Bunker Hill Remains On Schedule For Mine Restart In 2024

TORONTO - Bunker Hill Mining Corp.reported that concurrent with finalizing the engineering of the processing plant, the Company has now restarted construction work on site, and is on schedule and budget to restart mining operations by the end of 2024.

Sam Ash, CEO, said, “I am delighted to report that we have now restarted physical construction work on site, and that our post-financing project review affirms that we remain on track to start production in Q4 2024 in accordance with the existing budget. This aligns with our strategy of delivering a low capex restart to set a solid foundation to unlock significant value creation via subsequent optimization and exploration.”

The Russell Portal, constructed in the 1980s and located at the Wardner site, provides primary access to and egress from the initial mining areas at Level 4 of the underground. Following a competitive tender, this is being expanded by GMS Mine Repair and Maintenance Inc of Maryland from 10’ x 10’ dimensions to 16’ x 16’ dimensions to enable the most efficient haulage and vehicle passage during operations and is expected to be completed by early September 2023.

This will be followed in phases, over 6 months, by (i) refurbishment of the existing underground ramp between the 6 and 8 Levels, (ii) geotechnical stabilization of the ramp as it cuts through the Cate Fault between Levels 5 and 6, (iii) installation of final ventilation support, (iv) establishment of key underground facilities such as the maintenance shop, (v) connecting the underground mine to the power grid, and (vi) definition drilling of initial mining areas.

The Company has now completed the intended purchase of the additional mill capable of increasing production throughput capacity, as originally announced in the Company’s news release of September 20, 2022. The purchase and its subsequent move to the Bunker Hill site will enable the process plant engineering team to repurpose it as part of an upgraded comminution circuit.

Increased extra capacity provides the mine planners with an immediate upside opportunity to improve upon the economics of the existing 1,800 tpd restart plan and is being investigated as part of an ongoing business plan optimization process.

In accordance with the post-financing project schedule, Barr Engineering continues to advance final detailed engineering for the processing plant and expects this to be 100% complete in Q3 2023. The advanced status of this work has allowed the Company to issue a $3.5 million purchase order for the fabrication of the conveyor system to Rapat Corporation of Minnesota, and for procurement packages to be prepared for thickeners, inching drive, and 3rd zinc cleaner cell replacement.

Although PFS-level testwork validated 100 years of processing performance, sufficient to provide a solid basis for business planning/financing, further metallurgical test work is being conducted over next 3-6 months to optimize these initial recoveries and concentrate quality calculations, concurrent with additional studies designed to highlight additional processing plant optimization opportunities.

Work has started now to complete the power distribution upgrades at Wardner to provide new primary metered delivery to the underground mine at a maximum of 1.85 MW, and remove the need for diesel power in the underground environment. This will be followed by the completion of a feeder between the Bunker Hill and Big Creek Substations to allow for shifting of load between those key facilities.

To ensure adequate support to the processing operations at the main Kellogg site, the next phase will see the upgrade of the distribution system through the installation of new primary metered delivery capable of an initial maximum of 5.0 MW by August 2024, an additional 1.2 MW by August 2025 and a further 2.0 MW by August 2027. These upgrades will then be further enhanced with investments in load management and the construction of a larger transformer at the Bunker Hill site to ensure a dedicated feeder position to serve the mine.

In this way, Avista Utilities and Bunker Hill are working together to deliver low-cost, hydro-electric/green grid power for as low as 4.7 cents per KWh, thereby setting the conditions for the replacement of all diesel-powered equipment with modern electrical machinery at some time in the future.