Abacus Mining & Exploration Corporation is pleased to provide an overview of the 2015 work program as approved by the Board of KGHM Ajax Mining Inc. on the feasibility stage Ajax copper-gold project located near Kamloops, BC.
The Ajax project is 100% owned by KGHM Ajax Mining Inc., a joint venture between Abacus (20% ownership) and KGHM Polska Miedz SA (80% ownership).
The significant 2015 work program purposes to complete by the end of the year the majority of technical studies necessary to make a production decision, while continuing the success of the 2014 program (see NRS of February 12, 2015) in the areas of various permitting activities and stakeholder engagement. The major technical effort during 2015 will include the commencement and completion of basic engineering, completion of various optimization trade-off studies and continued drilling to confirm and improve the block model, obtain samples for additional metallurgical test work along with ongoing condemnation and geotechnical drilling. Capital cost estimates and a revised economic model will be completed by year end.
Abacus has elected to contribute its proportionate share of the estimated 2015 capital expenditure of CDN $58.4 million the majority of which, pursuant to the Joint Venture Agreement between the parties, will be provided by KGHM on behalf of Abacus as a loan that will be recovered from Abacus' share of revenue once production commences from Ajax. Accordingly, commencing with the April cash call, KGHM Group has been requested to provide Abacus' portion of the project expenditures for the remainder of the year.
The Ajax Project is a proposed open-pit mine with an estimated approximate 23-year mine life expected to yield approximately 109 million pounds of copper and 99,000 ounces of gold annually. Total proven and probable mineral reserves are estimated at 3 billion lbs Cu and 2.7 million ozs Au at 0.27% Cu and 0.17 g/t Au based on $2.50 Cu and $1,085 Au. [see Report titled "Ajax Copper/Gold Project -- Kamloops, British Columbia Feasibility Study Technical Report" by Wardrop (a Tetra Tech Company) dated January 6, 2012 ("FS")].
The EA Application/EIS is scheduled to be submitted in the second quarter of 2015, and will be followed by a 30-45 day assessment period to determine whether the application will be received for formal review. This review process is expected to take approximately one year in parallel with which permit applications will be submitted. A number of potential delays associated with material changes or additions to the AIR/EIS guidelines may prolong this schedule. The Board aims to take decisions on mine construction after the review process is completed and all required permits are secured.