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Project Status: Feasibility -- completed by Wardrop Engineering Inc. Adequacy - Yukon Environmental and Socio-economic assessment Board (YESAB) deemed the Mactung Proposal adequate in October 2009. Screening of the Proposal has commenced pursuant to the Yukon Environmental and Socio-economic Assessment Act (YESAA). Property Description and Location The Mactung property is located in the Yukon in the Selwyn Mountain Range and covers the area around Mt. Allan, approximately eight kilometres northwest of MacMillan Pass. The nearest settlement accessible by road, Ross River, is 250 km away to the southwest along the Canol Road, a drive that takes about six hours. The property is located at latitude 63º17'N and longitude 130º10'W, and the Cantung Mine is approximately 160 km to the south In February 2009 the Company announced the results of the feasibility study for its 100% owned Mactung Project in the Yukon Territory. Wardrop Engineering Inc. ("Wardrop") provided the principal engineering services for the project design and the capital and operating cost estimates. Geotechnical and environmental input was provided by EBA Engineering Consultants Ltd. ("EBA"). The Mactung Project is forecast to run at 2,000 tonnes per day from an underground operation using conventional long hole plus cut and fill mining methods. The ore will be processed into both a premium gravity concentrate (67% WO3) and a flotation concentrate (55% WO3). Key parameters that form the basis of the economic evaluation of the Mactung Project are as follows:
Mine life is 11.2 years for the underground mine with the potential to expand by 17 years with an open pit, exploiting near surface, lower grade indicated and inferred mineral resources. The capital expenditure estimate is comprised of a project capital cost of CDN$356.5 million plus a contingency of CDN$45.6 million. Based on an 11.2 year mine life and the base case parameters, the project's pre-tax net present value is calculated as follows:
The pre-tax internal rate of return for the project is 23.5%. Payback of invested capital is anticipated to occur within 2.9 years after production starts. DETAILS OF THE AMENDED TECHNICAL REPORT ON THE MACTUNG PROPERTY, YUKON, CANADA DATED APRIL 3, 2009 ARE AVAILABLE AS NATIONAL INSTRUMENT 43-101 TECHNICAL REPORT FILED UNDER THE COMPANY'S PROFILE AT WWW.SEDAR.COM ON MAY 18, 2010.
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