Adex Mining Inc.
TSX VENTURE: ADE
Oct 30, 2008 11:00 ET
Adex Announces Results for Fire Tower Zone Scoping Study
TORONTO, ONTARIO--(Marketwire - Oct.
30, 2008) - Adex Mining Inc. ("Adex" or the "Company") (TSX
VENTURE:ADE) is pleased to announce the results of the scoping study on
the Fire Tower Zone ("FTZ") at its Mount Pleasant Mine Property ("Mount
Pleasant" or the "Property") located in southwestern New Brunswick,
Canada. The FTZ is the site of a past-producing tungsten-molybdenum
underground mining operation during the 1980s.
The results of the scoping study indicate that the FTZ project is
financially robust, with an unlevered pre-tax internal rate of return
("IRR") estimated at 27.1%. The after-tax IRR is estimated at 19.8%.
Similarly, the net present value ("NPV") of the FTZ project, using a
discount rate of 8%, is CAD $164.6 million and CAD $83.7 million on a
pre-tax and after-tax basis, respectively.
"We're very excited by these results of the FTZ scoping study,"
said Kabir Ahmed, President and CEO of Adex. "The scoping study is a
key step in assessing the economic potential of the tungsten-molybdenum
bearing Fire Tower Zone, and an important decision-making tool in
determining whether to proceed to definitive feasibility work and a
production decision on the Property."
The results were prepared by Aker Metals, a division of Aker
Solutions Canada Inc., and part of Aker Solutions ASA, a major
multinational engineering consulting firm contracted by Adex to
complete the FTZ scoping study. The full scoping study report will be
completed by Aker Metals within the next few weeks. The total
preproduction capital cost is estimated to be CAD $130,780,000, with an
additional sustaining capital of CAD $5,750,000 to be spent during the
production lifespan of the mine.
Based on the product prices that follow, the operation is projected
by the scoping study to generate CAD $1.160 billion in revenue over the
13 year life of the mine. Product pricing used in the scoping study is
based on a market study prepared by the Company's independent
consultants, Thibault & Associates Inc. ("TAI"), which also managed
the gravity concentration test program and carried out the process
design work. Operating costs are estimated to total CAD $599,602,000.
The product pricing for the financial analysis is as follows:
- APT (ammonium paratungstate): US$215/MTU WO3
- Molybdenum: US$23.17/lb MoO3
- The currency exchange rate for the financial analysis is as follows: US$:CAD$ 1.00:1.057
According to the results of the scoping study:
- the existing underground mine at the FTZ, which is currently
flooded, can be dewatered, refurbished and prepared for production in
- the overall project duration from start of the Definitive
Feasibility Study (DFS) to the start of production is estimated at 29
- the surface infrastructure will likely require very little work
since the existing roads and buildings are serviceable and will require
only minor upgrading.
In addition, a 10 megawatt electric power substation exists, as does the associated secondary voltage distribution system.
Should the FTZ project proceed to production, underground mining
will be carried out utilizing a Vertical Crater Retreat method that had
been successfully employed by the previous operator. The mine is
designed to be capable of producing 840,000 tonnes per year at a rate
of 2400 tonnes per day (tpd).
The flow sheet for the process, to produce ammonium paratungstate
(APT) and a molybdenum sulphide concentrate, includes gravity
separation for pre-concentration of oxide minerals (tin and tungsten),
flotation of sulfide minerals (arsenic and molybdenum) and
hydrometallurgical processing of the concentrates to comply with end
user specifications. The development of grinding, gravity separation
and flotation unit operations for optimum tungsten and tin recovery is
based on bench scale testing. The remainder of the process, including
the APT hydrometallurgical circuit and molybdenum concentrate leaching
circuit, is predicated on conventional industrial practice.
The annual mill throughput is estimated to be 788,000 tonnes, at an
average rate of 2200 tpd. The recovery of APT is estimated at 75% and
the recovery of a molybdenum sulphide concentrate is estimated at 76%.
Given the scoping study's positive economic assessment of the FTZ
project, the Company intends to carry out pilot plant work as part of
the DFS in order to confirm metallurgical parameters, process flow
sheet details, and to more accurately define reagent consumption and
The scoping study is based on the resource estimate announced in
the Company's press release dated October 23, 2008 completed by SRK
Consulting (Canada) Ltd. ("SRK") in conjunction with the preparation of
an independent NI 43-101 Technical Report currently being completed by
Watts, Griffis and McOuat Limited ("WGM"), all under the supervision of
Trevor Boyd, P.Geo., the Company's Geological Consultant.
The scoping study and the economic analyses contained therein are
preliminary in nature and contain inferred mineral resources that are
considered too speculative geologically to have economic considerations
applied to them that would enable them to be categorized as mineral
reserves and there is no certainty that the results of the scoping
study will be realized with more detailed work. Mineral resources that
are not mineral reserves do not have demonstrated economic viability.
John Rogers, P.Eng., Project Manager for Aker Metals and an
independent qualified person as defined by NI 43-101, supervised the
preparation of the scoping study and the technical information
contained in this press release in compliance with NI 43-101.
ABOUT AKER SOLUTIONS:
Aker Solutions is a leading global provider of engineering and
construction services, technology products and integrated solutions.
The businesses within Aker Solutions comprise several industries,
including Oil & Gas, Refining & Chemicals, Mining & Metals
and Power Generation. The Aker Solutions group is organised in a number
of separate legal entities. Aker Solutions is used as the common
brand/trademark for most of these entities. The parent company in the
group is Aker Solutions ASA. Aker Solutions has aggregated annual
revenues of approximately NOK 50 billion and employs approximately
23,000 people in about 30 countries. With its Metals Headquarters based
in Santiago, Chile, Aker Solutions has other Metals offices located in
Toronto, Canada; Tucson, Arizona, U.S.A.; combined with regional metals
capabilities in Perth, Brisbane and Melbourne, Australia; Mumbai, India
and Stockton-on-Tees, U.K. The Metals Division of Aker Solutions
provides a global capability to serve its clients across the full
project cycle from studies through to design engineering, procurement,
construction, commissioning and startup. Specialized expertise spans:
precious metals, nickel, copper, molybdenum, iron ore, zinc, uranium,
evaporites and industrial minerals.
Adex Mining Inc. is a Canadian junior mining company with an
experienced management team. The Company is focused on developing its
flagship Mount Pleasant Mine Property, a multi-metal project that is
host to promising tungsten-molybdenum and tin-indium-zinc-copper
mineralization. Located in Charlotte County, New Brunswick, the Mount
Pleasant Mine Property is situated approximately 80 kilometres south of
Fredericton, the provincial capital, and is 65 kilometres from the
United States border. The common shares of Adex trade on the TSX
Venture Exchange under the stock symbol "ADE."
Certain statements in this press release may constitute
"forward-looking" statements which involve known and unknown risks,
uncertainties and other factors which may cause actual results,
performance or achievements of Adex, its subsidiary or the industry in
which they operate to be materially different from any future results,
performance or achievements expressed or implied by such
forward-looking statements. When used in this press release, the words
"estimate", "believe", "anticipate", "intend", "expect", "plan", "may",
"should", "will", the negative thereof or other variations thereon or
comparable terminology are intended to identify forward-looking
statements. Such statements reflect the current expectations of the
management of Adex with respect to future events based on currently
available information and are subject to risks and uncertainties that
could cause actual results, performance or achievements to differ
materially from those expressed or implied by those forward-looking
statements. These risks and uncertainties are detailed from time to
time, including, without limitation, under the heading "Risk Factors",
in reports filed by Adex with the Alberta, British Columbia and Ontario
Securities Commissions which are available at www.sedar.com
and to which readers of this press release are referred for additional
information concerning Adex, its prospects and the risks and
uncertainties relating to Adex and its prospects. New risk factors may
arise from time to time and it is not possible for management to
predict all of those risk factors or the extent to which any factor or
combination of factors may cause actual results, performance and
achievements of Adex to be materially different from those contained in
forward-looking statements. Although the forward-looking statements
contained in this press release are based upon what management believes
to be reasonable assumptions, Adex cannot assure investors that actual
results will be consistent with these forward-looking statements. Given
these risks and uncertainties, investors should not place undue
reliance on forward-looking statements as a prediction of actual
The forward-looking information contained in this press release is
current only as of the date of the press release. Adex does not
undertake or assume any obligation to release publicly any revisions to
these forward-looking statements to reflect events or circumstances
after the date hereof or to reflect the occurrence of unanticipated
events, except as required by law.
No securities commission or regulatory authority has approved or disapproved the contents of this press release.
The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this press release.