Copper

Trilogy Metals Inc. (TSX: TMQ) (NYSE American: TMQ) ("Trilogy" or the "Company") is pleased to announce the release of an updated mineral resource estimate for the Bornite Project located in the highly prospective Ambler Mining District of Northwest Alaska . The Bornite Project forms part of the Upper Kobuk Mineral Projects ("UKMP"), owned by Ambler Metals LLC ("Ambler Metals"), the joint venture operating company equally owned by Trilogy and a wholly owned subsidiary of South32 Limited (ASX, LSE, JSE: S32; ADR: SOUHY) ("South32").

Highlights of the Updated Bornite Resource Estimate

  • At a base case 0.50% copper cut-off grade and constrained within a limiting pit shell, the Bornite Project is estimated to contain in-pit indicated mineral resources of 41.7 million tonnes grading 1.04% copper for 955 million pounds of contained copper and in-pit inferred mineral resources of 93.9 million tonnes grading 0.98% copper for 2.0 billion pounds of contained copper (see Table 1 for details).
  • Below the resource limiting pit shell, and at a base case cut-off grade of 1.5% copper, the combined South Reef and Ruby Zone is estimated to contain additional inferred mineral resources of 50.3 million tonnes grading 2.97% copper for 3.3 billion pounds of contained copper (see Table 1 for details).
  • The South Reef area, which represents the bulk of the resources located below the pit shell, has inferred mineral resources estimated at 35.3 million tonnes grading 3.39% copper for 2.6 billion pounds of contained copper (see Table 1 for details).
  • Below the resource pit shell, the Ruby Zone has inferred mineral resources estimated to be 15 million tonnes grading 1.98% copper for 653 million pounds of contained copper (see Table 1 for details).
  • The total cobalt inferred mineral resource (in-pit and below pit), based on a cut-off grade of 0.5% copper, is 185.8 million tonnes grading 0.021% cobalt for 88 million pounds of contained cobalt (see Table 2 for details).

The sensitivity of mineral resources located below the pit shell to the cut-off grade is shown in Table 3 for the South Reef area and in Table 4 for the Ruby Zone.

This mineral resource estimate was prepared for Trilogy Metals Inc. by Robert Sim , P.Geo., SIM Geological Inc. ("SGI") and Bruce M. Davis , FAusIMM, ("BMD"), who are both independent Qualified Persons as set forth by National Instrument 43-101. A National Instrument 43-101 (NI 43-101) technical report detailing the mineral resource estimate for the Bornite Project will be completed and filed on SEDAR ( www.sedar.com ) within 45 days of this news release.

Table 1. Estimate of Copper Mineral Resources for the Bornite Project

Class

Type

Cut-off (Cu%)

Tonnes

Average Grade

Contained Metal

(million)

Cu (%)

Cu (Mlbs)

Indicated

In-Pit

0.5

41.7

1.04

955


Total Indicated


41.7

1.04

955

Inferred

In-Pit

0.5

93.9

0.98

2,034

Inferred

Below-Pit South Reef

1.5

35.3

3.39

2,639

Inferred

Below-Pit Ruby Zone

1.5

15.0

1.98

653


Total Inferred


144.1

1.68

5,326

Notes:


(1)

Resources stated as contained within a pit shell developed using a metal price of US$3.50/lb copper, mining costs of US$3.00/tonne, milling costs of US$11.00/tonne, underground mining cost of US$65.00/tonne, G&A cost of US$5.00/tonne, 87% metallurgical recoveries and an average pit slope of 43 degrees.

(2)

Mineral Resources are not Mineral Reserves and do not have demonstrated economic viability. There is no certainty that all or any part of the Mineral Resources will be converted into Mineral Reserves.

(3)

It is reasonably expected that the majority of Inferred mineral resources could be upgraded to Indicated mineral resources with additional exploration.

Table 2. Estimate of Cobalt Mineral Resources for the Bornite Project

Class

Type

Cut-off (Cu%)

Tonnes

Average Grade

Contained Metal

(million)

Co (%)

Co (Mlbs)

Inferred

In-Pit

0.5

135.6

0.017

51

Inferred

Below-Pit South Reef

1.5

35.3

0.039

30

Inferred

Below-Pit Ruby Zone

1.5

15.0

0.021

7


Total Inferred


185.8

0.021

88

Notes:


(1)

Mineral Resources stated as contained within a pit shell developed using a metal price of US$3.50/lb copper, mining costs of US$3.00/tonne, milling costs of US$11.00/tonne, underground mining cost of US$65.00/tonne, G&A cost of US$5.00/tonne, 87% metallurgical recoveries and an average pit slope of 43 degrees.

(2)

Mineral Resources are not Mineral Reserves and do not have demonstrated economic viability. There is no certainty that all or any part of the Mineral Resources will be converted into Mineral Reserves.

(3)

It is reasonably expected that the majority of Inferred mineral resources could be upgraded to Indicated mineral resources with additional exploration.

(4)

Due to limited sample data, none of the cobalt mineral resource meets the confidence level for Indicated-class mineral resources. All cobalt mineral resources are considered to be in the Inferred category.


Table 3. Sensitivity to Cut-Off Grade of Inferred Mineral Resources Below the Base Case Pit Shell in the South Reef Area

Inferred

Cut-off (Cu %)

Tonnes (million)

Average Grade

Contained Metal

Cu (%)

Co (%)

Cu (Mlbs)

Co (Mlbs)

1.00

60.3

2.51

0.028

3,339

37

1.25

42.2

3.07

0.035

2,861

32

1.50 Base Case

35.3

3.39

0.039

2,639

30

1.75

31.8

3.57

0.041

2,499

29

2.00

29.8

3.67

0.043

2,413

28

Notes:


(1)

Base case cut-off grade of 1.50% copper is shown in bold in the table.

(2)

Mineral Resources are not Mineral Reserves and do not have demonstrated economic viability. There is no certainty that all or any part of the Mineral Resources will be converted into Mineral Reserves.

(3)

It is reasonably expected that the majority of Inferred mineral resources could be upgraded to Indicated mineral resources with additional exploration.

Table 4. Sensitivity to Cut-Off Grade of Inferred Mineral Resources Below the Base Case Pit Shell in the Ruby Zone

Inferred

Cut-off (Cu %)

Tonnes (million)

Average Grade

Contained Metal

Cu (%)

Co (%)

Cu (Mlbs)

Co (Mlbs)

1.00

48.7

1.5

0.019

1,604

21

1.25

26.8

1.75

0.02

1,033

12

1.50 Base Case

15.0

1.98

0.021

653

7

1.75

7.8

2.2

0.022

378

4

2.00

3.1

2.41

0.022

165

2

Notes:


(1)

Base case cut-off grade of 1.50% copper is shown in bold in the table.

(2)

Mineral Resources are not Mineral Reserves and do not have demonstrated economic viability. There is no certainty that all or any part of the Mineral Resources will be converted into Mineral Reserves.

(3)

It is reasonably expected that the majority of Inferred mineral resources could be upgraded to Indicated mineral resources with additional exploration.

Tony Giardini , President and CEO of Trilogy, commented, "As seen in Figure 1, the Bornite and Arctic projects not only have a significant amount of copper but both assets also have some of the highest grades in the world and easily stand apart from our copper peers. I want to also note that the rationale of this updated resource estimate is to highlight the South Reef area which, based on drilling, appears to be amenable to underground bulk mining methods due to its exceptional mineralized widths and continuity. While our Ambler Metals Joint Venture team has been focused on the Arctic Project, which is located 24 kilometers from Bornite, we want to remind investors that Bornite is also a very compelling copper-cobalt project and is one of the highest-grade undeveloped copper assets in the world. We will now pass along this resource estimate to the Ambler Metals Joint Venture team which will look at ways at integrating this asset with our other assets within the UKMP."

Richard Gosse , Vice-President Exploration for Trilogy, commented, "The current resource update confirms the significant size and copper grades at the Bornite project and puts the spotlight on the high-grade resource in the South Reef area, which is being separately reported in the below-pit inferred resource category in this update. Besides its exceptional grade, South Reef is characterized by good thickness and continuity, and its discovery in 2011, more than 60 years after copper was first discovered at Bornite, points to the excellent exploration potential for other Bornite-type deposits nearby in the Cosmos Hills and the Ambler Lowlands."

Figure 1. Comparison of Trilogy's Mineral Resources Compared to its Peers (CNW Group/Trilogy Metals Inc.)

Notes:


(1)

Peer group data as per latest company documents and public filings.

(2)

Assumes all assets on a 100% basis. Trilogy has a 50% interest in the UKMP which includes the Arctic and Bornite Projects.

Comparison of 2018 and 2021 Resource Estimates

Table 5 shows a comparison between the 2018 resource estimate and the current estimate of mineral resources. As can be seen below, the Indicated and Inferred in-pit resource tonnage estimates increased by 3% and 12%, respectively. While the below-pit resource tonnage decreased by 13%, the average copper grade increased from 2.89% to 2.97%. Total inferred resource tonnage (in-pit and below-pit) decreased by about 2%.

Table 5. Comparison of Current and Previous Resource Estimates for the Bornite Deposit

Class

Type

Cut-off
(Cu %)

December 2021

June 2018

Tonnes (million)

Average
Grade Cu (%)

Contained
Metal Cu
(Mlbs)

Tonnes
(million)

Average
Grade Cu (%)

Contained
Metal Cu
(Mlbs)

Indicated

In-Pit

0.5

41.7

1.04

955

40.5

1.02

913

Inferred

In-Pit

0.5

93.9

0.98

2,034

84.1

0.95

1,768

Inferred

Below-Pit

1.5

50.3

2.97

3,292

57.8

2.89

3,683

Inferred

Total Inferred

144.1

1.68

5,326

141.9

1.74

5,450

Factors that contribute to the changes in mineral resources are summarized as follows:

  • The current mineral resource estimate includes the results of drilling that was conducted in 2017, 2018, and 2019, but the 2017 drill holes were too widely spaced to support updated mineral resources on the northern (down-dip) part of the deposit at that time. The additional drilling had no impact on the distribution of mineral resources in the Indicated category located inside the resource pit shell. Most of the new drilling was located along the northern, down-dip side of the deposit, or in the vicinity of the South Reef area. These additional drill holes generally resulted in a slight reduction in the volume (tonnage) of mineral resources, but with a corresponding increase in both copper and cobalt grades.
  • The interpretations of geologic domains and trend planes were updated based on all available drilling information. The differences in these interpretations compared to the previous resource estimate are relatively minor.
  • The projected operating costs and metal prices used to generate the resource constraining pit shell were updated to reflect the current mining environment. The mining cost was increased, by 50% from US$2.00 /tonne to US$3.00 /tonne and the copper price was increased from US$3.00 /lb to US$3.50 /lb. These changes have resulted in a slightly larger resource constraining pit shell, which generally increased the volume of open-pit mineral resources and decreased the amount of underground mineral resources.
  • The new mineral resource estimate was subjected to a critical review of the continuity of grade and thickness of mineralization below the pit shell; this was completed to ensure that the mineral resource exhibits reasonable prospects for eventual economic extraction using underground mining methods. This process has eliminated some of the more isolated mineralized areas that were present in the previous mineral resource estimate.

2017-2019 Drilling Campaigns

During the summer of 2017, seven drill holes were completed, totaling 8,437 meters, that tested the down-dip continuity of the northern part of the Bornite deposit. As stated previously, the spacing of these holes was considered too far apart to support the generation of additional mineral resource estimates at that time, and as a result, the estimate of copper mineral resources remained unchanged in the June 2018 report from those reported in the previous technical report dated April 2016 . However, the June 2018 technical report did include, for the first time, an estimate of cobalt mineral resources for the Bornite Project.

In the summer of 2018, Trilogy Metals conducted a drilling program on the Bornite property that included the completion of 12 holes totaling 10,123 meters that, in part, filled the gaps in previous drilling in the northern, down-dip part of the deposit.

In the summer of 2019, another drilling program, totaling 7,610 metres, was conducted on the property comprising eight holes that tested the continuity of the mineralization within the Bornite deposit and two holes that tested exploration targets located about 1 km south and southeast of the deposit.

Database and Methodology

The project database comprises a total of 273 diamond drill (core) holes totaling 106,406 meters, including 203 holes that targeted the Ruby Zone to the west and 58 holes that targeted the South Reef area to the east. The remaining 12 holes in the database were exploratory in nature and tested for satellite mineralization proximal to the Bornite deposit or represent holes that encountered problems and were therefore abandoned. The database contains a total of 39,740 samples that were analyzed for copper content and 34,177 samples that were analyzed for cobalt content. Most holes were drilled by Trilogy Metals, plus a few select historical holes drilled by Kennecott Mines Company, containing additional analyses for elements such as zinc, lead, gold, silver, and cobalt. At this time, only copper and cobalt show any significant economic potential, and the others were excluded from the estimation of mineral resources.

Grade estimates are made into model blocks measuring 5m x 5m x 5m , using ordinary kriging with sample data composited to 2-meter intervals. The copper and cobalt resource models were validated using a combination of a visual review and statistical comparisons with models generated using other estimation methods. The effects of potentially anomalous high grade sample data were controlled using a combination of traditional top cutting as well as restricting the distance of influence during block grade interpolation. Copper and cobalt resources in the Inferred category occur within a maximum distance of 100 meters from a drill hole and exhibit reasonable confidence in the grade and continuity of mineralization. Copper resources included in the Indicated category are considered amenable to open-pit extraction methods and are delineated with holes spaced at a maximum distance of 75 meters. Note that there is less available cobalt sample data and, as a result, none of the cobalt mineral resource is included in the Indicated category. A portion of the mineral resource has been constrained within a pit shell generated based on the copper content in the model using a copper price of US$3.50 /lb, mining operating costs of US$3.00 /tonne, processing costs of US$11.00 /tonne and G&A costs of US$5.00 /tonne, copper process recovery of 87% and a pit slope of 45 degrees. Mineral resources located below the pit shell are based on an assumed mining cost of US$65.00 /tonne and exhibit the continuity and thickness to be considered amenable to underground extraction methods such as longhole stoping and cut-and-fill mining. It is assumed that extraction from the Bornite deposit is based on the copper content in the rocks and that cobalt would be a secondary contributor to the potential economic viability of the deposit. As a result, both copper and cobalt mineral resource estimates are defined based on a copper cut-off grade threshold.

Location and Distribution of Mineral Resources

The location of the Bornite Project is shown in Figure 2. The distribution of open pit and underground mineral resources at the South Reef and Ruby Zone are shown in Figures 3 and 4.

Figure 2. Location of the Arctic and Bornite Projects within the UKMP (CNW Group/Trilogy Metals Inc.)

Figure 3. Perspective View Looking Northwest of Mineral Resources at Bornite (CNW Group/Trilogy Metals Inc.)

Figure 4. Perspective View Looking Southwest of Mineral Resources at Bornite (CNW Group/Trilogy Metals Inc.)

Geology and Mineralization

The Bornite deposit is located approximately 24 km southwest of the Arctic deposit, subject of Trilogy's Feasibility Study completed in 2020, that will be served by the Ambler Access Road. Bornite is a carbonate-hosted copper deposit with associated cobalt and is made up of three stratabound copper bodies or 'reefs' that plunge northeast at about -25 degrees. These include the Lower and Upper Reefs, referred to as the Ruby Zone, with both in-pit and below-pit resources. Approximately 250 meters southeast of the Ruby Zone is the South Reef Zone, discovered in 2011. South Reef's 2% copper shell starts at about 400 meters below surface and plunges to the northeast at about -25 degrees to approximately 1,000 meters below surface. The true thickness of the resource at South Reef is variable, ranging from 5 meters to over 40 meters and averages about 15-20 meters.

The geology of the Bornite resource area is composed of alternating intervals of carbonate rocks (limestone and dolostone) and calcareous phyllite. Limestone transitions laterally into dolostone near zones of mineralization and is hydrothermally altered. Copper mineralization at Bornite is comprised of chalcopyrite, bornite, and chalcocite as stringers, veinlets, and breccia fillings distributed in stacked, roughly stratabound zones exploiting favorable stratigraphy.

Cobalt mineralization at Bornite is comprised of cobaltiferous pyrite within and enveloping the copper mineralized zones and carrollite and cobaltite directly associated with copper bearing minerals.

2021 Exploration Activities

During the 2021 field season, field mapping and relogging of drill core advanced the understanding of the Bornite deposit, and the potential for additional deposits was advanced with a new interpretation of the carbonate sequence at Bornite and an improved structural understanding of the Cosmos Hills. The Bornite sequence is now interpreted as a tectonized "normal" carbonate slope deposit that consists of calcitic material (lime mud) derived from a nearby shallow-marine source area, interlayered with variable amounts of terrigenous mud. Importantly, superimposed on the active limestone slope system is the local presence of dolostone-clast conglomerate that are likely derived from subaqueous horst blocks of pre-existing older dolostone that shed into the slope limestone system. The fault scarp(s) that shed dolostone clasts were probably part of a seafloor paleo-topographic system that developed during regional extension and associated fault-mediated syn-depositional subsidence. Proximal-distal relationships may help locate structures that delivered mineralizing fluids because dolostone conglomerates dominate the stratigraphy in the mineralized areas of the Bornite deposit. Massive sulphide distribution and characteristics suggest that syn-sedimentary faults associated with dolostone-clast conglomerates may have later served as conduits for mineralizing fluids. A better understanding of the configuration of the sedimentary system is recommended as its characteristics could assist in future exploration looking for other Bornite-style deposits.

Qualified Persons

Robert Sim , P.Geo., a Qualified Person as defined by NI 43-101, is responsible for the estimate of mineral resources presented in this news release and has reviewed, verified, and approved the contents of this news release as they relate to the mineral resource estimate, including the sampling, analytical, and test data underlying the mineral resource estimate. Mr. Sim is independent from Trilogy Metals and confirms there were no limitations from the company in verifying the drilling and sample data with site visit observations and monitoring of the QA/QC program.

Richard Gosse , Vice President of Exploration for Trilogy, is a Qualified Person as defined by National Instrument 43-101. Mr. Gosse has reviewed the scientific and technical information in this news release and approves the disclosure contained herein.

About Trilogy Metals

Trilogy Metals Inc. is a metal exploration and development company which holds a 50 percent interest in Ambler Metals LLC which has a 100 percent interest in the Upper Kobuk Mineral Projects ("UKMP") in Northwestern Alaska . On December 19, 2019 , South32, a globally diversified mining and metals company, exercised its option to form a 50/50 joint venture with Trilogy. The UKMP is located within the Ambler Mining District which is one of the richest and most-prospective known copper-dominant districts located in one of the safest geopolitical jurisdictions in the world. It hosts world-class polymetallic VMS deposits that contain copper, zinc, lead, gold and silver, and carbonate replacement deposits which have been found to host high-grade copper and cobalt mineralization. Exploration efforts have been focused on two deposits in the Ambler Mining District – the Arctic VMS deposit and the Bornite carbonate replacement deposit. Both deposits are located within a land package that spans approximately 181,387 hectares. Ambler Metals has an agreement with NANA Regional Corporation, Inc., an Alaska Native Corporation that provides a framework for the exploration and potential development of the Ambler Mining District in cooperation with local communities. Trilogy's vision is to develop the Ambler Mining District into a premier North American copper producer.

Cautionary Note Regarding Forward-Looking Statements

This press release includes certain "forward-looking information" and "forward-looking statements" (collectively "forward-looking statements") within the meaning of applicable Canadian and United States securities legislation including the United States Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical fact, included herein, including, without limitation, statements relating to the future demand for and price of cobalt, the future price of copper, the estimation of mineral reserves and mineral resources, the realization of mineral reserve and mineral resource estimates, the timing and amount of estimated future production, the South Reef Zone appearing to be amenable to underground bulk mining methods, the possible integration of the Bornite Project within the UKMP, the filing and timing of an updated Technical Report on the Bornite Project, costs of production, capital expenditures, costs and timing of the development of projects, the potential future development of Bornite, the future operating or financial performance of the Company, planned expenditures and the anticipated activity at the UKMP, are forward-looking statements. Forward-looking statements are frequently, but not always, identified by words such as "expects", "anticipates", "believes", "intends", "estimates", "potential", "possible", and similar expressions, or statements that events, conditions, or results "will", "may", "could", or "should" occur or be achieved. These forward-looking statements may include statements regarding perceived merit of properties; exploration plans and budgets; mineral reserves and resource estimates; work programs; capital expenditures; timelines; strategic plans; market prices for precious and base metals; or other statements that are not statements of fact. Forward-looking statements involve various risks and uncertainties. There can be no assurance that such statements will prove to be accurate, and actual results and future events could differ materially from those anticipated in such statements. Important factors that could cause actual results to differ materially from the Company's expectations include the uncertainties involving success of exploration, development and mining activities, permitting timelines, requirements for additional capital, government regulation of mining operations, environmental risks, unanticipated reclamation expenses; mineral reserve and resource estimates and the assumptions upon which they are based; capital estimates; prices for energy inputs, labour, materials, supplies and services the interpretation of drill results, the need for additional financing to explore and develop properties and availability of financing in the debt and capital markets; uncertainties involved in the interpretation of drilling results and geological tests and the estimation of reserves and resources; the need for cooperation of government agencies and native groups in the development and operation of properties as well as the construction of the access road; the need to obtain permits and governmental approvals; risks of construction and mining projects such as accidents, equipment breakdowns, bad weather, non-compliance with environmental and permit requirements, unanticipated variation in geological structures, metal grades or recovery rates; unexpected cost increases, which could include significant increases in estimated capital and operating costs; fluctuations in metal prices and currency exchange rates; and other risks and uncertainties disclosed in the Company's Annual Report on Form 10-K for the year ended November 30, 2020 filed with Canadian securities regulatory authorities and with the United States Securities and Exchange Commission and in other Company reports and documents filed with applicable securities regulatory authorities from time to time. The Company's forward-looking statements reflect the beliefs, opinions and projections on the date the statements are made. The Company assumes no obligation to update the forward-looking statements or beliefs, opinions, projections, or other factors, should they change, except as required by law.

Cautionary Note to United States Investors

This press release has been prepared in accordance with the requirements of the securities laws in effect in Canada , which differ from the requirements of U.S. securities laws. Unless otherwise indicated, all resource and reserve estimates included in this press release have been prepared in accordance with Canadian National Instrument 43-101 Standards of Disclosure for Mineral Projects ("NI 43-101") and the Canadian Institute of Mining, Metallurgy and Petroleum (CIM)—CIM Definition Standards on Mineral Resources and Mineral Reserves, adopted by the CIM Council, as amended ("CIM Definition Standards"). NI 43-101 is a rule developed by the Canadian Securities Administrators which establishes standards for all public disclosure an issuer makes of scientific and technical information concerning mineral projects. Canadian standards, including NI 43-101, differ significantly from the requirements of the United States Securities and Exchange Commission (SEC), and resource and reserve information contained herein may not be comparable to similar information disclosed by U.S. companies. In particular, and without limiting the generality of the foregoing, the term "resource" does not equate to the term "reserves". Under U.S. standards, mineralization may not be classified as a "reserve" unless the determination has been made that the mineralization could be economically and legally produced or extracted at the time the reserve determination is made. The SEC's Industry Guide 7 did not permit the inclusion of information concerning "mineral resources". The SEC's new mining disclosure rules under Regulation S-K 1300 are closer, but not identical to NI 43-101 and CIM Definition Standards. As the Company is not yet subject to Regulation S-K 1300, it remains subject to SEC industry Guide 7. Bornite does not have known reserves, as defined under SEC Industry Guide 7. Accordingly, information concerning mineral deposits set forth herein may not be comparable with information made public by companies that report in accordance with U.S. standards under either SEC's Industry Guide 7 or Regulation S-K 1300.

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Trilogy Metals Reports High Grade Copper and Zinc from Drilling at its Arctic Deposit

VANCOUVER, Oct. 27, 2016 /PRNewswire/ – Trilogy Metals Inc. (TSX:TMQ) (NYSE:TMQ), formerly NovaCopper Inc., is pleased to announce drill results and provide a project update from its 2016 summer field program at the Arctic poly-metallic volcanogenic massive sulphide (VMS) deposit, part of the Upper Kobuk Mineral Projects (UKMP) located in the Ambler mining district of Northwest Alaska. All amounts are in United States dollars unless otherwise stated.

The majority of this year’s project budget of US$5.5 million was spent on a drilling program at the Arctic Project that included 3,058 meters of drilling for geotechnical, hydrological, waste rock characterization and metallurgical studies as well as further resource definition. In addition to the drilling program, a series of environmental studies were conducted over the UKMP. The LiDAR survey that was incomplete last year due to weather conditions was also completed during the summer. This site investigation work will form the basis for completing a future pre-feasibility study on the Arctic deposit.

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Company News

Trilogy Metals Announces Third Quarter Results and Provides a Corporate and Project Update

VANCOUVER, Oct. 6, 2016 /CNW/ –  Trilogy Metals Inc. (TSX:TMQ) (NYSE:TMQ), formerly NovaCopper Inc., announces its financial results for the third quarter ended August 31, 2016. Details of the Company’s financial results are contained in the unaudited consolidated financial statements and Management’s Discussion and Analysis which will be available on the Company’s website at www.trilogymetals.com, on SEDAR at www.sedar.com and on EDGAR at www.sec.gov. All amounts are inUnited States dollars unless otherwise stated.
Corporate and Project Update
Name Change
In September 2016, we changed our name to Trilogy Metals Inc. to better reflect our Company’s naturally diversified resource base. The Company’s Upper Kobuk Mineral Projects (“UKMP”) are located in the Ambler mining district in northwest Alaska; a region known to host deposits rich in copper, zinc, lead, gold and silver. The Company controls the mineral rights to approximately 353,000 acres of land containing two known mineral belts, the Ambler Schist Belt and the Bornite Carbonate Sequence. The Ambler Schist Belt hosts volcanogenic massive sulphide (“VMS”) type mineralization occurring as a series of high-grade polymetallic copper-lead-zinc-gold-silver deposits along the entire 100 kilometer (70 mile) long belt. The Bornite Carbonate Sequence hosts several copper replacement targets around the Aurora and Pardner Hill prospects, in addition to an established resource identified at Bornite. Mineralization at Bornite is open to further exploration. The shareholders had previously voted in favour of the change of the Company’s name to Trilogy at our annual and special meeting of shareholders held on May 18, 2016.
Upper Kobuk Mineral Projects
In early August 2016, we wrapped up another successful season advancing the Arctic deposit towards pre-feasibility. The majority of the 2016 project budget of $5.5 million was spent completing a 3,058 metre drill program at the Arctic Project to support geotechnical, hydrological, waste rock characterization and metallurgical studies, as well as resource definition. Substantial field work was also completed to support the continuation of baseline environmental data collection. During the course of the field season, data collection was completed to support an aquatic survey, an avian and large mammal habitat survey, an archaeological survey and expansion of the wetlands delineation and surface quality work. The remaining thirty percent of the LiDAR survey (used to obtain high resolution topographic data) over the UKMP, initiated during the last field season, was completed. The site investigation work completed in 2016 will form the basis for the completion of studies this fall and a future pre-feasibility study on the Arctic deposit. Drill assay results are expected to be released during the fall of 2016.
Sale of Sunward and the Titiribi Project
On September 1, 2016, Trilogy closed the sale of all of the issued and outstanding shares of Sunward Investments Ltd. (“Sunward Investments”) to Brazil Resources Inc. (“BRI”) for consideration of 5,000,000 common shares of BRI, of which 2,500,000 common shares are subject to a six month holding period, and 1,000,000 BRI warrants, with each warrant exercisable into one common share of BRI for a period of two years from the closing date at an exercise price of Cdn$3.50 for total consideration valued at approximately$8.1 million.  Sunward Investments, through a subsidiary, owns 100% of the Titiribi gold-copper exploration project located approximately 70 kilometers southwest of the city of Medellin, in Antioquia Department, Colombia. Trilogy acquired Sunward Investments and the Titiribi project as part of its acquisition of Sunward Resources Ltd. (“Sunward”) in a business combination which closed on June 19, 2015.
The Company reclassified the net assets of Sunward Investments as an asset held for sale and its operations as a discontinued operation, retrospectively, in its third quarter financial statements. The Company expects to realize a gain on the sale of approximately$4.4 million in the fourth quarter of 2016.
Connect with Trilogy Metals Inc. (TSX:TMQ) (NYSE:TMQ) to receive an Investor Presentation.

Company News

Mining News: Enter Trilogy Metals

What does a name say about a company? Management of NovaCopper Inc. feels that its corporate moniker does not say enough about the diversity of metals present in the high-grade deposits encompassed by its Upper Kobuk Minerals Projects in the Ambler mining district of Northwest Alaska.
Arctic, the most advanced UKMP deposit, actually hosts more zinc than it does copper. And, while copper remains the dominant metal in terms of value, zinc supply shortages are closing the price gap between these two metals. Additionally, strong gold and silver prices have increased precious metals contributions to Arctic’s value this year.
“The Ambler district is more than just copper – it is copper; it’s zinc; (and) it’s precious metals,” NovaCopper President and CEO Rick Van Nieuwenhuyse explained in a recent interview.
As such, when markets open in Toronto and New York Sept. 8, NovaCopper Inc. will be no more. In its place, Trilogy Metals Inc. (TSX:TMQ) (NYSE:TMQ), will grace the boards of the Toronto Stock Exchange and NYSE-MKT.
NovaCopper shares under the previous symbol, NCQ, will seamlessly transition to Trilogy Metals shares, requiring no action for current shareholders.
Transition to Trilogy
Spun out of Novagold Resources Ltd. in 2012 to continue the exploration of Arctic and Bornite, two of the highest grade un-mined copper deposits in the world, NovaCopper was a natural choice for the Ambler mining district focused exploration company.
In the months leading up to the formation of NovaCopper, Van Nieuwenhuyse, who was then president and CEO of Novagold, forged a partnership with NANA Regional Corp. that brought together a large package of Novagold-owned mining claims blanketing a 70-mile- (110 kilometer) long belt of high-grade copper-lead-zinc-gold-silver deposits with an adjacent package of NANA-owned lands known for hosting exceptionally high-grade copper.
The alliance provides the Inupiat-owned Alaska Native regional corporation with the opportunity to benefit from the exploration and eventual development of the world-class Arctic deposit and other similar volcanogenic massive sulfide prospects across the Ambler belt. In return, NovaCopper was given the opportunity to investigate Bornite, a copper-rich deposit situated about 16 miles (26 kilometers) southwest of Arctic, and explore other mineral prospects across a large highly prospective swath of NANA lands in the Upper Kobuk region.
Over the ensuing four years, the partnership and the mineral endowment found on the 353,000 acres of UKMP lands has grown.
Today, the Arctic and Bornite deposits together are believed to host roughly 8.4 billion pounds of copper; 2.6 billion lbs. of zinc; 610,000 oz. of gold; 45.3 million oz. of silver; as well as significant quantities of lead and cobalt.
It is the natural diversity this broad range of metals – especially the zinc and precious metals components of Arctic, the UKMP deposit nearest to a production decision – that prompted the transition to the new name of Trilogy Metals.
Arctic focus
Over the past two years, the rebranded company has focused its field work on gathering the last bits of information needed to complete a pre-feasibility study that will outline plans to develop an open pit mine at Arctic.
A roughly 3,000-meter drill program at Arctic was the biggest ticket item of this year’s field program.
Prior to a similar infill drill program completed last year, Arctic hosted 23.85 million metric tons of indicated resource averaging 3.26 percent (1.71 billion lbs.) copper, 4.45 percent (2.34 billion lbs.) zinc, 0.76 percent (400 million lbs.) lead, 0.71 grams per metric ton (550,000 oz.) gold, and 53.2 g/t (40.8 million oz.) silver.
This VMS deposit also contains an estimated 3.63 million metric tons of inferred resource averaging 3.22 percent (239 million lbs.) copper, 3.84 percent (285 million lbs.) zinc, 0.58 percent (43.2 million lbs.) lead and 0.59 g/t (60,000 oz.) gold.
“What is so spectacular about Arctic is it hosts really fantastic grades,” said Van Nieuwenhuyse.
Drilling over the past two seasons has focused on upgrading much of the inferred resources to the higher confidence measured and indicated categories; some pit expansion drilling; and holes targeted to collect pit slope stability, hydrology and metallurgical information.
Thanks in part to great weather at Arctic this year, the 2016 program came in under the US$5.5 million budgeted for the field work.
Trilogy Metals is expected to release results from this drilling and the other field work in October.
Advancing Ambler
When Trilogy Metals returns to the Ambler district in 2017, the company plans to complete the geotechnical work needed to further refine locations for a power plant, mill, waste rock pile, stockpiles and tailings facilities for the Arctic mine plan to be detailed in the prefeasibility study.
The renamed company also would like to resume drilling at Bornite, a copper-rich carbonate replacement deposit that is reminiscent of those found in the African Copper Belt of southern Africa and the Mt. Isa district of Queensland, Australia.
Using a 0.50 percent copper cutoff grade, Bornite now hosts an estimated 40.5 million metric tons of in-pit indicated resources averaging 1.02 percent (913 million pounds) copper; and 84.1 million metric tons of inferred resources averaging 0.95 percent (1.8 billion lbs.) copper.
Additionally, at a 1.50 percent copper cutoff grade, Bornite is estimated to contain 57.8 million metric tons of below-pit inferred resources averaging 2.89 percent (3.7 billion lbs.) copper.
While already world-class in terms of both size and grade, the various zones of Bornite are open to expansion in several directions. The most compelling area is a 1,000-meter-wide stretch of continuing high grades along the northern front.
Hole RC13-0220, the most northeasterly hole drilled at Bornite cut three very high-grade intervals from 877 to 923 meters (at a 2.0 percent cutoff): 5.9 meters of 6.66 percent copper; 9.9 meters of 2.48 percent copper; and 19.7 meters of 2.24 percent copper.
Hole RC13-0224, drilled about 800 meters west of hole 220, cut five high-grade intercepts from 579 meters to 755 meters along this northern front: 19.5 meters of 3.02 percent copper; 16.8 meters of 2.36 percent copper; 39.5 meters of 2.37 percent copper; 8.6 meters of 3.26 percent copper; and 6.5 meters of 7.7 percent copper.
Trilogy believes that continued expansion in this direction could put the grades and size of its Ambler deposits on par with Mount Isa, where more than 400 million metric tons of ore grading 2.12 percent copper has been mined over the past 75 years.
Financial footing
An innovative financing completed last year puts Trilogy Metals in a good position to finish the pre-feasibility work at Arctic and continue exploration at Bornite.
In mid-2015, the company closed the buyout of Sunward Resources Ltd., a fellow exploration company with roughly US$20 million in the bank but a market cap hovering around US$13 million.
In exchange for the cash and Sunward’s Titiribi gold-copper project in Columbia, NovaCopper issued 43.1 million shares to Sunward shareholders.
When Trilogy Metals lights up the boards of the TSX and NYSE-MKT exchanges, it will have nearly US$10 million of this cash remaining in its treasury.
Adding to this strong financial footing, the company cut a deal in mid-August to sell the Titiribi property to Brazil Resources Inc., an exploration company with a growing portfolio of gold and copper properties in South America and Alaska.
In exchange for the Columbia gold-copper property, Trilogy will hold 5 million Brazil Resources shares. With a 50-day moving average of C$2.60 per share, these shares are currently worth about C$13 million.
“While we believe the Titiribi property has excellent exploration potential and a strong local team, the sale allows NovaCopper (Trilogy) to focus on its high-grade copper, zinc and precious metals projects located in Northwest Alaska,” said Van Nieuwenhuyse.
Connect with Trilogy Metals Inc. (TSX:TMQ) (NYSE:TMQ) to receive an Investor Presentation.

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