The Importance of Geometallurgy to Make Mineral Deposits Viable

Transcription

1 The Importance of Geometallurgy to Make Mineral Deposits Viable Denise Nunes Metallurgy Lead SIMEXMIN 2016

2 About JDS Energy & Mining Inc. Founded in 2004 by principal, Jeff Stibbard Diverse set of skilled professionals mining & construction Our Focus: Partnering with our Customers to Achieve Maximum Resource Development Value Proven record for fit-for-purpose design and excellence in project execution and value delivery Projects delivered from concept to full operation Minto Mine Gahcho Kue Mine Silvertip Mine 2

3 Executive Team Jeff Stibbard, P.Eng., CEO Jeff is the Founder and CEO of JDS. He is a mining engineer with expertise in mine design, construction and operation. His extensive experience includes: Mining Manager of BHP Ekati s Diamond Mine which included initial design, and permitting and construction of the project. He also served as the General Manager of Mining at Albian Sands Energy Inc. in Fort McMurray. Prior to Albian Sands, he was one of the original founding members of Western Oil Sands Inc., a 20% partner in the development of the Shell Muskeg River Mine in Fort McMurray. He has also served as a Director of Stornoway Diamond Corp. Mr. Stibbard received a BASc. in Mining Engineering, from the Montana School of Mines in Since founding JDS in 2005, Jeff has been involved through his company in the design, permitting, construction, operation and maintenance of multiple successful projects. Kevin Mather, P.Eng., M.Sc., President Kevin is a highly driven, self-motivated, young mining and construction executive with 15+ years of experience in the Canadian resource industry, spending the majority of this time as a contractor before joining JDS in Kevin is an astute decision maker, known for delivering results. He has been involved in managing and directing major site development contracts, including the Syncrude Aurora Mine, the Albian Muskeg River Mine, the Canadian Natural Resources Limited Horizon Mine, the De Beers Victor Diamond Mine, and Newmont s Hope Bay Gold Project. He has also bid and managed major long-term mining contracts, several long-term mine service agreements in the oil sands industry, and the Grande Cache Coal restart. Kevin s experience extends beyond projects into business, including the lead operational executive role in completing an IPO in 2006, and running several businesses with North American Energy Partners. Brent Gilchrist, President JDS Resources Inc. Brent has worked closely with JDS and with founder Jeff Stibbard for most of the last decade. He accepted Mr. Stibbard s offer to join JDS with a keen interest and the challenge of raising venture capital and private equity. He joined the JDS group of companies in January 2012 as president of Jeffco Ventures Inc., the capital arm of the organization. Brent s financial background and keen business sense were cultivated by working for more than seven years in the financial sector, managing individual portfolios at RBC Dominion Securities, the investment branch of the Royal Bank of Canada. Prior to RBC, Brent played for 15 years in the National Hockey League with five teams. He is a member of the 1998 Stanley Cup champion team Detroit Red Wings. Brent retired from the NHL in Gord Doerksen, P.Eng., P.E., VP Engineering Gord Doerksen is a registered professional mining engineer in BC, Yukon, Wyoming and Alaska and has over 25 years of operations and engineering experience in Canada, US and Africa. He has worked in a variety of mines in tropical, temperate and sub-arctic environments, both underground and open pit, including gold, copper, coal, trona and aggregates. Gord s early engineering experience was gained as a mine planning and project engineer at open pit and underground mines throughout North America and Africa and evolved into senior management roles in engineering and operations. Prior to joining JDS early in 2012, Gord worked at SRK Consulting (Canada) Inc. for six years where he was a Principal and lead project teams in a wide variety of engineering studies, operational assistance initiatives and due diligence work all over the world. 3

4 Executive Team Dan Johnson, P.E., VP Business Development Dan has over 30 years of experience as a civil engineer and professional mining engineer. His expertise ranges from mine design, construction, and operations, to finance and corporate management. Dan has designed, constructed and operated mines across the globe. He is an accomplished leader in the mining industry, with proven results delivered throughout his progressive career, from construction engineer, project engineer, operations superintendent, mine manager, project development manager, general manager, and company CEO and President. Dan has an extensive experience base in Northern mines, including being the GM of BHP s Ekati Diamond Mine during construction, the VP of construction and operations of Tahera s Jericho Diamond Mine, as well as leading the Feasibility Study and project development for De Beers / Mountain Province s Gahcho Kue Diamond Mine. Wayne Corso, P.E., VP Engineering Wayne received his Mining Engineering degree from the Colorado School of Mines in Wayne has planned, coordinated, and directed resources and activities for a wide variety of projects, first for Homestake and later for BHP Minerals. From the BHP Minerals Mine services group, he supported exploration, new business development, and operations with engineering and economic evaluations for various projects. He was eventually recruited to join the bulk sampling and development team at the Ekati Diamond Mine, where he played an instrumental part in the permitting and development of the Project. Wayne s ability to creatively apply practical, economic solutions to all types of projects has made him a valuable member of the team. Gord Bussieres, VP Construction Gord has been with the company since its inception and has participated in every major project undertaken. Overseeing all JDS field operations with particular attention to project reporting, site safety and logistics management, Gordon's attention to detail and organizational control ensures projects remain on budget and on schedule. He has over 20 years of industry experience with a proven track record for completing projects on time and within budget. Gord worked as a Construction Manager at Sherwood Copper's $100M Minto Mine and before that Mine Manager and Expansion Manager at the $2B Muskeg River Mine in Alberta. In addition to the above noted projects, Gord managed the heavy equipment division for Neegan Developments Ltd. In Fort McMurray consisting of a $50M budget annually. Garett Macdonald, P.Eng, VP Project Development Garett is an accomplished mining executive with 20 years of industry experience including an extensive background in project development and mine operations. He has been involved with several public companies as an officer & director and has managed large technical programs through concept, feasibility and into construction. He is a results-driven professional with diverse technical experience across multiple commodities and is known for finding solutions that deliver shareholder value. Garett is based in Toronto where he is leading JDS s eastern Canada business operations. Victoria Viveash, CPA, CMA, CFO Victoria has been with JDS since 2012, leading the economic valuation group and now leads the Company s Finance and Accounting Team. Victoria has been involved with a majority of the Jeffco Ventures transactions and the structuring of financing arrangements for the JDS group of companies. With over eight years of experience in various finance roles at Scotiabank, Export Development Canada, and Business Development Bank, Victoria s analytical skills enable her to make decisions while keeping a focus on details. Victoria is completely fluent in English, French, and Spanish and has had numerous work experiences with multinational companies in various industries. Victoria has a Bachelor of Commerce from the University of Ottawa and is a Chartered Professional Accountant. 4

5 Our Principles 1. No harm to people, environment, assets or reputation 2. Deliver the highest standard of leadership, teamwork & accomplishment 3. Conduct business professionally, ethically and practically 4. Open and honest communication both internally and with our clients 5. Accept no mediocrity, be true to our word and get it done 6. Treat our clients money like it is our own 5

6 Achieve Maximum Resource Development Value Deliver value by designing and building projects like we own them : Owner s return over external interests Needs over wants Decision over research/study Function over fashion Fit for purpose Health, Safety and Environment attitudes over platitudes 6

7 JDS Today Over 150 people, including 30 mining engineers Offices located in Canada, US and Mexico Owned and operated equipment fleet and logistics solutions Excellent safety records Experience working in most jurisdictions around the world 7

8 Our Services Exploration Field Support Scoping Studies & Due Diligence Technical Engineering Studies NI Preliminary Economic Assessments Pre Feasibility Studies Feasibility Studies Engineering, Procurement and Construction Management Permitting & Environmental Support Mine Operational Support Mine Reclamation Services We take projects from the early conceptual vision, right through every stage of planning and development, until we hand you the keys to a fully operational business. Bring us your mining start-up and resource development challenges and we ll take them on, delivering on time, without harm and on budget. 8

9 Proven Global Experience Curraghinalt Project Ireland Idaho Cobalt Project USA El Creston Project Mexico Romero Project Dominican Republic Campo Morado Mine Mexico Arista Mine Mexico Escobal Mine Guatemala Karma Project Burkina Faso Efemçukuru Mine Turkey Halilağa Project Turkey Cosmo Mine Australia Buriticá Project Colombia Aurizona Mine Brazil Mothae Mine Lesotho 9

10 Proven Northern Experience Coffee Eagle Gold Carmacks Mactung Giant Mine Back River Hope Bay Gahcho Kué Mary River Angilak Minto Wellgreen Silvertip Tulsequah Chief Red Mountain Kutcho Prairie Creek 10

11 Outline What makes Geo-Metallurgy? How Geo-Metallurgy can add value? Simple case study PEA level Available data Data processing the metallurgist work (rock whispering?) Averaging grades (the blended approach) Deposit-by-deposit (the separated approach) Consequences Metal production Production schedule $$$$ Conclusion 11

12 From my first Geo-metallurgy mentor 12

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17 Uncertainty in Mining Projects 17

18 Geo-Metallurgy Economics Geology Marketing Metallurgy Environmental Mining Social Exploration Pre-Feasibility Feasibility Pre-Production Production Rehabilitation 18

19 Simple case study PEA level

20 Simple case study PEA level Project: 5 independent deposits/mines 1 flotation plant 2 concentrates Products: Pb and Zn concentrates Ag revenue from both concentrates Majority from Pb con 20

21 Available data Mine production schedule Metallurgy Lab results Available for each deposit independently NO composite samples Variable head grades Bench tests only (2kg of sample per test/data point) 21

22 Data Processing - Ag Recovery PEA A B C D E 22

23 Data Processing - Pb Recovery PEA A B C D E 23

24 Data Processing - Zn Recovery PEA A B C D E 24

25 Total Payable Metal Produced Blended vs Separated Grade Approaches 25

26 LOM Metal Production Blended vs Separated Grade Approaches Y1Q1 Production by quarters Y9Q2 26

27 The Economic Model Common to both economic models: Mine schedule and head grades Recovery equations/correlations Metal prices and treatment charges CAPEX and OPEX Unit - $M EC - Blended EC - Sep. Dif(Sep.-B) Revenue OPEX Royalty CAPEX Sustaining Net Cash EC - Blended EC - Sep. Dif(Sep.-B) Combined Mill Feed Pb, % Zn, % Ag, gpt LOM Recoveries to Pb Conc., % Pb Ag LOM Recoveries to Zn Conc., % Zn Ag

28 The Economic Model Common to both economic models: Mine schedule and head grades Recovery equations/correlations Metal prices and treatment charges CAPEX and OPEX Unit - $M EC - Blended EC - Sep. Dif(Sep.-B) Revenue OPEX Royalty CAPEX Sustaining Net Cash Cumulative Cash Flow after Tax - Blended Feed IRR 45% NPV $37 M$ Discount Rate 5% Annually Cumulative Cash Flow after Tax - Separated Feed IRR 55% NPV $44 M$ Discount Rate 5% Annually EC - Blended EC - Sep. Dif(Sep.-B) Combined Mill Feed Pb, % Zn, % Ag, gpt LOM Recoveries to Pb Conc., % Pb Ag LOM Recoveries to Zn Conc., % Zn Ag

29 Conclusion Geometallurgy can add value to a project from as soon as mineral samples are available for testing Guide exploration efforts More investments to more valuable geo-met domains Help for geological interpretations Guide engineering Allow for optimization of mining schedule Early identification of refractory ores (big loss from resource to reserve) 29

30 Conclusion Current market conditions is highly focused on cash flow High NPV Low CAPEX High IRR Avoid LOM representative samples at very early stages Good only for a given scenario Expensive sampling and testing Independent samples will add more flexibility for project optimization 30

31 jdsmining.ca 31