The Scoping Study referred to in this announcement has been undertaken to demonstrate the additional value created by the inclusion of revenue from bismuth and additional project life of Rover 1. It is a preliminary technical and economic study of the potential viability of the Rover 1 project. It is based on low level technical and economic assessments that are not sufficient to support the estimation of ore reserves. Further exploration and evaluation work and appropriate studies are required before Castile Resources will be in a position to estimate any ore reserves or to provide any assurance of an economic development case.
The Scoping Study is based on the material assumptions outlined below. These include assumptions about the availability of funding. While Castile Resources considers all of the material assumptions to be based on reasonable grounds, there is no certainty that they will prove to be correct or that the range of outcomes indicated by the Scoping Study will be achieved.
To achieve the range of outcomes indicated in the Scoping Study, funding of in the order of $171.6 million will likely be required. Investors should note that there is no certainty that Castile Resources will be able to raise that amount of funding when needed. It is also possible that such funding may only be available on terms that may be dilutive to or otherwise affect the value of Castile Resources’ existing shares.
It is also possible that Castile Resources could pursue other ‘value realisation’ strategies such as a sale, partial sale or joint venture of the project. If it does, this could materially reduce Castile Resources proportionate ownership of the project.
Given the uncertainties involved, investors should not make any investment decisions based solely on the results of the Scoping Study.
The Scoping Study referred to in this report is based on low-level technical and economic assessments and is insufficient to support estimation of Ore Reserves or 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.
Inferred Resources. The mine plan contains approximately 30% Inferred Mineral Resources. An Inferred Mineral Resource has a lower level of confidence than an Indicated Mineral Resource and there is no certainty than any further exploration work will result in the conversion.
The mine plan assumes that limited Inferred Mineral Resources are mined within the first 5 years of the Project, which extends beyond the simple repayment period demonstrated by the Study. Thereafter, a small proportion of Inferred Mineral Resources are intended to be mined in subsequent years.
The Company is satisfied that the respective proportions of Inferred Mineral Resources are not the determining factors in viability of the Rover 1 Project. There is a low level of geological confidence associated with Inferred Mineral Resources and there is no certainty that further exploration work will result in the determination of Indicated Mineral Resources or that the production target itself will be realised. The stated production target is based on the company’s current expectations of future results or events and should not be solely relied upon by investors when making investment decisions. Further evaluation work and appropriate studies are required to establish sufficient confidence that this target will be met.
