Minera IRL Provides Update on Ollachea Financing Negotiations
LIMA, PERU–(Marketwired – Dec. 23, 2014) – Minera IRL Limited (“Minera IRL” or the “Company”) (TSX:IRL)(AIM:MIRL)(BVL:MIRL), the Latin America gold mining company, provides an update on its activities relating to ongoing financing discussions for the development of the Ollachea Gold Mine in southern Peru.
“The Ollachea Gold Project has all the key permits in place to commence development. Project financing discussions are at an advanced stage and we look forward to bringing these discussions to conclusion during the first quarter of 2015,” stated Courtney Chamberlain, Executive Chairman.
As at 30 September 2014, the Company had a cash balance of $5.4 million and, as announced on 12 November 2014, the Company has sufficient funds together with the expected cash flows from Corihuarmi to meet its cash requirements to the end of the first quarter of 2015 by which time the Company expects to have project financing in place for its flagship Ollachea Gold Project.
With project financing in place during the first quarter of 2015, the Company expects production to commence at Ollachea during the fourth quarter of 2016.
The Ollachea Gold Project
The Ollachea orogenic gold deposit, located in southern Peru, was discovered by Minera IRL in late 2008 after acquiring the property from Rio Tinto in 2006. Since that time, the Company has completed more than 81,000 metres of surface diamond drilling in 208 holes, resulting in the delineation of significant gold mineral resources and reserves at Ollachea. The project has strong community support, as evidenced by a 30-year surface rights agreement.
In November 2012, the Company completed a Definitive Feasibility Study on the Minapampa deposit. The results of a subsequent optimization process were announced on 4 June 2014. These studies reported the details of a robust underground mining operation with Probable Mineral Reserves of 9.2 million tonnes grading 3.4 grams of gold per tonne of material (“g/t Au”) containing 1.0 million ounces.
The Ollachea Gold Mine has scheduled production of 930,000 ounces over an initial nine-year mine life at an average site cash operating cost of $507 per ounce of gold produced.
The up-front capital cost is estimated at $177 million (including IGV, which is recoverable) with a total life-of-mine capital cost estimate of $220.0 million.
The following table reports the key performance measures of the Ollachea Project over a range of gold prices on a total project basis that is equity financed:
Exploration and resource infill drilling has defined Indicated Mineral Resources of 10.1 million tonnes grading 4.0 g/t Au containing 1.3 million ounces at a 2.0 g/t Au cut-off, plus Inferred Mineral Resources totalling 12.1 million tonnes grading 3.0 g/t Au containing 1.1 million ounces at a 2.0 g/t Au cut-off. Significant open-ended potential exists to increase mineral resources both along strike and at depth as evidenced by underground drilling results along the eastern extension of the Minapampa deposit (reported in the Press Release dated 2 April 2013).
Minera IRL Limited is an AIM, TSX and BVL listed precious metals mining and exploration company with operations in Latin America. Minera IRL is led by a management team with extensive operating experience in South America. In Peru, the Company operates the Corihuarmi Gold Mine and is advancing its flagship Ollachea Gold Project towards production. For more information, please visitwww.minera-irl.com.