(TheNewswire)
Highlights:
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- Jervois Board has approved fullconstruction and development its 100%-owned Idaho Cobalt Operations(“ICO”) in the United States (the “U.S.”)
- Approval follows the successfulpricing and books closing of Jervois’ subsidiary’s offering ofsenior secured bonds to raise US$100 million, guaranteed byJervois
- Proceeds from the bond issue willbe used to fund construction of Jervois’ ICO and bring it intoproduction
- Jervois expects to commencecommercial concentrate production at ICO from mid-2022
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- The bond issue preserves commercialflexibility through ICO construction by not obliging Jervois toirrevocably commit cobalt supply early
- Jervois continues to advancefunding support discussions with the U.S. Government
TheNewswire - 6 July 2021 - Jervois Mining Limited (“ Jervois ” or the“ Company ”) (ASX:JRV) (TSXV:JRV) (OTC:JRVMF) advises its Board hasapproved final construction of Jervois’ Idaho Cobalt Operations(“ ICO ”) in the United States (the “ U.S. ”). ICO issituated approximately 40km west of the town of Salmon in east centralpart of the state of Idaho.
Approval follows pricing and closure of the book ofJervois’ subsidiary’s offering of senior secured bonds to raiseUS$100 million, guaranteed by Jervois. Upon satisfaction of theconditions precedent to the release from escrow of the proceeds of thebonds which is expected in Q4 2021, they will be used for the paymentof capital expenditures, operating costs and other costs associatedwith the construction of ICO and bringing it into production. Firstproduction from ICO continues to be expected from mid 2022.
The properties upon which the mine and mill aresituated in the U.S. National Forest lands managed by United StatesForest Service (the “ USFS ”). Jervois controls 100 percent ofthe unpatented mining claims over this land, consisting of 313unpatented lode mining claims. All activities at ICO adhere to theUSFS and Environmental Protection Agency requirements. The site isenvironmentally permitted with an approved Plan of Operations.
Jervois acquired ICO in July 2019. ICO was partiallyconstructed, with more than US$120 million invested by prior ownerssince discovery of the cobalt deposit. Prior to initiating finalconstruction, Jervois commissioned DRA Global and its sub-consultants,M3 Engineering (“ M3 ”), to prepare an updated Australian JORCCode 2012 Edition Bankable Feasibility Study(“ BFS ”) and Canadian National Instrument 43-101 FeasibilityStudy on ICO, the results of which were announced on 29 September2020.
M3 was appointed as lead engineer for the detaileddesign and site early works in November 2020, and an EPCM contract forfull construction is expected to be executed shortly. M3 isheadquartered in Tucson, Arizona and was selected as the preferredengineering contractor due its extensive construction experience andtrack record of successful project delivery in the U.S., specificallyrelating to local conditions in Idaho and regional contractorcapabilities.
Final construction of ICO will include developing anunderground mine over a period of 10 months starting in September2021, which is scheduled to deliver first ore to an operational millin July 2022. D evelopment of the mine is beingexecuted by Small Mine Development (“ SMD ”), based inBattle Mountain, Nevada. SMD also participated in the mine designand costing for the updated BFS.
ICO will comprise a 1,200 short tons of ore per day(“ stpd ”) mill and concentrator to produce separated cobalt andcopper concentrates. Gold mineralisation in the mine reserve at ICOwill largely report to the cobalt concentrate and will be recovered at São Miguel Paulista (“ SMP ”) refinery in Brazil, subject to Jervoiscompleting its SMP acquisition and successfully restarting therefinery in stages during 2022 and 2023 . Copper concentrates willbe sold into North American markets. Tailings will either be placedback underground or filtered and safely placed in a dry stack wastestorage facility.
Jervois has developed detailed plans to operate ICO inan environmentally responsible manner. Demonstration by Jervois ofits ability to construct and operate safely for the environment,together with necessary drilling success once underground access hasbeen opened (to both convert existing and future mineral resourcesinto mine reserves) are expected to positively support discussionswith the USFS and other U.S. regulators regarding a future expansionutilizing the currently disturbed site footprint.
Jervois has awarded Metso Outotec the design,fabrication and delivery contract for a 4.7m diameter and 2.5m-long750kW SAG (semi-autonomous grinding) mill. The mill will comfortablyaccommodate the nameplate 1,200stpd processing capacity cap applied inthe ICO BFS, which is based on the Company’s currently approved Planof Operations. Delivery of the Metso Outotec SAG mill to site inIdaho is planned and on schedule for Q4 2021.
Site early works are well underway, with fullconstruction to commence on the ground in September 2021. ICO willcreate approximately 200 local construction jobs and 180 operationalpositions once the site transitions into commercial operation.
Site early works include:
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- Limited remaining earthworks and concrete design andexecution;
- High density polyethylene lining installation on thewaste storage facility base;
- Commissioning of the wastewater treatmentplant;
- Constructing and commissioning of a pump backsystem;
- Constructing an accommodation camp;
- Bolting and meshing of the portal and extensionearthworks of the portal bench; and
- Erecting buildings which will allow construction tocontinue over winter.
All these activities have been designed and are invarious stages of execution on the site.
The mine site is equipped with all requiredinfrastructure including access roads from both Salmon and Challis,full grid power (at less than U.S. 5 cents per kwh; Idaho Power hasoffered ICO 100% renewable power from 2023, the first full year ofmine and mill operation), a bore field for water supply,communications and all site earthworks and terracing, as illustratedin the following site overhead photograph.
The design and construction of the process facility andall related supporting infrastructure is being managed by M3;c urrent site works have been tendered usinglocal and regional sub-contractors.
With yesterday’s announcement of pricing and closingof books on Jervois’s subsidiary’s offering of US$100 million ofsenior secured bonds, the Company is excited to now progress into final construction at ICO. Once inoperation, ICO will be the first U.S. cobalt mine in generations. Given cobalt’s many applications andsignificant supply chain risks, it has been designated a criticalmineral by the U.S. Government, and was listed by the Department ofthe Interior in coordination with other executive branch agenciespursuant to Executive Order 13817, “A Federal Strategy to EnsureSecure and Reliable Supplies of Critical Minerals” (82 FR 60835) with the final list being published in May 2018(83 FR 23295). Jervois remains actively engaged with the U.S.Government with regard to the geopolitical and economic importance ofthe Idaho facility.
The Board of Jervois is excited to announcing thissignificant investment into Idaho. Idaho is an extremely supportiveand attractive jurisdiction to invest, and leads the U.S. with itsstable legal and political system, tax and other regulations tofacilitate investment and job creation, whilst simultaneouslyprotecting the state’s pristine natural environment. Jervois isexcited to become a significant economic partner of both Idaho Stateand Lemhi County.
Figure 1: Current ICO ConstructionSite Overview
On behalf of Jervois
Bryce Crocker, CEO
For further information, please contact:
Investors and analysts: James May Chief Financial Officer Jervois | Media: Nathan Ryan NWR Communications nathan.ryan@nwrcommunications.com.au Mob: +61 420 582 887 |
Forward-Looking Statements
This news release may containcertain “Forward-Looking Statements” within the meaning of theUnited States Private Securities Litigation Reform Act of 1995 andapplicable Canadian securities laws. When used in this news release,the words “anticipate”, “believe”, “estimate”,“expect”, “target, “plan”, “forecast”, “may”,“schedule”, “expected” and other similar words or expressionsidentify forward-looking statements or information. Theseforward-looking statements or information may relate to timing of thedelivery of equipment to ICO, the timing of construction andproduction at ICO, the release timing for settlement and drawdown ofthe Bonds and certain other factors or information. Such statementsrepresent Jervois’ current views with respect to future events andare necessarily based upon a number of assumptions and estimates that,while considered reasonable by Jervois, are inherently subject tosignificant business, economic, competitive, political and socialrisks, contingencies and uncertainties. Many factors, both known andunknown, could cause results, performance or achievements to bematerially different from the results, performance or achievementsthat are or may be expressed or implied by such forward-lookingstatements. Jervois does not intend, and does not assume anyobligation, to update these forward-looking statements or informationto reflect changes in assumptions or changes in circumstances or anyother events affections such statements and information other than asrequired by applicable laws, rules and regulations.
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