TORONTO, ONTARIO — (Marketwire) — 08/10/12 — Advanced Explorations Inc. (TSX VENTURE: AXI)(FRANKFURT: AE6)(the „Company“ or „AEI“) is pleased to announce positive results of its Feasibility Study („FS“) conducted on the C Zone of its Roche Bay Iron Project. The FS has been completed by TetraTech Wardrop („TetraTech“) and confirms that the project has a Net Present Value of US $642 million (pre-tax). The complete report will be filed by the authors on SEDAR within 45 days of this press release.
Highlights of the Roche Bay Iron Project Feasibility Study:
John Gingerich, president & CEO, commented:
„The completion of our Feasibility Study marks a significant milestone for the Company, and lays a clear foundation for the path forward to production. The positive economics at this initial modest start-up production rate demonstrate that we have an excellent project with substantial opportunities for expansion and to further lower the operating cost using power solutions such as Liquefied Natural Gas (LNG). The location of the project at tidewater and its consequent low infrastructure requirements promote future expansion and lower operational and construction risks, which compares favourably with many projects in Brazil, Australia and Canada. We are well positioned to become a globally competitive, low cost producer and are on our way to become one of the lowest cost iron ore producers in North America“.
Project Overview
The Roche Bay Iron Project is situated on the east coast of the Melville Peninsula, approximately 60km southwest of the community of Hall Beach, and approximately 240 km west of Iqaluit, Nunavut. The C Zone ore body is located approximately 6 km from tidewater where the project has a natural deep water harbour (+20m depth) capable of accepting large Cape-size vessels. The proximity to tidewater provides for significant operational and construction advantages. The objectives of the current Feasibility Study for the Roche Bay C Zone project include the definition of an initial start-up operation comprising a 5.5 million tonne Fe concentrate production facility producing a high quality, globally marketable concentrate, ideally suited for pellet plants and other customer markets.
Key elements of the project include:
The current mineral resource for the project-s C Zone includes 501 million tonnes in the Indicated category averaging 26.35% total iron at a 20% iron cut-off grade.
A further 66 million tonnes averaging 26.37% total iron at a 20% iron cut-off remains in the Inferred category.
CAPEX
Pre-production capital costs amount to U.S. $1.24 billion (contingency not included). Total pre-production capital costs (including 10% contingency) are U.S. $1.37 billion and are summarized in Table 1 below.
OPEX
Total operating costs per tonne of iron concentrate amount to U.S. $49.13 and are summarized in Table 2 below.
Financial Analysis
The financial analysis used in the FS is based on the assumption that pre-production/pre-stripping (mine) would begin in 2015 with a mine life of 15 years.
Project Opportunities
In addition to the above, the Company believes that significant opportunities exist to add value by considering the following:
Qualified Persons
The Qualified Persons responsible for the Feasibility Study include the following number of specialist service groups and sub-consultants.
The Feasibility Study is based on the review of technical studies performed to this date. The Feasibility Study also includes expert contributions including EBA Consulting Inc., PND Engineers Inc., Raw Materials Group, Golder Associates Ltd. and Tetra Tech Inc., and was overall reviewed for its technical content by Tetra Tech Inc. under the direction of Mr. Paul Souter, P. Eng. As the Company-s Independent Qualified Person, Mr. Paul Souter, P.Eng. has also reviewed the contents of this release. The resource and geology sections are based upon AEI-s most recent NI 43-101 Technical Report which Golder Associates Ltd. authored and filed on SEDAR March 6, 2012. Bernie Swarbrick, B.Sc., MBA, Vice President of Capital Projects and Studies for Advanced Explorations Inc., is a Qualified Person within the meaning of NI 43-101 and has reviewed and approved the contents of this press release.
ON BEHALF OF THE BOARD
John Gingerich, President & CEO
ABOUT Advanced Explorations Inc.
The Ocean-based Roche Bay Project boasts an NI 43-101 compliant resource estimate of over 500 million tonnes outlined within a small portion of the potential 140 km of banded iron formation. Recently, the Company announced a positive outcome of the feasibility study for the project-s C-Zone. To date, AEI has delineated over 1 billion tonnes of iron under NI 43-101 among its Roche Bay and Tuktu deposits and continues to explore other targeted deposits in areas to the north, south and west of Roche Bay. The management team has extensive technical, exploration and Canadian Arctic mining expertise to effectively develop the high quality iron ore opportunities on the Melville Peninsula.
This news release also includes forward-looking statements that involve a number of risks and uncertainties. The information reflects numerous assumptions as to industry performance, general business and economic conditions, regulatory and legal requirements, taxes and other matters, many of which are beyond the control of the company. Similarly, this information assumes certain future business decisions that are subject to change. There can be no assurance that the results predicted here will be realized. Actual results may vary from those represented, and those variations may be material.
This news release does not constitute an offer to sell or a solicitation of an offer to sell any securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the „U.S. Securities Act“) or any state securities laws and may not be offered or sold within the United States or to U.S. Persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.
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Contacts: Advanced Explorations Inc. (416) 203-0057 x226
