YERINGTON, Nev., June 06, 2022 (GLOBE NEWSWIRE) — Nevada Copper (TSX: NCU) (OTC: NEVDF) (FSE: ZYTA) (“Nevada Copper” or the “Company”) provides an update on recent operational events at its Pumpkin Hollow underground copper mine located in Yerington, Nevada (the “Underground Mine”) and its financial liquidity.
Restricted access to east-south sites
The underground mine encountered operational and geotechnical challenges in the latter part of May which are expected to delay mining from stopes in the east-south mining area and result in reduced concentrate production for the second quarter of 2022. Access to the worksites scheduled for June and July have been delayed due to an unidentified weak rock structure encountered in the main ramp of the east-south zone which requires additional drilling and geotechnical mitigation work to reinforce the area before proceeding. This, combined with limited access to the main ramp, slower-than-expected development and longer backfill cycles, resulted in lower-than-expected development ore production. These challenges have caused a planned delay of most stope ore production until August. Management is reviewing the full operational impact these events will have on production and plans are also being developed to reinstate restricted east-south felling areas.
Progress with the crossing of the dyke and access to the north-east worksites
The Company is currently pursuing development of its priority cape through the dam structure and into the East North mining area. The North East Zone is the largest mining area of the underground mine and is expected to have significantly higher copper grades and better geotechnical conditions compared to the South East Zone.
The focus on critical development has recently resulted in significant progress being made on the second dyke crossing. Management expects the second crossing to be completed by the end of June to allow further access to the larger, higher grade stoping areas in the northeast area.
In view of the challenges mentioned above, management has started taking steps to reduce costs, including reducing the workforce of the Company’s contractors. However, work continues to progress on the second dyke crossing and open pit pre-feasibility study and drilling.
Pala Investments Limited (“Pala”), the Company’s major shareholder, has agreed to provide additional financing of up to US$20 million under a promissory note. Drawdowns by the Company are subject to the agreed use of proceeds and the Company entering into satisfactory arrangements with certain creditors and vendors. The promissory note has a maturity date of December 31, 2023 and bears interest at 8% per annum on amounts drawn. The promissory note is subject to the approval of the Toronto Stock Exchange and has been reviewed and approved by a committee of independent directors of the Company.
The Company is in discussions with Pala and other third parties to obtain the additional financing required. Pala has fully disbursed the US$15 million accordion to the company under its existing credit facility with the company.
There can be no assurance that the full amount of financing contemplated by the promissory note will be made available or that an agreement will be reached on additional financing or on the amount, terms and sufficiency of such additional financing. Consistent with the Company’s previous disclosure, in the absence of sufficient funding received and/or arranged in a timely manner by Pala or other third parties, the Company may not be able to continue its operations in the normal course. activities.
The technical information and data contained in this press release has been reviewed by Steven Newman, Registered Member – SME, Vice President, Technical Services for Nevada Copper, who is a non-independent qualified person within the meaning of NI 43-101.
About Nevada Copper
Nevada Copper (TSX: NCU) is a copper producer and owner of the Pumpkin Hollow copper project. Located in Nevada, USA, Pumpkin Hollow has significant reserves and resources including copper, gold and silver. Its two fully licensed projects include the high-grade underground mine and processing facility, which are now in production, and a full-scale open-pit project, which is progressing towards feasibility status.
President and CEO
For more information, please visit the company’s website at www.nevadacopper.comor contact:
Tracey Thomas | Vice President, IR and Community Relations
+1 775 391 9029
Caution Regarding Forward-Looking Statements
This press release contains “forward-looking information” and “forward-looking statements” within the meaning of applicable Canadian securities laws. All statements in this press release, other than statements of historical fact, are forward-looking statements. Such forward-looking information and forward-looking statements specifically include, but are not limited to, statements relating to underground mine development, production and ramp-up expectations and objectives, financing requirements and other plans of the Company. in exploration, development, construction and production ramp-up.
Forward-looking statements and information include statements regarding management’s expectations and beliefs. Often, but not always, forward-looking statements and forward-looking information can be identified by the use of words such as “anticipates”, “expects”, “potential”, “is expected”, “planned”, “is targeted”, “budget”, “planned”, “estimates”, “anticipates”, “intends”, “anticipates” or “believes” or their negative aspects or variations of such words and expressions or statements that certain actions , events or results “may”, “could”, “might”, “could” or “will” be taken, occur or be realized. Forward-looking statements or information should not be construed as guarantees of performance and results. are subject to known and unknown risks, uncertainties and other factors that may cause actual results and events to differ materially from any future results, performance or achievements expressed or implied by such statements. or computer ons prospective.
These risks and uncertainties include, but are not limited to, those relating to: additional capital requirements and no assurance can be given as to the availability thereof; the Company’s ability to complete the ramp-up of the underground mine within anticipated timeframes and cost estimates; the impact of COVID-19 on the Company’s business and operations; the state of financial markets; history of losses; dilution; adverse events related to milling operations, construction, development and ramp-up, including the Company’s ability to resolve underground development and processing plant issues; ground conditions; cost overruns related to the development, construction and ramp-up of the underground mine; loss of material properties; interest rates rise; Mondial economy; limited production history; future fluctuations in metal prices; speculative nature of exploration activities; periodic interruptions to exploration, development and mining activities; environmental risks and liability; industrial accidents; failure of processing and mining equipment to perform as intended; labor disputes; supply issues; the uncertainty of production and cost estimates; interpretation of drilling results and estimation of mineral resources and reserves; changes in project parameters as plans continue to be refined; possible variations in ore reserves, mineralization grade or recovery rates from management’s expectations and the difference may be material; legal and regulatory proceedings and community actions; accidents; the title matters; regulatory approvals and restrictions; increased costs and physical risks associated with climate change, including extreme weather events, and new or revised climate change regulations; permits and licenses; dependence on management information systems and cybersecurity risks; the volatility of the market price of the Company’s securities; Insurance; competition; hedging activities; currency fluctuations; the loss of key employees; other risks of the mining industry as well as the risks discussed in the Company’s MD&A for the fiscal year ended December 31, 2021 and the quarter ended March 31, 2022 and in the section entitled “Risk Factors” of the annual report of the Company. Information Statement dated March 31, 2022. The forward-looking statements and information contained in this press release are based on assumptions that management believes are reasonable, including, without limitation: no adverse developments regarding the ownership or operations of the project ; no material changes to applicable laws; ramping up operations at the underground mine in accordance with management’s plans and expectations; no worsening of current work restrictions related to COVID-19; reduced impacts of COVID-19 in the future; the Company will be able to obtain sufficient additional financing to complete the ramp-up, no material adverse change in the price of copper from current levels; and the absence of any other factor that could cause actions, events or results to differ from those anticipated, estimated or intended.
Forward-looking information and statements are made as of the date hereof. The Company disclaims any intention or obligation to update any forward-looking statements or information, except as required by law. Although the Company has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in the forward-looking information and statements, there may be other factors that could cause that the actions, events or results are not as anticipated, estimated or anticipated. Specific reference is made to “Risk Factors” in the Company’s MD&A for the year ended December 31, 2021 and the quarter ended March 31, 2022 and to “Risk Factors” in the Company’s Annual Information Form dated March 31, 2022. , for a discussion of factors that may affect forward-looking statements and information. Should one or more of these risks or uncertainties materialize, should other risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results and events could differ materially from those described in the forward-looking statements and information. . For further information on the Company and the risks and challenges of its business, investors should consult the documents filed by the Company which are available at www.sedar.com.
The Company does not guarantee that forward-looking statements and information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements or information. Accordingly, readers should not place undue reliance on any forward-looking statements or information.