Florence Copper Prefeasibility Study Demonstrates Positive Economics

VANCOUVER, Feb. 13, 2013 /CNW/ - Curis Resources Ltd. ("Curis" or the "Company") (TSX: CUV), is pleased to announce the results of the Prefeasibility Study (PFS) on its Florence Copper Project in central Arizona, USA.  The PFS report is authored by M3 Engineering & Technology Corp. (U.S.), with input from a number of other specialized and experienced consulting and advisory firms in the areas of hydrology, geology, in-situ extraction, oxide metallurgy and cultural resources.

The PFS supports the findings of the Company's September 2010 Preliminary Economic Assessment (PEA) projecting low capital and operating costs and favorable economic potential.

Highlights of the outcomes of the base case analysis are as follows:

• The base case economics utilize a US$2.75 per pound long-term copper price and an average design production rate of 55 million pounds (27,500 tons) of copper per year in the first 5 years, rising to 85 million pounds (42,500 tons) in year 6.
  
  
• The base case economics indicate pre-tax Net Present Value (NPV) of US$748 million at a 7.5% discount rate with an Internal Rate of Return (IRR) of 38% and a pre-tax 2.4-year payback of initial capital.
  
  
• At a US$3.00 per pound copper price, the pre-tax NPV increases to $875 million and the project has an IRR of 41%.
  
  
• Life of project direct operating cost is estimated at US$0.79 per pound copper recovered.
  
  
• Initial capital costs are estimated at US$196 million.   This represents an 18 % decrease from the initial capital cost estimate presented in the 2010 PEA.   The commercial operating life of the project has also been extended from 19 to 25 years.
  
  
• Operations will occur on land owned by and leased by Curis from the Arizona State Land Department (ASLD) for a total of 13 years.  The first 9 years of copper production will occur exclusively on ASLD land and are scheduled to begin in 2016.  In year 10, production would expand on to private patented land owned by Curis.  

"Completion of a positive Prefeasibility Study for the Florence Copper Project is a critical milestone for Curis," said Michael McPhie, President and CEO of Curis Resources Ltd. "The study further confirms the robust economic potential indicated by the Company's 2010 PEA.  And with capital and operating costs that are estimated to be among the lowest in the global copper industry and a revised near term development plan now in place that provides a clear path to commercial operations, the PFS demonstrates both the economic and technical viability of the Florence Copper Project."

The Florence Copper Project

The Florence Copper Project is an advanced-stage copper development project located in central Arizona, and owned 100% by Curis. The project site hosts a shallowly buried porphyry copper deposit with a significant oxide mineral resource that is amenable to in-situ copper recovery and industry-standard solvent extraction and electrowinning (SX-EW) copper production. The Florence deposit was advanced to a prefeasibility study level of assessment and achieved full project permits when owned by BHP Copper (BHP) in the late 1990s.  Curis is now amending and updating these operational permits through a well-defined and time-limited amendment process with a goal of initiating copper production at a Phase 1 production test facility in late-2013.  BHP operated a successful ISCR production test at the Florence Copper Project in 1998 which confirmed the viability of utilizing in-situ production techniques for extracting copper.  The production test and an extensive groundwater monitoring program over the past 16 years have also conclusively demonstrated that ISCR techniques can be operated without adverse impacts to local or regional ground water quality. 

Details of the Prefeasibility Study Results

A summary of the PFS results based on long term US $2.75 and US$3.00 per pound copper prices.

FLORENCE COPPER PRE-FEASIBILITY STUDY FINANCIAL MODEL RESULTS

Initial capital costs include an average contingency of 20%.

Key Aspects and Assumptions of the Prefeasibility Study

The following are some key aspects and development revisions that have been included in the PFS.  These represent key changes or modifications to the plans for developing the project as compared to the development plan included in the 2010 PEA.

• A revised extraction plan that utilizes existing facilities and locates the well field, copper processing plant, water management facilities and related infrastructure on the 160-acre ASLD lease area controlled by Curis for the first 9 years of operations.
• A revised annual production scenario averaging 55 million pounds of copper cathode for years 1 through 6, optimum production averaging 85 million pounds of copper cathode during years 7 through 21, and a decline thereafter.
• Updated total copper recovery estimates announced in Curis' January 7, 2013 Press Release.  The copper recovery estimates used in the PFS are based on work undertaken by Metcon Research of Tucson, Arizona and supervised by Dr. Terrence McNulty, PE, of T.P. McNulty and Associates, Inc. of Tucson, Arizona.
• Inclusion of costs relating to project site reclamation and water treatment.
• The study is based on 339,953,000 tons of probable mineral reserves grading 0.358% TCu at a cutoff grade of 0.05% TCu.

M3 completed the PFS of the ISCR operability of the Florence Copper Project, utilizing industry standard criteria.

Richard Zimmerman, RM-SME, of M3 coordinated overall compilation of the PFS and was involved with process design, infrastructure, capital and operating costs and economic analysis, with contributions from Dr. Terrence McNulty, PE, of TP McNulty and Associates (metallurgy and leaching recovery), Michael Young, RM-SME, Haley & Aldrich (hydrology, recoverable resource estimates, extraction methods and schedule, environmental studies, and reclamation), and Corolla Hoag, CPG, RM-SME, of SRK Consulting (geology and mineral resources, 2010, 2011).  All are qualified persons that are independent of the Company and have reviewed this release. David Copeland, P.Eng., a qualified person who is a director of Curis and supervised the work on behalf of the Company has reviewed and approved the content of this release.  A technical report documenting the PFS will be filed on www.sedar.com within 45 days.

Project Status and Near Term Development Plan

Curis is awaiting approval from the Environmental Protection Agency (EPA) for an Underground Injection Control (UIC) permit for Phase 1 Production Test Facility (PTF) at the Florence Copper Project.  The Company will initiate formal construction and operations of a Phase 1 PTF once the UIC permit is received.

About Curis

Curis Resources Ltd. is a mineral development company associated with Hunter Dickinson Inc., a diversified global mining company with a 25-year history of mineral development success.  Curis is focused on the acquisition, development and operation of high-quality next-generation copper properties in progressive jurisdictions around the world.  It is currently focused on advancing its 100% owned Florence Copper Project in Arizona, USA to near-term production.

Michael McPhie
President & CEO

No regulatory authority has approved or disapproved of the information contained in this news release.

CAUTION REGARDING FORWARD-LOOKING INFORMATION

This release includes certain statements that may be deemed "forward-looking statements". All statements in this release, other than statements of historical facts, that address exploration drilling, test results, exploitation activities and events or developments that the Company expects to occur, are forward-looking statements. Although the Company believes that the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in the forward-looking statements.  Forward-looking statements are subject to known and unknown risks, uncertainties and other factors that may cause the Company's actual results, level of activity, performance or achievements to be materially different from those expressed or implied by such forward-looking statements. These include but are not limited to:

• uncertainties and costs related to the Company's exploration and development activities, such as those associated with continuity of mineralization, or determining whether mineral resources or reserves exist on a property;

• uncertainties related to the accuracy of our estimates of mineral reserves, mineral resources; expected production rates, the timing of expected production, the geotechnical or hydrological nature of mineral deposits, and diminishing quantities or grades of mineral resources;

• uncertainties related to the ability to obtain necessary environmental, land use, and other licenses, permits, approvals, surface rights and title for development projects;

• uncertainties and delays related to judicial or regulatory proceedings; changes in, and the effects of, laws, regulations and government policies affecting our exploration, development and mining operations, particularly laws, regulations and policies in jurisdictions in which our projects are located, relating to environmental protection and associated compliance costs, land use, effective future tax rates, the protection of the health and safety of mine workers, and mineral rights ownership;

• changes in general economic, market or business conditions, the financial markets and in the demand and market price for copper, gold, and other minerals and commodities, such as diesel fuel, steel, concrete, electricity and other forms of energy, mining equipment, and fluctuations in exchange rates, particularly with respect to the value of the U.S. dollar and Canadian dollar, and the continued availability of capital and financing on terms acceptable to the Company;

• the ability of the Company to achieve fulfillment of all conditions for drawdown under its loan agreement with RK Mine Finance Trust I;

• the risk of inadequate insurance or inability to obtain insurance to cover all risks associated with the exploration, development or mining of the Company's projects;

• the risk of loss of key employees;

• changes in accounting policies and methods we use to report our financial condition, including uncertainties associated with critical accounting assumptions and estimates;

• environmental issues and liabilities associated with mining including processing ore; and

• labour strikes, work stoppages, or other interruptions to, or difficulties in, the employment of labour in markets in which we operate mineral projects or mines, or environmental hazards, industrial accidents or other events or occurrences, including third party interference that interrupt the production of minerals in our mines.

Investors are cautioned that any such statements are not guarantees of future performance and actual results or developments may differ materially from those projected in the forward-looking statements. For more information on the Company, a more detailed description of the assumptions used to develop the forward-looking statements and the risk factors that may cause actual results to differ materially from forward-looking statements, investors should review the Company's continuous disclosure filings, copies of which are available at www.sedar.com.

Cautionary Note to U.S. Investors Concerning Reserve Estimates

The mineral reserves disclosed in this news release have been estimated in accordance with Canadian National Instrument 43-101 - Standards of Disclosure for Mineral Projects ("NI 43-101"), as required by Canadian securities regulatory authorities. The Company is not subject to the reporting requirements of section 13(a) of section 15(d) of the United States Securities Exchange Act of 1934, as amended (the "Exchange Act").  However, the Company's U.S. investors are cautioned that SEC Industry Guide 7 under the Exchange Act, as interpreted by Staff of the SEC, applies different standards in order to classify mineralization as a reserve.  As a result, the definitions of proven and probable reserves used in NI 43-101 differ from the definitions in the SEC Industry Guide 7.  Under SEC standards, mineralization may not be classified as a "reserve" unless the determination has been made that the mineralization could be economically and legally produced or extracted at the time the reserve determination is made.  Among other things, all necessary permits would be required to be in hand or issuance imminent in order to classify mineralized material as reserves under the SEC standards.  Accordingly, mineral reserve estimates contained in this news release may not qualify as "reserves" under SEC standards.  In addition, disclosure of "contained ounces" is permitted disclosure under Canadian regulations; however, the SEC only permits Exchange Act reporting companies to report reserves in ounces, and requires reporting of mineralization that does not qualify as reserves as in place tonnage and grade without reference to unit measures.

SOURCE: Curis Resources Ltd.