Vancouver, British Columbia…Trevali Mining Corporation (“Trevali” or the “Company”) (TSX: TV; BVL: TV; OTCQX: TREVF; Frankfurt: 4TI) reports preliminary first quarter (“Q1”) 2017 production results from its two operating zinc mines, the Caribou Mine in New Brunswick, Canada and the Santander Mine in Peru. For the three months ending March 31, 2017, approximately 32.2 million payable pounds zinc, 10.0 million payable pounds lead and 345,662 payable ounces of silver was produced (see Table 1).
Table 1: Consolidated Q1-2017 preliminary production statistics
|Concentrate Produced DMT (dry metric tonnes):|
*Q1-2016 production figures do not include Caribou Zinc Mine production that commenced commercial production on July 1, 2016.
“During Q1 we saw continued strong throughput at both our Santander Zinc Mine in Peru and Caribou Zinc Mine in New Brunswick,” stated Dr. Mark Cruise, Trevali’s President and CEO. “As previously stated during the first half of this year at Santander will see operations continue to process ore primarily from the more zinc-rich Magistral Central and South Deposits and then mining will sequence back into the more lead-and-silver-rich Magistral North Deposit and Oyon Zone into the second half of the year, boosting Pb and Ag metal production for the remainder of the year and going forward. Additionally, at Caribou we have continued to implement operational efficiencies, specifically targeting recoveries and we are seeing increased lead and silver recoveries for Q1 and have started to see improvements in zinc recoveries in the latter part of the quarter.”
Santander Zinc Mine, Peru
For Q1-2017, Santander delivered consistent operational performance as mining continues to sequence through the more zinc-dominant Magistral Central and South zones. The Santander team continues to advance Magistral North ramp development in order to access the higher-grade Zn-Pb and Ag mineralization in the Magistral North and Oyon Zones, both of which remain open for expansion and which will result in increased Pb-Ag production in the latter half of 2017 and going forward.
Preliminary quarterly production of 12.6 million payable pounds of zinc, 1.9 million payable pounds of lead and 128,577 payable ounces of silver (see Table 2). Recoveries averaged 88% for zinc, 79% for lead and 63% for silver.
Santander mill throughput for Q1-2017 was 200,249 tonnes, approximately 10% above the nameplate design of 2,000-tonnes-per-day (730,000 tonnes per year).
Table 2: Santander Mine Q1-2017 preliminary production statistics
|Average Head Grades (%)|
|Silver - Oz/tonne||0.96||1.32|
|Average Recoveries (%)|
|Concentrate Produced DMT (dry metric tonne):|
|Concentrate Grades (%)|
|Silver - Oz/tonne||57.92||38.70|
Zinc lbs (pounds)
Lead lbs (pounds)
2017 Santander Mine Production Guidance
The 2017 production guidance estimate for the Santander mine remains unchanged at:
- 63-65 million pounds of payable zinc in concentrate
- 12-14 million pounds of payable lead in concentrate
- 700,000-900,000 ounces of payable silver
Cash costs for 2017 are estimated at approximately US$35-40 per tonne milled (please see Cautionary Note on Forward Looking Statements at the end of this document).
The Santander exploration team also commenced the Phase I, approximately 13,000-metre, 2017 exploration program in early April. The aim of the program is to aggressively probe the depth and lateral extents of the Magistral polymetallic system that remains open for expansion in addition to converting additional inferred tonnages into higher confidence categories to support longer- range mine planning. Conventional and directional surface drilling will initially test the high priority Santander Pipe target, which remains open for expansion at depth, for future mine planning purposes. It is anticipated that underground exploration will commence in June when dedicated exploration footwall drives are completed and will initially test the depth extents of Magistral North-Central and transitioning to Central-South as the program progresses. Contingent on success, Phase II drilling will continue to define and expand the mineralized systems.
Caribou Zinc Mine, Canada
Q1-2017 marked the Caribou Mine’s third commercial production quarter and saw ongoing optimization initiatives targeting further improvements in both throughput and metallurgical recoveries. Both Pb and Ag recoveries continued to improve while Zn recoveries remained level.
In Q1-2017, Caribou produced 19.6 million pounds of payable zinc, 8.1 million payable pounds of lead and 217,085 payable ounces of silver (see Table 3). Recoveries averaged 75% for zinc, 64% for lead and 38% for silver. Mill throughput for Q1 was 232,880 tonnes, effectively at its nameplate (3,000-tonne-per-day) performance. Zinc recoveries during the first-half of the Quarter were adversely affected by a combination of substandard grinding media (fragmentation of steel balls in the mills), which is now resolved, and winter conditions, but have recovered in latter half of the Quarter as various seasonal optimization programs took effect. Test work, both internally and with third parties (Surface Science Western and McGill University) including partner Glencore, is ongoing to enable better future management of seasonal zinc recovery variation.
Table 3: Caribou Mine Q1-2017 preliminary production statistics
|Average Head Grades:|
|Average Recoveries (%):|
|Concentrate Produced DMT (dry metric tonnes):|
|Zinc Silver in zinc conc.||47% 4.0 oz/t||- -|
|Silver in lead conc.||19.3 oz/t||-|
* No corresponding Q1 production quarter in 2016 as the Caribou Zinc Mine declared commercial as of July 1, 2016.
2017 Caribou Mine Production Guidance
The 2017 production guidance estimate for the Caribou mine remains unchanged at:
- 90-93 million pounds of payable zinc in concentrate
- 30-32 million pounds of payable lead in concentrate
- 800,000-900,000 ounces of payable silver
Cash costs for 2017 are estimated at approximately US$55-60 per tonne milled (please see Cautionary Note on Forward Looking Statements at the end of this document).
The Caribou mine transition to owner-operated with new Sandvik supported mine fleet remains on track for mid-year commencement. Initial training and fleet deliveries will commence in May, which when fully integrated is anticipated to result in improved operational efficiencies including mine cost savings of approximately US$5-6/tonne.
Qualified Person and Quality Control/Quality Assurance
EurGeol Dr. Mark D. Cruise, Trevali’s President and CEO, Paul Keller, P.Eng, Trevali’s Chief Operating Officer are qualified persons as defined by NI 43-101, have supervised the preparation of the scientific and technical information that forms the basis for this news release. Dr. Cruise is not independent of the Company as he is an officer, director and shareholder. Mr. Keller is not independent of the Company as he is an officer and shareholder.
ABOUT TREVALI MINING CORPORATION
Trevali is a zinc-focused, base metals mining company with two commercially producing operations.
The Company is actively producing zinc and lead-silver concentrates from its 2,000-tonne-per-day Santander mine in Peru and its 3,000-tonne-per-day Caribou mine in the Bathurst Mining Camp of northern New Brunswick. Trevali also owns the Halfmile and Stratmat base metal deposits, located in New Brunswick, that are currently undergoing a Preliminary Economic Assessment reviewing their potential development. Additionally, the Company has entered into a definitive agreement with Glencore PLC to acquire a portfolio of zinc assets from Glencore, including an 80% interest in the Rosh Pinah mine in Namibia, a 90% interest in the Perkoa mine in Burkina Faso, an effective 39% interest in the Gergarub project in Namibia, an option to acquire 100% interest in the Heath Steele property in Canada and certain related exploration properties and assets.
The common shares of Trevali are listed on the TSX (symbol TV), the OTCQX (symbol TREVF), the Lima Stock Exchange (symbol TV), and the Frankfurt Exchange (symbol 4TI). For further details on Trevali, readers are referred to the Company’s website (www.trevali.com) and to Canadian regulatory filings on SEDAR at www.sedar.com.
On Behalf of the Board of Directors of
TREVALI MINING CORPORATION
“Mark D. Cruise” (signed)
Mark D. Cruise, President
Vice President, Investor Relations and Corporate Communications
Phone: (604) 488-1661 / Direct: (604) 638-5623
This news release contains “forward-looking statements” within the meaning of the United States private securities litigation reform act of 1995 and “forward-looking information” within the meaning of applicable Canadian securities legislation. Statements containing forward-looking information express, as at the date of this news release, the Company’s plans, estimates, forecasts, projections, expectations, or beliefs as to future events or results and the Company does not intend, and does not assume any obligation to, update such statements containing the forward-looking information. Such forward-looking statements and information include, but are not limited to statements as to: the expected benefits of the proposed Transaction, the closing the Transaction„ including the anticipated timing thereof, the satisfaction of all conditions to closing the Transaction and the Offering including, without limitation, obtaining all necessary consents and approvals, the completion of the debt financing, the Company’s plan to prepare a new PEA for its Halfmile and Stratmat properties, the accuracy of estimated mineral resources, anticipated results of future exploration, and forecast future metal prices, expectations that environmental, permitting, legal, title, taxation, socio-economic, political, marketing or other issues will not materially affect estimates of mineral resources. These statements reflect the Company’s current views with respect to future events and are necessarily based upon a number of assumptions and estimates that, while considered reasonable by the Company, are inherently subject to significant business, economic, competitive, political and social uncertainties and contingencies.
These statements reflect the Company’s current views with respect to future events and are necessarily based upon a number of assumptions and estimates that, while considered reasonable by the company, are inherently subject to significant business, economic, competitive, political and social uncertainties and contingencies. Many factors, both known and unknown, could cause actual results, performance or achievements to be materially different from the results, performance or achievements that are or may be expressed or implied by such forward-looking statements contained in this news release and the Company has made assumptions and estimates based on or related to many of these factors. Such factors include, without limitation: fluctuations in spot and forward markets for silver, zinc, base metals and certain other commodities (such as natural gas, fuel oil and electricity); fluctuations in currency markets (such as the Canadian dollar and Peruvian sol versus the U.S. dollar); risks related to the technological and operational nature of the Company’s business; changes in national and local government, legislation, taxation, controls or regulations and political or economic developments in Canada, the United States, Peru or other countries where the Company may carry on business in the future; risks and hazards associated with the business of mineral exploration, development and mining (including environmental hazards, industrial accidents, unusual or unexpected geological or structural formations, pressures, cave-ins and flooding); risks relating to the credit worthiness or financial condition of suppliers, refiners and other parties with whom the Company does business; inadequate insurance, or inability to obtain insurance, to cover these risks and hazards; employee relations; relationships with and claims by local communities and indigenous populations; availability and increasing costs associated with mining inputs and labour; the speculative nature of mineral exploration and development, including the risks of obtaining necessary licenses and permits and the presence of laws and regulations that may impose restrictions on mining; diminishing quantities or grades of mineral resources as properties are mined; global financial conditions; business opportunities that may be presented to, or pursued by, the Company; the Company’s ability to complete and successfully integrate acquisitions and to mitigate other business combination risks; challenges to, or difficulty in maintaining, the Company’s title to properties and continued ownership thereof; the actual results of current exploration activities, conclusions of economic evaluations, and changes in project parameters to deal with unanticipated economic or other factors; increased competition in the mining industry for properties, equipment, qualified personnel, and their costs. Investors are cautioned against attributing undue certainty or reliance on forward-looking statements. Although the Company has attempted to identify important factors that could cause actual results to differ materially, there may be other factors that cause results not to be as anticipated, estimated, described or intended. The Company does not intend, and does not assume any obligation, to update these forward-looking statements or information to reflect changes in assumptions or changes in circumstances or any other events affecting such statements or information, other than as required by applicable law.
Trevali’s production plan at the Caribou Mine is based only on measured, indicated and inferred mineral resources, and not mineral reserves, and does not have demonstrated economic viability. Trevali’s production plan at the Santander Mine is based only on measured, indicated and inferred mineral resources, and not mineral reserves, and does not have demonstrated economic viability. Inferred mineral resources are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves, and there is therefore no certainty that the conclusions of the production plans and Preliminary Economic Assessment (PEA) will be realized. Additionally, where Trevali discusses exploration/expansion potential, any potential quantity and grade is conceptual in nature and there has been insufficient exploration to define a mineral resource and it is uncertain if further exploration will result in the target being delineated as a mineral resource.
We advise US investors that while the terms “measured resources”, “indicated resources” and “inferred resources” are recognized and required by Canadian regulations, the US Securities and Exchange Commission does not recognize these terms. US investors are cautioned not to assume that any part or all of the material in these categories will ever be converted into reserves.
This news release does not constitute an offer to sell or a solicitation of an offer to buy any of the securities in the United States. The securities described herein have not been and will not be registered under the United States Securities Act of 1933, as amended, or the securities laws of any state and may not be offered or sold within the United States, absent such registration or an applicable exemption from such registration requirements.
The TSX has not approved or disapproved of the contents of this news release.