INNOVATIVE ENERGY EFFICIENT SOTKAMO SILVER

Transcription

1 INNOVATIVE ENERGY EFFICIENT SOTKAMO SILVER Industry Summit, 5th October 2017, Oulu Timo Lindborg CEO, Dr. Tech., Adjunct professor Sotkamo Silver AB

2 SOTKAMO SILVER AB Sotkamo Silver AB is listed in NGM Equity in Stockholm and parallel listed in Nasdax OMX Helsinki Market valuation of ca. 50 million EUR, a total of 19,313,694 shares Three largest shareholders (as per end of Augusti 2017) Ilmarinen Mutual Pension Insurance Company 9.4 % Timo Lindborg (through the company) 3.2 % HEXOF Oy 3.0% A total of shareholders of which 9700 from Finland owning 82 % of the total shares Chairman of the Board Mr. Mauri Visuri and CEO Dr. Timo Lindborg both from Oulu Sotkamo Silver Oy is fully owned by Sotkamo Silver AB and is the operating entity in Finland

3 WHAT IS INNOVATIVE MINING v Are minerals innovative high technology products? v Is mining technology innovative technology? v If mining industry use high technology in it's processes, is mining Innovative Mining? v Is green technology high technology? v Is mining part of circular economy? v Sotkamo Silver - smart mining

4 FUTURE INNOVATIVE MINING TECHNOLOGIES v v v v v v v v v v v Automated tunnel borers Ore processing Simulation technology Automated transport systems and mine site infrastructure X-ray diffraction equipment and in-situ analysis 3D Mapping, remote mapping and surveying Alternative energy Digital as an enable Ground penetrating techniques In-Situ recovery of metals Innovative financing methods

5 VALUE CREATING WITH INNOVATIVE MINING metal contents "in situ" value Waste Value-added in mining Value-added in concentrating Value-added in refining Value-added in prospecting ( TEKES, MTI ) Government ( GSF ) Prospecting Mining Concentrating Refining Junior Mining Listed or more mature companies 5

6 SUFFICIENCY OF MINERAL RESOURCES It is certain that the cut-off limit of mineral deposits (the lowest grade, what is profitably mineable) in the long term is forced to decrease and correspondingly, the amount of mineral resources just increases. From the point of view of our society it is not to be expected, during any financial planning time frame, that non-renewable geological resources would run out - on the contrary, those increase.

7 Minerals sector challenges: Deposits are of lower grade, or are located at greater depth. Decline in availability of aggregates in proximity to locations of greatest use. Extractive operations are limited by competing forms of land use and access. Permitting procedures become more complex, and processes become longer. Increasingly difficult to recruit expert consultants and skilled labour.

8 Minerals sector challenges Emissions and waste need to be minimised. Utilisation of by-products and replacement materials must be enhanced. Automation in the mining industry must be encouraged. Health and safety issues and workplace atmosphere must be improved. Use of rehabilitated sites after mine closure needs to be promoted. The general acceptability and perception of the industry must be improved. Water and energy consumption must be decreased.

9 SOTKAMO SILVER - THE INNOVATIVE OPERATIONS We committed to minimizing our carbon footprint and pursuing a more circular business model through pioneering use of new modern technologies: venhance Energy Efficiency: 1. DEPLOYMENT OF A FIRST OF A KIND ORE SORTER TECHNOLOGY (TEKES) 2. Participating in the Baltic Sea Underground Innovation Network BSUIN (INTERREG) venhance Operational Efficiency: 1. Use of new technologies for remote operations and maintenance of the plant vreduce carbon footprint: 1. Usage of a new technique to prepare tailings dams basement 2. Monetize the industrial side streams as mine tailings for geopolymers 3. Use electrical power from the hydro-power plant v Other Pioneering Initiatives: 1. Considering the potential use of solar power and wind power 2. Participating in Team Finland growth programme, Mining Finland

10 SILVER MINE PROJECT ECONOMIC ESTIMATES Technical Report 2017 Base Case 6 years operational time (current Ore Reserve) IRR 48 %, NPV 57 million (@ 5 %) (calculated with a consensus Ag price of $17,6-19,01Oz Ag) LOM CAPEX 40 M inclusive of ore-sorting and capacity increase during year 3 Payback: less than 3 years from the start of production 6 years s EBITDA: 101 million All-In Cash Cost in average 8,8 $/Oz Ag Management view estimate 11 years (Ore Reserve + 5 years from Exploration Potential) IRR 40 %, NPV 103 million (@ 5 %) (calculated with a consensus Ag price of $ 14,9-20,0/Oz Ag) LOM CAPEX 44 million inclusive of underground ore-sorting and capacity increase during year 3 with ore-sorter, ventilation shaft extension from -350 to -700 level and three km extension of hauling tunnel Payback: 3 years from start of production Estimated Life-of-Mine: 11 year s EBITDA: 194 million Sotkamo Silver 10

11 UTILIZATION OF THE PRECONCENTRATING Utilization of the preconcentrating opens new opportunities for operational and efficiency improvements smart mining Safety and Environment Sustainable utilization of the assets Optimization of the material flows only feed needs to be hauled to the surface availability of backfilling material underground OPEX savings potential at ore haulage milling and flotation

12 SILVER MINE PROJECT FLOTATION PROCESS Crushing Milling Ag-Au-Pb Zn FeS Conventional flotation process Annual capacity of the plant 450 ktpy Produces three concentrates Ag-Au-Pb-concentrate tpy Zn-Ag-concentrate tpy FeS-concentrate tpy Ag production ca 1.5 Moz/year Au production ca oz/year Sotkamo Silver 12

13 XRT PRECONCENTRATING PROCESS XRT (X-Ray Transmission) Classifies ores according to their specific atomic density. Simple process Crushing and sieving of the fines Feeding to conveyor Analysis by XRT Pneumatic separation to Preconcentrated ore Rejected gangue

14 SORTING TEST PROCEDURE Sorting tests have been conducted with Outotec-Tomra XRT sorter The sample comprised of kg of Silver Mine ore which was divided into low and medium grade samples Tests were performed with 30 to 70 mm fraction Further development to sort also mm fraction to reduce the amount of unsorted fines which will be fed to the flotation with the preconcentrated ore Potential to apply optical sorting to separate the quartz vein fragments

15 OPERATING CONCEPT OF THE UNDERGROUND SORTING Preconcentrating process can be implemented underground to yield the maximum benefits Crushing plant Preconcentrating using Ore Sorter Storages Haulage of the ore to flotation plant Usage of the rejects to backfilling of the underground stopes Sotkamo Silver 15

16 Silver Mine Project since the discovery in the early 1980 s The first phase of the investigations until early 1990 s Drilling of ca. 47 km of diamond drill core Mining of 2.6 km decline and ventilation shaft down to depth of 350 meters Extensive investigations were conducted Restart in 2006 by the current operator Has acquired land (430 hectares) Further drilling of ca 10 km of diamond drill core Has applied and received all the necessary permits and licenses Further investigations, planning and works Final financing ongoing, remaining total investment ca. 35 MEur Total investment to date ca. 30 MEur

17 SOTKAMO SILVER HAS SUBSTANTIAL GROWTH POTENTIAL Prospects of Sotkamo Silver Oy in Tipasjärvi Greenstone Belt area; aeromagnetic low altitude Prospects map, picture of width Sotkamo 22km Silver Oy in Tipasjärvi Greenstone Belt area; aeromagnetic low altitude map, picture width 22km

18 SILVER MINE PROJECT MINE PLAN Sotkamo Silver 18

19 Sotkamo Silver Deposits and Projects Sotkamo Silver develops silver, gold and zinc deposits in the Nordic region: Silver Mine Project Including exploration targets at the Tipasjärvi Greenstone Belt Gold prospects at the Tampere area Hopeavuori as the most advanced Mo I Rana project in Norway VMS type Zn-Cu-Pb-Ag-Aumineralizations Historically, the Mofjellet mine produced 4.35 Mt of ore at average grade of 3.6 % Zn, 0.7 % Pb and 0.3 % Cu Sotkamo Silver Mo I Rana Silver Mine Tampere 19

20 Mineral Resource and Ore Reserve Mineral Resource as at Jan 2014 (cut-off 50 g/t Ag) Mt Ag (g/t) Au (g/t) Zn (%) Pb (%) Measured Indicated Inferred Ore Reserve as at Jan 2016 (cut-off 30 Eur/t NSR) Mt Ag (g/t) Au (g/t) Zn (%) Pb (%) Proven + Probable Sotkamo Silver 20

21 POTENTIAL IN MO I RANA, NORWAY Mofjellet South mine area - 5 mining licensees 3 M tonne mineral resources left in the old mine with 2,5 % zinc, 0,4 % lead and 0,3 % copper + gold and silver Access along 4 km long tunnel is available Great geological potential, with more than 200 known deposits of which 93 selected for further exploration. The area is very favourable for the rich and large volcanogenic massive sulphide ore deposits, so called VMS deposits Mine

22 Thank You for Your Attention