Shares in Amur Minerals moved higher after releasing the findings of a pre-feasibility study on the Company's flagship Kun-Manie nickel sulphide deposit in eastern Russia.
The findings will give investors plenty to mull over the holiday season, highlights included:
- Post Tax Net Present Value (10%) of US$84 million
- Post tax internal rate of return of 15.7%
- 10 year mine life
- 159,000t of nickel and 43,000t of copper over mine life
The report used a range of assumptions, including a total capital expenditure of US$331 million to mine from three ore bodies using a 365 days/year operation processing 38.2 million tonnes of ore over 10 years. The model was based on a probable ore reserve of 31.5 million tonnes grading 0.54% nickel and 0.15% copper with a low stripping ratio of 2.9 to 1 and recoveries of around 76%. The final key assumption in the report was a nickel price of $7.50//lb, which the study pointed out that every US$1/lb increase in price added an impressive US$100 million to the NPV(10%).
Robin Young, Chief Executive Officer, Amur Minerals commented:
'Our primary objective was to determine if the resource we have identified to date is large enough to justify the significant capital expenditure required due to the remote location of Kun-Manie. This report confirms that the first phase of the Kun-Manie development is economic. It also confirms our belief that Kun-Manie will be a premier nickel producer when in production.
'Multiple undrilled targets remain and we have not yet defined the limits of the mineralisation in two of our drilled deposits, all of which is recoverable by open pit mining. There is the potential to more than double the resources on the site.