August 10, 2012 11:44 ET
Advanced Explorations Inc. Receives Positive Feasibility Study on Roche Bay Iron Project C Zone
TORONTO, ONTARIO--(Marketwire - Aug. 10, 2012) - Advanced Explorations Inc. (TSX VENTURE:AXI)(FRANKFURT:AE6)(the "Company" or "AEI") is pleased to announce positive results of its Feasibility Study ("FS") conducted on the C Zone of its Roche Bay Iron Project. The FS has been completed by TetraTech Wardrop ("TetraTech") and confirms that the project has a Net Present Value of US $642 million (pre-tax). The complete report will be filed by the authors on SEDAR within 45 days of this press release.
Highlights of the Roche Bay Iron Project Feasibility Study:
5.5 million tonnes per year start-up production based upon 501 million tonnes @26.35% Fe (indicated)*
High quality, low impurity, 66% Fe concentrate production with demonstrated potential to produce 68% + concentrate
Mine life of 15 years (C Zone)
Low mine stripping ratio of 0.92:1 over life of mine (LOM) reducing overall mine costs and mine footprint per tonne of ore
Pre-Tax Net Present Value ("NPV") of U.S. $642 million at a discount rate of 8% and a concentrate selling price of U.S. $104/tonne of iron concentrate (FOB Roche Bay)
Start-up mine cash flow (net) of U.S. $2.9 billion
Pre-Tax Internal Rate of Return ("IRR") of 16%
Capital cost ("CAPEX") of U.S. $1.2 billion (excluding contingency)
Operating Cost ("OPEX") of U.S. $49.13/tonne of iron concentrate (averaged over the life of mine)
Reduced infrastructure costs due to the proximity (6 kms) of ore body to natural, deep water harbour (no rail, extended power lines, or slurry pipelines and no dependency on third parties to provide these services).
John Gingerich, president & CEO, commented:
"The completion of our Feasibility Study marks a significant milestone for the Company, and lays a clear foundation for the path forward to production. The positive economics at this initial modest start-up production rate demonstrate that we have an excellent project with substantial opportunities for expansion and to further lower the operating cost using power solutions such as Liquefied Natural Gas (LNG). The location of the project at tidewater and its consequent low infrastructure requirements promote future expansion and lower operational and construction risks, which compares favourably with many projects in Brazil, Australia and Canada. We are well positioned to become a globally competitive, low cost producer and are on our way to become one of the lowest cost iron ore producers in North America".