Trilogy Metals completes Preliminary Feasibility Study for Arctic deposit

Trilogy Metals completed a Preliminary Feasibility Study Feb. 20 for development of its Arctic copper/ zinc deposit in the Ambler Mining District of the western Brooks Range. The study estimated a $779.6 million initial capital investment with $845.5 million needed over the life of the mine. A 10,000 tonne- per-year surface mine is proposed using conventional truck-and-shovel mining methods. (A “tonne,” the unit commonly used in Canada’s mineral industry, is 2,200 lbs., compared with the U.S. unit of a “ton,” or 2,000 lbs.). The feasibility study uses ore reserves of 159 million pounds of copper, 199 million pounds of zinc, 33 million pounds of lead, 30,600 ounces of gold, and 3.3 million ounces of silver.

The study assumes, through the life of the project, an average copper price of $3 a pound; $1.10 per pound for zinc; $18/ounce for silver and $1,300/ounce for gold. Cash production costs are estimated
at 63 cents per pound for the copper, which would include mining and transportation. Power generated in a 12.6 Megawatt power plant would be fueled by lique ed natural gas, under the assumptions used in the Preliminary Feasibility Study. A 12-year mine life is used in the study but mines, once they are built, typically exceed the mine life assumed in the initial analysis because new ore reserves are almost always added.

Trilogy is also engaged in exploration of Bornite, a nearby deposit. NANA Regional Corp. has a buy-in option for both Arctic and Bornite under an exploration agreement with Trilogy. NANA is the landowner around Bornite and purchased the deposit, held on federal mining claims, from Kennecott, the company that originally discovered and first explored Bornite. NANA sold the property to Trilogy, which was exploring at Arctic, under the agreement that allows NANA to opt-in at both projects.

Meanwhile, a proposed 211-mile industrial access road to connect the project with the Dalton Highway, important for both Arctic and Bornite, is in the permitting stage by the Alaska Industrial Development and Export Authority, the state development corporation. The $300 million road cost is not included in the $845.5 million capital estimate because it would be built by AIDEA and paid for through tolls, similar to AIDEA’s current road and port supporting the Red Dog Mine north of Kotzebue.

Pebble Partnership back in the field this summer

Pebble Partnership Ltd. plans to be back in the field this summer with new drilling, state resources commissioner Andy Mack told a legislative panel last week. The company plans 80 test holes, most related to geotechnical assessments related to facility siting. Mack said the Department of Natural Resources is considering approval of a short-term Miscellaneous Land Use Permit that would give the agency time to assess the summer drilling. The project is a massive copper/gold/molybdenum deposit 18 miles north of Iliamna that is being opposed by fisheries groups.