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Home > News > Magna Mining PEA predicts...

Magna Mining PEA predicts 13-year life for Crean Hill Project

Sep 17, 2024


Magna Mining Inc. is pleased to announce the successful completion of its Updated Preliminary Economic Assessment ("PEA") by SGS Geological Services (SGS) on its 100% owned Crean Hill Project (the "Project") located in Sudbury, Ontario. 

The PEA envisions an underground only mining operation, with Life of Mine ("LOM") potentially mineable resource being sold to a third-party existing mill in Sudbury. Underground mining would be initiated with a 15-month Advanced Exploration ("AdEx") program followed by a 12-month pre-production ramp-up period and 13 years of commercial production. Initial mining will be done with ramp access via a new surface portal with the eventual rehabilitation and re-establishment of the historic #2 shaft for personnel access and hoisting as mining progresses deeper. 

Note: All dollar values are reported in Canadian Dollars unless otherwise stated.

2024 PEA Highlights

  • Low pre-production capital cost of $27.7M following AdEx period;

  • Payback of pre-production period capital within the first year of commercial production, and payback of all capital including AdEx period capital within the second year of commercial production; 

  • Underground average production rate of 2,200 tonnes per day ("tpd") consisting of 1,650 tpd of higher-margin primary feed and 550 tpd of lower grade, incremental feed; 

  • Pre-tax NPV (8%) of $265.3 million and an Internal Rate of Return ("IRR") of 142% at conservative metal prices.

Magna Mining COO Jeff Huffman commented: "This updated Preliminary Economic Assessment focuses efforts on a high margin, underground-only mine plan. A low capital approach of establishing a new surface portal will provide quick access to the resource, allowing us to offset capital costs with early revenues. This PEA also benefits from increased certainty on third party processing terms. The project timeline has been derisked by having environmental permits approved and in-hand, as well as more detailed stope planning and sequence optimization. The PEA metal pricing assumptions have been updated to reflect a more conservative long term nickel price. We are excited and encouraged by the results of this PEA and look forward to continuing to advance the Crean Hill Project". 

The primary feed is designed to ensure rapid payback and minimize upfront capital requirements while simultaneously mitigating the potential impact of low metal prices. The lower cut-off grade of incremental material allows more complete extraction of the resource and the two-pronged nature of the mining sequence facilitates lower-cost extraction of the incremental material.

Financial Analysis

The Crean Hill PEA uses metal prices of US$ 8.50/lb nickel, US$ 4.00/lb copper, US$ 13.00/lb cobalt, US$ 900/oz platinum, US$ 1000/oz Palladium, US$ 2,150/oz gold, and a 1.35 C$/US$ exchange rate as outlined in Table 2.

The Base Case generates a pre-tax NPV (8%) of $265.3 million and an Internal Rate of Return ("IRR") of 142%, after-tax NPV (8%) is $194.1 million, with an IRR of 129%.



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