Avanti Mining Inc
SymbolAVT
Shares Issued154,085,220
Close 2009-11-13C$ 0.165
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Avanti Mining receives results of Kitsault PFS

2009-11-16 14:22 ET - News Release

Mr. Craig Nelsen reports

AVANTI MINING RECEIVES POSITIVE PREFEASIBILITY STUDY CONFIRMING ROBUST ECONOMICS FOR RESTART OF KITSAULT MINE

Avanti Mining Inc. is releasing the results of the NI 43-101 preliminary feasibility study (PFS) prepared by Wardrop, a Tetra Tech company (Wardrop) on its 100-per-cent-owned Kitsault molybdenum property in British Columbia, Canada. The complete report will be filed on SEDAR and Avanti's website within 45 days of the issue of this press release. All figures in United States dollars and were derived assuming 100-per-cent equity financing, excluding the benefits and cost of potential debt financing.

Highlights include:

  • The mine plan calls for a total of 215.3 million tonnes of proven and probable reserves grading 0.085 per cent molybdenum to be mined over a 15-year mine life, producing 368 million pounds of molybdenum. The first five years of production averages 0.10 per cent Mo.
  • Initial capital costs are estimated at $641-million.
  • Cash operating costs are estimated to be $4.43 per pound of accountable molybdenum (recovered molybdenum less 1-per-cent deductions).
  • The average life of mine (LOM) price of molybdenum for base-case scenario is computed by using the CPM Group projections and it is $15.88 per pound.
  • The base-case after-tax NPV (net present value) (8 per cent) is $551-million, with an IRR of 20.6 per cent.
  • Projected undiscounted net cash flow (after-tax) is $1.56-billion.
  • Annual metal production for the mine life averages 24.5 million pounds of molybdenum with the first five years averaging 29.2 million pounds per year.
  • The mine has certain infrastructure in place with road and ocean freight access to the mine site, and will be serviced by the BC Hydro transmission grid.
  • It will develop a run-of-river hydroelectric project, by taking advantage of the site water diversion design in managing runoff from the average two metres of precipitation.
  • The hydroelectric project may represent a long-lived project asset with implications for project reclamation financing.
  • The reopening of the mine is projected to create over 330 jobs in addition to 250 construction jobs over that three-year period.
  • The mines existing M-10 permit can be amended under the BC Mines Act process or a voluntary BC Environmental Assessment Act opt-in process.

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