(TheNewswire)
Vancouver, B.C., Canada – TheNewswire - December 15, 2020 – Deep-South Resources Inc.(" Deep-South " or“ the Company ") (TSXV:DSM) today announced thatit has received the results of the updated Preliminary EconomicAssessment ("PEA") from METSEngineering Group (“METS”) on its Haib Copper Project in Namibia . Further to recent increases in thecopper price to well over $3.00 per lb, Deep-South revised the Preliminary Economic Assessment("PEA") on its 100% controlled HaibCopper Project in Namibia.
Pierre Leveille, President & CEO of Deep-Southstated that: "We are extremely encouragedby the results of our updated PEA: its economics have improveddramatically. Our base case model using a price of US $ 3.00 per lbshows an after-tax NPV of US $957million and an after tax IRR of29.7%. Moreover, at a copper price of $3.50 per lb our Haib Copperproject shows an after-tax NPV of US $ 1.3 billion and an after taxIRR of 42.1%. Of note, our current market capitalization is only 0.8%of this NPV. We are highly encouraged by the solid copper marketoutlook and with the funds in-hand we are confident that our comingexploration and development program will bring strong added value in2021 and onward.”
Our base model is as follows:
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-- The deposit showed to beamenable to bio-heap leaching;
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-- Throughput of 20 Mtpa;
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-- Copper recovery of80%;
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-- Production of 35,332 tpa coppercathodes and 51,080 tpa copper sulfate;
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-- Copper price US $ 3.00 per lb:after-tax NPV US $ 957 million and IRR: 29.7%;
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-- Low Capex at US $341million;
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-- Low-strip ratio at1.41:1;
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-- After-tax payback: 4.23years;
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-- Life of mine : 24years.
The updated report will be filedsoon on SEDAR under Deep-South's profile and on the web site of thecompany. Our shareholders will be informed timely.
Highlights of the PEA
The recent leaching test-work was carried out by Mintekof South Africa. Mintek is a world leader in Bio-leachingtechnologies.
Amenability test work confirmed copper recoveries of upto 95% in bacterially assisted heap leaching of the Haib mineral. Thetests were carried out in 1 meter columns and the recoveries in largeleach pads on site can differ from the columns test work. However,recoveries of 80% and 82% were showed to be very achievable andsustainable for the project from the test-work to date and were chosenas base model recoveries.
Further work is required in order to refine andoptimize process conditions to improve recoveries and operatingcosts.
Run-of-Mine mineral Bio heap leaching was determined tobe the most viable process route for the Haib mineral. Six processingscenarios were established with the key variables being recoveries,final products (copper cathode and copper sulfate) and metalprice. The base case chosen by Deep-South is thescenario (1) below, which is based on the production of coppercathodes and copper sulfate. All financial metrics are based on the recent 43-101 indicated resourceestimation of 456.9 MT @ 0.31% Cu:
Table 1: Scenario 1 - project metrics
20 Mtpa @ 80% Cu Recovery + CuSO 4 | |||||
LME Cu, tpa | 35,332 | ||||
CuSO4.5H2O, tpa | 51,081 | ||||
CAPEX, (US) | $341 | ||||
OPEX, (US / year) | $91 | ||||
Total Cost, US$/t ROM | $7.73 | ||||
Total Cost, US$/lb CuEq | $1.36 | ||||
Copper Price, US$/lb | $2.50 | $3.00 | $3.25 | $3.50 | $4.00 |
Avg. Annual Revenue LME Cu (US$ Million/year) | $195 Million | $234 Million | $253 Million | $273 Million | $312 Million |
Avg. Annual Revenue CuSO 4 (US/year) | $90 Million | $108 Million | $116 Million | $125 Million | $143 Million |
Total Cost, USD/t ROM | $7.64 | $7.73 | $7.77 | $7.81 | $7.90 |
Total Cost, USD/lb CuEq | $1.34 | $1.36 | $1.37 | $1.37 | $1.39 |
NPV 7.5%, pre-tax (US$ M) | $977 Million | $1,530 Million | $1,807 Million | $2,083 Million | $2,636 Million |
IRR pre-tax | 30.1% | 40.2% | 44.9% | 49.4% | 58.1% |
Payback Period pre-tax | 4.22 | 3.13 | 2.8 | 2.5 | 2.2 |
NPV 7.5%, after-tax (US$ M) | $611 Million | $957 Million | $1,130 Million | $1,303 Million | $1,648 Million |
IRR after-tax | 22.7% | 29.7% | 32.9% | 36.1% | 42.1% |
Payback Period after-tax | 5.71 | 4.23 | 3.8 | 3.4 | 2.8 |
Strip Ratio | 1.41:1 | ||||
LOM, years | 24 |
Note: The PEA is based only on the estimated indicatedresource and the inferred resource are not part of this economicassessment
With further metallurgical work and testing, thecompany's goal is to attain higher recovery rates. The below scenario(2) illustrate the potential economic upside of higherrecoveries:
Table 2: Scenario 2 - projectmetrics
20 Mtpa @ 85% Cu Recovery + CuSO 4 | |||||
LME Cu, tpa | 38,337 | ||||
CuSO4.5H2O, tpa | 51,081 | ||||
CAPEX, (US) | $341 | ||||
OPEX, (US / year) | $96 | ||||
Total Cost, US$/t ROM | $8.00 | ||||
Total Cost, US$/lb CuEq | $1.33 | ||||
Copper Price, US$/lb | $2.50 | $3.00 | $3.25 | $3.50 | $4.00 |
Avg. Annual Revenue LME Cu (US$ Million/year) | $211 Million | $254 Million | $275 Million | $296 Million | $338 Million |
Avg. Annual Revenue CuSO 4 (US$ Million/year) | $90 Million | $108 Million | $116 Million | $125 Million | $143 Million |
Total Cost, USD/t ROM | $7.91 | $8.00 | $8.05 | $8.09 | $8.18 |
Total Cost, USD/lb CuEq | $1.32 | $1.33 | $1.34 | $1.35 | $1.36 |
NPV 7.5%, pre-tax (US$ M) | $1,088 Million | $1,673 Million | $1,966 Million | $2,259 Million | $2,844 Million |
IRR pre-tax | 32.2% | 42.6% | 47.5% | 52.2% | 61.1% |
Payback Period pre-tax | 3.94 | 2.94 | 2.6 | 2.4 | 2.0 |
NPV 7.5%, after-tax (US$ M) | $681 Million | $1,047 Million | $1,229 Million | $1,412 Million | $1,778 Million |
IRR after-tax | 24.1% | 31.3% | 34.7% | 38.0% | 44.3% |
Payback Period after-tax | 5.34 | 3.98 | 3.5 | 3.2 | 2.7 |
Strip Ratio | 1.41:1 | ||||
LOM, years | 24 |
Note: The PEA is based only on the estimated indicatedresource and the inferred resource are not part of this economicassessment
Please note that: MineralResources that are not mineral reserves do not have demonstratedeconomic viability. Mineral resource estimates do not account formineability, selectivity, mining loss and dilution. These mineralresource estimates ar based on Indicated MineralResources that are considered too speculativegeologically to have the economic considerations applied to them thatwould enable them to be categorized as mineral reserves . However, there is no certainty thatthese indicated mineral resources will be converted to measuredcategories through further drilling, or into mineral reserves, onceeconomic considerations are applied. There is nocertainty that the preliminary economic assessment will berealized.
Other scenarios
The other scenarios can be foundin the NI 43-101 technical report for the Haib Copper project that isavailable on SEDAR under Deep-South's profile and on the web site ofthe company.
Geology & Mineralization
The Haib deposit is located within part of theNamaqua-Natal Province called the Richtersveld geological sub-provincewhich is further subdivided into a volcano-sedimentary sequence(locally, the Haib Subgroup), the Orange River Group and the intrusiveVioolsdrift suite which are closely related in space and time.
The principal mineralized hosts at the Haib are aQuartz Feldspar Porphyry (QFP) and a Feldspar Porphyry (FP).
The Haib deposit is, in essence, a large volume of rockcontaining copper mineralization. The grade is variable from highergrade in the three core zones progressively dropping towards themargin of the deposit.
The principal sulfides within the Haib body are pyriteand chalcopyrite with minor molybdenite, bornite, digenite, chalcociteand covellite.
Mineral Resources
The mineral resources for the Haib Copper Project wereestimated by Dean Richards of Obsidian Consulting Services,supervidsed by Peter Walker of P & E Walker Consultancy, bothindependent Qualified Persons as defined by NI 43-101 and werereported in a news release dated January 16, 2018 but are summarizedbelow for convenience. Readers should reviewthat news release for additional information or read the full reportthat can be viewed on our web site at: https://www.deepsouthresources.com/projects/technical-reports/ or on the SEDAR web site at: www.sedar.com .
Table 3: Classified Mineral Resources of the HaibProject at a 0.25% Cu Cut-Off Grade
Resource Class | xMillion Tonnes | Cu(%) | Contained Cu x billion lbs |
Indicated | 456.9 | 0.31 | 3.12 |
Inferred | 342.4 | 0.29 | 2.19 |
Notes:
1- Dean Richards of Obsidian Consulting Services, aMember of the Geological Society of South Africa and ProfessionalNatural Scientist (Pr. Sci. Nat) with the South African Council forNatural Scientific Professions (SACNASP), estimated the MineralResources under the supervision of Peter Walker of P & E WalkerConsultancy, both of whom are the Qualified Persons for the MineralResource Estimates. The effective date of the estimate is January 15,2018. Mineral Resources are estimated using the CIM DefinitionStandards for Mineral Resources and Reserves (2014).
2- Reported Mineral Resources contain no allowances forhanging wall or footwall contact boundary loss and dilution. No miningrecovery has been applied.
Rounding as required by reporting guidelines may resultin apparent differences between tonnes, grade and contained metalcontent.
Table 4: Haib Copper Indicated Mineral Resources,Sensitivity Cases
%Cu Cut-off | xMillion Tonnes | Cu(%) | Contained Cu x billion lbs |
0.20% | 904.8 | 0.27 | 5.39 |
0.25% | 456.9 | 0.31 | 3.12 |
0.30% | 219.8 | 0.36 | 1.74 |
Table 5: Haib Copper Inferred Mineral Resources,Sensitivity Cases
%Cu Cut-off | xMillion Tonnes | Cu(%) | Contained Cu x billion lbs |
0.20% | 686.2 | 0.26 | 3.93 |
0.25% | 342.4 | 0.29 | 2.19 |
0.30% | 109.8 | 0.34 | 0.82 |
Note: The PEA is based only on the estimated indicatedresource and the inferred resource are not part of this economicassessment
This Haib Copper Mineral Resource has been defined bydiamond core drilling covering a total surface area of some 2.6 squarekilometres.
The mineral resource classification is closely relatedto data proximity. Topographic elevations within the mineral resourcearea vary from 320m to 640m above mean sea level and average 480mabove mean sea level.
Indicated resources are constrained between thevariable topographic surface and a horizontal level which is 75m abovemean sea level and within which the majority of the drill and assaydata are constrained. Inferred resources are laterally constrained bythe last line of drill holes and extend vertically from the horizontalsurfaces defined by the +75m and -350m above mean sea level (a blockof 425m thickness) within which there is a lesser data set derivedfrom drilling.
Mineralization is open near surface and at depth to atleast 800 metres deep. The Mineral Resource estimate is based on theresults from approximately 66,500 metres of drilling in 196 holes. Themost recent drilling data comes from Teck Resources drilling programstotalling 14,500 metres (2010 & 2014) and from re-assaying a partof the 164 historical drill cores which are well preserved on site.Indicated Resources are defined by a drill grid of 150 metres by 150metres, while Inferred Resources are defined by a drill grid of 300metres by 150 metres.
The Haib Copper exploration licence providessignificant potential for resource expansion, since there is known,but poorly drilled and assayed, mineralisation beyond the drill gridboundaries and below the main mineralized body (which covers some 2square kilometres of surface area), where a few drillholes from 75mabove mean sea level to -350m above mean sea level (i.e. a thicknessof 425m) have shown that mineralisation is present. The deepestdrillhole did not pass out of mineralized material. In addition, thereare 5 satellite mineralized target areas surrounding the main Haibporphyry body which still require further evaluation.
Mineral Resources that are not mineral reserves do nothave demonstrated economic viability. Mineral resource estimates donot account for mineability, selectivity, mining loss and dilution.These mineral resource estimates ar based on Indicated Mineral Resources that are considered too speculative geologically to have the economicconsiderations applied to them that would enable them to becategorized as mineral reserves . However, there is no certainty that these indicated mineralresources will be converted to measured categories through furtherdrilling, or into mineral reserves, once economic considerations areapplied. There is no certainty that thepreliminary economic assessment will be realized.
Mineralogy
The Haib Copper Deposit is a large sulfide mineraldeposit. Copper is mainly present as a sulfide in the form ofchalcopyrite. Copper is also present as oxides (chrysocolla,plancheite, malachite and azurite), occurring as intrusions in shearzones. Initial testwork results showed that the Haib mineralisation isa competent quartz feldspar porphyry rock.
It can be seen that the main mineral is copper withonly an accessory amount of molybdenum present. The chalcopyrite alsooccurs as occasional coarse irregular grains from 0.1 mm to 0.35 mm.
Mining Methods
Considering the Haib copper deposit characteristics,the suitable mine design is based on an open pit method. As thedeposit is basically composed of hard rock material, the miningoperations will involve drill and blast of all excavated material,which will be segregated by cut-off grade.
The mining fleet considered for the Haib project wouldconsist of appropriately sized hydraulic excavators and off highwaydump trucks, depending, supported by standard open-cut drilling andauxiliary equipment.
Initial open pit mine design work undertaken indicatesa strip ratio of 1.41:1 for 20 Mtpa. The low strip ratio has asignificant effect on the low operating cost indication of theproject.
Recovery Method
For the recovery of copper from the Haib deposit, heapleaching was considered for all options. The primary reasons for theselection of heap leaching are the low-grade nature of the deposit andthe vast scale of the mineral body. Previous work conducted on theHaib Project suggested that a conventional crush-grind-float and saleof copper concentrate is not economically feasible under the currentcopper market conditions. The low costs associated with heap leachingcompared to a whole mineral flotation circuit is believed to improvethe viability of the project. Heap leaching is traditionally performedon oxide material, although there has been increasing development inthe application to acid-insoluble sulfides.
Previous sighter amenability test-work, carried out byMintek, METS and SGS South Africa, suggests that high amounts ofcopper can be extracted from the Haib material, up to 95.2% via abacterial assisted leaching. However, additional test-work is requiredto determine the optimal operating parameters. The system designproposed will use 3 stage crushing and a mineral sorting system(either on the primary crushed product or the secondary crushedproduct depending on the technology selected) that will provide highergrade mineral to the heaps. The primary crusherwill reduce the rock to 127 mm (gyratory crusher) , the secondarycrusher to 32 mm (cone crusher) and the tertiarycrusher to 5 mm (HPGR).
Haib Copper Flow Sheet diagram
(on the following page)
Capital Costs
Table 6: Capital cost breakdown @ 80% Cu recovery at aprice of US $ 3.00 per lb of copper
Direct Cost (US) | 20 Mtpa |
Crushing & HPGR | 101.1 |
Agglomeration & Heap Leaching | 43.2 |
Copper Solvent Extraction | 72.9 |
Iron Removal | 6.3 |
Process and Raw Water | 4.1 |
Reagents | 5.0 |
Services | 2.9 |
Supporting Infrastructure | 3.0 |
First Fill | 8.3 |
Indirect Cost (US) | |
Working Capital | 24.7 |
Insurance | 7.4 |
EPCM | 24.7 |
Contingency | 24.7 |
Commissioning | 5.0 |
Accommodation & Temp Services | 5.0 |
Spares & Tools | 3.0 |
Total (US) | 341.3 |
Operating Costs
Total operating costs, including capital leases as anoperating expense, are estimated in the PEA and are broken down asfollows:
Table 7: Total Operating Cost Breakdown – Scenario1
20 Mtpa @ 80% Cu Recovery + CuSO 4 | ||||
Area | Annual Cost | Unit Cost | Unit Cost | |
(‘000 USD) | (USD/t ROM) | (USD/lb CuEq) | ||
Mining | 45,200 | 2.26 | 0.40 | |
Processing | 90,799 | 4.54 | 0.80 | |
Product Freight | 3,889 | 0.19 | 0.03 | |
Wharfage & Shiploading | 432 | 0.022 | 0.004 | |
Administration | 4,000 | $0.20 | 0.04 | |
Royalty | $2.00 | 6,824 | 0.34 | 0.06 |
$2.25 | 7,677 | 0.38 | 0.07 | |
$2.50 | 8,530 | 0.43 | 0.08 | |
$2.85 | 9,724 | 0.49 | 0.09 | |
$3.00 | 10,236 | 0.51 | 0.09 | |
Total | $2.00 | 151,144 | 7.56 | 1.33 |
$2.25 | 151,997 | 7.60 | 1.34 | |
$2.50 | 152,850 | 7.64 | 1.34 | |
$2.85 | 154,044 | 7.70 | 1.35 | |
$3.00 | 154,556 | 7.73 | 1.36 | |
Note: Mineral Resources that arenot mineral reserves do not have demonstrated economic viability.Mineral resource estimates do not account for mineability,selectivity, mining loss and dilution. These mineral resourceestimates are based on Indicated MineralResources that are considered too speculativegeologically to have the economic considerations applied to them thatwould enable them to be categorized as mineral reserves . However, there is no certainty thatthese indicated mineral resources will be converted to measuredcategories through further drilling, or into mineral reserves, onceeconomic considerations are applied. There is nocertainty that the preliminary economic assessment will berealized.
Tailing Disposal
There will be no tailings. The spent heaps will berehabilitated and left in place. Due to environmental reasons andwater resources, the tailings from the pH adjustment process and theiron removal process will be disposed onto the spent heaps via themethod of filtered dry stacked tailings .
Environmental considerations
In terms of environmental aspects, dry stack facilitiesoffer a number of advantages to other surface tailings storage options– some of these include:
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-- Reduced water requirements,principally achieved by recycling process water and near eliminationof water losses through seepage and/or evaporation;
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-- Groundwater contaminationthrough seepage is virtually eliminated;
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-- Significant safety improvementwith the risk of catastrophic dam failure and tailings runout beingeliminated;
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-- Easier to close andrehabilitate.
Waste rock storage
It is suggested to consider stockpiling the low-grademineral to process it at the end of mine life, in case the copperprice increase considerably by the end of the mine life and/or a newmineral processing technology be created or developed.
Products
LME Copper (cathodes)
Copper is one of the most widely used metals on theplanet. China, Europe and the USA are the main global consumers ofcopper. Copper will be produced on the cathode of the electrowinningcell as pure sheets, which will be a pure (99%) solid. Pure coppermetal is used for a variety of purposes. The major use is electricalwiring due to the great electrical conductivity of copper.Additionally, copper is used in many metal alloys such as brass andbronze, which are stronger and more corrosion resistant than purecopper.
Copper Sulfate
Copper sulfate will be sold as a blue powder when thecrystals are crushed and dried. Copper sulfate is used in multipleindustries such as arts, mining, chemical, pharmaceutical, healthcareand agriculture. The biggest use is for farming as an herbicide orfungicide. Additionally, it inhibits the growth of E-Coli. In thehealthcare sector, it is used in sterilizers and disinfectants and canbe used to control proliferation of bacteria and viruses. Industrialusage could be in adhesives, building, chemical, textile industries,etc. where it is used to manufacture products like insecticides, wood preservatives and paints.High purity copper sulfate has a 25% premium price based on the coppercontent in the sulfate.
Sulphur Burning Plant
The design for each option as it stands involves theburning of sulphur to produce sulphuric acid. There are severalpossibilities for sulphuric acid sourcing, including purchasing fromsmelters within Namibia.
Buying in sulphuric acid at the start of the projectlife and building a sulphur burning plant once the project is cashflow positive may provide a better economic scenario.
This will allow for the sulphur burning plant capitalto be deferred and the payback period to be shortened.
The results from the PEA have been promising andprovides a fundamental support for Deep South Resources intention tomove the project towards the Feasibility Study phase on the of thedeposit.
Deep South Resources has set a target of achieving 85%copper recovery as a basis of design in the feasibility study. Some ofthe parameters to be evaluated in the study are:
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- Recycled column leaching
- Higher temperatureleaching
- Optimization of particle sizing for leaching
- Different bacterial strains
- Resting after 200 days for 30 days and thenirrigation for another 30 days
- Optimization of leach pH leach
- Optimization of nutrient addition to the leach
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Infill drilling in the high-grade area of the deposit,which can be included in the early part of the mine schedule isrecommended. This will improve project economics in the financialmodel.
A drill program of 12,000 meters is recommended toinfill a high grade section of the deposit. With a closer gridspacing, a high-grade part of the deposit could be included in thefirst years of mining to improve the economics and pay-backperiod.
Further to the Feasibility Study and the drilling ofthe mineral body as above, a small Pilot Plant is recommended on-siteto validate and optimize the process under local conditions. Thedetailed engineering information and optimization would provideimproved confidence in proceeding with a commercial operation.
The work conducted to date provides confidence to moveforward, and there is every possibility of improving copper recoveryand reducing the operating costs further.
The PEA technical report will be filed on SEDAR at www.sedar.com and on the Deep-South website at www.deepsouthresources.com shortly after the issuance of this news release.
Project Risks
Further information about the PEA and the resourceestimate referenced in this news release, including information inrespect of data verification, key assumptions, parameters, risks andother factors, can be found in the NI 43-101 technical report for theHaib Copper project that will be filed on SEDAR under Deep-South'sprofile.
Opportunities
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-- Metallurgical advanced testwork;
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-- Infill drilling of thehigh-grade area in order to estimate a measured resource;
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-- X-Ray ore sorting test work todefine the potential economic enhancement
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-- Solar Energy: Given the semi-arid climate of Namibia, a solar energy farmmay be an option for reducing the unit cost of power. This will alsohave positive social impacts for the project, which is expected tohave a long life.
Other opportunities are presented in the the NI 43-101 technical report for the Haib Copper projectthat will be filed on SEDAR under Deep-South's profile.
Project Expansion :
The resource tonnage allows for possible multipleexpansion stages to be executed should the project proceed to once inproduction. A staged approach is recommended in order to de-risk theproject by projecting that the project achieves positive cash flowprior to plant expansions.
Way Forward
The results from the updated PEA have been promising,Deep-South Resources intends to undertake a Feasibility Study for thedeposit as the next phase of the project. The program will include butnot limited to: drilling of the high-grade area in order to define thegrade and estimate a measured resource, detailed mine design, measuredresource definition, metallurgical and process technologies test work,engineering design and an environmental impact study.
Quality Control andAssurance and DataVerification
The independent qualified persons forthe Haib Copper PEA are Mr. Damian Connelly of Mineral Engineering and TechnicalServices , Mr. Peter Walker of P & E WalkerConsultancy and Mr. Dean Richards of Obsidian ConsultingServices.
Obsidian Consulting Services conducted a review of theQA/QC programme implemented by Teck using the certificates of analysisreceived from Acme Labs and provided by Teck. This review comparedthe results of field duplicates, blanks as well as the variousstandards utilised with respect to Cu and Mo.
The design of Teck's drilling programme, qualityassurance / quality control programme and the interpretation ofresults were under the control of Teck's geological staff. The QA/QCprogramme is consistent with industry best practices. Drill core islogged and cut onsite, with half-core samples prepared at AnalyticalLaboratory Services, Windhoek, Namibia. Prepared samples are shippedto Acme Analytical Laboratories, Vancouver, Canada for appropriatebase metal assaying and gold fire assaying techniques. Allanalytical batches contain appropriate blind standards, duplicates andblanks inserted at regular intervals to independently assessanalytical accuracy and precision.
Mr. Walker and Mr. Richards reviewed thesample chain-of-custody, quality-assurance and quality-control (QA/QC)procedures, and the accreditations of analytical laboratories used byTeck. The QPs are of the opinion that the procedures and QA/QC areacceptable to support Mineral Resource estimation.
Mr. Walker also audited the assaydatabase, core logging and geological interpretations and found nomaterial issues with the data as a result of theseaudits.
In the opinion of the QPs, the dataverification programs undertaken on the geological and assay datacollected from the Haib Copper support the geological interpretations and the analytical anddatabase quality, and the data collected, can support Mineral Resourceestimation.
Qualified Persons
Damian E.G. Connelly, BSc (Applied Science), FAusIMM,CP (Met), Principal Consulting Engineer of METS EngineeringGroup is the main author of the PreliinaryEconomic Assessment report and is responsiblefor the technical part of this press release and is the designatedQualified Person under the terms of National Instrument 43-101.
Peter Walker B.Sc. (Hons.) MBA Pr.Sci.Nat. of P & E Walker Consultancy is themain author of the 43-101 resource estimation report, and is aQualified Person under the terms of National Instrument 43-101.
Mr. Dean Richards Pr.Sci.Nat. , MGSSA – BSc. (Hons.)Geology, of Obsidian ConsultingServices is the contributing author of the 43-101 resource estimationreport and is a Qualified Person under the Terms of the NationalInstrument 43-101.
About METS Engineering
Established in 1988 by Damian Connelly, MineralEngineering Technical Services (METS) has a reputation for providingquality service to the global mining industryBased in Perth Australia.They have served clients all around the world from large companiessuch as Rio Tinto to exploration and development companies such asDeep-South Resources. They provide a comprehensive range of servicesincluding: Mineral processing, Engineering design and hydro metallurgytestwork.
About Deep-South Resources Inc.
Deep-South Resources Inc. is a mineral explorationcompany largely held by Namibian shareholders and Management -Directors with 24% and Teck Resources Ltd with 23% of Deep-South sharecapital.
Deep-South currently holds 100% of the Haib Copperproject in Namibia, one of the largest copper porphyry deposits inAfrica. Deep-South also holds an investment of 75% in the Kapili TepeCopper exploration project in Turkey.
Deep-South’s growth strategy is to focus on theexploration and development of quality assets, in significantmineralized zones, close to infrastructure, in stable countries.
This press release contains certain"forward-looking statements," as identified in Deep-South’s periodic filings with Canadian Securities Regulators thatinvolve a number of risks and uncertainties.
There can be no assurance that such statements willprove to be accurate and actual results and future events could differmaterially from those anticipated in such statements.
Neither the TSX Venture Exchange nor its RegulationServices Provider (as that term is defined in the policies of the TSX Venture Exchange)accepts responsibility for the adequacy or accuracy of thisrelease.
More information is available by contacting PierreLéveillé, President & CEO at
+1-819-340-0140 or at: info@deepsouthresources.com or
Paradox Public Relations at +1-514-341-0408.
Cautionary statement on forward-lookinginformation
Mineral Resources that are not mineral reserves do nothave demonstrated economic viability. Mineral resource estimates donot account for mineability, selectivity, mining loss and dilution.These mineral resource estimates are based on Indicated Mineral Resources that are considered too speculative geologically to have the economicconsiderations applied to them that would enablethem to be categorized as mineral reserves . However, there is no certainty that theseindicated mineral resources will be converted to measured categoriesthrough further drilling, or into mineral reserves, once economicconsiderations are applied. There is nocertainty that the preliminary economic assessment will berealized.
Certain statements in this release constitute“forward-looking statements” or “forward-looking information”within the meaning of applicable securities laws.
Such statements involve known and unknown risks,uncertainties and other factors which may cause the actual results,performance or achievements of the company, or industry results, to bematerially different from any future results, performance orachievements expressed or implied by such forward-looking statementsor information. Such statements can be identified by the use of wordssuch as “may”, “would”, “could”, “will”, “intend”,“expect”, “believe”, “plan”, “anticipate”,“estimate”, “scheduled”, “forecast”, “predict” andother similar terminology, or state that certain actions, events orresults “may”, “could”, “would”, “might” or “will”be taken, occur or be achieved. These statements reflect thecompany’s current expectations regarding future events, performanceand results and speak only as of the date of this release.
As well, all of the results of the 2018 Haib Copperpreliminary economic assessment constitute forward-lookinginformation, including estimates of internal rates of return, netpresent value, future production, estimates of cash cost, assumed longterm price for copper of US$3.00 per pound, proposed mining plans andmethods, mine life estimates, cash flow forecasts, metal recoveries,and estimates of capital and operating costs. Furthermore, withrespect to this specific forward-looking information concerning thedevelopment of the Haib Copper Project, Deep-South Resources has basedits assumptions and analysis on certain factors that are inherentlyuncertain. Uncertainties include among others: (i) the adequacy ofinfrastructure); (ii) unforeseen changes in geologicalcharacteristics; (iii) changes in the metallurgical characteristics ofthe mineralization; (iv) the ability to develop adequate processingcapacity; (v) the price of copper; (vi) the availability of equipmentand facilities necessary to complete development; (vii) the size offuture processing plants and future mining rates, (viii) the cost ofconsumables and mining and processing equipment; (ix) unforeseentechnological and engineering problems; (x) accidents or acts ofsabotage or terrorism; (xi) currency fluctuations; (xii) changes inlaws or regulations; (xiii) the availability and productivity ofskilled labour; (xiv) the regulation of the mining industry by variousgovernmental agencies; (xv) political factors, including politicalstability.
All such forward-looking information and statements arebased on certain assumptions and analyses made by Deep-South’smanagement in light of their experience and perception of historicaltrends, current conditions and expected future developments, as wellas other factors management believe are appropriate in thecircumstances. These statements, however, are subject to a variety ofrisks and uncertainties and other factors that could cause actualevents or results to differ materially from those projected in theforward-looking information or statements including, but not limitedto, unexpected changes in laws, rules or regulations, or theirenforcement by applicable authorities; the failure of parties tocontracts to perform as agreed; social or labour unrest; changes incommodity prices, including the price of copper; unexpected failure orinadequacy of infrastructure, or delays in the development ofinfrastructure, the failure of exploration programs or other studiesto deliver anticipated results or results that would justify andsupport continued studies, development or operations, and the resultsof economic studies and evaluations. Other important factors thatcould cause actual results to differ from these forward-lookingstatements also include those described under the heading “RiskFactors” in the company’s most recently filed MD&A filed byDeep-South. Readers are cautioned not to place undue reliance onforward-looking information or statements. The factors and assumptionsused to develop the forward-looking information and statements, andthe risks that could cause the actual results to differ materially areset forth in the “Risk Factors” section and elsewhere in thecompany’s most recent Management’s Discussion and Analysis reportand Annual Information Form, available at www.sedar.com .
This news release also contains references to estimatesof Mineral Resources. The estimation of Mineral Resources isinherently uncertain and involves subjective judgments about manyrelevant factors. Mineral Resources that are not Mineral Reserves donot have demonstrated economic viability. The accuracy of any suchestimates is a function of the quantity and quality of available data,and of the assumptions made and judgments used in engineering andgeological interpretation, which may prove to be unreliable anddepend, to a certain extent, upon the analysisof drilling results and statistical inferences that may ultimatelyprove to be inaccurate. Mineral Resource estimates may have to bere-estimated based on, among other things: (i) fluctuations in copperprices or other mineral prices; (ii) results of drilling; (iii)results of metallurgical testing and other studies; (iv) changes toproposed mining operations, including dilution; (v) the evaluation ofmine plans subsequent to the date of any estimates; and (vi) thepossible failure to receive required permits, approvals and licences,or changes to any such permits, approvals or licence. Although theforward-looking statements contained in this news release are basedupon what management of the company believes are reasonableassumptions, the company cannot assure investors that actual resultswill be consistent with these forward-looking statements. Theseforward-looking statements are made as of the date of this newsrelease and are expressly qualified in their entirety by thiscautionary statement.
Subject to applicable securities laws, the company doesnot assume any obligation to update or revise the forward-lookingstatements contained herein to reflect events or circumstancesoccurring after the date of this news release.
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