A. Resource estimation and PEA level studies are completed by independent engineering firms and provide shareholders and the investing public confidence in the stage and valuations related to the projects.
In 2013 Copper Fox completed a feasibility study on the Schaft Creek project that yielded (on a 100% basis) an after-tax discounted value of $US64 million. While this was considered a positive, the project valuation was substantially below that required for a sanction decision but sufficient to warrant further investment to investigate project optimization. The 2021 PEA was based on the results of the work programs completed by Teck, as Operator of the Schaft Creek Joint Venture, and yielded a $US842 million after tax discounted value of the project. The PEA also provided Copper Fox an opportunity to provide its shareholders and investing public updated technical and financial information for the project. Going forward, the Schaft Creek Joint Venture is focussing on improving metallurgical recoveries, reducing the Life of Mine strip ratio, reducing the pre-production timeline and pursuing additional project enhancements to increase project valuation. With a 133ktpd throughput scenario, Schaft Creek is one of the largest development stage projects that would be of considerable interest to all large copper producers, including Teck.
Since the acquisition of the Van Dyke project our work programs have continually advanced the geological understanding of the deposit and increased the total contained copper, resulting in a higher confidence in the resource model. Increases in soluble copper content within the deposit, higher metallurgical recoveries, and the updated geological model strongly indicates the potential to increase the project valuation, providing the Company the confidence in the business opportunity. For example, the 2015 PEA at $US3.00/lb copper, yielded an after tax discounted valuation of $US149 million whereas the 2020 PEA at $US3.15/lb copper yeilded an after tax value of $US645 million.