Fortune Minerals Applauds Government Investment In Northwest BC Power
Transmission Line
Positive impacts on Company's Mount Klappan Anthracite Coal Project
Issued Capital: 68,240,857
The Minister for Energy, Mines and Petroleum Resources for B.C. announced that it would proceed with the
Mount Klappan is one of the world's largest undeveloped deposits of high rank anthracite coal with Proven and Probable 10% ash Product Reserves of 60.8 million tonnes within a larger global Mineral Resource including, Measured Resources of 107.9 million tonnes, Indicated resources of 123 million tonnes, plus 2.572 billion tonnes in the Inferred and Speculative classes (see News Releases, dated
Mount Klappan has already been assessed in a positive definitive feasibility study for a mine and wash plant producing 3 million tonnes of metallurgical coal products per year from an initial open pit in the Lost Fox deposit, one of the four deposit areas currently identified on the property. The 2008 feasibility study was conducted by Marston
Mount Klappan Base Case Economic Results
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Pre-Tax IRR Pre-Tax (8%) NPV Capital Costs
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C$1 equals US$0.97 28.9% $702 million $617 Million
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C$1 equals US$0.83 40.9% $1.28 billion $656 Million
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The Mount Klappan feasibility studies, and reserve and resource estimates were prepared by Marston
The Marston feasibility study addresses the following impacts on the Mount Klappan project in the event of the extension of the B.C electrical grid and the Company establishing a connection at Highway 37 with a spur running along the Company's proposed short-cut haul road to the proposed mine:
- The Company would be able to purchase significantly lower cost grid
power and eliminate the need for expensive on-site diesel power
generation resulting in a material savings in power costs;
- The capital cost of the power line to Highway 37 would be partially
offset by elimination of the diesel power plant;
- Transportation costs for the haulage of diesel to the mine and its
storage at the site would be reduced;
In addition to the impacts addressed in the feasibility study, a
connection to the B.C. grid would also provide the following benefits to the
Mount Klappan project:
- The Company could use more efficient electric-cable shovels and
trolly-assisted pit trucks instead of the diesel hydraulic equipment
currently specified;
- Uncertainties associated with the fluctuation and escalation in the
price of diesel would be reduced;
- The feasibility of using a high speed conveyor to transport coal from
the mine to a trans-load facility at Highway 37 is enhanced due to
the availability of the 25 MW required to power it;
- Carbon and greenhouse gas emissions from the mine would be reduced.
Fortune Minerals is pleased that B.C. and Canadian Governments will proactively invest in infrastructure to sustain and grow the mineral resource industry in British Columbia and help preserve Canada's preeminent position as a leader in this sector. Fortune Minerals is actively seeking a partner to help develop the Mount Klappan anthracite coal project while the Company develops its NICO gold-cobalt-bismuth-copper project in the Northwest Territories independently. The process for securing a development partner for Mount Klappan was suspended earlier this year because of the financial crisis. However, with resurgence in the global demand for metallurgical coal and the recovering commodities sector, the Company has renewed discussions with companies interested in the project.
About Fortune Minerals
Fortune Minerals is a diversified natural resource company with several mineral deposits and a number of exploration projects, all located in
This press release contains forward-looking information. This forward-looking information includes, or may be based upon, estimates, forecasts, and statements as to management's expectations with respect to, among other things, the timing and progress in development of the Northwest Power Transmission Line referred to herein, the size and quality of the Company's mineral resources, progress in development of mineral properties, timing and cost for placing the Company's mineral projects into production, costs of production, amount and quality of products recoverable from the Company's mineral resources, demand and market outlook for coal and future coal prices. Forward-looking information is based on the opinions and estimates of management at the date the information is given, and is subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking information. These factors include the inherent risks involved in the exploration and development of mineral properties, uncertainties with respect to the receipt or timing of required permits and regulatory approvals and the timing and progress of the Northwest Power Transmission Line, the uncertainties involved in interpreting drilling results and other geological data, fluctuating metal and coal prices, the possibility of project cost overruns or unanticipated costs and expenses, uncertainties relating to the availability and costs of financing needed in the future, uncertainties related to metal recoveries and other factors. Mineral resources that are not mineral reserves do not have demonstrated economic viability. Inferred mineral resources are considered too speculative geologically to have economic considerations applied to them that would enable them to be categorized as mineral reserves. There is no certainty that mineral resources will be converted into mineral reserves. Readers are cautioned to not place undue reliance on forward-looking information because it is possible that predictions, forecasts, projections and other forms of forward-looking information will not be achieved by the Company. The forward-looking information contained herein is made as of the date hereof and the Company assumes no responsibility to update them or revise it to reflect new events or circumstances, except as required by law.
For further information: Fortune Minerals Limited, Robin Goad, President - or - Lindsay Simmons, IR Coordinator, [email protected], Tel.: (519) 858-8188, Fax: (519) 858-8155, www.fortuneminerals.com; Renmark Financial Communications, Dan Symons: [email protected] -or- Barbara Komorowski: [email protected]; Media Contact, François Trépanier: [email protected], Tel: (514) 939-3989, Fax: (514) 939-3717, www.renmarkfinancial.com
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