July 29, 2016 – Sydney, Australia – Heron
Resources Ltd. (TSX: HER; ASX: HRR) ("Heron" or the "Company")
announces its quarterly activities for the three months ended June
30, 2016. Details of the Company's results are contained in the
filing “Heron Resources Limited Quarterly Report June 2016” which
is available on SEDAR at www.sedar.com and the Company's website
www.heronresources.com.au
June Quarter 2016 Highlights
- Cash and Cash Equivalents – At June 30, 2016
Heron held A$22.8M in cash (including A$0.2M in bonds) and A$1.7M
in investments
- Commodity market - fundamentals continue to
strengthen for zinc, with zinc prices hitting a 12 month high in
July
- Woodlawn Zinc-Copper Project:
Feasibility Study: on 29 June 2016 the Company
announced the results of the Woodlawn Feasibility Study (FS). The
complete NI 43-101 Technical Report in support of the FS study was
published on Heron’s website and lodged on SEDAR www.sedar.com
(TSX:HER) on 26 July 2016. The key outcomes of this study
include:
Attractive project characteristics
- Initial 9.3 year mine life based upon the combined underground
and tailings Mineral Reserves (“Starter Case”)
- Campaign processing rate of up to 1.0Mtpa from underground
mining, and up to 1.5Mtpa from reclaiming tailings, processed
through a standard single-sulphide flotation facility
- Steady-state (2020-2023) annual Production Target of 40kt Zn,
10kt Cu, 12kt Pb, 900koz Ag and 4koz Au contained within zinc,
copper, and lead concentrates
- Project is totally contained upon granted Special Mining Lease
SML20 – Woodlawn is fully ‘permitted’ and ‘mine ready’
- Utilising existing local and regional infrastructure to achieve
significant reductions in development costs
- Close proximity to large service and employment centres
(Sydney, Wollongong, Canberra, Goulburn)
- Strong local community and regulator support
- Inferred Mineral Resources defined in both the underground and
tailings projects demonstrate excellent potential to extend mine
life to more than 11.5 years
Mineral Resources & Mineral Reserves
- Underground mine plan focused on the shallower areas of the
deposit reflecting the success of the recent Preliminary Economic
Assessment (PEA) & FS drilling programs. There is a high level
of confidence based on historic data for extensions to this
mineralisation both at-depth and along strike
- Two separate production sources, mining from underground and
reclaiming of tailings, provides operational flexibility and
reduces risk
- 20 years of historical operational data removes ‘greenfield’
unknowns
Robust economics
- C1 costs of US$-0.05/lb zinc and C3 of US$0.34/lb expected to
place Woodlawn firmly in the lower half of the cost curve
- Attractive capital cost metrics based on annual metal
Production Targets and Reserves-based mine life
- Life extension case (PEA equivalent mine plan) shows excellent
consistency with previously published PEA
- Significant leverage to the price outlook for zinc, which
comprises approximately 48% of total payable metal value
Expedited development and financing pathway to meet
market opportunity
- The Company has commenced a structured project funding process
with the assistance of Azure Capital and is targeting finalisation
in the later part of 2016
- A number of optimisation opportunities that have the potential
to further enhance the project outcomes were identified during the
FS program. A number of these options will be pursued in parallel
to the funding and include aspects such as equipment sourcing
alternatives and additional shallow mineralised positions
- Rapid development schedule of 15 months from commencement of
construction until completion of wet commissioning
- First production targeted early 2018 to meet projected
favourable zinc market conditions
Phase III Exploration Drill
Program Commenced
- A step-out drill program commenced in early July, with the
first hole (WNDD0105) intersecting 1.2m of polymetallic massive
sulphides in a 4.5m zone of sulphidic mineralisation from 538m
depth – assays are pending. Down hole electro-magentics (DHEM) is
planned to delineate potential conductors prior to further
drilling. This intercept confirms the extension of the B Lens
horizon in this northerly direction, and lends support to the
potential for further discovery.
- A number of holes are also planned to test for, and in-fill,
shallow mineralised positions which could add to the Mineral
Reserves for the early years of the production schedule
Woodlawn Zinc-Copper Project
Heron’s primary development project is the high grade Woodlawn
Zinc-Copper Project located 250km southwest of Sydney, New South
Wales. The project consists of both a high grade underground and a
large medium grade tailings resource. The development approach
envisages the construction of a single 1.5Mtpa processing plant
capable of treating material from both sources. Planned production
will see the generation of three separate base metal concentrates
(zinc, copper and lead) with associated precious metal credits. In
addition, the project is very well supported by excellent
infrastructure, an existing mining lease and state government
development approvals.
Woodlawn is expected to become an important Australian near term
zinc producer delivering concentrates into a market with strong
supply and demand fundamentals underpinning a strong commodity
price.
About Heron Resources
Heron is engaged in the exploration and development of base and
precious metal deposits in Australia. In addition to the high grade
Woodlawn Zinc-Copper Project, the Company holds a significant
property holding in the Lachlan Fold Belt of New South Wales and
the Kalgoorlie Nickel Project in Western Australia.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING
INFORMATION
This news release contains forward-looking statements and
forward-looking information within the meaning of applicable
Canadian securities laws, which are based on expectations,
estimates and projections as of the date of this news release. This
forward-looking information includes, or may be based upon, without
limitation, estimates, forecasts and statements as to management’s
expectations with respect to, among other things, the timing and
amount of funding required to execute the Company’s exploration,
development and business plans, capital and exploration
expenditures, the effect on the Company of any changes to existing
legislation or policy, government regulation of mining operations,
the length of time required to obtain permits, certifications and
approvals, the success of exploration, development and mining
activities, the geology of the Company’s properties, environmental
risks, the availability of labour, the focus of the Company in the
future, demand and market outlook for precious metals and the
prices thereof, progress in development of mineral properties, the
Company’s ability to raise funding privately or on a public market
in the future, the Company’s future growth, results of operations,
performance, and business prospects and opportunities. Wherever
possible, words such as “anticipate”, “believe”, “expect”,
“intend”, “may” and similar expressions have been used to identify
such forward-looking information. Forward-looking information is
based on the opinions and estimates of management at the date the
information is given, and on information available to management at
such time. Forward-looking information involves significant risks,
uncertainties, assumptions and other factors that could cause
actual results, performance or achievements to differ materially
from the results discussed or implied in the forward-looking
information. These factors, including, but not limited to, the
ability to implement the Woodlawn Zinc-Copper Project Feasibility
Study on time or at all, fluctuations in currency markets,
fluctuations in commodity prices, the ability of the Company to
access sufficient capital on favourable terms or at all, changes in
national and local government legislation, taxation, controls,
regulations, political or economic developments in Canada,
Australia or other countries in which the Company does business or
may carry on business in the future, operational or technical
difficulties in connection with exploration or development
activities, employee relations, the speculative nature of mineral
exploration and development, obtaining necessary licenses and
permits, diminishing quantities and grades of mineral reserves,
contests over title to properties, especially title to undeveloped
properties, the inherent risks involved in the exploration and
development of mineral properties, the uncertainties involved in
interpreting drill results and other geological data, environmental
hazards, industrial accidents, unusual or unexpected formations,
pressures, cave-ins and flooding, limitations of insurance coverage
and the possibility of project cost overruns or unanticipated costs
and expenses, and should be considered carefully. Many of these
uncertainties and contingencies can affect the Company’s actual
results and could cause actual results to differ materially from
those expressed or implied in any forward-looking statements made
by, or on behalf of, the Company. Prospective investors should not
place undue reliance on any forward-looking information. Although
the forward-looking information contained in this news release is
based upon what management believes, or believed at the time, to be
reasonable assumptions, the Company cannot assure prospective
purchasers that actual results will be consistent with such
forward-looking information, as there may be other factors that
cause results not to be as anticipated, estimated or intended, and
neither the Company nor any other person assumes responsibility for
the accuracy and completeness of any such forward-looking
information. The Company does not undertake, and assumes no
obligation, to update or revise any such forward-looking statements
or forward-looking information contained herein to reflect new
events or circumstances, except as may be required by law.
No stock exchange, regulation services provider,
securities commission or other regulatory authority has approved or
disapproved the information contained in this news
release
Australia:
Mr Wayne Taylor
Managing Director and Chief Executive Officer
Tel: +61 2 9119 8111 or +61 8 6500 9200
Email: heron@heronresources.com.au
Canada:
Tel: +1 647 862 1157 (Toronto)
cmuir@heronresources.com.au
www.heronresources.com.au
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