NorZinc posts positive PEA for Prairie Creek with extended life, higher throughput
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The PEA outlines a majorly de-risked project with world class potential, says NorZinc. The after-tax net present value with an 8% discount is $299 million and an after-tax internal rate of return of 17.7%.
With an initial capex of $368 million (including $35 million contingency), the study outlines total direct costs of $251 million (mining $51 million, site preparation $1 million, processing plant $41 million, paste tailings plant $28 million, surface infrastructure $41 million, and all-season road $89 million). There are also indirect costs and owner’s costs totalling $82 million.
The Prairie Creek mine would have a life of 20.3 years with a payback of 4.8 years. Average annual payable production would be 2.6 million oz. of silver, 122 million lb. of zinc, and 101 million lb. of lead. Sustaining and closure costs are pegged at $332 million.
The PEA was prepared using a silver price of $24 per oz., a zinc price of $1.20 per lb., and a lead price of $1.05 per lb.
NorZinc said it is beginning work on the feasibility study immediately to examine ways to improve capital and operating costs. Talks are underway for concentrate offtake agreements.
Mine operating permits were received from the MacKenzie Valley Land and Water Board in 2013 and renewed in 2020. Modifications have been made to the application to reflect the higher mining rate, but the final permits are expected by the end of March 2022.
(This article first appeared in the Canadian Mining Journal)