Scoping Study Economics for the Toral Zn, Pb & Ag Project, Spain
Europa Metals Ltd
(Formerly Ferrum Crescent Limited)
(Incorporated and registered in Australia
and registered as an external company in
the Republic of South Africa)
(Registration number 4459850)
(External company registration number 2011/116305/10)
Share code on the ASX: EUZ
Share code on AIM: EUZ
Share code on the JSE: EUZ
("Europa" or “the Company”)
Not for distribution, in whole or in part, directly or indirectly, to United States newswire
services or dissemination in, into or from the United States (including its territories and
possessions, any State of the United States and the District of Columbia) or any jurisdiction
where to do so would constitute a violation of the relevant laws or regulations of such
Scoping Study Economics for the Toral Zn, Pb & Ag Project, Spain
Europa Metals, the European lead-zinc explorer, is pleased to announce the full independent scoping
study (the “Scoping Study”) in respect of its wholly owned Toral Project, located in the Castilla y León
region, Northwest Spain.
The Scoping Study is based upon the Inferred Resource estimate of 16 million tonnes at 7.5% Zinc
equivalent with Pb and Ag credits in accordance with JORC (2012), which will be the subject of further
investigation as part of the planned pre-feasibility and feasibility studies in due course. The full Scoping
Study is available on the Company’s website at www.europametals.com
The Scoping Study referred to in this announcement is a technical and economic investigation of the
viability of the Toral Project. It is based on low-level accuracy technical and economic assessments
(± 30% accuracy) and is insufficient to support estimation of Ore Reserves to provide assurance of
an economic development case at this stage or to provide certainty that the conclusions of the
Scoping Study will be realised. The Scoping Study is based on the material assumptions detailed in
the Scoping Study which have been carefully vetted and signed off by an independent expert. The
production target and forecast financial information referred to in this technical document is based
on JORC (2012) Inferred Mineral Resources. There is a low level of geological confidence associated
with Inferred Mineral Resources and there can be no certainty that further exploration work will result
in the determination of Indicated Mineral Resources or that the production target itself will be realised.
Further evaluation work in the form of a Feasibility Study is ongoing. To achieve the outcomes
specified in this Scoping Study initial funding in the order of USD33 million (input costs sourced from
similar operations and recognised and accepted mine cost databases, considered accurate to +/-
30%) is likely to be required. Investors should note that there can be no certainty that Europa Metals
will be able to raise funding when needed. It is also possible that funding may only be available on
terms that may be dilutive to or otherwise effect the value of Europa Metal’s shares.
This announcement complies with English and South African laws and the rules of AIM and JSE
respectively and is made under those laws and rules. The Scoping Study details the assumptions in
announcing forecast financial information for the Toral Project and the Company believes that there
is a reasonable basis (as that term is defined under English and South African law) for announcing
forecast financial information. Investors are urged to read the Scoping Study in full and to seek
independent advice where appropriate.
To the fullest extent possible Europa Metals and its Directors expressly disclaim any liability arising
under any law outside England and South Africa. Specifically, persons resident in Australia should
note that ASIC and ASX have issued guidance to the effect that inferred resources (upon which the
Scoping Study is based) do not provide a reasonable basis for production targets and forecast
financial statements and that Australian law does not consider there to be a reasonable basis for
announcing forecast financial information for the Toral Project. By accessing this announcement and
the Scoping Study persons acknowledge that they will not rely upon this announcement or the
Scoping Study in making any investment decision.
Toral Project Economic Highlights from selected development scenario
• Estimated economic forecasts for the Toral Project, based on the current level of work (+/-
30%), for the Conceptual Scenario 2a comprise:
o US$110 million net present value (NPV) using a discount rate of 8%;
o 24.4% internal rate of return (IRR);
o Estimated US$33 million CAPEX for a proposed 450ktpa design capacity plant,
including associated auxiliary costs, with infrastructure being situated near portal
entrance on the north side of the deposit.
o Estimated total CAPEX of US$110 million.
o US$25 per tonne indicative OPEX processing cost at steady state conditions.
o US$36 per tonne indicative OPEX mining cost utilising mechanised cut and fill.
o 15-year production plan, with significant potential for extension.
Outlook for 2019:
Subject to funding, the Company’s plans for the Toral Project in 2019, include:
• An infill drilling campaign to target the high-grade core of the deposit, with the aim of increasing
confidence in the resource estimate to the JORC (2012) Indicated category.
• Completion of the first metallurgical test work programme on the project to provide PFS level
results on comminution, flotation and concentrate grade.
• Commencement of environmental studies, which will be ongoing across the seasons.
• Commencement of hydrogeological characterisation of the Toral Project.
• In conjunction with drilling, geotechnical information will be routinely gathered and assessed,
complementing the Company’s growing knowledge base for the project.
Commenting today, Laurence Read, Executive Director of Europa Metals, said:
“Toral is demonstrating itself to be a highly robust lead, zinc and silver project located in a first world
jurisdiction. The initial economics from the independent scoping study are robust with an estimated
US$110 million of Capex and US$25/tonne processing cost. By building a mining model around the
zinc, lead and silver high-grade core of the Toral deposit, a US$110 million NPV has been estimated
using conservative parameters with a project IRR of 24.4%, anticipating payback from first production
within 4 years, operating within the first world mining jurisdiction of Spain. We look forward to providing
further updates as the Company progresses its wholly owned Toral Project throughout the remainder
Commenting today, Myles Campion, Executive / Technical Director of Europa Metals, said:
“2018 was a busy year at Toral and the work completed by our technical team should not be
underestimated. We successfully established a new team in Spain that has worked exceptionally well
together and with our independent consultants. They have taken our understanding of Toral to a new
level through the application of a fundamental geological approach of reviewing, assessing and re-
logging over 30,000m of core and applying modern techniques. We also accomplished a highly detailed
and robust Scoping Study and I am pleased that we can today publish the economics. I now look
forward to progressing the project further with a clear focus on development at the earliest opportunity.”
Summary of Scoping Study Mine Development
Basis for announcing economics
The factors that lead the Company to believe that it has a reasonable basis for announcing a
production target and forecast financial information are detailed in the Scoping Study and can
be summarised as follows:
Three conceptual underground mining development and production scenarios were
considered and developed throughout the Scoping Study, resulting in the identification of a
preferred scenario, being Conceptual Scenario 2a, highlights from which are set out below:
• A decline ramp access to the north of the deposit, targeting mine production within the
higher-grade core towards the centre of the planned mining blocks. This mining plan
was refined as part of the Scoping Study to focus on the higher-grade blocks for the
whole of the 15-year production plan, with lower grade material (albeit still above cut-
off grade) being mined later in the life of mine (LOM).
• The conceptual scenario selected progresses decline access ramp with a high-grade
• mechanised cut and fill (MCAF) mining method proposed;
• entry to mine via a principal decline reaching various levels;
• series of internal mining inclined ramps constructed to access levels;
• a ventilation raise would be drilled (raise-bored) to provide both adequate
ambient conditions underground and a second, emergency means of
access/egress into the mine;
• ore transported to a flotation process plant by conveyor or haul truck from
the mine and crushed to a suitable product for milling;
• milled ore floated by standard flotation technology to provide lead and zinc
concentrate, with silver probably reporting to the lead concentrate for sale
as a combined product;
• 4x4 metre mine standard development size; and
• 4% Zn Eq cut-off used with potential for mine life extension.
JORC (2012) resource estimate
The study is based on a previously announced JORC (2012) resource estimate comprising
16 million tonnes, in the Inferred category, @ 7.5% Zn equivalent (Pb, Ag), 3.9% zinc, 3.1%
lead and 24g/t silver equating to 640,000 tonnes of zinc, 510,000 tonnes of lead and 13 million
ounces of silver*.
Contain Ag Troy
4% Zn Eq Tonnes Density Zn Eq Zn Eq Contained Zn ed Pb Oz
Zn % Pb % Ag g/t
(PbAg)% (Millions) g/cm3 (Pb)% (PbAg)% Tonnes (000s) Tonnes (Millions
2018 16 2.8 7 7.5 3.9 3.1 24 640 510 13
*Zn Eq (PbAg)% is the calculated Zn equivalent incorporating silver credits as well as lead; (Zn Eq (PbAg)% = Zn
+ Pb*0.96 + Ag*0.022). Zn equivalent calculations were based on 3-year trailing average price statistics obtained
from the London Metal Exchange and London Bullion Market Association giving an average Zn price of US$2,500/t,
Pb price of US$2,100/t and Ag price of US$17/oz.
For further information on the Company, please visit www.europametals.com or contact:
Europa Metals Ltd
Dan Smith, Non-Executive Director and Company Secretary (Australia)
T: +61 417 978 955
Laurence Read, Executive Director (UK)
T: +44 (0)20 3289 9923
Strand Hanson Limited (Nominated Adviser)
Rory Murphy / Matthew Chandler
T: +44 (0)20 7409 3494
Turner Pope Investments (TPI) Limited (Broker)
T: +44 (0)20 3621 4120
Sasfin Capital Proprietary Limited (a member of the Sasfin group)
T (direct): +27 11 809 7762
The information contained within this announcement is deemed by the Company to constitute inside
information as stipulated under the Market Abuse Regulation (EU) No. 596/2014.
Competent Person’s Statement
The Scoping Study and JORC (2012) resource estimate for Toral therein was prepared by Mr J.N. Hogg, MSc.
MAIG Principal Geologist for Addison Mining Services Limited (“AMS”), Mr J. Bennett BSc (Hons). ARSM, FIMMM
CEng Associate Principal Mining Engineer for AMS, Dr N. Holloway, CEng, FIMMM Associate Processing Engineer
for AMS, and Dr S. Struthers CEnv, FIMMM, Associate Environmental Consultant for AMS together being
independent Competent Persons within the meaning of the JORC (2012) code and qualified persons under the
AIM Note for Mining and Oil & Gas Companies. The Scoping Study was aided by Mr R. J. Siddle, MSc, MAIG
Senior Resource Geologist for AMS, under the guidance of the competent persons. Mr Hogg, Mr Bennett, Mr
Holloway and Ms Struthers have reviewed and verified the technical information that forms the basis of, and has
been used in the preparation of, the Scoping Study and this announcement, including all analytical data, assumed
and acquired technical and economic inputs, diamond drill hole logs, QA/QC data, density measurements, and
sampling, diamond drilling and analytical techniques, and consent to the inclusion in this announcement of the
matters based on the information, in the form and context in which it appears. Mr Hogg, Mr Bennett, Mr Holloway
and Ms Struthers have also reviewed and approved the technical information in their capacities as qualified persons
under the AIM Rules for Companies.
Additionally, Mr Hogg confirms that the entity is not aware of any new information or data that materially affects the
information contained within the Company’s previous announcements referred to herein.
Some statements in the Scoping Study and this announcement regarding estimates or future events are forward-
looking statements. They include indications of, and guidance on, future earnings, cash flow, costs and financial
performance. Forward-looking statements include, but are not limited to, statements preceded by words such as
“planned”, “expected”, “projected”, “estimated”, “may”, “scheduled”, “intends”, “potential”, “could”, “nominal”
“conceptual” and similar expressions. Forward-looking statements, opinions and estimates included in this
announcement are based on assumptions and contingencies which are subject to change without notice, as are
statements about market and industry trends, which are based on interpretations of current market conditions.
Forward-looking statements are provided as a general guide only and should not be relied on as a guarantee of
future performance. Forward-looking statements may be affected by a range of variables that could cause actual
results to differ from estimated results.
The Company believes it has a reasonable basis for making the forward-looking statements in this announcement,
including with respect to any production targets, based on the information contained in this announcement and, in
particular, the Scoping Study and Mineral Resource Estimate contained therein in accordance with JORC 2012 for
the Toral Pb-Zn-Ag project, located in the Castilla y León region, Northwest Spain, as originally announced on 10
December 2018 and now available in full on the Company’s website.
Glossary of Technical Terms:
"g/t" grammes per tonne;
"Inferred that part of a Mineral Resource for which quantity and grade (or quality) are estimated on the basis
Resource" of limited geological evidence and sampling. Geological evidence is sufficient to imply but not verify
geological and grade (or quality) continuity. It is based on exploration, sampling and testing
information gathered through appropriate techniques from locations such as outcrops, trenches,
pits, workings and drill holes;
"JORC" the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves,
as published by the Joint Ore Reserves Committee of The Australasian Institute of Mining and
Metallurgy, Australian Institute of Geoscientists and Minerals Council of Australia;
“IRR” internal rate of return;
"JORC (2012)" the 2012 edition of the JORC code;
“Ktpa” thousand tonnes per annum;
“masl” metres above sea level;
"Mineral Resource" a concentration or occurrence of material of economic interest in or on the earth's crust in such form
and quantity that there are reasonable and realistic prospects for eventual economic extraction. The
location, quantity, grade, continuity, and other geological characteristics of a Mineral Resource are
known, estimated from specific geological evidence and knowledge, or interpreted from a well-
constrained and portrayed geological model;
"Mt" million tonnes;
“NPV” net present value;
"oz" troy ounce;
“PFS” pre-feasibility study;
"QA/QC" quality assurance/quality control;
“Zn Eq” zinc equivalent.
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