Canada Nickel files preliminary economic assessment for Crawford nickel sulfide project
The EEP, titled “Crawford Nickel Sulphide Project NI 43-101 Technical Report and Preliminary Economic Assessment” has been independently prepared by Ausenco Engineering Canada Inc., in accordance with National Instrument 43-101 (“NI 43-101”) , as previously announced. in a dated press release May 25, 2021. Canada Nickel is moving the project to a feasibility study, which is expected to be completed by mid-2022.
Highlights of the PEA
The EEP indicates a 25 year mining plan based on a 120,000 tonne per day open pit mine and processing operation using a conventional nickel sulfide concentrator, producing nickel concentrates and magnetite concentrate.
Over the mine life of 25 years, Crawford is expected to produce 842,000 tonnes of nickel, 21 million tonnes of iron and 1.5 million tonnes of chromium worth $ 24 billion using long-term price assumptions. Average annual nickel production of 75 million pounds (34,000 tonnes) with an annual peak average of 93 million pounds (42,000 tonnes), with significant iron and chromium byproducts of 860,000 tonnes per year and 59,000 tonnes per year, respectively.
- After taxes, $ 1.2 billion VAN8% and 16% IRR at long-term price assumptions (Note 1)
- Large scale, low cost, long service life
- Significant iron and chromium by-products of 860,000 tonnes per year and 59,000 tonnes per year, respectively
- Net cash cost C1 over the life of the mine $ 1.09/ lb and AISC net of $ 1.94/ lb based on by-products (1st quartile) (Notes 2 and 3)
- Production over a 25-year lifespan with 842,000 tonnes of nickel, 21 million tonnes of iron and 1.5 million tonnes of chromium evaluated at $ 24 billion using long-term price assumptions (note 1)
- Significant profits and generation of free cash flow. Annual EBITDA of $ 439 million and the annual free cash flow of $ 274 million (Notes 1 and 3)
- Minimization of the carbon footprint through the use of autonomous forklifts and electric shovels, which reduces diesel consumption by 40%. Optimization of the carbon sequestration potential of tailings and waste rock.
Notes and assumptions
- All dollar figures are in United States (“US dollars. The prices of US metals used in the PEA have been $ 7.75/ lb nickel, $ 1.04/ lb of chromium, and $ 290/ ton of iron. A US dollar exchange rate of 0.75 was applied.
- Source for 1st quartile costs – Wood Mackenzie and S&P Capital IQ; Price from May 20, 2021.
- C1 data on cash cost, AISC, EBITDA and cash flow are non-IFRS measures. Refer to Non-IFRS measures.
- A complete copy of the technical report and PEA, including material assumptions, opinions and caveats, can be viewed on the company profile at www.sedar.com.
In light of the positive result of the PEA, the Company is moving the Crawford project forward through additional studies, including exploration programs to drill infill to bring current resources to the measured category; additional metallurgical studies and a feasibility study.
The PEA is preliminary in nature, it includes inferred mineral resources that are considered too geologically speculative for economic considerations that would allow them to be categorized as mineral reserves to be applied, and there is no certainty. that the results of the PEA will be achieved.
Qualified person and data verification
Stephen J. Balch P. Geo. (ON), VP Exploration of Canada Nickel and a “qualified person” as such term is defined by National Instrument 43-101, has verified the data disclosed in this press release and has further reviewed and approved the technical information contained therein. in this press release on behalf of Canada Nickel Company Inc.
About Canada Nickel Company
Canada Nickel Company Inc. is advancing the next generation of nickel sulfide projects to supply the nickel required to power the high growth electric vehicle and stainless steel markets. Canada Nickel Company has applied for a trademark of the terms NetZero NickelTM, NetZero CobaltTM, NetZero IronTM in several jurisdictions and continues to develop processes that allow the production of net zero carbon nickel, cobalt and iron products. . Canada Nickel offers investors leverage on nickel in low political risk jurisdictions. Canada Nickel is currently anchored in its flagship, 100% owned Crawford Nickel Sulfide project at the heart of the prolific Timmins–Cochrane mining camp. For more information, please visit www.canadanickel.com.
Non-IFRS measures
The Company has included certain non-IFRS measures in this press release. The Company believes that these measures provide investors with a better ability to assess the underlying performance of the project. Non-IFRS measures are intended to provide additional information and should not be viewed in isolation or as a substitute for performance measures prepared in accordance with IFRS. These measures do not have standardized meanings prescribed by IFRS and therefore may not be comparable to those of other issuers.
C1 net cash costs are the sum of operating costs (including all stripping expenses) less chromium and iron ore by-product credits per pound of nickel payable. Net AISCs (all in sustaining costs) are C1 cash costs plus royalties plus sustaining capital per pound of nickel payable.
EBITDA is earnings before interest, taxes, depreciation and amortization, which includes net smelter returns less royalties and operating costs and, for the purposes of economic analysis, assume all stripping costs are expensed . Free cash flow represents cash flow from operations less capital expenditures.
Caution Regarding Forward-Looking Statements
This press release contains certain information that may constitute “forward-looking information” under applicable Canadian securities legislation. Forward-looking information includes, but is not limited to, the results of Crawford’s comprehensive environmental assessment, including statements relating to net present value, future production, cash cost estimates, plans and methods of operation. mining operations, mine life estimates, cash flow forecasts, metal recoveries, capital and operating cost estimates, permitting schedule and environmental assessments, completion of mineral resource estimates, capital and operating cost estimates, project and mine life estimates, ability to obtain permits on time, project size and classification upon completion production achieved, estimates of economic return, timing and amount of estimated future production and capital, operating expenses and exp loration and potential benefits and alternatives. Readers should not place undue reliance on forward-looking statements.
Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause Canada Nickel’s actual results, performance or achievements to differ materially from future results, performance or achievements expressed or implied by the companies. forward-looking statements. The results of the PEA are estimates only and are based on a number of assumptions, each of which, if incorrect, could materially alter the expected result. There can be no assurance that Crawford will be put into production. Factors that could affect the result include, among others: actual results of development activities; project delays; failure to raise the necessary funds to complete development; general business, economic, competitive, political and social uncertainties; future metal prices or project costs could differ significantly and make any commercialization unprofitable; availability of alternative nickel sources or substitutes; actual nickel recovery; conclusions of economic evaluations; changes in project parameters as plans continue to be refined; accidents, labor disputes, availability and productivity of skilled labor and other risks of the mining industry; political instability, terrorism, insurgency or war; delays in obtaining government approvals, necessary permits, or in completing development or construction activities; the mineral resource estimates for Crawford may prove to be inaccurate for any reason; additional but currently unplanned work may be required to move to the feasibility stage; and even if Crawford goes into production, there can be no assurance that operations will be profitable.
Although Canada Nickel has attempted to identify material factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that may cause actual actions, events or results to differ materially from those described in forward-looking statements. actions, events or results differ from those anticipated, estimated or intended. The forward-looking statements contained herein are made as of the date of this press release and Canada Nickel disclaims any obligation to update any forward-looking statements, whether as a result of new information, future events or results or otherwise. , except as required by securities laws.
SOURCE Canada Nickel Company Inc.
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