The Company filed its updated Mount Hope 43-101 Feasibility Study 2013 on the Mt. Hope Project, which was completed in accordance with the Canada National Instrument 43-101 (NI 43-101), in January 2014.

Technical Report Feasibility Study for Mt. Hope Project

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Please refer to the listed Qualified Persons and other NI 43-101 disclosures in the Technical Report.

Figure 1: NI 43-101 Technical Report Feasibility Study, Mt. Hope Project – Summary of Key Project Data (100% basis)

Open Pit Mine Life (years) 34
Milling of Low Grade stockpile (years) 7
Total Life (years) 41
Ore Density (SG) 2.53
Mine Type: Open Pit
Process Description: Crushing, Grinding, Flotation, Concentrate Leaching, Thickening, Filtering, Roasting and Packaging
Mill Throughput (Short tons per day) 66,688
Initial Capital Costs ($U.S. Millions) $1,246
Sustaining Capital Costs ($U.S. Millions) $786
Average Annual Payable Metals 5 yr 10 yr LOM
Ore Grade, Mo % 0.092 0.086 0.070
Mill Recovery % 89.8 89.5 88.8
Leach and Roaster Recovery % 99.2 99.2 99.2
Molybdenum (millions of lbs) 40.1 37.2 28.9
Unit Operating Cost:
Mining Cost per total ton material $1.06 $1.09 $1.44
Mining Cost per processed ore ton $4.25 $4.50 $3.91
Milling Cost per processed ore ton $4.59 $4.59 $4.60
Roaster Cost per processed ore ton $0.57 $0.53 $0.42
Laboratory Cost per processed ore ton $0.07 $0.07 $0.07
Site G&A Cost per processed ore ton $0.72 $0.71 $0.64
Shipping Cost per processed ore ton $0.15 $0.08 $0.02
Total cost per processed ore ton $10.35 $10.48 $9.65
Average Cost Per Pound Molybdenum:
Operating Cost $6.28 $6.86 $7.90
Royalties Cost $0.72 $0.76 $0.80
Cost Applicable to Sales $7.00 $7.62 $8.70
Metals Price assumptions: Base Case Low Case High Case
Molybdenum (price per pound) $15.00 $12.50 $17.50
After Tax Project IRR 19.1% 11.6% 25.3%
After Tax NPV at 8% Discount Rate ($Millions) $953 $278 $1,589
Payback (years) 4.1 5.5 3.1

Figures 2 & 3: NI 43-101 Technical Report Feasibility Study, Mt. Hope Project – NPV Sensitivities (100% basis)

Change of NPV8 Parameter Change Parameter Change Impact from Parameter Decrease Impact from Parameter Increase Impact from Parameter Decrease Impact from Parameter Increase
$million $million Minus Plus
Sustaining Capital -20% 20% 39 -39 4% -4%
Capital -10% 10% 80 -81 8% -8%
Operating Cost -10% 10% 215 -217 23% -23%
Mill Recovery -5% 5% -195 195 -20% 20%
Ore Grade -5% 5% -195 195 -20% 20%
Molybdenum Price -20% 20% -794 764 -83% 80%

 

Figure 4: NI 43-101 Technical Report Feasibility Study, Mt. Hope Project – NPV Sensitivity of a Rising Moly Price (100% basis)