Rosh Pinah Expansion “RP2.0”
Pre-Feasibility Study

Contrast

Rosh Pinah Expansion “RP2.0” Pre-Feasibility Study

Trevali had positive results from the independent Rosh Pinah Expansion “RP2.0” NI 43-101 Pre-Feasibility Study (“PFS”) at its 90%-owned Rosh Pinah mine in Namibia. The PFS is based on a scenario to expand the current throughput from 0.7 Mtpa to 1.3 Mtpa through the modification of the processing plant, construction of a paste fill plant, and development of a dedicated portal and ramp to the WF3 deposit. All figures are stated in United States dollars on a 100% ownership basis unless otherwise stated.

Representation of Rosh Pinah Expansion “RP2.0”

Highlights of the Expansion Pre-Feasibility Study include:

  • Zinc payable metal production of 1.2 Blbs over an 11-year mine life (2020 to 2030) at an average All-In-Sustaining-Cost (AISC1) of $ 0.70/lb.
  • Construction of the expansion project assumed to commence in Q1 2022 and commercial production to be achieved by start of Q1 2023.
  • Post Expansion (2023 onwards):
    • Average annual zinc payable production of 132 Mlbs at an average AISCof $0.64/lb.
    • Average annual lead and silver payable production of 21.8 Mlbs and 286 koz respectively.
  • Proven and Probable Mineral Reserves of 11.23 Mt containing 1,550 Mlbs of zinc, 329 Mlbs of lead, and 6,892 koz’s of silver.
  • Project capital cost of $93 million which includes:
    • Modifications to the existing process plant to include a single stage SAG mill, crushing and ore blending system with a nominal throughput of 1.3 Mtpa.
    • Paste fill plant and reticulation system.
    • Dedicated portal and surface material handling and ventilation systems for the WF3 deposit. 
    • Mine underground infrastructure.
  • Project economics (post-tax) at an average $1.11/lb zinc price, $0.93/lb lead price and $19.81/oz silver price:
    • Net Present Value (“NPV”) @ 8% of $142 million.
    • Free cash flow of $238 million.
    • IRR of 65%.
    • Payback: <4 years

Rosh Pinah Expansion “RP2.0” Pre-Feasibility Study

Processing Plant: The PFS incorporates an upgrade to the comminution circuit to include a new single stage SAG mill and pebble crusher. The upgrade also includes primary crushing upgrades, an ore blending system, along with other circuit modifications to provide increased flotation, thickening, filtration and pumping capacity to achieve the target throughput of 1.3 Mtpa. The upgrade will also include several flowsheet modifications aimed at improving both the concentrate grade and metal recoveries.

Underground Development and Infrastructure: A dedicated portal and decline to the WF3 deposit will be constructed to support the increase to mine production levels and reduce operating costs. The trucking decline is 3.9 km in length, excluding level access and stockpiles. For construction purposes, the decline is separated into five independent legs to enable concurrent development and reduce overall construction time. Internal legs of the trucking decline will be developed off existing development, with take-off positions selected to minimize interaction with the underground operation.

The new trucking decline will act as an additional fresh air intake within the ventilation network and will enable direct ore haulage from the WF3 zone to a new surface primary crusher station utilizing large-scale (60 tonne) trucks. Ore sourced from other areas (EOF, SF3, SOF, and BME) will be transported to the existing underground crushing system using the existing 30 tonne truck fleet and conveyed to surface via the existing conveying system.

Paste Fill Plant: A paste fill plant has been included to modify the mining method which improves both the safety conditions and economics of the mine. Paste filling the stopes rather that leaving them void will improve ground stability, increase ore recovery, and reduce dilution. It will also reduce surface tailings as a portion of new and existing tailings will be redirected underground to be used as paste fill.

Mobile Equipment: The existing small-scale underground trucks and load-haul-dump (LHD) fleet will continue to be used primarily in the current mining areas. This will reduce capital expenditure associated with purchasing new mobile equipment, increasing development profiles and changing the existing underground crushing and conveying system. As mining extends deeper and average haulage distances increase in WF3, new large-scale trucks and LHDs will be purchased for the more efficient transportation of material to surface reducing costs over the life-of-mine.

Onsite Operating Costs: Once the project is commissioned, onsite operating costs are expected to reduce by approximately 28% on a per tonne milled basis. Mining costs per tonne milled will be reduced due to the change in the mining method to include paste fill allowing for increased ore recovery and reduced mining dilution. Mining costs will also benefit from the dedicated underground decline to the WF3 deposit which will allow for more efficient material handling and reduced cycle times. Except for power, the processing unit costs will decrease as a result of treating increased tonnages following the upgrade. Fixed on site costs on a per tonne milled basis will also decrease as the mine ramps up from 0.7 Mtpa to the PFS target of 1.3 Mtpa as a function of higher annual throughput.

Figure 1: Rosh Pinah Annual Ore Production2 Schedule with Metal Grades

Figure 2: Rosh Pinah Annual Payable Metal Production2 Schedule and AISC1

Future Study Opportunities

The Feasibility study is currently underway and is expected to be delivered in H2 2021. Several additional optimization opportunities are being pursued that have the potential to enhance the projects economics further. The key opportunities are listed below:

  • Optimization of critical underground infrastructure placement including the positioning of the decline and the ventilation, electrical substation, and paste fill distribution networks may reduce mine design physicals and lower capital and operating costs.
  • There is potential for lead recovery improvement with the inclusion of a Jameson flotation cell in a cleaner scalper flotation duty.
  • Inferred Mineral Resources have the potential to be converted to Indicated and Measured Mineral Resources via additional infill drilling work and enable additional higher-value ore (above the strategic optimal cut-off value of $80/t NSR) to displace lower-value ore earlier in the mine schedule thereby improving NPV.
  • Significant exploration potential exists within the Property with a number of high priority drill targets identified to delineate additional Mineral Resources.

Table 1: Life of Mine and RP2.0 PFS Expansion Economics

Project Metrics

Unit

LOM (Q1 2020 – 2030)

Post Expansion

Mine life

Yrs

11

8

Total ore production

Kt

11,610

9,491

Zinc grade (average)

%

6.3

6.2

Lead grade (average)

%

1.3

1.2

Silver grade (average)

g/t

19.1

17.9

Payable Zinc metal

t

544,789

436,260

Payable Lead metal

t

92,606

71,836

Payable Silver metal

Oz

2,685,176

2,074,261

Capital costs – project

US$M

93

-

Capital costs – sustaining

US$M

132

78

Capital costs – closure

US$M

7

7

C1 cash costs1

US$/lb

0.58

0.56

All-In-Sustaining-Cost “AISC”1

US$/lb

0.70

0.64

Post-tax free cashflow

US$M

238

316

Post-tax NPV (8%)

US$M

142

-

Post-tax IRR

%

65

-

Payback Period post-tax

Yrs

3.9

-

Table 2: Expansion Capital Cost Summary in US$M

Item Description

2021
(USD)

2022
(USD)

2023
(USD)

Total

(USD)

Processing

 

Processing plant upgrade

4.1

36.5

4.8

45.4

Mine Infrastructure – Underground

 

 

 

Electrical

0.5

0.4

0.1

0.9

Dewatering

0.1

0.8

-

0.9

Ventilation

0.4

1.6

-

2.0

Other

-

0.4

-

0.5

Mine Infrastructure – Surface

 

 

 

Boxcut / Portal (WF3)

0.6

-

-

0.6

Paste fill plant

-

18.7

-

18.7

Paste fill reticulation

-

3.5

-

3.5

Batching plant (Shotcrete)

-

0.8

-

0.8

General upgrade infrastructure

-

2.2

-

2.2

EPCM

0.7

6.4

-

7.1

Sub-Total

6.4

71.3

4.9

82.6

Contingency (13%)

1.4

8.5

0.6

10.4

Total

7.8

79.8

5.5

93.0

Table 3: Zinc Price Sensitivity Estimates

Financial Metric

Unit

$0.90/lb

$1.00/lb

$1.11/lb

$1.20/lb

$1.30/lb

Post-tax free cashflow

US$M

95

160

238

293

363

Post-tax NPV (8%)

US$M

45

90

142

183

231

1 See “Use of Non-IFRS Financial Performance Measures” below.

2 2020 forecasted production in Figures 1 and 2 is for the full year whereas the Mineral Reserves in Table 5 excludes Q1-2020

3 See “Use of Non-IFRS Financial Performance Measures” below.

4 See “Use of Non-IFRS Financial Performance Measures” below.