January 22, 2015
- Maintain top quartile safety performance and social license to operate
- Produce 150 to 175 million pounds of copper with C1 cash costs of $1.20 to $1.40 per pound payable
- Extend the Bisha mine life through exploration and optimize mine plan
- Keep zinc expansion project on-time and on-budget for H1 2016 commissioning
- Opportunistically monetize stockpiled gold ore
Bisha Mining Share Company (BMSC or the Company) announces its 2015 operational objectives including copper production and capital allocation guidance for the Company. The Bisha Mine is one of the highest grade open pit base metal deposits in the world and has a mine life currently in excess of 10 years. All financial figures are in US dollars.
BMSC Chairman, Cliff Davis, commented, “Following a very strong 2014 year from both an operating and financial perspective, BMSC is looking forward to another year of exceptional production and exploration from Bisha in 2015. For organic growth, we plan to aggressively explore the Bisha VMS district to again further expand our resources and reserves.”
Safety is priority number one. In 2014 Bisha completed a third year of operations, cumulatively approximately 22 million hours, without an on-site lost time injury for employees or contractors. BMSC will strive to maintain its top quartile safety performance and work towards maintaining lost time injury rates that are much less than the North American mining industry average.
BMSC will continue its ongoing efforts to provide training at its Bisha operations, employment opportunities and localization in country to promote and enhance our collective social responsibility program initiatives to reflect evolving international standards.
Copper Production and Cost Guidance
BMSC expects to produce between 150 and 175 million pounds of copper in concentrate in 2015 through processing of approximately 2,300,000 tonnes of ore from Bisha Main pit averaging about 3.9 percent copper feed grade. We expect our C1 cash cost for 2015 will be $1.20 to $1.40 per payable pound sold. Budget assumptions include diesel fuel prices of $1.13 per litre and by-product revenues based on $1,100 per ounce of gold and $15 per ounce of silver, however we now expect there is opportunity to improve on these.
Mine Life Extension and Optimization
As a result of the successful regional exploration program in 2014, the Company plans to announce a revised mineral resource estimate in coming weeks. The primary change to the current estimate will be based on the southern down-dip drilling at the Harena deposit announced over the last half of 2014. We are also preparing a revised life of mine plan by Q3 2015, which will include underground mining scenarios for the future.
Zinc Expansion Project and Other Investment
The zinc expansion remains on track for commissioning by mid-2016. We are confident the total capital costs will not exceed the budget estimate of $89 million. A strategic decision was made to increase the capacity of the mining fleet to mitigate any potential risk on waste mining and to provide us with greater flexibility to increase tonnes mined in future years should zinc prices increase.
A further $10 million in exploration investment is planned for 2015. Key 2015 exploration objectives, which will be prioritized on a success basis for additional work include:
- Expanding and upgrading the resource at Harena through drilling and down-hole geophysics;
- Drilling high priority targets at depth and on strike from Bisha Main; and
- Continued testing of high priority greenfield targets on the Mogoraib River exploration licence.
We expect to drill in excess of 25,000 metres during the year.
The Company has considerable additional value held in stockpiles to be monetized. This includes 6,500 tonnes of precious metals concentrate containing about 7,000 ounces of gold with high silver content. BMSC has also mined and stockpiled over 130,000 tonnes of oxide ore at over 5 g/t Au containing over 20,000 ounces of gold, and nearly 400,000 tonnes of pyrite sand ore that is estimated to contain over 60,000 ounces of gold with significant silver content. The Company is finalizing alternative methods to monetize these assets in 2015.
Forward Looking Statements:The above contains statements regarding copper production, mine operations, process recoveries, construction progress, resources and reserves. Forward-looking statements are frequently, but not always, identified by words such as “expects,” “anticipates,” “believes,” “intends,” “estimated,” “potential,” “possible” and similar expressions, or statements that events, conditions or results “will,” “may,” “could” or “should” occur or be achieved. Forward-looking statements are statements about the future and are inherently uncertain, and actual achievements of the Company or other future events or conditions may differ materially from those reflected in the forward-looking statements due to a variety of risks, uncertainties and other factors. The Company’s forward-looking statements are based on the beliefs, expectations and opinions of management on the date the statements are made and the Company assumes no obligation to update such forward-looking statements in the future.
Bisha Mining Share Company
“Cliff T. Davis”
Cliff T. Davis