Trevali Mining Corp on Tuesday tabled results of a pre-feasibility study for a proposed expansion of its 90%-owned Rosh Pinah zinc-lead-silver mine in Namibia.
The prefeasibility study envisions a throughput expansion to 1.3 million tonnes annually, up from the current 700,000 tonnes, at a total capital expenditure of $93 million. Trevali estimates that the project has a relatively attractive internal rate of return (IRR) of 65% and 8% net present value (NPV) of $142 million based on a zinc price of US$1.11 a pound.
On Tuesday, Trevali shares were off $0.01 or 3.45% to 14 cents on volume of 339,590. The shares are currently trading in a 52-week range of 26 cents and $0.06.
Trevali is a Vancouver-based mining company. The bulk of its revenue is generated from base metals mining at four operations. They are the 90%-owned Perkoa Mine in Burkina Faso, the 90%-owned Rosh Pinah Mine, the wholly-owned Caribou zinc-lead-silver Mine in New Brunswick, and the wholly-owned Santander Mine in Peru.
In June, 2020, Trevali released updated proven and probable reserves for Rosh Pinah of 11.23 million tonnes at 6.26% zinc, which compares to 9.79 million tonnes at 6.45% zinc at the end of 2019. This represents a 15% increase in tonnage and 11% increase in contained zinc. However, the total resources, including reserves, remain largely unchanged.
Prior to making an investment decision, Trevali said it intends to commence a feasibility study for the Rosh Pinah expansion in the first quarter of 2021. The PFS anticipates a construction start date of the first quarter of 2022 with commercial production for the expanded plant beginning in the first half of 2023.
By expanding the throughput to 1.3 million tonnes annually, the mine is expected to yield an average life of mine zinc output of 109 million pounds of zinc at a very low all-in-sustaining cost of US$0.70 a pound over an 11 year mine life.