Stornoway Diamond Corporation (TSX:SWY)
(the "Corporation" or "Stornoway") is pleased to
announce that it has filed an updated Technical Report under
National Instrument ("NI") 43-101 – Standards for Disclosure for
Mineral Projects following the publication of the updated Renard
Mineral Resource Estimate on September 24, 2015.
The Renard Mineral Resource Estimate, effective September 2015,
stands at 30.2 million carats of Indicated Mineral Resources
(representing 42.6 million tonnes at an average 71 carats per
hundred tonnes, or "cpht") and 13.3 million carats of Inferred
Mineral Resources (representing 24.5 million tonnes at an average
54 cpht). These resources are contained within the Renard 2, 3, 4,
65, and 9 kimberlite pipes and the Lynx and Hibou kimberlite dykes
(Tables 1 and 2). Mineral resources that are not mineral reserves
do not have demonstrated economic viability.
The technical report also includes a description of the
exploration potential at the Renard Project in the form of Targets
for Further Exploration ("TFFE"). This includes, for the first
time, an assessment of the potential of the Renard 1, 7 and 10
kimberlite pipes to provide future Mineral Resources. These
kimberlite bodies, originally discovered in 2001 and 2003, are
located between 2 and 4 kilometers north of the Renard mine site
and sufficient diamond drilling, microdiamond assessment, and
geological modeling has now been completed to allow their potential
to be assessed. Utilizing "Low" and "High" ranges of TFFE for each
body, this is 1.7 to 3.9 million carats for Renard 1 (8.6 to 13.0
million tonnes at 20 to 30 cpht), 1.9 to 3.8 million carats in
Renard 7 (6.3 to 9.4 million tonnes at 30 to 40 cpht) and 0.7 to
2.1 million carats in Renard 10 (1.2 to 1.7 million tonnes at 60 to
120 cpht). Based on new geological and geochemical data, the
exploration potential of the Hibou dyke has been increased to 3.6
to 6.1 million carats (3.5 to 4.0 million tonnes at 104 to 151
cpht). In total, the exploration potential of the Renard Project in
the form of TFFE is 33.0 to 71.1 million carats within 76.2 to
113.2 million tonnes, with grades ranging variously by body from a
low of 20 cpht to a high of 168 cpht. The potential quantity and
grade of any exploration target is conceptual in nature, there has
been insufficient information to define a mineral resource and it
is uncertain if further exploration will result in it being
delineated as a mineral resource.
Support materials that illustrate the updated Renard Mineral
Resource Estimate, effective September 2015, can be found on
Stornoway's website at www.stornowaydiamonds.com.
Table 1: Renard NI 43-101 2015 Mineral Resource
Estimate
Changes from July 2013 Mineral Resource estimate shown in
italics
Indicated Mineral
Resources(1,2,4) |
|
Contained Carats
(millions) |
Tonnes
(millions) |
Grade
(cpht)(3) |
Renard 2, All Units |
21.58 |
+15.6% |
25.70 |
+38.3% |
84 |
-16.4% |
Renard 2, w/o CRB-2A,
CRB |
20.39 |
+11.0% |
20.52 |
+15.9% |
99 |
-4.3% |
CRB-2A |
0.29 |
+2.6% |
0.90 |
+2.6% |
32 |
-- |
CRB |
0.90 |
n/a |
4.28 |
n/a |
21 |
n/a |
Renard 3 |
1.86 |
+2.3% |
1.82 |
+3.4% |
102 |
-1.0% |
Renard 4 |
4.44 |
+3.0% |
7.25 |
-- |
61 |
+3.0% |
Renard 65 |
2.30 |
-- |
7.87 |
-- |
29 |
-- |
Total Indicated
Mineral Resources |
30.17 |
+11.4% |
42.63 |
+20.2% |
71 |
-7.4% |
|
|
|
|
|
|
|
Inferred Mineral
Resources(1,2) |
|
Contained Carats
(millions) |
Tonnes
(millions) |
Grade
(cpht)(3) |
Renard 2, All Units |
3.88 |
-48.0% |
6.59 |
-44.0% |
59 |
-7.2% |
Renard 2, w/o CRB |
3.36 |
-46.1% |
4.08 |
-22.0% |
82 |
-30.9% |
CRB |
0.53 |
-57.6% |
2.51 |
-61.6% |
21 |
+10.5% |
Renard 3 |
0.61 |
-- |
0.54 |
-- |
112 |
-- |
Renard 4 |
2.46 |
+3.5% |
4.75 |
-- |
52 |
+3.5% |
Renard 65 |
1.18 |
-- |
4.93 |
-- |
24 |
-- |
Renard 9 |
3.04 |
-- |
5.70 |
-- |
53 |
-- |
Lynx |
1.92 |
-- |
1.80 |
-- |
107 |
-- |
Hibou |
0.26 |
-- |
0.18 |
-- |
144 |
-- |
Total Inferred
Mineral Resources |
13.35 |
-20.8% |
24.49 |
-17.50% |
54 |
-4.0% |
Notes |
|
|
|
|
|
|
1 Resource categories
follow the CIM Standards for Mineral Resources and Mineral
Reserves. |
|
|
|
2 Totals may not add
due to rounding. |
|
|
|
|
|
|
3 Carats per hundred
tonnes.Estimated at a +1 DTC sieve size cut-off. |
|
|
|
|
4 Diamond valuation
data utilized for the test of prospects of reasonable economic
extraction are derived from a diamond valuation exercise undertaken
in March 2014 (see Stornoway Annual Information Form dated July
2015). |
Table 2: Renard Targets for Further
Exploration
Changes from July 2013 shown in italics
Target
for Further Exploration(1,2) |
|
Contained
Carats (millions) |
Tonnes
(millions) |
Grade
(cpht)(3) |
Renard
1 |
1.7 |
to |
3.9 |
8.6 |
to |
13.0 |
20 |
to |
30 |
Renard 2, All
Units |
3.7 |
to |
15.5 |
6.1 |
to |
15.5 |
60 |
to |
100 |
Renard
3 |
3.5 |
to |
6.3 |
3.4 |
to |
3.8 |
105 |
to |
168 |
Renard
4 |
5.6 |
to |
11.8 |
11.1 |
to |
15.4 |
50 |
to |
77 |
Renard
65 |
7.3 |
to |
13.5 |
29 |
to |
40.9 |
25 |
to |
33 |
Renard
7 |
1.9 |
to |
3.8 |
6.3 |
to |
9.4 |
30 |
to |
40 |
Renard
9 |
2.0 |
to |
4.3 |
3.9 |
to |
6.3 |
52 |
to |
68 |
Renard
10 |
0.7 |
to |
2.1 |
1.2 |
to |
1.7 |
60 |
to |
120 |
Lynx |
3.0 |
to |
3.8 |
3.1 |
to |
3.2 |
96 |
to |
120 |
Hibou |
3.6 |
to |
6.1 |
3.5 |
to |
4.0 |
104 |
to |
151 |
Total
TFFE |
33.0 |
to |
71.1 |
76.2 |
to |
113.2 |
|
|
|
|
28% |
|
40% |
49% |
|
51% |
|
|
|
Notes |
|
|
|
|
|
|
|
|
|
1 Target for Further
Exploration: represents potential upside that can be reasonably
assumed given the nature and grade of material within the current
2015 Mineral Resource. The Renard 2 shape has been projected 250m
below the deepest kimberlite intersection at 1,000m depth. Tonnage
and grade ranges are not directly applicable to potential total
carats. |
2 Totals may not add
due to rounding. |
|
|
|
|
|
|
|
|
3 Carats per hundred
tonnes.Potential at a +1 DTC sieve size cut-off. |
|
|
|
|
|
|
About the Renard Diamond Project
The Renard Diamond Project is located approximately 250 km north
of the Cree community of Mistissini and 350 km north of Chibougamau
in the James Bay region of north-central Québec. On July 8th 2014
Stornoway announced the completion of a $946 million1 project
financing transaction to fully fund the project to production, and
construction commenced on July 10th, 2014. First ore is scheduled
to be delivered to the plant in the second half of 2016 with
commercial production scheduled for the 2nd quarter of 2017. In
January 2013, Stornoway released the results of an Optimized
Feasibility Study at Renard which highlighted the potential of the
project to become a significant producer of high value rough
diamonds over a long mine life. Probable Mineral Reserves, as
defined in NI 43-101, stand at 17.9 million carats. Total Indicated
Mineral Resources as at September 2015, inclusive of the Mineral
Reserve, stand at 30.2 million carats, with a further 13.35 million
carats classified as Inferred Mineral Resources, and 33.0 to 71.1
million carats classified as non-resource exploration upside.
Average annual diamond production is forecast at 1.6 million
carats/year over the first 11 years of mining, at an average
valuation of US$190/carat based on a March 2014 assessment by WWW
International Diamond Consultants Ltd. Readers are cautioned that
the potential quality and grade of any target for further
exploration is conceptual in nature, there has been insufficient
exploration to define a Mineral Resource and it is uncertain if
further exploration will result in the target being delineated as a
Mineral Resource. All kimberlites remain open at depth. Readers are
referred to the technical report dated February 28th, 2013 in
respect of the January 2013 Optimization Study for further details
and assumptions relating to the project. Disclosure of a scientific
or technical nature in this press release was prepared under the
supervision of Patrick Godin, P.Eng. (Québec), Chief Operating
Officer and Robin Hopkins, P.Geol. (NT/NU), Vice President,
Exploration, both "qualified persons" under NI 43-101. Darrell
Farrow, PrSciNat, P.Geo.(BC), Ordre des geologues du Quebec
(Special Authorisation # 332) of GeoStrat Consulting Services Inc.
is the independent Qualified Person responsible for preparation of
the mineral resource estimate for the Renard Diamond Project.
GeoStrat Consulting Services Inc, a mineral resources consultancy,
focuses on client interaction and involvement in developing
resource models, and has experience in exploration, geological
modeling, resource evaluation, production, resource reconciliation
and accounting of diamond deposits around the globe. GeoStrat has
verified the results disclosed herein with respect to the mineral
resources, and has conducted appropriate verification on the
underlying data, including visitations to the Renard site and the
primary process laboratories.
1 For illustrative purposes. Assumes a C$: US$ conversion rate
of $1.10. Actual proceeds of each financing tranche are measured at
the C$: US$ exchange rate in effect the date the funds are
received.
About Stornoway Diamond Corporation
Stornoway is a leading Canadian diamond exploration and
development company listed on the Toronto Stock Exchange under the
symbol SWY and headquartered in Montreal. Our flagship asset is the
100% owned Renard Diamond Project, on track to becoming Québec's
first diamond mine. Stornoway is a growth oriented company with a
world class asset, in one of the world's best mining jurisdictions,
in one of the world's great mining businesses.
On behalf of the Board STORNOWAY DIAMOND CORPORATION /s/ "Matt
Manson" Matt Manson President and Chief Executive
This press release contains "forward-looking information" within
the meaning of Canadian securities legislation. This information
and these statements, referred to herein as "forward-looking
statements", are made as of the date of this press release and the
Corporation does not intend, and does not assume any obligation, to
update these forward-looking statements, except as required by
law.
These forward-looking statements include, among others,
statements with respect to Stornoway's objectives for the ensuing
year, Stornoway's medium and long-term goals, and strategies to
achieve those objectives and goals, as well as statements with
respect to Stornoway's beliefs, plans, objectives, expectations,
anticipations, estimates and intentions. Although management
considers these assumptions to be reasonable based on information
currently available to it, they may prove to be incorrect.
Forward-looking statements relate to future events or future
performance and reflect current expectations or beliefs regarding
future events and include, but are not limited to, statements with
respect to: (i) the amount of Mineral Resources and
exploration targets; (ii) the amount of future production over
any period; (iii) net present value and internal rates of
return of the mining operation; (iv) assumptions relating to
recovered grade, average ore recovery, internal dilution, mining
dilution and other mining parameters set out in the 2011
Feasibility Study or the Optimization Study; (v) assumptions
relating to gross revenues, operating cash flow and other revenue
metrics set out in the 2011 Feasibility Study or the Optimization
Study; (vi) mine expansion potential and expected mine life;
(vii) expected time frames for completion of permitting and
regulatory approvals related to construction activities at the
Renard Diamond Project; (viii) the expected time frames for
the completion of the open pit and underground mine at the Renard
Diamond Project; (ix) the expected time frames for the completion
of construction, start of mining and commercial production at the
Renard Diamond Project and the financial obligations or costs
incurred by Stornoway in connection with such mine development;
(x) future exploration plans; (xi) future market prices
for rough diamonds; (xii) the economic benefits of using
liquefied natural gas rather than diesel for power generation;
(xiii) sources of and anticipated financing requirements;
(xiv) the effectiveness, funding or availability, as the case
may require, of the Stream, the Senior Secured Loan, the COF and
the Equipment Facility and the use of proceeds therefrom;
(xv) the Corporation's expectations regarding receipt of the
remaining deposits under the Stream and its ability to meet its
delivery obligations thereunder; and (xvi) the impact of the
Financing Transactions on the Corporation's operations,
infrastructure, opportunities, financial condition, access to
capital and overall strategy. Any statements that express or
involve discussions with respect to predictions, expectations,
beliefs, plans, projections, objectives, assumptions or future
events or performance (often, but not always, using words or
phrases such as "expects", "anticipates", "plans", "projects",
"estimates", "assumes", "intends", "strategy", "goals",
"objectives", "schedule" or variations thereof or stating that
certain actions, events or results "may", "could", "would", "might"
or "will" be taken, occur or be achieved, or the negative of any of
these terms and similar expressions) are not statements of
historical fact and may be forward-looking statements.
Forward-looking statements are made based upon certain
assumptions by Stornoway or its consultants and other important
factors that, if untrue, could cause the actual results,
performances or achievements of Stornoway to be materially
different from future results, performances or achievements
expressed or implied by such statements. Such statements and
information are based on numerous assumptions regarding present and
future business prospects and strategies and the environment in
which Stornoway will operate in the future, including the price of
diamonds, anticipated costs and Stornoway's ability to achieve its
goals, anticipated financial performance, regulatory developments,
development plans, exploration, development and mining activities
and commitments. Although management considers its assumptions on
such matters to be reasonable based on information currently
available to it, they may prove to be incorrect. Certain important
assumptions by Stornoway or its consultants in making
forward-looking statements include, but are not limited to:
(i) required capital investment and estimated workforce
requirements; (ii) estimates of net present value and internal
rates of return; (iii) receipt of regulatory approvals on
acceptable terms within commonly experienced time frames;
(iv) anticipated timelines for completion of construction,
commencement of mine production and development of an open pit and
underground mine at the Renard Diamond Project, which heavily
depend, among other things, on adequate availability and
performance of skilled labour, engineering and construction
personnel, performance of mining and construction equipment and
timely delivery of components; (v) anticipated geological
formations; (vi) market prices for rough diamonds and the
potential impact on the Renard Diamond Project; (vii) the
satisfaction or waiver of all conditions under each of the Stream,
the Senior Secured Loan, the COF and the Equipment Facility to
allow the Corporation to draw on the funding available under those
financing elements for the completion of the development and
construction of the Renard Diamond Project; (viii) Stornoway's
interpretation of the geological drill data collected and its
potential impact on stated Mineral Resources and mine life; (ix)
future exploration plans and objectives; and (x) the receipt
of the remaining deposits under the Stream and the Corporation's
ability to meet its delivery obligations thereunder. Additional
risks are described in Stornoway's most recently filed Annual
Information Form, annual and interim MD&A, and other disclosure
documents available under the Corporation's profile at:
www.sedar.com.
By their very nature, forward-looking statements involve
inherent risks and uncertainties, both general and specific, and
risks exist that estimates, forecasts, projections and other
forward-looking statements will not be achieved or that assumptions
do not reflect future experience. We caution readers not to place
undue reliance on these forward- looking statements as a number of
important risk factors could cause the actual outcomes to differ
materially from the beliefs, plans, objectives, expectations,
anticipations, estimates, assumptions and intentions expressed in
such forward-looking statements. These risk factors may be
generally stated as the risk that the assumptions and estimates
expressed above do not occur, including the assumption in many
forward-looking statements that other forward-looking statements
will be correct, but specifically include, without limitation:
(i) risks relating to variations in the grade, kimberlite
lithologies and country rock content within the material identified
as Mineral Resources from that predicted; (ii) variations in
rates of recovery and breakage; (iii) the uncertainty as to
whether further exploration of exploration targets will result in
the targets being delineated as Mineral Resources;
(iv) developments in world diamond markets; (v) slower
increases in diamond valuations than assumed; (vi) risks
relating to fluctuations in the Canadian dollar and other
currencies relative to the US dollar; (vii) increases in the
costs of proposed capital and operating expenditures;
(viii) increases in financing costs or adverse changes to the
terms of available financing, if any; (ix) tax rates or
royalties being greater than assumed; (x) uncertainty of
results of exploration in areas of potential expansion of
resources; (xi) changes in development or mining plans due to
changes in other factors or exploration results; (xii) changes
in project parameters as plans continue to be refined;
(xiii) risks relating to the receipt of regulatory approvals
or the implementation of the existing Impact and Benefits Agreement
with aboriginal communities; (xiv) the effects of competition
in the markets in which Stornoway operates; (xv) operational
and infrastructure risks; (xvi) execution risk relating to the
development of an operating mine at the Renard Diamond Project;
(xvii) failure to satisfy the conditions to the effectiveness,
funding or availability, as the case may require, of each of the
Stream, the Senior Secured Loan, the COF and the Equipment
Facility; (xviii) changes in the terms of the Stream, the
Senior Secured Loan, the COF or the Equipment Facility;
(xix) the funds of the Stream, the Senior Secured Loan, the
COF or the Equipment Facility not being available to the
Corporation; (xx) the Corporation being unable to meet its
delivery obligations under the Stream; (xxi) future sales or
issuances of Common Shares lowering the Common Share price and
diluting the interest of existing shareholders; and (xxi) the
additional risks described in Stornoway's most recently filed
Annual Information Form, annual and interim MD&A and
Stornoway's anticipation of and success in managing the foregoing
risks. Stornoway cautions that the foregoing list of factors that
may affect future results is not exhaustive, and new, unforeseeable
risks may arise from time to time.
CONTACT: For more information, please contact
Matt Manson (President and CEO) at 416-304-1026 x2101
or Orin Baranowsky (Director, Investor Relations)
at 416-304-1026 x2103 or toll free at 1-877-331-2232
Pour plus d'information, veuillez contacter
M. Ghislain Poirier, Vice-president Affaires
publiques de Stornoway au 418-254-6550,
gpoirier@stornowaydiamonds.com
Website: www.stornowaydiamonds.com
Email: info@stornowaydiamonds.com