Lion Copper releases Nevada PEA backed by Rio Tinto technology

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Lion Copper and Gold Corp. [LEO-TSXV, LCGMF-OTCQB] has announced the positive results of a preliminary economic assessment at its Yerington Copper Project in Nevada. The PEA envisions an open pit mining strategy following by a heap leach operation enhanced by the application of Rio Tinto’s [RIO-NYSE] Nuton technologies for recovering cathode copper from sulfide materials, negating the need for concentrator, tailings impoundment and smelter operations.

“Given the multitude of advantages offered by Nuton compared to conventional sulfide processing, it serves as the project’s preferred and foundational approach, forming the cornerstone of this PEA. The PEA was completed with funding in accordance with the agreement between the company and Nuton LLC, a unit of Rio Tinto.

Lion Copper and Gold is advancing its flagship copper project at Yerington via an option agreement with Rio Tinto, a mining and metals giant with operations in 35 countries. It’s Nuton technologies offer the potential to economically unlock known low-grade copper sulfide resources, copper bearing waste and tailings and achieve higher recoveries on oxide and transitional material, allowing for a significantly increased copper production outcome.

“One of the key differentiators of Nuton is the potential to deliver leading environmental performance, including more efficient water usage, lower carbon emissions, and the ability to reclaim mine sites by reprocessing mine waste,’’ Lion Copper has said.

Under a March, 2022, option agreement Rio Tinto has the right to earn a 65% interest in Lion’s copper assets in Mason Valley, Nevada. They consist of 34,494-acres of land, including the historic Yerington mine, greenfield MacArthur Project, Wassuk property, the Bear deposit and associated water rights.

In addition, Rio Tinto agreed to evaluate the potential deployment of its Nuton technologies at the site.

Under stage one of the deal, Rio Tinto agreed to pay up to US$4.0 million for an exclusive earn-in option and agreed-upon Mason Valley study and evaluation works to be completed by Lion by the end of 2022.

Assuming it elected to proceed with Stage 2, the mining giant pledged to pay up to US$5.0 million for agreed-upon Mason Valley study and evaluation works within 12 months of the date that the parties agreed upon the scope of the Stage 2 work.

Based on the results of stages 1 and 2, Rio Tinto has the option to fully-fund a feasibility study and ancillary work at a cost of US$50 million.

The PEA envisages an initial capital spend of US$413 million, including all mine pre-production costs, with sustaining capital of US$653 million. It also forsees 12-year-open pit mine life encompassing operations at Yerington and MacArthur, with projected lifetime copper production of 1.4 billion pounds, averaging 117 million pounds annually. The average cash operating cost is expected to be US$2.20 per pound of payable copper.

The PE merges the Yerington and MacArthur projects into a cohesive, integrated mining operation. The development strategy begins with the reprocessing of legacy rock stockpiles and tailings at the Yerington mine, followed by mining activities within the base of the legacy Yerington pit, once the pit has been dewatered.

On Tuesday, Lion Copper shares were priced at $0.08. The shares trade in a 52-week range of 11.5 cents and $0.065.

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