Plains Creek announces filing of feasibility studies for 1 Million
tonne/year Beneficiated Rock Concentrate Project and 1.3 Million
tonne/year Direct Shipping Phosphate Rock Project for the Farim
Phosphate Project, Guinea-Bissau, West Africa
VANCOUVER,
Nov. 23, 2012 /CNW/ - Plains Creek
Phosphate Corporation ("Plains Creek", the "Company")
(TSXV: PCP) is pleased to announce the filing on SEDAR of
two feasibility studies (the "Feasibility Studies")
for two respective production alternatives: firstly, the 1 Million
tonne per year Beneficiated Phosphate Rock Concentrate
("BPRC") Project; and secondly, the 1.3 Million tonne per
year Direct Shipping Option ("DSO") Phosphate Rock Project.
The Feasibility Studies were previously announced on October 9, 2012 and have now been finalized and
filed on SEDAR. The Feasibility Studies were prepared for GB
Minerals AG and the Company by GBM Minerals Engineering Consultants
Limited ("GBMMEC") in conjunction with Golder Associates
Limited ("Golder"), W.F.
Baird & Associates Ltd. ("Baird"), GEEEM
Consultants and Tropica Environmental, all of whom are independent
of the Company and GB Minerals AG.
These two production alternatives address the
first phase of the development of the GB Minerals AG
("GBMAG") Farim Phosphate Project (the "Project") in
Guinea-Bissau, West Africa. The second phase is to mine and
process the remainder of the Project's phosphate deposit including
the production of up to 2 Million tonnes per year of
beneficiated phosphate rock concentrate with an open pit mine,
processing plant, pipeline, and port construction, which will be
assessed in a separate feasibility study.
Background
The Project is located in the northern part of
central Guinea-Bissau,
West Africa, approximately
25 km south of the Senegal
border, approximately 5 km west of the town of Farim and some
120 km north of Bissau, the
capital of Guinea-Bissau. The
Project consists of a high grade sedimentary phosphate deposit of
one continuous phosphate bed (known as the FPA layer), which
extends over a known surface area of approximately 40 km².
Studies and investigations have been underway on
the Project since February 2011 and
as work progressed a number of alternative production scenarios
were investigated in order to maximize the project value, reduce
the time to production, minimize development capital, accommodate
the phosphate market demand and the changing political climate in
Guinea Bissau. As a result, GBMAG
is now targeting the two-phased development of the Project as an
open pit mining operation.
Three production scenario alternatives are
planned for the progressive development of the Project, depending
on the phosphate market conditions and the off takers requirements,
the economic and political climate in Guinea-Bissau, and the availability of capital
and skilled manpower to develop the Project have been investigated
as follows:
Phase One
- 1.3 Million tonne per year Direct Shipping Option (DSO)
Phosphate Rock product production alternative;
- 1 Million tonne per year Beneficiated Phosphate Rock
Concentrate product (BPRC) production alternative; and
Phase Two
- 2 Million tonne per year Beneficiated Phosphate Rock
Concentrate product alternative, which includes an open pit mine,
processing plant, pipeline, and port construction which will be
assessed in a separate feasibility study.
Mining Agreement, Mining Lease and Production
License
A Mining Agreement was negotiated in
May 2009 in terms of which GBMAG was
granted a Mining Lease and a Production License for the Project by
the Guinea-Bissau Government. Included within this Mining Agreement
are numerous permissions and incentives that have influenced the
development and production plans for the Project. As the Project
progresses, there are ongoing discussions with the Government of
Guinea-Bissau regarding certain
aspects of the Mining Agreement, such as royalties, tax incentives,
project area and others.
Mineral Resources and Reserves
As previously announced by the Company on
5th September 2012, the
Mineral Resource Estimate for the Project was completed by the
Qualified Person, Dr. Marcelo Godoy
of Golder in Santiago,
Chile. Terry Kremmel of
Golder has completed the mineral reserves estimates, which are
disclosed in the Feasibility Studies. Each of Dr. Godoy and
Terry Kremmel meet the requirements
of a Qualified Person for the purposes of NI 43-101 reporting
and are independent from the Company.
The Mineral Resource Estimate defines a Measured
Resource of 64.6 Mt at an average grade of 29.11%
P2O5, an Indicated Resource of 28.1 Mt
at an average grade of 27.68% P2O5 and an
Inferred Resource of 18.3 Mt at an average grade of
28.66% P2O5. No recoveries or
dilution factors have been considered in this estimate and the
estimate is strictly in situ, in accordance with NI 43-101
reporting guidelines for resources.
The mineral reserves estimates are based on a
minimum thickness of 1.5 m of the FPA layer, maximum in situ
strip ratio of 20:1 and a constant dry density of 1.4
t/m3. On this basis, the total estimated proven
and probable reserves are 33.0 Mt (dry) with an average ROM
P2O5 grade of 30.4%.
Mining Plan
Based on the estimated proven and probable
reserves, a 25 year mine plan has been prepared as part of the
Feasibility Studies for either the BPRC production alternative
which produces 1 Million tonnes per year of phosphate rock
concentrate at an average grade of 33.1% P2O5
and 1.6% Fe2O3 and 1.4%
Al2O3; or the DSO production alternative
which produces 1.3 Million tonnes per year of phosphate rock at an
average grade of 30.4 % P2O5 and 4.4%
Fe2O3 and 2.5%
Al2O3.
A. 1 Million Tonnes Per Year BPRC Project Feasibility
Study Overview
1 Million Tonne Per Year BPRC Project - Process
Flow
The BPRC Project Feasibility Study encompasses the following
general process flow:
- Annual production rate of 1 Million tonnes per year of
beneficiated phosphate rock concentrate.
- Contractor mining.
- Removal of overburden using a combination of excavators and
trucks.
- The overall ROM strip ratio is estimated to be 9.08 bank cubic
metres (bcm) per tonne of ROM phosphate matrix. The overall product
strip ratio is estimated to be 14.47 bcm per tonne of phosphate
rock, requiring the removal of approximately 299.5 million bcm of
overburden over the life of the mine.
- 1.3 Million tonnes per year of Run of Mine (ROM) phosphate
matrix removed by excavator and truck to a 130,000 tonne ROM pad
for storage and beneficiation. The ROM pad is located some
1.5 km from the open pit and adjacent to the barge loading
facility at an area known as Canico, on the River Cacheu.
- ROM phosphate matrix is removed from the ROM pad and processed
in the beneficiation plant to produce a phosphate rock concentrate
product which is stockpiled at Canico in a 3,000 tonne stockpile
which feeds a conveyor for barge loading. Recoveries of 78% by
weight, have been determined from metallurgical test work and
process design, which will result in the production of
approximately 1 million tonnes per year of phosphate rock
concentrate product.
- Barges of up to 3,500 tonnes capacity will be moored and loaded
at a pontoon warf near Canico. A set of four barges will be formed
into a flotilla that will be maneuvered by a 'Pusher' tug to a
barge marshalling area at Bolor in the River Cacheu estuary, some
175 kilometers from Canico.
- The barges will then be maneuvered by tug to an offshore
trans-shipment point in the Atlantic Ocean, where the phosphate
rock concentrate will be loaded onto carriers (bulk carrier vessel
of up to 28,000 tonnes capacity) utilizing ship's gear.
- The battery limit for the BPRC Project is the phosphate rock
concentrate product loaded into the hold of the bulk carriers.
- Phosphate rock concentrate product will also be available for
supply to the in-country market as a direct application
fertilizer.
1 Million Tonnes Per Year BPRC Project - Economic Analysis
Key Criteria and Highlights
A summary of the project parameters is provided
in Table 1, below. A pre-tax cash flow projection has been
generated for a 25 year mine life using the estimated capital and
operating costs that are summarized in Table 2, further
below.
All amounts in US dollars
Table 1: Summary of Physical Parameters of the
BPRC Project
Physical Parameter |
Value |
Mine Life |
25 Years |
Construction Period |
2 Years |
Operation |
304 days per year |
Production Rate |
1,300,000 ROM tonnes per year
phosphate matrix |
Total Life of Mine Product Production |
25 million tonnes phosphate rock
concentrate |
Average Product Grade |
33.1% P2O5 @
1.6% Fe2O3 and 1.4 %
Al2O3 |
Annual Product Sales |
1,000,000 tonnes phosphate rock
concentrate |
Revenue Guidance Estimate |
$150 USD per tonne of phosphate rock
concentrate FOB |
Table 2: Summary of BPRC Project Costs
Operating Costs |
Life of Mine |
Mining |
$ 46.01 per tonne phosphate rock
concentrate |
Marine |
$5.92 per tonne phosphate rock
concentrate |
Personnel |
$6.69 per tonne phosphate rock
concentrate |
Electricity |
$9.82 per tonne phosphate rock
concentrate |
Reagents |
$ 0.23 per tonne phosphate rock
concentrate |
Fuel |
$3.64 per tonne phosphate rock
concentrate |
Maintenance |
$ 2.83 per tonne phosphate rock
concentrate |
Total |
$ 75.15 USD per tonne
phosphate rock concentrate |
Capital costs (life of mine) |
Life of Mine |
Pre-production stripping (incl. mobilisation) |
USD $ 10.93 million |
Mine, Marine & Infrastructure (incl.
contingency) |
USD $ 154.19 million |
Total Mine Capital Cost |
US$ 165.12 million |
Sustaining |
USD $ 134.71 million |
Closure |
USD $ 3.04 million |
Total Life of Mine Capital Cost (incl.
contingency) |
USD $ 302.87 million |
Contingencies |
17.6% |
Accuracy |
+/-15 % |
Royalties |
2%* |
* Pending discussions with the Government of
Guinea-Bissau.
Estimated mining costs include all costs related
to land clearing, drainage and water control, pit dewatering, waste
stripping, overburden transport and dump management, phosphate
matrix mining and transport to beneficiation plant, beneficiated
phosphate rock transport to stockpiles located at the barge loading
facility, and reclamation.
The estimated processing costs include all costs
related to the beneficiation of the phosphate matrix and subsequent
dewatering for the production of a phosphate rock concentrate ready
for sale.
The estimated product handling and transport
costs include all handling and storage costs for the phosphate rock
concentrate at Canico. Also included is the barge loading and
transport of the phosphate rock concentrate.
Table 3 (below) shows the capital cost estimate
breakdown by project area.
Table 3: Project CAPEX Estimate (Area
Breakdown)
Area # |
Area Name |
Fixed Capital
(M USD) |
Contingency
(M USD) |
Total Capital
(M USD) |
Percent Total |
000 |
Project General |
31.88 |
4.20 |
36.08 |
22% |
100 |
Mine |
26.06 |
5.30 |
31.36 |
19% |
200 |
Processing |
35.86 |
7.75 |
43.62 |
26% |
300 |
Product Handling and Transport |
46.57 |
7.50 |
54.07 |
33% |
|
Total |
140.37 |
24.75 |
165.12 |
100% |
Capital estimates include mine facilities,
beneficiation plant and infrastructure, mining equipment,
dewatering wells, stockpile loader, dyke construction, stockpile
area, ex-pit haul road construction and barges.
The Project's cash flow analysis is shown in
Table 4, below.
Table 4: Cash Flow Analysis
Units |
2013 |
2014 |
2015 |
2016 |
2017 |
2018 |
2019 |
2020-2039 |
Production: |
|
|
|
|
|
|
|
|
ROM '000
tonne |
0 |
0 |
1,300 |
1,300 |
1,300 |
1,300 |
1,300 |
26,000 |
Sales
'000 tonne |
0 |
0 |
1,000 |
1,000 |
1,000 |
1,000 |
1,000 |
20,000 |
Price
Phosphate product USD $/t |
0 |
0 |
150 |
150 |
150 |
150 |
150 |
150 |
Sales USD $
'000 |
0 |
0 |
150,000 |
150,000 |
150,000 |
150,000 |
150,000 |
3,000,000 |
Cost of Sales: |
|
|
|
|
|
|
|
|
Operating cost USD $/t |
0 |
0 |
68.36 |
68.23 |
70.63 |
70.66 |
72.28 |
76.42 |
Total operating cost USD $
'000 |
0 |
0 |
68,362 |
68,225 |
70,634 |
70,655 |
72,280 |
1,528,403 |
EBITDA USD $ '000 |
0 |
0 |
81,638 |
81,775 |
79,366 |
79,345 |
77,720 |
1,471,597 |
CAPEX USD $ '000 |
57,504 |
107,616 |
12,403 |
3,236 |
5,712 |
3,236 |
10,441 |
102,723 |
Net cash flow before tax and royalties USD $
'000 |
(57,504) |
(107,616) |
69,235 |
78,538 |
73,654 |
76,108 |
67,279 |
1,368,874 |
Considering the BPRC Project on a stand-alone
basis, the undiscounted pre-tax cash flow totals US$ 1.569 billion over the 25 year mine
life. Operating cash flow averages US$ 69.35
million per year and simple payback of total preproduction
capital is achieved after approximately 2 years of operation.
EBITDA as disclosed in the table above is a
non-GAAP financial measure and does not have a standardized meaning
and is therefore unlikely to be comparable to similar measures
presented by other issuers.
The Internal Rate of Return (IRR) is 39%.
Pre-tax Net Present Value (NPV) at various discount rates is shown
in Table 5, below.
Table 5: Pre-tax NPV Sensitivity to Discount
Rate
Rate |
NPV |
0 % (Undiscounted) |
USD $1,569 million |
5 % |
USD $740 million |
10 % |
USD $387 million |
15 % |
USD $216 million |
20 % |
USD $123 million |
25 % |
USD $68 million |
30 % |
USD $34 million |
Mineral Resources Estimates
The resource estimate was subcontracted to
Golder who modelled the Farim resource based on a two dimensional
(2D) block model with 125 m by 125 m cells and 25 internal
discretisation nodes covering the extents of the FPA layer. The
extents of the FPA layer were estimated based on the presence or
absence of the FPA layer in the drill holes.
Exploratory data analysis and variography were
carried out and variables were estimated using a three pass
strategy, whereby each successive pass had an increased search
radius and less restrictive sample selection criteria. This
approach ensures all blocks received a value for each variable.
Values were assigned using a combination of Ordinary Kriging and
Inverse Distance Weighted methods for the following variables:
- P2O5s;
- Al2O3s;
- CaO;
- Fe2O3s;
- SiO2s;
- FPA Thickness; and
- Overburden Thickness.
The stripping ratio (SR) was derived from the
estimated overburden and FPA thicknesses.
Classification was assigned to each block in the
model based on a drilling spacing as follows:
- Measured: Areas with drilling coverage of up to 500 m by 500 m
and a P2O5 slope of regression greater than
or equal to 0.65;
- Indicated: Areas with drilling coverage of up to 1000 m by 1000
m and a P2O5 slope of regression greater than
or equal to 0.4; and
- Inferred: Areas within the extents of the FPA and not
classified as Measured or Indicated.
A corridor following the river was excluded and
set to "unclassified" due to the uncertainty related to the
extraction of material in this area. In addition, the resource
estimate was divided into blocks corresponding to the location
relative to the river; "north" or "south".
After applying the above criteria and for the
purpose of public reporting the resources were restricted to a
minimum FPA thickness of 1.5 m and a stripping ratio no greater
than 20:1. By applying these mining restrictions it is considered
that the disclosed mineral resource estimates fulfill the
requirement of "reasonable prospects for economic extraction". Due
to the consistent grade continuity, with grades above 27%
P2O5, a phosphate cut-off grade was not
applied to report the Mineral Resource estimate.
Mineral Resource Statement
The reported open pit resources were restricted
to a minimum FPA thickness of 1.5 m and stripping ratio no greater
than 20:1. A constant density of 1.4 t/m3 was used to
estimate tonnages. Golder considers the criteria used to define the
mineral inventory to be adequate for the purpose of public
reporting. The Mineral Resource estimate defines a combined
Measured and Indicated Resource of 92.6 Mt at an average grade of
28.68 % P2O5 and an Inferred Resource of 18.3
Mt at an average grade of 28.66 % P2O5.
Tonnage figures have been rounded. No recoveries
or dilution factors have been considered in this estimate and the
estimate is strictly in situ, in accordance with NI 43-101
reporting guidelines for resources.
The mineral resources reported in this Technical
Report were estimated using the Canadian Institute of Mining,
Metallurgy and Petroleum (CIM) Standards on Mineral Resources and
Reserves, Definitions and Guidelines prepared by the CIM Standing
Committee on Reserve Definitions.
Mineralisation at Farim is still currently open
to the west and poorly drilled to the south of the River. Golder
recommends that additional QA/QC data should be gathered during the
next drilling campaign, including blanks, to allow an analysis of
the reliability of the GBMAG samples.
As the project moves into detailed design and
production, it is recommended that a more thorough and systematic
program of density determination be carried out and the resulting
data be used to update the current estimates.
Table 6: Mineral Resource Statement, Farim
Phosphate Deposit
Resource
Class |
Block |
Tonnage
(Mt) |
P₂O₅
(%) |
FPA
(m) |
Al2O3
(%) |
CaO
(%) |
Fe2O3
(%) |
SiO2
(%) |
Over
burden
(m) |
S/R |
Measured |
North of River |
64.6 |
29.11 |
3.65 |
2.78 |
39.44 |
5.60 |
11.39 |
43.40 |
12.43 |
Indicated |
North of River |
17.7 |
26.93 |
3.15 |
2.62 |
40.14 |
5.19 |
10.64 |
39.50 |
13.18 |
South of River |
10.3 |
28.96 |
2.61 |
5.36 |
36.37 |
4.59 |
11.68 |
29.05 |
12.11 |
Sub total |
28.1 |
27.68 |
2.95 |
3.63 |
38.75 |
4.97 |
11.02 |
35.65 |
12.79 |
Measured +
Indicated |
North of River |
82.3 |
28.64 |
3.54 |
2.75 |
39.59 |
5.51 |
11.23 |
42.56 |
12.59 |
South of River |
10.3 |
28.96 |
2.61 |
5.36 |
36.37 |
4.59 |
11.68 |
29.05 |
12.11 |
Sub total |
92.6 |
28.68 |
3.44 |
3.04 |
39.23 |
5.41 |
11.28 |
41.05 |
12.54 |
Inferred |
North of River |
3.4 |
27.36 |
2.75 |
2.75 |
39.30 |
5.21 |
11.05 |
42.70 |
15.81 |
South of River |
14.9 |
28.96 |
2.35 |
6.30 |
35.78 |
4.57 |
11.64 |
29.45 |
13.19 |
Sub total |
18.3 |
28.66 |
2.42 |
5.64 |
36.43 |
4.69 |
11.53 |
31.90 |
13.67 |
Mineral Reserves Estimates
Estimated ROM phosphate matrix reserves and
phosphate rock reserves for the proposed Beneficiation Option are
listed in table below. The result of the Mineral Reserve Estimate
is based on a minimum FPA thickness of 1.5 m, maximum in situ SR of
20:1 and a constant dry density of 1.4 t/m3. Golder
considers the criteria used to define the 25 year mineral inventory
to be reasonable for public reporting. This assumes the resource
would be exploitable using open pit mining methods.
Table 7: Proven and Probable Reserves
|
|
Phosphate Matrix
Reserves |
Category |
Unit |
Proven |
Probable |
Total/Average |
ROM tonnes, dry |
Mt |
29.5 |
3.5 |
33.0 |
ROM %P2O5, dry |
% |
30.4 |
29.6 |
30.4 |
ROM %Al2O3, dry |
% |
2.6 |
2.6 |
2.6 |
ROM %CaO, dry |
% |
41.1 |
41.3 |
41.2 |
ROM %Fe2O3, dry |
% |
4.5 |
4.6 |
4.5 |
ROM %SiO2, dry |
% |
10.3 |
9.9 |
10.3 |
Product tonnes, dry |
Mt |
22.5 |
2.7 |
25.1 |
Product %P2O5, dry |
% |
33.1 |
32.2 |
33.0 |
Product %Al2O3, dry |
% |
1.4 |
1.5 |
1.4 |
Product %CaO, dry |
% |
46.0 |
46.2 |
46.0 |
Product %Fe2O3, dry |
% |
1.6 |
1.7 |
1.6 |
Product %SiO2, dry |
% |
11.1 |
10.7 |
11.1 |
The Measured and Indicated Resource estimates as
stated in under "Mineral Resource Estimates" are inclusive of the
resources comprising the Proven and Probable Reserve estimates
described in Table 6.
For the Farim BPRC Option the total estimated
Proven and Probable Reserves are 33.0 Mt (dry) with an average
ROM P2O5 grade of 30.4%. Total rock (product)
tonnes after beneficiation are estimated to be 25.1 Mt (dry) with
an average product P2O5 grade of 33.1%. The
overall ROM SR is estimated to be 9.08 bank cubic metres (bcm) per
tonne of ROM phosphate matrix. The overall product strip ratio is
estimated to be 14.47 bcm per tonne of phosphate rock, requiring
the removal of approximately 299.5 million bcm of overburden over
the life of the mine.
B. 1.3 Million Tonnes Per Year DSO Project Feasibility
Study Overview
1.3 Million Tonnes Per Year DSO Project - Process
Flow
The DSO Project Feasibility Study encompasses the following
general process flow:
- Annual production rate of 1.3 Mt per year of phosphate rock
product.
- Contractor mining.
- Removal of overburden by a combination of excavators and
trucks.
- The overall ROM SR is estimated to be 9.08 bank cubic metres
(bcm) per tonne of ROM phosphate matrix. The overall product strip
ratio is estimated to be 14.47 bcm per tonne of phosphate rock,
requiring the removal of approximately 299.5 million bcm of
overburden over the life of the mine.
- 1.3 million Tonnes per annum of Run of Mine (ROM) phosphate
matrix is removed by excavator and truck to a 130,000 t ROM pad for
storage and blending. The ROM pad is located some 1.5 km from
the open pit and adjacent to the barge loading facility at Canico,
on the Cacheu River. Phosphate rock is transferred from the ROM pad
to the barge loading facility by front end loader.
- Barges of up to 3,500 tonnes capacity will be moored and loaded
at a pontoon wharf near Cancio. A set of four barges will be
formed into a flotilla that will be maneuvered by a 'Pusher' tug to
a barge marshalling area at Bolor in the River Cacheu estuary, a
distance of 175 kilometers.
- The barges will then be maneuvered by tug to an offshore
trans-shipment point in the Atlantic Ocean, where the phosphate
rock product will be loaded onto carriers (bulk carrier vessel of
28,000 tonnes capacity) utilizing ship's gear.
- The battery limit of this DSO option is phosphate rock product
loaded into the hold of the bulk carriers.
- ROM phosphate rock product will also be available for supply to
the in-country market as a direct application fertilizer.
1.3 Million Tonne Per Year DSO Project -
Economic Analysis Key Criteria and Highlights
A summary of key criteria is provided in Table
8, below. A pre-tax cash flow projection has been generated for a
25 year mine life using estimated capital and operating costs,
which are summarized in Table 9, further below.
All amounts in US dollars
Table 8: Summary of Physical Parameters of the
DSO Project
Physical Parameter |
Value |
Mine Life |
25 Years |
Construction Period |
2 Years |
Operation |
304 days per year |
Production Rate |
1,300,000 ROM tonnes per year
phosphate product |
Total Life of Mine Production |
32.99 million tonnes phosphate
product |
Average Product Grade |
30.4 %
P2O5 @ 2.5% Al2O3; 4.4%
Fe2O3 |
Annual Product Sales |
1,300,000 tonnes phosphate
product |
Revenue Guidance Estimate |
$110 USD per tonne of phosphate FOB
(Port Cacheu) |
Table 9: Summary of DSO Project Costs
Operating Costs |
Life of Mine |
Mining |
$ 35.02 per tonne of phosphate rock
product |
Marine |
$ 4.49 per tonne of phosphate rock
product |
Personnel |
$ 4.12 per tonne of phosphate rock
product |
Power and Electricity |
$ 0.57 per tonne of phosphate rock
product |
Fuel |
$ 3.01 per tonne of phosphate rock
product |
Maintenance |
$ 1.34 per tonne of phosphate rock
product |
Total |
$ 48.54 USD per tonne of phosphate
rock product |
Capital costs (life of mine) |
Life of Mine |
Pre-production stripping (incl. mobilisation) |
USD $ 10.93 million |
Mine, Marine & Infrastructure (incl.
contingency) |
USD $ 99.91 million |
Total Mine Capital Cost |
US$ 110.84 million |
Sustaining |
USD $ 86.66 million |
Closure |
USD $ 0.71 million |
Total Life of Mine Capital Cost (incl.
contingency) |
USD $ 198.21 million |
Contingencies |
17.46% |
Accuracy |
+/-15% |
Royalties |
2%* |
* Pending discussions with the Government of Guinea-Bissau.
Capital costs have been further estimated as
follows:
Table 10: DSO Project CAPEX Estimate (Area
Breakdown)
Area # |
Area Name |
Fixed Capital
[M USD] |
Contingency
[M USD] |
Total Capital
[M USD] |
Percent Total
[M USD] |
000 |
Project General |
22.17 |
3.73 |
25.90 |
23% |
100 |
Mine |
26.10 |
5.3 |
31.40 |
28% |
300 |
Product Handling & Transport |
46.34 |
7.20 |
53.54 |
48% |
|
Total |
94.61 |
16.23 |
110.84 |
100% |
Capital estimates include mine facilities and
infrastructure, mining equipment, dewatering wells, stockpile
loader, dyke construction, stockpile area, ex-pit haul road
construction and barges.
Table 11: Cash Flow Analysis
Units |
2013 |
2014 |
2015 |
2016 |
2017 |
2018 |
2019 |
2020-2039 |
Production: |
|
|
|
|
|
|
|
|
ROM '000
tonne |
0 |
0 |
1,300 |
1,300 |
1,300 |
1,300 |
1,300 |
26,000 |
Price Phosphate product USD $ / t |
0 |
0 |
110 |
110 |
110 |
110 |
110 |
110 |
Sales USD $
'000 |
0 |
0 |
143,000 |
143,000 |
143,000 |
143,000 |
143,000 |
2,860,000 |
Cost of Sales: |
|
|
|
|
|
|
|
|
Operating cost USD $/t |
0 |
0 |
43 |
43 |
45 |
45 |
46 |
50 |
Total operating cost USD $
'000 |
- |
- |
56,363 |
56,315 |
58,644 |
58,659 |
60,271 |
1,287,437 |
EBITDA USD $
'000 |
- |
- |
86,638 |
86,685 |
84,356 |
84,341 |
82,729 |
1,572,563 |
CAPEX USD $
'000 |
39,685 |
71,159 |
11,971 |
2,804 |
5,280 |
2,804 |
4,619 |
59,890 |
Net cash flow before tax and royalties USD $
'000 |
(39,685) |
(71,159) |
74,666 |
83,881 |
79,076 |
81,537 |
78,111 |
1,512,673 |
Considering the DSO Project on a stand-alone
basis, the undiscounted pre-tax cash flow totals US$ 1.799 billion over the 25 year mine
life. Operating cash flow averages US$ 76.40
million per year and simple payback of total preproduction
capital is achieved after approximately 18 months of operation.
EBITDA as disclosed in the table above is a
non-GAAP financial measure and does not have a standardized meaning
and is therefore unlikely to be comparable to similar measures
presented by other issuers.
The Internal Rate of Return (IRR) is 58.5%.
Pre-tax Net Present Value (NPV) at various discount rates is shown
in Table 12, below.
Table 12: Pre-tax NPV Sensitivity to Discount
Rate
Rate |
NPV |
0 % (Undiscounted) |
USD $1.799 million |
5 % |
USD $879 million |
10 % |
USD $484 million |
15 % |
USD $291 million |
20 % |
USD $185 million |
25 % |
USD $122 million |
30% |
USD $82 million |
Mineral Resources and Reserves
Estimates
Mineral Resources and Reserves estimates are the
same in each of the BPRC and DSO Projects.
Mining
The same mining plan is used for the BPRC and
DSO Projects.
The majority of the annual rainfall over the
Project area is concentrated in the period from July through
September, and the Project mine plan will carry out mining
activities for 10 months out of the year to avoid the possible
inefficiencies of mining during the higher rainfall months.
Installed mining equipment capacity has been designed to produce
the annual plan phosphate requirements and associated waste
stripping within the 10 drier months of the year.
Key design elements of the mining plan are water
management and haul road maintenance. All mining areas must
be fully dewatered in advance of mining activities. The proximity
of the mine to the River Cacheu will require the construction of a
protection dyke to prevent in-pit flooding.
Contractor mining has been selected for the
excavator/truck mining method for the mining plan based on
flexibility, lower initial capital, lower investment risk, grade
control, and the ability to blend quality for required product
specifications. Contractor mining has been proposed to minimize
capital investment and to shorten the period to production which
could arise from the availability of mining capital equipment and
the shortage of in country manpower skills.
The remote nature of the Project, with the lack
of power supply, precludes the use of electric mining equipment and
all mining equipment selected for the Project will use diesel
mobile equipment.
The mining method uses excavators and trucks to
handle 100% of the overburden and phosphate. Waste will be stripped
and removed with 12 m3 bucket class front-end
loaders matched with 97 tonne haul trucks. The phosphate
will be mined with 5m3 bucket class backhoes matched
with 36 tonne trucks.
The BPRC operation will mine 1.3 Mt/a of
phosphate matrix and will require a tailings management facility
capable of holding 3.43 Mm³. The facility will be approximately 25
m high with a footprint of 1,100 m by 900 m. A site selection study
of eight possible tailings storage locations has indicated a
preferred location to the west of the open pit, 2 km northwest of
the process plant.
Excavated overburden will be stored in two
overburden storage facilities, the first of which will be up to 37
m high storing 35.4 Mm3 of material. After an initial period, the
open pit will be backfilled as mining progresses and additional
storage within the pit footprint above original ground level made.
In later stages of production, a second ex-pit storage area will be
created to the north of the pit to store 17.8 Mm3 of material. The
preferred two ex-pit overburden storage facility areas are the
result of a site selection study of six possible locations.
The DSO operation will mine 1.3 Mt/a of
phosphate matrix and will require an overburden storage facility
capable of holding 53.7 Mm³ of excavated overburden. This will be
stored in two facilities, the first of which will be up to 37 m
high storing 35.4 Mm3 of material. After an initial
period, the open pit will be backfilled as mining progresses and
additional storage within the pit footprint above original ground
level made. In later stages of production, a second ex-pit storage
area will be created to the north of the pit to store 17.8
Mm3 of material. The preferred two ex-pit overburden
storage facility areas are the result of a site selection study of
six possible locations.
C. Beneficiation
The BPRC Project has a four stage beneficiation
process - screening, hydrocyclones, magnetic separators and
dewatering, and will require a tailings management facility capable
of holding 3.43 Mm³. A site selection study of eight possible
tailings storage locations has indicated a preferred location to
the west of the open pit, 2 km northwest of the beneficiation
plant.
For the DSO Project, the ROM phosphate will be
mined, blended if necessary, and will be directly shipped with
limited treatment or processing (if any).
D. Project Infrastructure
The infrastructure requirements associated with
the DSO and/or BPRC projects include the mine infrastructure, mine
camp, offices, workshops, water treatment facilities, diesel or
heavy oil power generation and water supply.
E. River Transport and Loading
The river transport and loading activities are
common to the Feasibility Studies of both the BPRC Project and the
DSO Project.
Transfer of the phosphate product, either DSO
phosphate rock from the ROM pad to the loading facility
located on the Cacheu River at Canico, or the beneficiated
phosphate rock concentrate product from the product stockpile into
the barges and the transport down the river to a bulk carrier
located offshore in the Atlantic Ocean, will be undertaken by the
Company.
A barge loading facility will be constructed on
the Cacheu River at Canico. The selected site is located adjacent
to the mining operation/beneficiation site to minimise haulage.
Phosphate product will be stockpiled and transferred to the barge
loading facility by a front end loader.
The loading facility will receive the phosphate
discharged from a front end loader into a feed hopper. The hopper
will feed a conveyor system to load 3,000 to 3,500 tonne capacity
barges. Sets of barges will then transport the products with the
aid of a pusher tug down the River Cacheu to a barge marshalling
site near Bolor. Individual barges will then be transported
offshore to the transhipment site, approximately 20 km offshore in
the Atlantic Ocean.
The barges will be unloaded utilizing the
clam-shell cranes onboard the bulk carrier. A seagoing vessel of
28,000 tonne capacity has been assessed and concluded feasible for
the unloading of phosphate at the trans-shipment point
identified.
Recommendations
The results of the two Feasibility Studies show
that both the BPRC and the DSO Projects are robust from a technical
and economic standpoint at the selected long term phosphate prices,
GBMMEC has recommended that the Company and GBMAG continue to
advance either of the two projects to the engineering design and
construction stages and to seek the necessary project financing and
off-take agreements.
Qualified Persons
Dr. Marcelo
Godoy, MAusIMM (CP) of Golder in Santiago, Chile, who is a Qualified Person as
defined in NI 43-101, prepared and is responsible for the Mineral
Resource Estimate as disclosed in this news release. Terry Kremmel,
PE (MO and NC), SME (CP) of Golder, who is a Qualified Person as
defined in NI 43-101, prepared and is responsible for the Mineral
Reserve Estimate for the Project as disclosed in this news
release. In addition, the following Qualified Persons
prepared (or supervised and approved the preparation thereof) and
are responsible for other parts of the Feasibility Studies, which
are referred to in this news release: Michael Short, FIMMM, CEng. of GBMMEC,
Richard Elmer, C.Eng., MIMMM of
Golder, Dr. Martin Preene, CEng
FICE, CGeol FGS, CSci CEnv C.WEM FCIWEM (CP) of Golder, Dr.
Marcelo Godoy, MAusIMM (CP) of
Golder, Hendrik J.H. Otto, Pr Eng
(SA) of Golder, Terry Kremmel, PE (MO and NC), SME (CP) of Golder,
and Matthew Clark, PE CEng PMP (QP) of Baird. All of these
Qualified Persons are independent from the Company.
About Plains Creek Phosphate
Corporation
Plains Creek Phosphate Corporation is a Canadian
mining and exploration company focused on advancing the Project in
Guinea‐Bissau, West Africa through
the company, GB Minerals AG. The Project currently comprises a
phosphate deposit consisting of one continuous flat lying phosphate
bed with a Mineral Resource estimate, disclosed in the Company's
Feasibility Studies on the Project in accordance with National
Instrument 43-101, which defines a Measured Resource of 64.6 MT at
an average grade of 29.11% P2O5, an Indicated
Resource of 28.1 Mt at an average grade of 27.68 %
P2O5, and an Inferred Resource of
18.3 Mt at an average grade of
28.66 % P2O5 and states total
proven and probable reserves of 33.0 Mt (dry) with an average
ROM P2O5 grade of 30.4%. The Measured
and Indicated Resource estimates stated above are inclusive of the
resources comprising the Proven and Probable Reserve estimates. The
Feasibility Studies are authored by the Qualified Persons listed
above, are filed on SEDAR and are publicly available under the
Company's profile at www.sedar.com. A two-phased development is
planned for the Project as an open pit mining operation. Phase One
consists of a 1.3 Mt per year phosphate rock product direct
shipping option project or a 1.0 Mt per year beneficiated phosphate
rock concentrate project and Phase Two consists of the production
of 2.0 Mt per year of phosphate rock concentrate and includes a
beneficiation plant and associated infrastructure, pipeline and
port.
The Company's shares are listed on the TSX
Venture Exchange under the trading symbol "PCP". For additional
information, please visit us at www.plainscreek.com.
ON BEHALF OF THE BOARD
(Signed) "Carson
Phillips"
Carson Phillips
Vice‐President, Corporate Development and Director
Cautionary Statement
Statements in this release may be viewed as
forward-looking statements. Such statements involve risks and
uncertainties that could cause actual results to differ materially
from those projected. There are no assurances the Company can
fulfill such forward-statements and the Company undertakes no
obligation to update statements. Such forward looking statements
are only predictions; actual events or results may differ
materially as a result of risks facing the Company, some of which
are beyond the Company's control.
The reader should be cautioned that there are
risks that could affect the potential development of the Project's
mineral resources, which include: the political instability in
Africa and Guinea-Bissau in particular, which is where
the Project is located; and that additional financing will be
required to ultimately develop the Project and the ability to
obtain such financing on favorable terms will be affected by
prevailing market conditions. A more detailed discussion of
such risks are outlined in the Company's Management's Discussion
& Analysis, its DSO Project Feasibility Study and the BPRC
Project Feasibility Study, all of which are filed under the
Company's profile on SEDAR at www.sedar.com.
NEITHER 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.
SOURCE Plains Creek Phosphate Corp.