prices might attract some short positions in
the near term, especially considering how low gross shorts are at the
moment – only 25% of the record,†Teves explained.
BofA Merrill Lynch also sees a high probability of a cool down in the rally based on subsiding “fear in physical markets.â€
“Assets under management at ETFs have now stabilized, suggesting that
the immediate need and willingness of market participants to tap these
vehicles has been limited. While fundamentals remain solid … all this
suggests that the rally especially of palladium may pause here,†BofA
Merrill Lynch wrote in a note in September.
Tags: clean energy, CSE, palladium, PGM, PGM Demand, stocks, tsx, tsx-v Posted in New Age Metals | Comments Off on #Palladium hits record highs, is $1,700 next? New Age Metals $NAM.ca Owns North America’s largest primary platinum group #PGM metals deposit $WG.ca $XTM.ca $WM.ca $PDL.ca
Palladium price peaks at new record high, rhodium roaring
Palladium hit a fresh all-time high on Friday on persistent worries about supply from South Africa and prospects of a pickup in demand in China.
Nymex Palladium futures gained 1.5% to $1,636.60 an ounce in New York in morning trading before easing back. Palladium’s gains for the year now top 40% or $477 per ounce.
Palladium hit a fresh all-time high on Friday on persistent worries
about supply from South Africa and prospects of a pickup in demand in
China.
Nymex Palladium futures gained 1.5% to $1,636.60 an ounce in New York
in morning trading before easing back. Palladium’s gains for the year
now top 40% or $477 per ounce.
The threat of labour unrest in South Africa, which together with
Russia are responsible for more than 80% of global platinum group metal
output, loomed large again on Friday after the militant union Amcu
re-elected its firebrand leader.
Amcu rose to prominence in 2012 when clashes between police and
striking workers at the Marikana mine in the African nation’s prolific
platinum belt left 34 dead.
Any signs of stimulus from the Chinese auto market could lead to additional upside price potential.
BMO Capital Markets
More than three-quarters of palladium ends up in catalytic converters
for gasoline engines and the rise in the precious metal comes despite a
severe slowdown in vehicle sales around the world.
Top consumer China has seen sales drop for 14 out of the last 15
months, and in August 9.9% fewer cars and truck rolled off lots compared
to last year. Annual sales in the world’s no 2 market – the US – are
also expected to come in below 2018’s total.
What has lifted palladium is greater average loadings per vehicle as
more stringent emissions standards are implemented in China and Europe.
BMO Capital Markets in a recent note said “any signs of stimulus from
the Chinese auto market could lead to additional upside price
potential.â€
Robust rhodium
Sister metal rhodium is also on a roll, more than doubling in price
so far this year. Rhodium, also used mainly in autocatalysts, exchanged
hands at $5,400 an ounce on Friday in New York, the highest in 11 years.
Due to rarity, the small size of the market and concentrated supply, prices are typically volatile.
Rhodium (and sister metal ruthenium) stand out when it comes to price
swings – rhodium touched $10,025 an ounce just before the 2008
financial crisis hit, but would drop 90% before the end of that
tumultuous year.
Platinum was trading flat on Friday at $945.10 after briefly scaling
$1,000 an ounce two weeks ago. Given the historically weak price, some
investors are using the opportunity to stock up on the metal.
ETF holdings of platinum have expanded rapidly this year, reaching 3.3m ounces last week, up 38% or 916,000 ounces in 2019.
In contrast, palladium ETF vaults have been emptying as investors
lock in some of the gains. Palladium-backed ETF holdings total 655,000
ounces, down 120,000 ounces year to date.
Posted by AGORACOM-JC
at 11:22 AM on Thursday, September 19th, 2019
A look at a mineralized outcrop containing Platinum Group
Metals (PGMs) on the River Valley project site. Metals such as PGMs and
lithium will continue to experience sustained increases in demand as the
global push for sustainability becomes mainstream.
The future of transportation is poised for sustainability
through the global adoption of hybrid electric vehicles (HEVs) and fully
battery electric vehicles (BEVs)
Industry experts are forecasting a consistent increase in demand for lithium, used to develop the batteries in HEVs and BEVs
Industry experts are also forecasting an increase in demand for the Platinum Group Metals (PGMs) used by autocatalyst manufacturers, to ensure compliance with tightening emissions regulations
New Age Metals’ flagship River Valley primary PGM project in
Ontario, and lithium division with assets in Manitoba positions the
company as a key player in the growth of HEVs and lowering CO2 emissions
By: Jason Smith
Harmful carbon dioxide emission levels are rising globally,
largely due to the use of fossil fuels as the primary source of energy
used by the transportation industry. Examples of this use include the powering of jumbo jets, container ships and semi-trucks.
Passenger vehicles also rely on fossil fuels and have a bad reputation
for the amount of pollutants they release into the atmosphere on a daily
basis.
However, passenger vehicles produce more than four times the
greenhouse gas (GHG) emissions of all domestic aviation, according to
the Globe and Mail. The focus over the last few years has been on making these passenger vehicles
more environmentally-friendly, which is a large reason why automakers
have started producing electric or hybrid electric vehicles (HEVs).
While automakers are being forced by emissions regulation to reduce
their carbon footprint, the majority of consumers are not ready to go
fully electric and are increasingly choosing hybrid vehicles to bridge
the gap with cars that solely use batteries. With more vehicles being
sold worldwide each year, especially those that are less pollutive,
automakers will need more of the critical raw materials used to create
the hybrid and electric vehicles.
This need for less pollutive methods of transportation is where
lithium and palladium enter the picture. Lithium is used to produce
batteries, but the size of car batteries used in HEVs and the increase
in HEV sales that is anticipated by the industry
will require substantially more lithium than what is available in the
market today. Palladium, which is a member of the PGM family, is largely
used to reduce pollution that originates from vehicles operating with
internal combustion engines (ICE) through its use as the primary
‘catalyst’ in catalytic converters (commonly known as auto-catalysts).
While palladium is often overlooked when it comes to the push for
sustainability, it has played a huge role in reducing the amount of
toxic emissions being released into the atmosphere. This positive impact
is most noticeable in urban areas where automobiles are concentrated.
The value of an ounce of palladium has increased exponentially in the
past year, rising 60 per cent year-over-year in Sept. 2019 from under
USD$950 to over USD$1500. The reason for the dramatic price movement is
due to supply concerns and the metals value as the premier option for
use in auto-catalysts.
With ICE-powered vehicles not going away any time soon, the global demand for palladium will endure as a pollution-control
device, and investors are taking notice. Anton Berlin is the head of
strategic marketing at the world’s largest producer of Palladium,
Norilsk Nickel. He recently stated, “Hybrids — cars with both an
electric battery and a combustion engine — will dominate the electric
vehicle market in the long-run, which suggests a long-term advantage for
the PGM market.â€
The extensive infrastructure required to support a universal
transition to EVs still needs time to be completely fleshed out but is
gaining speed. According to a new report entitled, “2019 Investor’s Business Daily/TIPP Electric Vehicle Outlook Study,â€
range and available charging stations are what make potential EV buyers
the most apprehensive, although these are issues that are currently
being addressed.
Regardless, the desire to limit pollution is leading to the growing
demand for middle-ground HEVs, which is causing car manufacturers to
focus on their abilities to design and assemble automobiles that emit
less noxious fumes primarily through the use of palladium and lithium.
Research has shown that hybrid electric vehicles actually require
more palladium and lithium than traditional gasoline-powered vehicles,
so increased adoption of hybrid vehicles will subsequently increase
demand for these metals.Harry Barr, CEO, New Age Metals.
A flagship project in a historic mining district
Anticipating the continued strength in demand for palladium and the general forecast for lithium demand is New Age Metals
(TSX.V: NAM, OTCQB: NMTLF, FSE: P7J), bolstered by the company’s
flagship River Valley project in the Sudbury region of Ontario. The
Sudbury region, known as the mining capital of Canada, is largely
dominated by major mining and processing operations run by Vale and
Glencore.
However, these companies’ operations are facing depleted ores to feed
processing facilities and may need to acquire additional sources to
operate closer to their intended capacity. This is where River Valley
comes in as an integral player, which lies just 100 km from Sudbury and
hosts 2.9 million ounces in the (NI-43 101 compliant) measured and
indicated category of palladium-equivalent (PdEq) resources and 1.1
million ounces in the inferred category.
Diagram of New Age Metals’ current project locations. Supplied
Harry Barr, CEO of New Age Metals, is well aware of the role his company is poised to play as demand for hybrids continually increases.
“Research has shown that hybrid electric vehicles actually require more
palladium and lithium than traditional gasoline-powered vehicles, so
increased adoption of hybrid vehicles will subsequently increase demand
for these metals,†he notes. New Age Metals recently had
a preliminary economic assessment completed on River Valley, projecting
a mine with a 14-year lifespan, 6 million tonnes annually of potential
process plant feed at an average grade of 0.88 g/t PdEq and a process
recovery rate of 80 per cent, resulting in an annual average payable
PdEq production of 119,000 ounces.
Barr elaborates, “It’s unique to have a deposit of mineable platinum
group metals in North America, and very unique to have a deposit near so
much processing infrastructure that’s also close to car manufacturers,â€
emphasizing the advantageous position the company finds itself in with
River Valley.
With this in mind, Barr and his team are focused on maximizing this
opportunity to expand the resources at River Valley and develop it to a
point where the project achieves feasibility and is producing. In the
meantime, the project also has tremendous exploration upside and
management plans to continue with an aggressive exploration program. A credible investment alternative to the big PGM players
A key advantage for the River Valley project is its location in a
safe, reliable mining jurisdiction. The majority of the world’s
palladium currently comes from South Africa and Russia,
both of which could be problematic in terms of long-term supply
security, political issues and concerns regarding human rights and
sustainability.
Worth noting is the fact that Norilsk Nickel is not only the worlds’ largest producer of palladium and nickel, but also the largest emitter of sulfur oxides which is a pollutant considered immediately dangerous to life and health.
Fortunately, New Age Metals’ Ontario-based project offers the benefit
of being located in a safe jurisdiction that has excess processing
infrastructure and is known for moderating the environmental impacts from mining and smelting.
Barr explains, “Sudbury’s been a mining center for 120 years, so every
type of mining service is nearby.†Given this unique situation, the
company represents a credible investment opportunity.
Sid Rajeev, vice-president of Fundamental Research Corp., conducted a
thorough analysis of the River Valley PEA. He notes, “Our biggest
takeaway from the PEA was that, at a reasonable palladium price estimate
of USD$1,200 per oz, the study showed an after-tax net present value at
5 per cent of $138 million. New Age Metals’ current enterprise value is
just USD$3 million, implying that shares are trading at just 2 per cent
of net asset value.â€
This level of potential upside is rarely available to the investment
community and as New Age Metals brings River Valley towards
pre-feasibility, it’s unlikely that the company will remain undervalued
for long.
Our biggest takeaway from the PEA was that, at a reasonable
palladium price estimate of USD$1,200 per oz, the study showed an
after-tax net present value at 5 per cent of $138 million. New Age
Metals’ current enterprise value is just USD$3 million, implying that
shares are trading at just 2 per cent of net asset value.Sid Rajeev, vice-president, Fundamental Research Corp.
Having a substantial deposit of PGMs in North America positions New
Age Metals to benefit from the future of sustainability, however there
is a general lack of knowledge about PGMs in North America due to the
low number of primary PGM producers in the arena. The company is in the
process of moving River Valley along the development curve but is also
seeking a qualified partner to assist in further exploration and
development of the project.
New Age Metals’ lithium angle
Adding to the company’s green energy story is its suite of lithium projects in Manitoba. The demand
for this metal is forecasted to increase by 20 per cent per year
through to 2028. With lithium in high demand due to the ever-increasing
growth in the popularity of battery-powered vehicles, these projects
give the company optionality on lithium discovery; two of its eight
projects are currently drill-ready. Plans to drill on the ‘Lithium One’
and ‘Lithium Two’ are in place and company management is anticipating
the initiation of these drill programs in the near future.
The company’s lithium projects are situated along strike of the Tanco
Pegmatite and the claims encompass several pegmatite groups. The
projects are also located 140 km northeast of Winnipeg, Manitoba. The
Tanco mine was owned by the Cabot Corporation who announced in Jan.
2019, that it would be selling the mine to Sinomine Rare Metals Co. Ltd
for USD$130 million. This sale demonstrates a high interest in the
project and potentially the surrounding area, which lends credibility to
New Age Metals’ projects, based on shared geology and proximity.
Exploration on Lithium One is ongoing with concentration of the
northern section, with focus on the Annie and Silverleaf Pegmatites.
Silverleaf Pegmatite has zones of spodumene and lepidolite exposed on
surface with samples up to 4.1 per cent lithium oxide (Li2O). The Annie
Pegmatite returned values up to 0.6 per cent Li2O and 0.37 per cent
Ta2O5.
On Lithium Two, the Eagle Pegmatite is exposed on surface and was
last drilled in 1948, and at the time it was indicated that it remains
open to depth and along strike. A historic tonnage of 544,460 tonnes
of 1.4 per cent Li2O was reported during this year, however the actual
amount has not been confirmed by a qualified person at this time.
An ownership map showing Tanco Mine location proximity to New Age Metals projects. Supplied
With drilling set to begin in Manitoba and River Valley continuing to
move along the development curve, New Age Metals expects to
consistently generate valuable news for investors in the coming months,
keeping the company top-of-mind. Its position in palladium and lithium
provide the company with incredible potential as a high-performing
source for investment as the need for sustainable transportation
continues to be a significant social issue.
To learn more about New Age’s operations and project portfolio, visit them online: newagemetals.com
The following video is a short overview of New Age Metals, and
outlines some of the reasons why the company is an avenue for investment
in the future of sustainability associated with the electrification of
transport
Palladium futures topped $1,600 an ounce on Thursday to finish at the highest level on record, shaking off recent data showing a decline in Chinese auto sales, as emissions standards fueled bets surrounding strong demand for the metal used in pollution-control devices.
“Palladium has witnessed a resurgence in price over the past two
months, much in line with other hard assets such as gold, platinum and
silver,†said Ryan Giannotto, director of research at exchange-traded
fund issuer GraniteShares. “What distinguishes palladium is its unique
position spanning precious and specialty industrial metals, and this
latter characteristic has benefited the metal in the momentary detente
in the U.S.-China trade conflict.â€
President Donald Trump on Wednesday announced
he would delay a tariff hike —from 25% to 30%—that was scheduled to
take effect Oct. 1, until Oct. 15., “as a gesture of goodwill.â€
The rally in palladium, which used in vehicle pollution-control
devices, comes despite data this week from the China Association of
Automobile Manufacturers which showed that China’s total auto sales fell
6.9% from the same month a year earlier to 1.96 million, according to Reuters.
Palladium for December delivery PAZ19, +3.65%
climbed $48, or 3.1%, to settle at $1,604.80 an ounce on Comex after
tapping a high of $1,616.50. Prices for the most-active contract have
never settled above the $1,600 mark, based on records going back to
January 1977, according to Dow Jones Market Data.
The metal previously settled at a record $1,588.10 on July 10 of this year and has gained 50% in the year to date.
“Auto sales have slowed, but this is more than completely offset†by
increased loadings per car for transport on China 6 emission standards
and “real-world driving (as opposed to fixed-in-a-lab testing) in
Europe, R. Michael Jones, president and chief executive officer of
Platinum Group Metals Ltd. PLG, -1.16% told MarketWatch. “In the USA, strong SUV and truck sales are also creating continued demand.â€
Annualized August auto sales in the U.S. were “better than expectedâ€
and up 2% year-over-year at 17 million vehicles, equal to a three-month
average, analysts at Evercore ISI wrote in a note last week.
Looking ahead, aggressive interest-rate cuts “should be supportive to
auto sales and palladium, as long as the risk-on mood continues…,â€
analysts at Zaner Metals said in a daily report Thursday.
Posted by AGORACOM-JC
at 8:34 AM on Thursday, August 8th, 2019
Highlights
Life of mine (LOM) of 14 years, with 6 million tonnes annually of potential process plant feed at an average grade of 0.88 g/t Palladium Equivalent (PdEq) and process recovery rate of 80%, resulting in an annual average payable PdEq production of 119,000 ounces
Pre-Production capital requirements: $495 M
Undiscounted cash flow before income and mining taxes of $586M
Undiscounted cash flow after income and mining taxes of $384M
August 8th, 2019 – Rockport, Canada – New Age Metals Inc. (NAM or the Company) (TSXV:NAM)(OTC:NMTLF)(FSE:P7J.F) Harry Barr, Chairman & CEO, stated; “We are pleased to announce that we have filed our National Instrument 43-101 Technical Report on the Preliminary Economic Assessment (PEA) on the Company’s 100% owned River Valley PGM Project in Sudbury, Ontario Canada (River Valley or the Project) titled “Technical Report, Updated Mineral Resource Estimate and Preliminary Economic Assessment of the River Valley Project” with an Effective Date of June 27, 2019, on SEDAR at www.sedar.com. The PEA demonstrates positive economics for a large-scale open pit mining operation, with 14 years of Palladium and Platinum production.”
(*) Cautionary statement NI 43-101: The
PEA was prepared in accordance with National Instrument 43-101 Standards
of Disclosure for Mineral Projects (“NI 43-101”). Readers are cautioned
that the PEA is preliminary in nature. It includes Inferred Mineral
Resources that are considered too speculative geologically to have the
economic considerations applied to them that would enable them to be
categorized as Mineral Reserves, and there is no certainty that the PEA
will be realized. Mineral Resources that are not Mineral Reserves do not
have demonstrated economic viability.
All currency is stated as CDN$ unless stated otherwise.
PEA Highlights (CDN$ unless otherwise noted): – Life of mine (LOM) of 14 years, with 6 million tonnes annually of potential process plant feed at an average grade of 0.88 g/t Palladium Equivalent (PdEq) and process recovery rate of 80%, resulting in an annual average payable PdEq production of 119,000 ounces – Pre-Production capital requirements: $495 M – Undiscounted cash flow before income and mining taxes of $586M – Undiscounted cash flow after income and mining taxes of $384M – Average unit operating cost of $19.50/tonne over the life-of-mine – LOM average operating cash cost of $971 per ounce (US$709/oz) and all-in sustaining cash cost of $972 per ounce (US$709/oz) at a 1.37 CDN: USD exchange rate. – A mining contractor will be engaged for the open pit mining – Pre-tax NPV (5%): $261M, After-tax NPV (5%): $138 M – Pre-tax IRR: 13%, After-tax IRR: 10% – Assumed metal prices of US$1,200/oz Pd, US$1,050/oz Pt, US$1,350/oz Au, US$3.25/lb Cu, US$8.00/lb Ni, US$35/lb Co – Using a + 20% Pd price sensitivity (to the base case of US$1,200/oz Pd) US$1,440 /oz Pd returns a pre-tax IRR of 19% and an after tax-IRR of 15%. – River Valley process plant feed will be treated by a conventional sulphide flotation process plant to produce a single saleable PGE concentrate that will be transported to the Sudbury area for smelting/refining – Potential for up to 325 jobs at the peak of production
Project Economics and Sensitivities
The economic results of the PEA are
summarized in Table 1 on an after-tax basis. The sensitivities and the
impact of cash flows have been calculated for +/- 20% variations against
the base case.
Table 1: Project Economics Sensitivity. All values shown are on an after-tax basis.
Project Sensitivity Analysis
Pd Price Sensitivity
%
-20%
-15%
-10%
-5%
Base Case
+5%
+10%
+15%
+20%
US$/oz
960
1,020
1,080
1,140
1,200
1,260
1,320
1,380
1,440
NPV (CDN$ M)
-23
16
59
98
138
179
220
260
300
IRR (%)
4
6
7
8
10
11
12
13
15
OPEX Sensitivity
%
-20%
-15%
-10%
-5%
Base Case
+5%
+10%
+15%
+20%
Cost Per Tonne
16
17
18
18
19
20
21
22
23
NPV (CDN$ M)
212
194
175
157
138
120
102
83
68
IRR (%)
14
12
11
10
10
9
8
7
7
CAPEX Sensitivity
%
-20%
-15%
-10%
-5%
Base Case
+5%
+10%
+15%
+20%
CAPEX (CDN$ M)
397
422
446
471
496
521
546
570
595
NPV (CDN$ M)
284
248
212
175
138
102
64
28
-6
IRR (%)
14
13
12
11
10
8
7
6
5
Updated Mineral Resource Estimate
The pit constrained Updated Mineral
Resource Estimate which formed the basis of the PEA, is set out in Table
2 and was prepared by WSP under the supervision of Todd McCracken, P.
Geo., an “Independent Qualified Person”, as defined in NI 43-101. The
effective date of this Updated Mineral Resource Estimate is January 9,
2019. The Updated Mineral Resource database contains 710 boreholes with
106,554 assays records in the database, and 2,642 surface channel
samplings. The Updated Mineral Resource Estimate was completed on the
Dana North, Dana South, Pine, Banshee, Lismer, Lismer Extension, Varley,
Azen, Razor, and River Valley Extension Zones, using the ordinary
kriging (OK) methodology on a capped and composited borehole dataset
consistent with industry standards. Validation of the results was
conducted thought the use of visual inspection, swath plots and global
statistical comparison of the model against inverse distance squared (ID2) and nearest neighbour (NN) models.
Table 2: Pit Constrained Updated Mineral Resource Estimate for River Valley PGM Project – Effective Date June 27, 2019.
Click Image To View Full Size
Class
PGM + Au (oz)
PdEq (oz)
PtEq (oz)
Measured
1,394,000
1,701,000
1,701,000
Indicated
983,000
1,166,000
1,166,000
Meas +Ind
2,377,000
2,867,000
2,867,000
Inferred
841,000
1,059,000
1,059,000
Notes:
1.CIM definition standards were followed for the Mineral Resource Estimate.
2.The 2018 Mineral
Resource models used Ordinary Kriging grade estimation within a
three-dimensional block model with mineralized zones defined by
wireframed solids.
3.A base cut-off
grade of 0.35 g/t PdEq was used for reporting Mineral Resources in a
constrained pit and 2.00 g/t PdEq was used for reporting the Mineral
Resources under the pit.
6.Mineral Resources that are not Mineral Reserves do not have economic viability
7. The Inferred
Mineral Resource in this estimate has a lower level of confidence than
that applied to an Indicated Mineral Resource and must not be converted
to a Mineral Reserve. It is reasonably expected that the majority of the
Inferred Mineral Resource could be upgraded to an Indicated Mineral
Resource with continued exploration.
About NAM’S PGM Division
NAM’s flagship project is its 100% owned River Valley PGM Project (NAM Website – River Valley Project)
in the Sudbury Mining District of Northern Ontario (100 km east of
Sudbury, Ontario). Recently the Company announced the results of the
first PEA (see News Release – June 27th, 2019)
completed on the River Valley Project. The PEA has been developed by
various independent consultants – P&E Mining Consultants Inc.
(P&E) was responsible for the open pit mining, surface
infrastructure, tailings facility, and project economics; DRA Americas
Inc. (“DRA”) was responsible for all metallurgical test work and
processing aspects of the Project; and WSP Canada Inc. (“WSP”) was
responsible for the Mineral Resource Estimate. The PEA is a preliminary
report, however, it has demonstrated that there are potentially positive
economics for a large-scale mining open pit operation, with 14 years of
Palladium and Platinum production.
On April 4th, 2018,
NAM signed an agreement with one of Alaska’s top geological consulting
companies. The companies stated objective is to acquire additional PGM
and Rare Metal projects in Alaska. On April 18th, 2018,
NAM announced the right to purchase 100% of the Genesis PGM Project,
NAM’s first Alaskan PGM acquisition related to the April 4th
agreement. The Genesis PGM Project is a road accessible, under
explored, highly prospective, multi-prospect drill ready Palladium (Pd)-
Platinum (Pt)- Nickel (Ni)- Copper (Cu) property. A comprehensive
report on previous exploration and future phases of work was completed
by Avalon Development of Fairbanks Alaska in August 2018 on Genesis.
On August 29, 2018, the Avalon report
was submitted to NAM, management is actively seeking an
option/joint-venture partner for this road accessible PGM and Multiple
Element Project using the Prospector Generator business model. See our
latest press release dated July 25, 2019 which details the current summer work program for the Genesis Project.
About NAM’S Lithium Division
The
Company has eight pegmatite hosted Lithium Projects in the Winnipeg
River Pegmatite Field, located in SE Manitoba. Three of the projects are
drill ready. The Company has applied for a drill permit for its
Lithium Two Project and expects the final permit to be granted by the
end of July. This Pegmatite Field hosts the world class Tanco Pegmatite
that has been mined for Tantalum, Cesium and Spodumene (one of the
primary Lithium minerals) in varying capacities, since 1969. NAM’s
Lithium Projects are strategically situated in this prolific Pegmatite
Field. Presently, NAM is the largest mineral claim holders for Lithium in the Winnipeg River Pegmatite Field. On January 15th 2018, NAM announced an agreement with Azincourt Energy Corporation (see Jan 15, 2018, Feb 22nd, 2018 and April 11th, 2018, May 2nd, 2018 Press Releases.
Qualified Persons and NI 43-101 Disclosure
The PEA was prepared under the
supervision of Eugene Puritch, P.Eng. of P&E Mining Consultants Inc.
The Updated Mineral Resource Estimate was prepared by Todd McCracken,
P.Geo. of WSP Canada Inc. Metallurgical test work and process plant
design and cost estimates were prepared by Jim Kambossos, P. Eng. of
DRA Americas Inc. All three are independent Qualified Persons in
accordance with NI 43-101. Mr. Puritch has reviewed and approved the
technical information in this news release. Michael Neumann, P.Eng.,
Managing Director for NAM is the Company Qualified Person as defined by
National Instrument 43-101 and has reviewed and approved the technical
content of this news release.
On behalf of the Board of Directors
“Harry Barr”
Harry G. Barr, Chairman and CEO
For further information on New Age Metals, please contact Harry Barr at 613-659-2773, or [email protected]
Neither the TSX Venture Exchange
nor its Regulation Services Provider (as that term is defined in the
policies of the TSX Venture Exchange) accepts responsibility for the
adequacy or accuracy of this release.
Cautionary Note Regarding Forward
Looking Statements: This release contains forward-looking statements
that involve risks and uncertainties. These statements may differ
materially from actual future events or results and are based on current
expectations or beliefs. For this purpose, statements of historical
fact may be deemed to be forward-looking statements. In addition,
forward-looking statements include statements in which the Company uses
words such as “continue”, “efforts”, “expect”, “believe”, “anticipate”,
“confident”, “intend”, “strategy”, “plan”, “will”, “estimate”,
“project”, “goal”, “target”, “prospects”, “optimistic” or similar
expressions. These statements by their nature involve risks and
uncertainties, and actual results may differ materially depending on a
variety of important factors, including, among others, the Company’s
ability and continuation of efforts to timely and completely make
available adequate current public information, additional or different
regulatory and legal requirements and restrictions that may be imposed,
and other factors as may be discussed in the documents filed by the
Company on SEDAR (www.sedar.com), including the most recent reports that
identify important risk factors that could cause actual results to
differ from those contained in the forward-looking statements. The
Company does not undertake any obligation to review or confirm analysts’
expectations or estimates or to release publicly any revisions to any
forward-looking statements to reflect events or circumstances after the
date hereof or to reflect the occurrence of unanticipated events.
Investors should not place undue reliance on forward-looking statements.
Tags: clean energy, CSE, palladium, PGM, PGM Demand, stocks, tsx, tsx-v Posted in Featured, New Age Metals | Comments Off on New Age Metals $NAM.ca Files NI 43-101 Technical Report for Preliminary Economic Assessment on the River Valley #PGE #PGM Project in Sudbury $WG.ca $XTM.ca $WM.ca $PDL.ca
Posted by AGORACOM-JC
at 5:16 PM on Tuesday, July 30th, 2019
SPONSOR: New Age Metals Inc. (NAM:TSX-V) owns one of North America’s largest primary platinum group metals deposits in Sudbury, Canada with NI 43-101 mineral resource estimate of 2,867,000 PdEq Measured and Indicated ounces, with an additional 1,059,000 PdEq ounces in the inferred category. Learn More.
NAM: TSX-V
Platinum’s Tide Is Turning – World Platinum Investment Council
In a recent interview with Kitco News, Trevor Raymond, director of research with the World Platinum Investment Council, said that the tide could be turning in platinum’s favor with resurgent interest in platinum’s demand growth potential.
Investment demand has been the critical factor behind the metal’s new bullish momentum.
Raymond noted that in the council’s quarterly supply demand publication, investment demand through exchange-traded products totaled 690,000 ounces in the first three months of the year.Â
(Kitco News) – Although platinum remains the laggard within the precious-metals complex, it is starting to catch up as platinum continues to see unprecedented investor demand.
In a recent interview with Kitco News, Trevor Raymond, director of
research with the World Platinum Investment Council, said that the tide
could be turning in platinum’s favor with resurgent interest in
platinum’s demand growth potential.
Investment demand has been the critical factor behind the metal’s new
bullish momentum. Raymond noted that in the council’s quarterly supply
demand publication, investment demand through exchange-traded products
totaled 690,000 ounces in the first three months of the year.
“That was the largest increase in ETF holdings in any three-month
period since the launch of physically backed platinum ETFs in 2007,†he
said.
He added that the trend has continued into through the second
quarter. While quoting listings data, Raymond said that EFT holdings
have increased by more than 750,000 ounces as of July.
“The magnitude and speed of the buying indicate this is institutional
money taking big positions in the platinum market,†he said. “We
haven’t seen this type of buying since 2014.â€
Although institutional investors very familiar with platinum are
jumping back in, Raymond said that retail and newer institutional
investors remain on the sidelines. He added that he expects the broader
investment market to move back into platinum when the metal sees a more
published evidence of demand growth from more diesel cars on Europe’s
roads, traction in heavy-duty fuel-cell trucks and increased use of
platinum in gasoline cars to replace scarce and pricey palladium.
Platinum’s automotive demand has suffered the last three years
because of the 2015 diesel emissions scandal. Platinum is the main
component in diesel-engine emissions control.
Raymond noted that this issue is starting to become less of a factor
in the auto sector; however, he added that a more significant factor for
platinum is its potential substitution, at a one-to-one ratio, for
palladium.
Many analysts have noted palladium’s meteoric rise in the
precious-metals space as prices have risen in the face of strong
industrial demand in gasoline vehicles and unresponsive supply. Although
many companies have been hesitant to confirm that they will substitute
palladium with platinum, Raymond said that they might have already done
so due to availability and price concerns.
“Regardless of the price difference, there is not enough palladium
supply to meet automotive needs so some companies will be forced to turn
back to platinum,†he said. “Substitution has happened before, and it
can happen again.â€
The WPIC sees a platinum surplus of around 375,000 ounces for this
year, but Raymond said that it wouldn’t take a significant rise in
demand to reduce the metal’s excess.
Tuesday, platinum is seeing some modest selling pressure as some
investors take profits after the metal posted a three-month high last
week. October platinum futures last traded at $878 an ounce, down 0.44%
on the day.
Posted by AGORACOM-JC
at 9:17 AM on Thursday, July 25th, 2019
The Genesis PGM Project is a road accessible, under explored, highly prospective multi-prospect drill ready Pd-Pt-Ni-Cu property that warrants initial drilling, additional surface mapping, sampling to expand the known footprint of mineralization and to determine the ultimate size and grade of the layered mineralization outlined to date.
A 3-phase summer work program has been initiated on the project which is intended to map potential hydrothermal alteration anomalies and define structural domains to better define drill targets on the Project.
A mineralized horizon has been identified in outcrop sampling for 850 m along strike and a 40 m true thickness. (for more information please click to the April 18, 2018 news release).
The identification of two different styles of PGM/ Multi-Element mineralization at Sheep Hill suggests that multiple mineralizing events have occurred.
NAM management is actively seeking an option/joint-venture partner for this road accessible PGM/Multiple Element Project using the Prospector Generator business model.
July 25th, 2019 – Rockport, Canada – New Age Metals Inc. (TSXV:NAM)(OTC:NMTLF)(FSE:P7J) is pleased to announce it has engaged Avalon Development Corp (Avalon) of Alaska, USA to carry out a field work program on its Genesis PGM-Ni-Cu Project in Alaska.
Genesis Project Summer 2019 Field Program
The summer 2019 field program on
Genesis is intended to map hydrothermal alteration to better define
drill targets on the Project and will be comprised of 3 phases of work;
ASTER Imaging and Interpretation, Landsat TM Imagery Processing and
Interpretation and ground induced polarization, Airborne Magnetics and
EM Reinterpretation. A detailed description of each phase of work
follows:
Phase 1: ASTER Imaging and Interpretation
The main objective of the ASTER (Advanced
Spaceborne Thermal Emission and Reflection Radiometer) processing and
interpretation is to map potential alteration targets to aid
district-scale PGM-Cu-Ni sulfide exploration. The end goal of this phase
is to generate 3 false color images: a 15-meter false-color image
composed of three VNIR bands, a 30-meter false-color image composed of
three SWIR bands, and a 90-meter false-color image composed of three TIR
bands. Each false-color image is designed to enhance the alteration
targets so they show up distinctively as color anomalies.
Phase 2: Landsat TM Imagery Processing and Interpretation
Interpret potential general clay alteration
targets and potential iron-oxide alteration targets to generate a
30-meter true-color image to aid visual interpretation of the iron-oxide
targets.
Phase 3: Airborne Magnetics and EM Reinterpretation
1. Reprocess existing State of Alaska
airborne magnetic data in 2D and 3D formats to outline chromite-bearing
PGM accumulations and identify structural domains.
2. Reprocess existing State of Alaska
airborne EM data in 2D and 3D formats to outline PGM-Cu-Ni sulfide
conductors and identify structural domains.
3. Reprocessing of a limited ground IP
program completed over the Sheep Hill prospect area to better define
strucutural details and target PGM-Cu-Ni sulfide-bearing horizons.
Merits of the Genesis PGM Project
The Genesis PGM Project is an under explored, highly prospective multi-prospect drill ready Pd-Pt-Ni-Cu property
that warrants follow-up drilling, additional surface mapping, sampling
to expand the known footprint of mineralization and to determine the
ultimate size and grade of the layered mineralization outlined to date.
The stable land status, ease of access and superb infrastructure make
this project prospective for year-around exploration, development and
production.
Significant aspects of the Genesis PGM Project include:
– Drill
ready PGM-Ni-Cu reef style target with 2.4 grams/ton Palladium (Pd), 2.4
grams/ton Platinum (Pt), 0.96% Nickle (Ni), and 0.58% Copper (Cu).
– Reef mineralization is open to the west, east, north, and at depth
– Mineralized reef identified in outcrop for 850 m along strike and a 40 m true thickness
– Separate style of chromite mineralization contains Platinum Group Metals (PGM) up to 2.5 g/t Pd and 2.8 g/t Pt.
– Known PGM mineralization covers a distance of 9 km across the prospect.
– No historic drilling has been done on the project.
– Project is within 3 km of a paved highway and electric transmission line.
– Project is on stable State of Alaska claims.
– Fraser Institute’s 2017 survey of mining companies has Alaska ranked as the 10th best jurisdiction in the world for mining.
Click Image To View Full Size
Figure 1: Location of the Genesis Project, Nelchina Mining
District, Alaska. The Genesis project is a Ni-Cu-PGM property located
in the northeastern Chugach Mountains, 75 road miles north of the city
of Valdez, Alaska. The project is within 3 km of the all-season paved Richardson Highway and a high capacity electric power line. The project is covered by 4,144 hectares (10,240 acres) of State of Alaska mining claims owned 100% by New Age Metals.
ABOUT NAM’S PGM DIVISION
NAM’s flagship project is its 100% owned River Valley PGM Project (NAM Website – River Valley Project)
in the Sudbury Mining District of Northern Ontario (100 km east of
Sudbury, Ontario). Recently the company announced the results of the
first PEA (see News Release – June 27th, 2019) completed on the River Valley Project. The
PEA has been developed by various independent consultants – P&E
Mining Consultants Inc. (P&E) was responsible for the open pit
mining, surface infrastructure, tailings facility, and project
economics; DRA Americas Inc. (“DRA”) was responsible for all
metallurgical test work and processing aspects of the Project; and WSP
Canada Inc. (“WSP”) was responsible for the Mineral Resource Estimate. The
PEA is a preliminary report but it has demonstrated that there are
positive economics for a large-scale mining open pit operation, with 14
years of Palladium and Platinum production.
On April 4th, 2018, NAM signed an agreement with one of Alaska’s top geological consulting companies. The companies stated objective is to acquire additional PGM and Rare Metal projects in Alaska. On April 18th, 2018,
NAM announced the right to purchase 100% of the Genesis PGM Project,
NAM’s first Alaskan PGM acquisition related to the April 4th
agreement. The Genesis PGM Project is a road accessible, under
explored, highly prospective, multi-prospect drill ready Palladium (Pd)-
Platinum (Pt)- Nickel (Ni)- Copper (Cu) property. A
comprehensive report on previous exploration and future phases of work
was completed by Avalon Development of Fairbanks Alaska in August 2018
on Genesis.
On August 29, the Avalon report was submitted to NAM, management is actively seeking an option/joint-venture partner for this road accessible PGM and Multiple Element Project using the Prospector Generator business model.
QUALIFIED PERSON
The contents contained herein that relate
to Exploration Results or Mineral Resources is based on information
compiled, reviewed or prepared by Curt Freeman, a consulting
geoscientist for New Age Metals. Mr. Freeman is the Qualified Person as
defined by National Instrument 43-101 and is the owner of Avalon
Development Corp. and Anglo Alaska Gold Corp, which is the vendor of the
Genesis PGM Project. Mr. Freeman has reviewed and approved the
technical content of this news release.
On behalf of the Board of Directors “Harry Barr” Harry G. Barr Chairman and CEO
Neither the TSX Venture Exchange
nor its Regulation Services Provider (as that term is defined in the
policies of the TSX Venture Exchange) accepts responsibility for the
adequacy or accuracy of this release.
Cautionary Note Regarding Forward
Looking Statements: This release contains forward-looking statements
that involve risks and uncertainties. These statements may differ
materially from actual future events or results and are based on current
expectations or beliefs. For this purpose, statements of historical
fact may be deemed to be forward-looking statements. In addition,
forward-looking statements include statements in which the Company uses
words such as “continue”, “efforts”, “expect”, “believe”, “anticipate”,
“confident”, “intend”, “strategy”, “plan”, “will”, “estimate”,
“project”, “goal”, “target”, “prospects”, “optimistic” or similar
expressions. These statements by their nature involve risks and
uncertainties, and actual results may differ materially depending on a
variety of important factors, including, among others, the Company’s
ability and continuation of efforts to timely and completely make
available adequate current public information, additional or different
regulatory and legal requirements and restrictions that may be imposed,
and other factors as may be discussed in the documents filed by the
Company on SEDAR (www.sedar.com), including the most recent reports that
identify important risk factors that could cause actual results to
differ from those contained in the forward-looking statements. The
Company does not undertake any obligation to review or confirm analysts’
expectations or estimates or to release publicly any revisions to any
forward-looking statements to reflect events or circumstances after the
date hereof or to reflect the occurrence of unanticipated events.
Investors should not place undue reliance on forward-looking statements.
Posted by AGORACOM-JC
at 11:31 AM on Thursday, June 27th, 2019
Life of mine (LOM) of 14 years, with 6 million tonnes annually of potential process plant feed at an average grade of 0.88 g/t Palladium Equivalent (PdEq) and process recovery rate of 80%, resulting in an annual average payable Pd production of 119,000 ounces
Pre-Production capital requirements: $495 M
Undiscounted cash flow before income and mining taxes of $586M
Undiscounted cash flow after income and mining taxes of $384M
June 27th, 2019 – Rockport, Canada – New Age Metals Inc. (NAM) (TSX.V: NAM; OTCQB: NMTLF; FSE: P7J.F) Harry Barr, Chairman & CEO, stated; “We are pleased to update our shareholders and interested parties as to the results of the initial Preliminary Economic Assessment (PEA) for the company’s 100% owned River Valley PGM Project in Sudbury, Ontario Canada. The PEA has been developed by various independent consultants – P&E Mining Consultants Inc. (P&E) was responsible for the open pit mining, surface infrastructure, tailings facility, and project economics; DRA Americas Inc. (“DRA”) was responsible for all metallurgical test work and processing aspects of the Project; and WSP Canada Inc. (“WSP”) was responsible for the Mineral Resource Estimate. The PEA demonstrates positive economics for a large-scale mining open pit operation, with 14 years of Palladium and Platinum production.”
Go-Forward Plan: In
order to enhance the Project, the PEA has outlined a phased work
approach to completing a Pre-Feasibility study. This includes advanced
metallurgical testing to improve / confirm process recoveries and more
accurately estimate concentrate grades, geotechnical logging of drill
core, with new geotechnical holes to create a 3D geomechanical block
model and estimate pit wall angles, hydrogeological studies that will
estimate water inflows to the open pits and generate a site water and
management plan. The Pre-Feasibility study will update the Project study
to a higher level of precision.
NAM plans to continue to improve
the River Valley Project’s value proposition by drill testing
geophysical anomalies found during the 2018 geophysics campaign,
continuing the geophysical program throughout the 16 kilometres of the
contact mineralization adding significant potential to find new
deposits, drilling near the defined open pit shells to increase the mine
life, drilling deeper to test the open-ended Deposit at depth, and
re-assaying existing drill core for Rhodium in order that Rhodium may be
added to the Project’s metal suite.
Technical Report: For
readers to fully understand the information in this news release, they
should read the PEA Technical Report in its entirety which the Company
expects to file in accordance with NI 43-101 within 45 days from the
date of this news release on SEDAR (www.sedar.com)
and it will also be available at that time on the New Age Metals
website, including all qualifications, assumptions and exclusions that
relate to the PEA. The Technical Report is intended to be read in its
entirety, and sections should not be read or relied upon out of context.
PEA Highlights (CDN$ unless otherwise noted):
– Life of mine (LOM) of 14 years,
with 6 million tonnes annually of potential process plant feed at an
average grade of 0.88 g/t Palladium Equivalent (PdEq) and process
recovery rate of 80%, resulting in an annual average payable Pd
production of 119,000 ounces
– Pre-Production capital requirements: $495 M
– Undiscounted cash flow before income and mining taxes of $586M
– Undiscounted cash flow after income and mining taxes of $384M
– Average unit operating cost of $19.50/tonne over the life-of-mine
– LOM average operating cash cost
of $971 per ounce (US$709/oz) and all-in sustaining cash cost of $972
per ounce (US$709/oz) at a 1.37 CDN: USD exchange rate.
– A mining contractor will be engaged for the open pit mining
– Pre-tax NPV (5%): $262M, After-tax NPV (5%): $139 M
– Pre-tax IRR: 13%, After-tax IRR: 10%
– Assumed metal prices of US$1,200/oz Pd, US$1,050/oz Pt, US$1,350/oz Au, US$3.25/lb Cu, US$8.00/lb Ni, US$35/lb Co
– Using a + 20% Pd price
sensitivity (to the base case of US$1,200/oz Pd) US$1,440 /oz Pd returns
a pre-tax IRR of 19% and an after tax-IRR of 15%. Palladium price as of June 25, 2019 is US$1,510/oz Pd, which would return a pre-tax IRR of 21% and an after-tax IRR of 16%.
– River Valley process plant feed will be treated by a conventional sulphide flotation process plant to produce a single saleable PGM concentrate that will be transported to the Sudbury area for smelting/refining
– Potential for up to 325 jobs at the peak of production
PEA Summary
The PEA parameters are summarized in Table 1.
(*) Cautionary statement NI 43-101:
The PEA was prepared in accordance with National Instrument 43-101
Standards of Disclosure for Mineral Projects (“NI 43-101”). Readers are
cautioned that the PEA is preliminary in nature. It includes Inferred
Mineral Resources that are considered too speculative geologically to
have the economic considerations applied to them that would enable them
to be categorized as Mineral Reserves, and there is no certainty that
the PEA will be realized. Mineral Resources that are not Mineral
Reserves do not have demonstrated economic viability. All currency is stated as CDN$ unless stated otherwise.
Table 1: PEA Summary Parameters
Assumptions
Palladium Price (Base case) US$/oz
1,200
Exchange Rate US$:CDN$
1.37
Production Profile
Total Tonnes Processed
78,100,000
Process Plant Head Grade PdEq g/t
0.88
Mine Life (years)
14
Daily process plant throughput (tpd)
16,440
Palladium Process Plant Recovery
80%
Total Payable Palladium Equivalent Ounces
1,600,000
Average annual Palladium Production Ounces
119,000
Operating Costs
Unit Operating Costs (per tonne processed)
19.50
Mining Costs
10.20
Processing Costs
8.44
G&A
0.90
LOM Average Cash Cost US$/oz
709
Capital Requirements
Pre-Production Capital Cost
$495.1 M
Sustaining Capital Cost (Life of Mine) Including Salvage
$1.0 M
Project Economics
Royalties
3% (Buy down to 1.5% with $1,500,000 payment)
Royalty Payable After $1.5M Payment
$39.7 M
Taxes
$202.3 M
Pre-Tax
NPV (5% Discount Rate)
$262 M
IRR
13%
Payback (years)
6.6
Cumulative Undiscounted Cash Flows
$586 M
After-Tax
NPV (5% Discount Rate)
$139 M
IRR
10%
Payback (years)
7.0
Cumulative Undiscounted Cash Flows
$384 M
Operating Cost
Table 2: Operating Cost Summary.
OPERATING COST
LOM ($/t)
Mining Cost
$/t material
2.28
Mining Cost
$/t feed
10.20
Processing Cost
$/t feed
8.44
G&A
$/t feed
0.90
Unit Operating
$/t feed
19.50
Capital Cost
Table 3: Capital Cost Summary
Development Capital
Initial (Y-2, Y-1) ($ M)
Sustaining ($’ M)
Total LOM ($’ M)
Mine Pre-Stripping
17.3
17.3
Process Plant Incl. Indirects
401.3
401.3
TMF
8.0
8.0
Mine Site Infrastructure
10.0
10.0
Office, Warehouse, Shops
10.0
10.0
Owner Cost
5.0
5.0
10% Contingency
43.4
43.4
Initial Project Capital
495.1
495.1
Sustaining Capital
Closure Bond
26.0
26.0
Salvage Value
-25.0
-25.0
Total Sustaining Capital
1.0
1.0
Total Capital
495.1
1.0
496.1
Project Economics and Sensitivities
The economic results of the PEA are
summarized in Table 4 on an after-tax basis. The sensitivities and the
impact of cash flows have been calculated for +/- 20% variations against
the base case.
Table 4: Project Economics Sensitivity.
Project Sensitivity Analysis
Pd Price Sensitivity
%
-20%
-15%
-10%
-5%
Base Case
+5%
+10%
+15%
+20%
Spot
US$/oz
960
1,020
1,080
1,140
1,200
1,260
1,320
1,380
1,440
1,510
NPV (CDN$ M)
-23
16
59
98
139
179
220
260
300
347
IRR (%)
4
6
7
8
10
11
12
13
15
16
OPEX Sensitivity
%
-20%
-15%
-10%
-5%
Base Case
+5%
+10%
+15%
+20%
Cost Per Tonne
16
17
18
18
19
20
21
22
23
NPV (CDN$ M)
212
194
175
157
139
120
102
83
68
IRR (%)
14
12
11
10
10
9
8
7
7
CAPEX Sensitivity
%
-20%
-15%
-10%
-5%
Base Case
+5%
+10%
+15%
+20%
CAPEX (CDN$ M)
397
422
446
471
496
521
546
570
595
NPV (CDN$ M)
284
248
212
175
139
102
64
28
-6
IRR (%)
14
13
12
11
10
8
7
6
5
River Valley Project Site Plan
See the image below that shows a site
plan from the River Valley PEA. The map shows all of the 14 open pits
that have been used in the engineering design of the Project as well as
the proposed process plant site, low-grade stockpile, waste rock storage
facilities, tailings storage facility and site infrastructure.
Click Image To View Full Size
Mineral Resource
The pit constrained Mineral Resource
Estimate which formed the basis of the PEA, is set out in Table 5 and
was prepared by WSP under the supervision of Todd McCracken, P. Geo., an
“Independent Qualified Person”, as defined in NI 43-101. The effective
date of this Mineral Resource Estimate is January 9, 2019. The Mineral
Resource database contains 710 boreholes with 106,554 assays records in
the database, and 2,642 surface channel samplings. The Mineral Resource
Estimate update was completed on the Dana North, Dana South, Pine,
Banshee, Lismer, Lismer Extension, Varley, Azen, Razor, and River Valley
Extension Zones, using the ordinary kriging (OK) methodology on a
capped and composited borehole dataset consistent with industry
standards. Validation of the results was conducted thought the use of
visual inspection, swath plots and global statistical comparison of the
model against inverse distance squared (ID2) and nearest neighbour (NN) models.
Table 5: Pit Constrained Mineral Resource Estimate for River Valley PGM Project – Effective January 9, 2019.
Click Image To View Full Size
Class
PGM + Au (oz)
PdEq (oz)
PtEq (oz)
Measured
1,394,000
1,701,000
1,701,000
Indicated
983,000
1,166,000
1,166,000
Meas +Ind
2,377,000
2,867,000
2,867,000
Inferred
841,000
1,059,000
1,059,000
Notes:
1.CIM definition standards were followed for the Mineral Resource Estimate.
2.The 2018 Mineral
Resource models used Ordinary Kriging grade estimation within a
three-dimensional block model with mineralized zones defined by
wireframed solids.
3.A base cut-off
grade of 0.35 g/t PdEq was used for reporting Mineral Resources in a
constrained pit and 2.00 g/t PdEq was used for reporting the Mineral
Resources under the pit.
6.Mineral Resources that are not Mineral Reserves do not have economic viability
7. The Inferred
Mineral Resource in this estimate has a lower level of confidence than
that applied to an Indicated Mineral Resource and must not be converted
to a Mineral Reserve. It is reasonably expected that the majority of the
Inferred Mineral Resource could be upgraded to an Indicated Mineral
Resource with continued exploration.
Mining and Processing
The PEA is preliminary
in nature, and includes Inferred Mineral Resources that are considered
too speculative geologically to have the economic considerations applied
to them that would enable them to be categorized as
Mineral Reserves. There is no certainty that the Preliminary Economic
Assessment will be realized.
The River Valley Project is expected
to be mined by a contractor. Initial mining will occur at the northwest
end of the Deposit, close to the proposed process plant site. A series
of 14 open pits will be mined, and will progress in a southeasterly
direction. Pit numbers 1 to 4 contain the bulk of the mineralized
process plant feed.
Annual process plant feed of up to 6
Mtpy (0.5 Mtpm) is planned, at an average strip ratio of 3.6:1 over the
life-of-mine. It is anticipated that a fleet of 221 t haul trucks, 29 m3
excavators and 254 mm diameter hole rotary drills will be utilized,
following industry standard conventional open pit mining techniques.
The process plant is designed to
produce a single saleable PGM concentrate using conventional sulphide
flotation techniques. The concentrate will be trucked to a
smelter/refinery in the Sudbury area.
The Run-Of-Mine (ROM) feed from the
mine will be crushed in a single primary jaw crushing stage prior to the
grinding circuit. The crusher discharge will be conveyed to a live
stockpile, which will provide an operating buffer between the crushing
and grinding circuits.
The grinding circuit will consist of a SAG mill in closed circuit with a pebble crusher and two ball mills in parallel.
The process plant design considers
three stages of cleaner flotation and is designed to process 21,920 tpd
(6.0 Mtpy) of ROM feed.
The flotation circuit configuration and design are based on the locked cycle tests conducted by SGS Canada in 2013.
Concentrate and tailings products
will be dewatered using high-rate thickeners and the concentrate will be
further dewatered by conventional plate and frame vacuum filtration.
Process water will be recovered from
the concentrate and tailings thickener overflow. Raw water is assumed to
be sourced from the local environment and will be used as makeup water.
It is assumed that 10% of the raw water requirement will be recycled
from the tailings pond.
Conventional tailings deposition techniques will be utilized.
A 230 kV transmission line is located
passing through the village of Warren, approximately 22 km from the
Project. A 115 kV transmission line passes through the village of Field,
located approximately 15 km to the east of the Project. It is assumed
that electrical power will be provided by the local utility via either
of these overland power lines. Diesel generators will be used to supply
emergency power.
Project Enhancement Opportunities
The PEA demonstrates that River
Valley has the potential to be economically viable. The PEA also
outlines several opportunities to enhance Project value. Additional
opportunities include:
Area of Focus
Opportunities to Explore
Management Target
Geotechnical study
– Geotechnical logging of drill core,
with new geotechnical holes to create a 3D geomechanical block model
and estimate pit wall slope angles
– Estimate pit wall slopes
Hydrogeological study
– Estimate water in-flows to the open pits and generate a site water management plan
– Site water management plan
Increase the Project Mineral Resource base
– Additional drilling in the footwall to expand the Mineral Resource.
After the ground proofing and surface exploration program conducted in
Summer 2018 which followed up on the most recent induced polarization
geophysical survey by Abitibi, NAM management has designed a 3-phase
5,000 metre drill program to test the new geophysical anomalies. See the
map figure below which shows these new geophysical anomalies and
potential targets for the next stage of drilling at River Valley
superimposed over the upper 4 kilometres of the project map.
Click Image To View Full Size
– Drilling near the defined open pit shells to increase the mine life.
– Drilling deeper to test the open-ended deposit at depth. Average drill hole depth is 220 metres below surface.
– Increase tonnes, grade and mine life of Project
– Continue to drill recent footwall discoveries
– Add additional Mineral Resources to the Project.
Mineral Resource
– In-fill drilling to convert Inferred Mineral Resources to Indicated Mineral Resources
– Improve Mineral Resource classification
Mineral Resource
– Step-out drilling to increase the Mineral Resource Estimate
– Increase the size of the Mineral Resource Estimate
Metallurgical testing
– Advanced metallurgical testing to
confirm or potentially improve process recoveries and more accurately
estimate concentrate grades produced
– Achieve a process recovery equal or greater than 80%.
Geophysical surveys
– Continue with induced polarization
geophysical surveys over the 12.5 kilometres of the contact / footwall
that has not been surveyed in the 2017 and 2018 programs
conducted on the Project. This work can be carried out in phases as
funding is available or until the contact / footwall is covered, see the
map figure below that shows a proposed scenario for how to phase the
work.
Click Image To View Full Size
– Outline new targets highlighting new potential footwall discoveries over the entire Project
Advanced sampling for Rhodium
– Re-assaying existing core for
Rhodium. Rhodium has been identified, however, insufficient assaying in
the past has not allowed for Rhodium’s inclusion in the Mineral Resource
Estimate.
– Quantify the amount of Rhodium in the Project and add this to the existing Mineral Resource Estimate
Pre-Feasibility study
– Updated Mineral Resource Estimate,
optimize the mine plan, process plant design, and Project economics.
Address environmental aspects.
– Update the Project study to a higher level of precision
Qualified Persons and NI 43-101 Disclosure
The PEA was prepared under the supervision
of Eugene Puritch, P.Eng. of P&E Mining Consultants Inc. The Mineral
Resource Estimate was prepared by Todd McCracken, P.Geo. of WSP Canada
Inc. Metallurgical testwork and process plant design and cost estimates
were prepared by Jim Kambossos, P. Eng. of DRA Americas
Inc. All three are independent Qualified Persons in accordance with NI
43-101. Mr. Puritch has reviewed and approved the technical information
in this release. Michael Neumann, P.Eng. Managing Director for NAM is
the company Qualified Person as defined by National Instrument 43-101
and has reviewed and approved the technical content of this news
release.
On behalf of the Board of Directors
“Harry Barr”
Harry G. Barr, Chairman and CEO
For further information on New Age Metals,
please contact Harry Barr and/or Anthony Ghitter, Business Development
at 613-659-2773, or [email protected]
Neither the TSX Venture Exchange nor
its Regulation Services Provider (as that term is defined in the
policies of the TSX Venture Exchange) accepts responsibility for the
adequacy or accuracy of this release.
Cautionary Note Regarding Forward
Looking Statements: This release contains forward-looking statements
that involve risks and uncertainties. These statements may differ
materially from actual future events or results and are based on current
expectations or beliefs. For this purpose, statements of historical
fact may be deemed to be forward-looking statements. In addition,
forward-looking statements include statements in which the Company uses
words such as “continue”, “efforts”, “expect”, “believe”, “anticipate”,
“confident”, “intend”, “strategy”, “plan”, “will”, “estimate”,
“project”, “goal”, “target”, “prospects”, “optimistic” or similar
expressions. These statements by their nature involve risks and
uncertainties, and actual results may differ materially depending on a
variety of important factors, including, among others, the Company’s
ability and continuation of efforts to timely and completely make
available adequate current public information, additional or different
regulatory and legal requirements and restrictions that may be imposed,
and other factors as may be discussed in the documents filed by the
Company on SEDAR (www.sedar.com), including the most recent reports that
identify important risk factors that could cause actual results to
differ from those contained in the forward-looking statements. The
Company does not undertake any obligation to review or confirm analysts’
expectations or estimates or to release publicly any revisions to any
forward-looking statements to reflect events or circumstances after the
date hereof or to reflect the occurrence of unanticipated events.
Investors should not place undue reliance on forward-looking statements.
Posted by AGORACOM-JC
at 10:52 AM on Tuesday, June 25th, 2019
SPONSOR: New Age Metals Inc. The company’s Lithium Division has already made significant acquisitions in Canada and the USA. The company also owns one of North America’s largest primary platinum group metals deposit in Sudbury, Canada. Updated NI 43-101 Mineral Resource Estimate 2,867,000 PdEq Measured and Indicated Ounces, with an additional 1,059,000 PdEq Ounces in the Inferred. Learn More.
NAM: TSX-V
———————
China’s breaking up the EV battery monopoly it carefully created
As China phases out subsidies
for electric vehicles next year, it’s also ending a related policy that
effectively shut out foreign battery makers, creating the domestic
monopoly we see today.
China’s Ministry of Industry and Information Technology (MIIT) announced yesterday
(June 25, link in Chinese) it is dropping its practice of publishing
lists of battery makers that met technical standards. The policy, put in
place in 2015, was meant to help develop the industry. Supplying the
information to get on the list was supposedly voluntary
(link in Chinese), but in reality, using the batteries on the
ministry’s lists made it more likely car makers would qualify for
government subsidies. As of 2016, the last time the list was updated, it
included a total of 57 companies—none of them foreign firms.
As a result, the top 10 battery makers powering the world’s largest EV market are all Chinese
(link in Chinese), according to 2018 data from the China Battery
Industry Association. That means China dominates the value-added chain
for domestically made electric vehicles, since batteries contribute 40%
of the cost of an EV—quite a contrast to the value added when China assembles an iPhone.
Financial newspaper Economic Observer noted
(link in Chinese) in April last year that Chinese car makers made their
component decisions from the lists, while local governments and
investment firms also consulted them. “Associated with subsidies, these
became known as the ‘white lists,’†the newspaper said.
The lists included CATL, the world’s largest EV battery maker
(Quartz membership), which supplies Chinese and foreign carmakers that
include state-owned BJEV, one of the country’s biggest manufacturers,
Volkswagen, Daimler, BMW, Honda, and Shanghai-based startu NIO.
The world’s biggest EV manufacturer, BYD, is also the country’s
second-biggest battery supplier, since it makes the batteries for its
own electric cars—last year it sold some 100,000 of them. Both BYD and CATL could supply batteries to Toyota cars soon. In third place is Guoxuan High Tech, a major supplier to state-owned carmaker BAIC Motor, the parent company of BJEV.
Taking away the lists could benefit established foreign battery
makers. “It’s a gesture of China opening up, along with pressure from
G20 and trade,†says Qiu Kaijun, who runs an EV news blog
(Quartz membership). Chinese president Xi Jinping is set to discuss
US-China trade tensions with US president Donald Trump on the sidelines
of the G20 meeting of leaders of top economies, which begins in Japan
Friday.
Before the policy was put in place, when China’s EV market was starting to take off, foreign firms like LG and fellow South Korean major Samsung were about to expand
(link in Chinese) in China. In 2015, LG had opened a battery factory in
China’s eastern city Nanjing that could supply to more than 100,000 EVs (link in Chinese), yet it never got on the white list and the factory ended up being sold to Zhejiang-based carmaker Geely in 2017 (link in Chinese).
“Earlier, all the subsidies went to those using Chinese EV
batteries—if you use LG and Samsung, you won’t get subsidies,†said
Angus Chan, a Shanghai-based auto analyst at Bocom International, “When
2020 comes, it will be free-market competition. It’s straightforward for
carmakers—energy density, safety, and price… Everybody is on the same
racing starting point in the post-subsidy era.â€
China began reducing its massive subsidies two years ago, and will move to a credit system next year.
The scrapping of the battery lists comes at a time when China has
rolled out the welcome mat for foreign EV firms in other ways. China last year said it would phase out
foreign investment limits for car manufacturing, a rule that earlier
made it impossible for foreign car makers to set up shop in China
without a local partner. That reform began with manufacturers of
electric vehicles, allowing Tesla to become the first foreign car maker
with a wholly-owned plant in China. Located in Shanghai, it is taking
orders for the first made-in-China Teslas, which are expected to roll out in the next six months.
Other new rules limiting the number of new factories in a province
mean Tesla’s factory has put a spanner in the works for local
manufacturers who were also hoping to set up near one of the country’s
most important cities for EV sales. It’s clear China’s EV industry is
going to put under greater pressure as a result of these moves—which
could improve their technologies, or kill off some of the weaker firms.
“What happens after the typhoon passes?†asked Zeng Yuqun, CATL’s founder, in an internal email (link in Chinese) in 2017. “Can a pig really fly?â€
He was referring to a Chinese allegory—“When the typhoon comes, the
pig will flyâ€â€”comparing the government subsidies to strong winds lifting
the company’s fortunes, and warning of a possible heavy landing once
those winds die down.
Looking for more in-depth coverage? Sign up to become a member and read more in-depth coverage of China’s electric-car boom in our field guide.
Posted by AGORACOM-JC
at 2:00 PM on Wednesday, June 5th, 2019
SPONSOR: New Age Metals Inc.
The company’s new Lithium Division has already made significant
acquisitions in Canada and the USA. The company also owns one of North
America’s largest primary platinum group metals deposit in Sudbury,
Canada. Updated NI 43-101 Mineral Resource Estimate 2,867,000 PdEq
Measured and Indicated Ounces, with an additional 1,059,000 PdEq Ounces
in the Inferred. Learn More.
NAM: TSX-V
———————
These Mining Superpowers Supply the World’s Lithium. Now They Want to Make Batteries, Too.
The race by Tesla Inc., Samsung SDI Co. and other technology giants
to secure supplies of lithium — a key ingredient in batteries for
electric vehicles and smartphones — is creating a unique chance for two
global mining superpowers to reap more value from their natural
resources.
Australia and Chile are looking to lithium to help them escape a
cycle that for decades has had the two nations digging out minerals such
as iron ore and copper, only to see them refined and turned into
valuable products abroad.
Almost three-quarters of the world’s lithium raw materials come from
mines in Australia or briny lakes in Chile, giving them leverage with
customers scrambling to tie-up supplies. The mining nations hope to
bring refining and manufacturing plants that could help kickstart
domestic technology industries.
The first moves in that plan are beginning to take shape.
Scraping a shovel into a patch of dirt near the Australian port city
of Bunbury in March, an executive for U.S.-based lithium leader
Albemarle Corp. heralded a A$1bn ($690m) plan to build the world’s
biggest processing plant of its type. Meanwhile, in Mejillones, northern
Chile, South Korea’s Samsung SDI and Posco are planning to jointly
develop a facility to make chemical components used in batteries.
“Chile and Australia have the advantage,†said Daniela Desormeaux,
chief executive officer at Santiago-based consulting firm SignumBOX.
They have the lithium and “at the same time state incentives, so
companies transforming the raw material can set up shop there.”
Mining rock and exporting it is a familiar story for Australia and
Chile. Australia, the world’s biggest producer of iron ore, has shipped
billions of tons of the steelmaking raw material to mills in Japan and
China since the 1960s. Chile, the world’s largest source of copper,
exports over half of its shipments as semi-refined concentrate.
“It’s an interesting economic model,†Peter Klinken, chief scientist
of Western Australia and an adviser to the state’s government, told a
February conference in Perth. “Take a big rock, make a little rock, put
it on a ship, and then buy something really expensive back in return.â€
The supply of lithium-ion batteries will need to jump more than
10-fold by 2030, BloombergNEF forecasts, with electric vehicles to
account for more than 70 percent of that demand. That’s prompting end
users to act, and Volkswagen AG and Volvo Cars have both struck
long-term supply deals since April.
Where’s the Value?
The first step on the lithium value ladder is refining the raw
material, something that’s currently done mostly in China. Ore from
mines or lithium-rich saline solution from underground lakes in South
America is concentrated into a silvery-gray powder that is sent to be
purified and refined into lithium hydroxide and lithium carbonate. Those
chemicals in turn are processed with materials such as nickel or cobalt
to produce battery electrodes, or with solvents to make electrolytes,
the key parts of the cells that are assembled into batteries.
Each step up the ladder affords more opportunity for profit. By 2025,
the market for mined lithium raw material may be worth $20bn, compared
with $43bn for refined products and $424bn for battery cells, according
to a base case scenario outlined in a 2018 study published by the
Australia-based Association of Mining and Exploration Companies.
Two major lithium miners operating in Chile, Sociedad Quimica &
Minera de Chile SA, or SQM, and Albemarle were only allowed to expand
production on condition that they sell a quarter of their output at the
lowest market price to companies that will develop the materials within
the country. SQM, which already carries out some processing in Chile, is
expanding its domestic capacity.
The strategy is “a golden key†to build a higher-value lithium
industry in Chile, said Sebastian Sichel, executive vice president of
government development agency Corfo, which owns the lithium concessions
in the Atacama desert and issues licenses to miners.
Three separate groups — Chile’s Molibdenos y Metales SA, or Molymet,
China’s Sichuan Fulin Industrial Group Co., and a consortium of Samsung
SDI and Posco — last year pledged to invest a total of about $754m to
build lithium-cathode and lithium-cell factories in Chile to win access
to Albemarle’s material. A second auction in April offered similar
access to SQM’s product, with winners expected to be announced early
next year.
New refining and chemical production capacity will offer Chile
additional revenue, while earnings from lithium exports are also
forecast to rise. The commodity has the potential to become one of the
country’s largest exports after copper, salmon and wine, Sichel said.
Australia could generate more than A$50bn ($35bn) in annual revenue
and support about 100,000 jobs by developing a battery materials sector,
according to a 2018 study for a regional development agency. That
compares with about A$1bn currently in annual lithium exports.
Australia’s government in April pledged A$25m to support a five-year
research program to expand its battery supply chain.
China’s Tianqi Lithium Corp. will later this year begin selling
lithium hydroxide from a new processing facility in Kwinana, south of
Perth. Tesla, battery maker LG Chem Ltd. and Mitsui & Co. have
agreed to supply deals for output from a rival plant nearby that’s being
built by Chile’s SQM and an Australian partner.
Efforts by Australia and Chile to wrest more control over refining
from China are being helped by trade tensions. “They could definitely
challenge China†in the next-step processing of lithium, said James
Jeary, an analyst at CRU Group in London. Lithium producers will
increasingly integrate mining and refining capacity, he said.
“We are hearing more and more that diversity of supply is critical,â€
said Phil Thick, Tianqi’s general manager in Australia. The producer’s
Kwinana plant will mainly supply customers in North America and Europe,
or carmakers in those regions via their suppliers in South Korea and
Japan, he said.
China’s in Charge
The producers plan to do more than just first-stage refining. Western
Australia has developed a “Lithium Valley†strategy to span the supply
chain. Chile also hopes to manufacture battery cells.
But there are major hurdles. Neither country has a major car
industry, and the auto sector typically prefers component suppliers to
be close to manufacturing hubs. The technical challenge of producing
battery components may require imported expertise. Costs and
environmental concerns are also factors.
A dispute between Corfo and Albemarle has already delayed progress
for Molymet, the Samsung SDI and Posco consortium, and Sichuan Fulin in
Chile, prompting concern the groups could opt to invest in battery
projects elsewhere. In Australia, lithium producer Neometals Ltd. has
delayed a plan to build a refinery, citing higher-than-expected costs.
There may only be a brief window for Chile or Australia to get a
foothold in the battery industry as rival mining nations join the fray.
Argentina and Bolivia have saline deposits near the border with
Chile. Countries from Serbia to Mali are keen to extract deposits in
their territory, and Russia, which has been producing lithium products
for more than 60 years for its nuclear industry, is already trying to
attract higher-value investment by setting up one of the world’s largest
lithium-ion battery plants in Novosibirsk with Chinese partner Thunder
Sky Group.
Persuading battery makers to set up operations in Australia or Chile
will require state incentives, said Vivas Kumar, a principal consultant
at industry adviser Benchmark Mineral Intelligence and previously a
member of Tesla’s battery supply chain team.
Lowering the cost of battery cells “continues to be the most
important focus area across all major companies,†Kumar said. Automakers
“are increasingly becoming involved with their cell manufacturing
partners’ supply chains in recognition of this.â€
Sichel at Corfo believes lithium offers Chile a chance to escape the
so-called resources curse, where mineral booms suck in investment at the
expense of manufacturing.
If we don’t do this, “there is a gigantic risk that our growth keeps
depending on the next hot commodity,†he said. “We remain stuck, unable
to make the jump to developed-nation status.â€
