Bunker Hill Mining Outlines Progress Towards Completing The PEA For Its Rapid Restart Program
TORONTO - Bunker Hill Mining Corporation reported continued progress towards completing its Preliminary Economic Assessment (PEA), aimed at assessing the potential to rapidly restart production at the historical Bunker Hill mine located in Idaho’s Silver Valley. Sam Ash, CEO, said, “We are pleased to report an update on progress towards completion of the PEA, with a number of key parameters taking shape. Engineering work to date based on our existing published resource, together with recently received drill results, continues to confirm the potential to realize our goal of rapidly restarting Bunker Hill as a profitable, sustainable, long-life underground operation.”
The PEA, led by Consulting Engineers from MineTech International LLC, is being conducted in accordance with National Instrument 43-101 (NI 43-01) and is expected to be based on an expanded resource due to further resources expected to be delineated following recently completed drilling. The PEA is expected to be published by early in the second quarter of 2021.
While engineering work, trade-off studies and economic analysis remains to be completed, the PEA is expected to contemplate a re-start with following parameters of low up-front capital costs through utilization of existing infrastructure, potentially enabling a rapid production re-start. MineTech is conducting a comprehensive review of existing infrastructure in the context of preliminary engineering designs and costing for restart capital, including areas of rehabilitation, electrical infrastructure, utility reticulation, ventilation, and material haulage. In addition, a review of the existing hoisting and shaft infrastructure is underway to engineer and evaluate options to access lower areas of the mine. Preliminary results indicate the potential for low up-front capital costs underpinned by: i) minimal development and rehabilitation work required to access initial stopes; ii) utilization of existing underground and surface infrastructure; iii) no de-watering requirement to commence re-start; iv) no requirement for above-ground tailings storage capacity; and v) no requirement for purchase of mobile equipment given the use of contract mining. Lastly, opportunity exists to offset initial capital costs during the re-start period with revenue from toll mining.
Given the presence of extensive existing infrastructure, the fully permitted status of the mine, and the above approach to the re-start, a potential re-start timeframe of less than two years is currently being contemplated.
Mine planning is advancing within the framework of three distinct stages to exploit the majority of the resource. Stage 1 will contemplate mining to the 11 level to exploit shallow resources located above the current water table. In Stage 2, higher-grade zinc resources extending to the 16 level could be accessed either through the existing shaft system, or alternatively through the construction of a new decline. Incremental investment in capital required for Stage 2 is contemplated to be financed from cash flow generated in Stage 1. A final Stage 3 will contemplate mining to the 23 level, facilitated through either shaft or ramp access.
Consistent with the Company’s objective of developing a sustainable operation with a low environmental footprint, the PEA will contemplate construction of an underground processing facility with a design capacity of approximately 1,500 tons per day. The majority of tailings generated from ore processing will be utilized for geotechnical paste back-fill, with the remaining material to be thickened and deposited in historic mine voids. As a result, the PEA will contemplate minimal surface disturbance and no requirement for above-ground tailings capacity.
Resource Development Inc. (RDI) has been engaged to design and conduct a metallurgical testing program, with assay results being incorporated into the geological and metallurgical models as received. Historical production has shown high recoverability of silver and base metals with approximately 87% silver recovery, 92% lead recovery and 93% zinc recovery. The ongoing metallurgical test program is designed to update and confirm these recoveries, and is expected to confirm extensive historical metallurgical data.
The preservation and enhancement of the water quality of the Coeur d’Alene lake is integral to the PEA and is fundamental to Bunker Hill management’s vision and strategy. As such, the Company is pleased to report that its underground pre-treatment facility is near completion, and has demonstrated the potential for removal of more than seventy percent of metal from effluent before it leaves the mine. Implementation of a successful long-term water management strategy will be contemplated in the PEA, consistent with the Company’s ongoing achievements. In addition, as outlined, utilization of underground processing and tailings deposition further contributes to minimizing the operation’s environmental footprint and surface disturbance activities.
The Company’s ongoing exploration program consists of 4,570 meters (15,000 feet) of diamond drilling from surface and underground focused on targets in the upper levels of the mine located in close proximity to existing infrastructure, aimed at expanding the resource base for the PEA. Drill results recently completed increase the Company’s confidence in its capacity to continue to grow the resource base.