Sandfire Resources America Announces Results of Updated Pre-Feasibility Study for the Johnny Lee Deposit and Updated Mineral Resource for the Lowry Deposit at the Black Butte Copper Project

Core Insights - The updated Preliminary Feasibility Study (PFS) for the Johnny Lee Deposit highlights significant high-grade underground copper potential, with a Probable Mineral Reserve of 9.5 million tonnes at 2.9% copper, equating to 270,000 tonnes of copper, supporting an 8-year mine life at the Black Butte Copper Project in Montana, USA [1][5][6] Project Overview - The Black Butte Copper Project encompasses 8,078 hectares, including 7,684 hectares of fee simple lands and 1,040 unpatented mining claims, located in south-central Montana, 27 km north of White Sulphur Springs [8] - The Johnny Lee Deposit is the cornerstone of the project, discovered in 1985, consisting of two mineralization zones: the upper copper zone (JL UCZ) and the lower copper zone (JL LCZ) [9][10] Economic Analysis - The construction capital cost is estimated at US$474 million, with average annual post-tax cash flows projected at US$78 million for the first five years [4][5] - The project is expected to generate US$2.3 billion in gross revenue and US$1.0 billion in pre-tax net cash flow, based on a copper price of US$4.70 per pound [5] - The pre-tax NPV at an 8% discount rate is estimated at US$143 million with an IRR of 13.6%, while the post-tax NPV is US$99 million with an IRR of 11.3% [18] Mineral Resource Estimates - The updated Measured and Indicated Mineral Resource for the Johnny Lee Deposit is 18.9 million tonnes at 2.4% copper, containing 462,000 tonnes of copper, with an Inferred Mineral Resource of 3.4 million tonnes at 1.9% copper, containing 64,000 tonnes of copper [5][52] - For the Lowry Deposit, located approximately 3 km southeast of the Johnny Lee Deposit, the updated Measured and Indicated Resource is 6.6 million tonnes at 2.4% copper, containing 154,000 tonnes of copper, and an Inferred Mineral Resource of 2.8 million tonnes at 2.1% copper, containing 58,000 tonnes of copper [7][36] Mining and Processing - The mining method for the Johnny Lee Deposit will utilize a drift and fill approach, with a processing plant designed to produce approximately 35,000 tonnes of contained copper annually during the initial four years of operation [12][53] - The project anticipates an average annual production of approximately 29,000 tonnes of copper metal over the 8-year mine life, with a direct operating cash cost (C1) of US$2.56 per pound [5][18] Environmental and Legal Considerations - The project has undergone rigorous environmental assessments, with a positive record of decision from the Montana Department of Environmental Quality (MT DEQ) allowing for development and underground mining [10][11] - The Montana Supreme Court recently ruled in favor of the company, reinstating the Mine Operating Permit, which allows the project to proceed without further legal challenges [11][75][77] Future Outlook - The company aims to advance the project towards the completion of a feasibility study, emphasizing a commitment to responsible mining practices that will provide long-term economic benefits to the local community and shareholders [6][8]