Updated Mineral Reserves and Resources estimate for the Aitik Copper- Gold Operation, Northern Sweden

Transcription

1 Updated Mineral Reserves and Resources estimate for the Aitik Copper- Gold Operation, Northern Sweden Boliden Mineral AB announces an update of the mineral reserves and resources for the Aitik, Salmijärvi, Aitik East, and Liikavaara Copper-Gold deposits (collectively termed the Aitik operation ) in Norrbotten County, northern Sweden. These updated reserves and resources (Table 1) are in support to the results of a recently completed Pre-feasibility study, and positively confirm the presence of a very large tonnage mineralization at the Aitik operation economically capable of supporting expansion of processing throughput from 36 to 45 million ore tonnes per year. Table 1: Mineral Reserve and Resource estimates for the Aitik, Salmijärvi, Aitik East, and Liikavaara deposits. Deposit Classification Mt Au Ag Cu Mo g / t g / t % g/t Aitik Proven reserve Probable reserve Measured resource Indicated resource Inferred resource Salmijärvi Proven reserve Probable reserve Measured resource Indicated resource Inferred resource Aitik Östra Liikavaara Proven reserve Probable reserve Measured resource Indicated resource Inferred resource Proven reserve Probable reserve Measured resource Indicated resource Inferred resource Table 1 continued to page 2. 1 (11)

2 Table 1 continued from page 1. Deposit Classification Mt Au Ag Cu Mo g / t g / t % g/t Aitik deposits total Proven reserve Probable reserve Total mineral reserve Measured resource Indicated resource Inferred resource Total mineral resource Note1: All tonnages in millions of metric tonnes (Mt) Note 2: Reserves and resources for the Liikavaara deposit were last updated in Since that time significant infill drilling has been carried out at the deposit and a re-estimate of reserves and resources is planned for late 2014 or early Grades encountered during infill drilling are in line with those previously observed and not expected to significantly alter the results of the estimation. Note 3: Since the time of estimation ( ) approximately 10 Mt of ore has been mined and processed from the combined Aitik and Salmijärvi deposits. Background: The Aitik operation is located in Gällivare municipality, Norrbotten county, northern Sweden about 60 km north of the Arctic Circle and 15 km east of Gällivare town center (Figure 1). Open pit operations at the site commenced in 1968 and have been in large part continuously active since that time. Historic production (through 31 st December 2013) tallies 633 Mt ore processed at a grade of 0.18 g/t Au, 3.3 g/t Ag, and 0.34% Cu, at a stripping ratio (waste/ore) of Current operations consist of mining at two open pits (Aitik and Salmijärvi), with ore processing carried out at the newly built and nearby concentrator plant. During 2013 a total of 37 Mt of ore was processed at the operation at a head grade of 0,10 g/t Au, 2,2 g/t Ag, and 0.21% Cu. Sulfide concentrates, containing payable copper, gold, and silver, are transported by rail to Boliden Mineral AB s Rönnskär smelter located about 350 km to the south in Skelleftehamn, Sweden. 2 (11)

3 Gällivare Aitik operation 5 km Figure 1: Location map of the Aitik operation. Properties: Boliden Mineral AB ( the company or Boliden ) holds a total of 5 mining concessions at the Aitik operation totaling 610 ha (Table 2, Figure 2). All mining concessions are fully owned by the company and are currently in good standing with Bergsstaten, the Swedish Mining Inspectorate. Table 2: List of mining concessions at the Aitik operation. Concession Area (ha) Expiration date Aitik K nr Aitik K nr Aitik K nr Aitik K nr Liikavaara K nr Total 610 However, not all areas of the updated mineral reserve are covered by the current Aitik mining concession block. An additional concession covering portions of the mining reserve for the Aitik and Aitik East deposits will be applied for during (11)

4 Figure 2: Aerial photo (July 2012) showing location of mining concessions at the Aitik operation. In addition to the mining concessions listed above, the company is actively exploring approximately 300 km 2 of exploration licenses in the area, mainly focused within a 20 km radius of operations. Environmental permits: Boliden holds and maintains all of the necessary environmental permits for mining and processing from the present Aitik and Salmijärvi open pits, at a plant throughput rate of up to 38 Mt of ore per year. A new permit for an expanded ore processing, up to 45 Mt per year, has been applied for at the Land and Environmental Court. The hearing for this permit application is scheduled for June (11)

5 Additional environmental permits will be required to be able to process the complete mineral reserves but no additional permit will be required in several years. Geology: The Aitik, Salmijärvi, and Aitik Östra deposits occur along a largely continuous elongate mineralized trend (the Aitik-Salmijärvi mineralization) stretching approximately 5 km along strike from north to south averaging about 500 m in width (Figure 3, 4). Liikavaara Liikavaara Cu-Au mineralization A Aitik East E1 Sa1 Salmijärvi Aitik N8 N6 N7 S1 S3 S2 Sa2 Aitik-Salmijärvi Cu-Au Mineralization (60 m level) A N 1 km Figure 3: Schematic map showing relative locations of the Aitik-Salmijärvi and Liikavaara mineralizations, as well as the corresponding deposits of Aitik, Salmijärvi, Aitik East, and Liikavaara. Individual mining positions (N6, N7, N8, S1, S2, S3, Sa1, Sa2, E1 and Liikavaara) shown as various colored shapes. Cross section A-A shown in Figure 4. Host rocks of the mineralization at the Aitik deposit consist mainly of paleoproterozoic aged (ca billion years) muscovite schists, biotite gneisses, and amphibole-biotite gneisses of volcanic and volcanoclastic origin, crosscut locally by diorite intrusive units. In places the diorite intrusive make up a significant proportion of the mineralized volume, but typically at lower than average grade. Foliation is well developed in the host rocks, dipping at about 50 degrees to the west. Main sulfide minerals in the deposit are chalcopyrite, pyrite and pyrrhotite, with significant accessory minerals including molybdenite and magnetite. The entire package has been metamorphosed to amphibolite grade resulting in significant re-crystallization and coarsening of both sulfide and silicate minerals. 5 (11)

6 Late granite pegmatite dikes crosscut the mineralized host rocks and are generally weakly mineralized to barren. West East A A N6 N7 Cu-Au mineralization N8 250 m Figure 4: Cross section of the Aitik deposit looking north (see Figure 3 for cross section line A-A ). Mining positions N6, N7 and N8 shown as red, green, and brown units, respectively. Mineralization at the Salmijärvi and Aitik East deposits is very similar in nature to the Aitik deposit, with the exception that host rocks are strongly dominated by amphibole-biotite gneisses and local diorite. Sulfide mineralization in these deposits is dominated by chalcopyrite, pyrite and pyrrhotite, although at typically lower grade than in the Aitik deposit. About 3 km to the east, on separate and volumetrically smaller mineralized trend, sits the Liikavaara deposit (Figure 3). At Liikavaara host rocks to the mineralization are dominated by strongly foliated biotite schist, dipping steeply (ca. 80 degrees) to the west. Within the biotite schist crosscutting mineralized dioritic dikes are observed, typically showing signs of significant hydrothermal (quartz-tourmaline) alteration. Sulfides are dominated by chalcopyrite, pyrite and pyrrhotite, being typically observed occurring within millimeter to centimeter scale quartz veinlets. Significant accessory minerals at Liikavaara are magnetite, molybdenite and scheelite, typically found in close association with Cu mineralization. Mineral Reserve and Resource estimation The figures for reserves and resources presented herein (Table 1) are estimates, and no assurances can be given that they will be realized during production. Such estimates are, in large part, based on interpretations of geological data obtained from drill hole sampling techniques. Actual mineralization or favorable host rock units may be different from those predicted. However, historic experience, documented by regular grade reconciliation between modeled mineralization and realized plant output, indicates high correlation between predicted and realized tonnages and grades at the Aitik operation (Table 3). This said, for some mining positions (positions N7, N8, S2, and S3 at Aitik, as well as Liikavaara and Aitik 6 (11)

7 East) it may many years before production is possible, and during that time the economic feasibility of exploiting the position may change. Table 3: Grade and tonnage reconciliation (model vs. realized) for the Aitik operation during years Reconciliation kton (model) kton (realized) g/t Au model g/t Au realized g/t Ag model g/t Ag realized %Cu model %Cu realized Calculation of the reserves and resources estimated herein is based on the modeling of data from a total of drill holes in the operational area, totaling over m of drilling and dating from the late 1950 s to present. From this a total of sample sections have been taken and analyzed, the majority of which for Au, Ag, Cu, Mo, and S. For the non-legacy assay data utilized in these reserve and resource estimates (that dating from year 2000 and later), half core samples were prepared at ALS Minerals laboratory in Öjebyn, Sweden and then shipped to analytical facilities in Vancouver, Canada. Samples were analyzed for Au using a 50 g fire assay with and ICP-AES finish. Ag, Cu and Mo were analyzed using aqua regia digestion and AAS finish, and S using the Total Sulphur (LECO) technique. A system of blanks, standards, and pulp duplicates were added to the sample stream by Boliden to verify accuracy and precision of assay results, supplementing and verifying a variety of internal QA/QC tests performed by ALS Minerals. For legacy data (that dating pre-2000) verification has been carried out mainly by using drill hole twinning as well as grade and tonnage reconciliation from producing operational areas. Mineral reserves at the Aitik, Aitik East, and Salmijärvi deposits assume mining cost for ore, mining cost for waste, processing, and overhead costs of approximately 23 SEK/t, 15 SEK/t, 22 SEK/t, and 6 SEK/t respectively. The Aitik operation uses a marginal milling cutoff of approximately 22 SEK/t, corresponding to a cutoff grade of 0.06% Cu. Overall slope angles of between 40 degrees on the footwall and 53 degrees in the southern end were used to guide reserve pit shell optimization of all three open pits. Revenue was estimated using parameters according to Table 4. 7 (11)

8 Table 4: Parameters used to calculate revenue for the Aitik, Aitik East, and Salmijärvi reserve pits. Parameter Value Exchange rate 6.7 SEK/USD Recovery % Au 49 Recovery % Ag 65 Recovery % Cu 90.3 Recovery % Mo 49 TC/RC 70 USD/t Au price 1200 USD/tr. oz Ag price 20 USD/tr. oz Cu price USD/t Mo price USD/t Discount rate 10% Au NSR 104 * g/t Au Ag NSR 1.8 * g/t Ag Cu NSR 357 * % Cu Mo NSR 0.1 * g/t Mo Mineral reserves for the Liikavaara deposit, last estimated in 2009, assumed mining costs of approximately 16 SEK/t waste, 16 SEK/t for ore, and 16 SEK/t for processing. An NSR cutoff grade of 26 SEK/t was chosen, taking into consideration the extra transport distance from the Liikavaara mining position to the nearest crushing point of the Aitik operation. Overall slope angles of 45 degrees on the footwall and 50 degrees on the hanging wall were used to guide reserve pit shell optimization. Revenue was estimated using parameters listed in Table 5. 8 (11)

9 Table 5: Parameters used to calculate revenue for the Liikavaara reserve pit (2009). Parameter Value Exchange rate 7.5 SEK/USD Recovery % Au 50 Recovery % Ag 50 Recovery % Cu 85 Recovery % Mo 0 TC/RC 60 USD/t Au price 750 USD/tr. oz Ag price 10 USD/tr. oz Cu price USD/t Mo price n/a Discount rate 10% Au NSR 66.2 * g/t Au Ag NSR 0.9 * g/t Ag Cu NSR * % Cu Mo NSR 0 * g/t Mo Using these input parameters an optimized reserve pit shell was constructed for the Aitik, Aitik East, Salmijärvi and Liikavaara deposits. From these reserve pit shells pit designs were constructed, leading ultimately to the reserve pit mining positions shown in Figures 3 and 4. For mineral resources at the Aitik, Aitik East, and Salmijärvi deposits Boliden assumes mining cost for ore, mining cost for waste, and processing costs approximately 15 SEK/t, 15 SEK/t, and 25 SEK/t, respectively. The Aitik operation uses a marginal milling cutoff of approximately 22 SEK/t, so a resource cutoff grade of 0.06% Cu was chosen. Assumed slope angles were 45 degrees for the footwall and 50 degrees for the hanging wall. Revenue was estimated using an NSR formula of: NSR SEK/ton = (115*g/t Au) + (2* g/t Ag) + (360 * %Cu) + (0.1 * g/t Mo) 9 (11)

10 Aitik East Aitik Salmijärvi Ultimate pit outline Mineral reserve Resource shell N 1 km Figure 5: Map showing footprint of mineral reserve and mineral resource (orange and blue lines, respectively) at the Aitik, Aitik East, and Salmijärvi deposits. Background aerial photo from September, Mineral resources for the Liikavaara deposit, last estimated in 2009, assumed mining costs of approximately 15 SEK/t waste, 15 SEK/t for ore, and 15 SEK/t for processing. Assumed slope angles were 45 degrees for the footwall and 50 degrees for the hanging wall. Cutoff for the Liikavaara deposit was chosen at an NSR value of 26 SEK/t, taking into account the extra transport distance between the deposit and the main crushing infrastructure of the Aitik operation. Revenue was estimated using the following formula: NSR SEK/t = (70* g/t Au) + (1.2*g/t Ag) + (250*%Cu) Using these input parameters, an undiscounted pit shell was constructed to constrain the outer limits of mineral resource (Figure 5). The inner limits of the mineral resource are defined by the outer walls of reserve pit mining positions. Thus, there is no volume overlap between mineral reserves and resources (mineral resources are exclusive of mineral reserves). About the estimation The estimation of Mineral Reserves and Mineral Resources were carried out in accordance with recommendations by the Swedish industry organisation for mining and metal companies, SveMin, known as the FRB standard. The estimations were carried out by the technical staffs in Aitik and 10 (11)

11 Boliden offices under supervision of Gunnar Agmalm, who is registered as a Qualified Person by SveMin. Gunnar Agmalm is fully employed by Boliden and has more than 20 years of relevant experience in the mining industry. 11 (11)