Canadian Zinc modifies 2016 Preliminary Feasibility Study

Canadian Zinc Corporation (TSX:CZN) reports that it has identified an error in the life-of-mine economic model included in its 2016 Preliminary Feasibility Study.
According to the news release:

The error caused an overstatement in gross smelter revenue to $3.7 billion from $3.3 billion, over the projected 17-year life of the Prairie Creek Mine. The gross metal value of production (using the same assumptions) remains unchanged. The overestimation resulted from the inclusion in the economic model of smelter revenue for bi-product metals in primary concentrates that may not be payable, depending on final concentrate contract terms.
All other inputs into the economic model and all technical aspects of the 2016 Preliminary Feasibility Study (“PFS”) remain unchanged, including all mineral resource and reserve estimates, mining plans and production rates and estimates of capital and operating costs and assumptions on concentrate treatment charges and penalties. However, royalties and taxes payable also reduce by $153 million over the projected life of the mine, partially offsetting the impact of lower revenue.
“It is important to note that the error in the economic model has no impact on reserve estimates, metal production or mine life and, notwithstanding the reduction in revenue, the revised financial results remain strongly positive and continue to demonstrate a robust project with undiscounted cumulative cash flow of $710 million at metal prices of US$1.00/lb for zinc and lead and US$19/oz for silver”, said John Kearney, Chairman and Chief Executive. “The revised financial model yields a Pre-tax NPV of $284 million at an 8% discount rate, with an IRR of 23%, and a Post-tax NPV of $155 million, with a post-tax IRR of 18%.”

Click here for the full news release.