Bear Creek Mining Selects Peruvian Firm to Complete Phase I Engineering Work at Corani Project
TSX VENTURE: BCM
Bear Creek Mining Corporation (TSX.V: BCM) ("Bear Creek" or the "Company") announces it has selected GMI SA Ingenieros Consultores ("GMI"), a company owned by the prominent Peruvian engineering and construction firm Graña y Montero Group ("G&M"), to undertake Phase I Detailed Engineering work at the Corani silver-lead-zinc project in Peru. GMI will work with Bear Creek to fine-tune the Corani engineering design, which will form the basis of the Company's application for a Construction Permit. The Corani Phase I Detailed Engineering is a key component of the use of proceeds of the Company's July 2016 Short Form Prospectus financing (see Bear Creek news release dated July 26, 2016).
Andrew Swarthout, President and CEO of Bear Creek, states, "We are very pleased to have the opportunity to partner with G&M, one of the largest and most respected Peruvian engineering and construction firms. G&M along with its subsidiaries has both the breadth and depth of experience to deliver exceptional service in not only engineering design but also in permitting, construction of mining operations, bulk earth moving and contract mining, as demonstrated by their track record of very successful construction and operation outcomes at the Cerro Verde, Las Bambas, La Arena, Shauhuindo and Constancia mining projects in Peru. We look forward to working with G&M's highly qualified team as we complete this important milestone in the development of the Corani project; one of the largest undeveloped silver mines in the world."
The Phase I Detailed Engineering work will commence in mid-November and is expected to require 6 months to complete at a cost of approximately US $3.2 million (including taxes). It will establish final processing flow sheets, equipment lists, mine sequencing optimization and updated CapEx and OpEx cost estimates for the Corani project based on a projected 2018 construction start up time frame, and will be used to support the Company's application for a Construction Permit. Concurrently, the Company will engage a project finance consultant with whom it will work to develop a financing structure for the Corani project. The Company expects the Phase I Detailed Engineering to be completed by the end of Q2 2017 and the Construction Permit and project financing to be in place by mid- to late-2017 such that a construction decision could be made before the end of 2017 (which decision will be contingent upon successful project financing, securement of all necessary permits, and market conditions). Bear Creek and G&M have indicated a mutual interest in considering various partnership structures for construction and operation of the Corani mine, which will be further contemplated upon completion of the Phase I Detailed Engineering.
Bear Creek also reports that the Company has submitted an application to the Peruvian Ministry of Energy and Mines ("MEM") for accelerated recovery of the 18% value added tax (IGV) that applies to the Company's planned future investments in the Corani project. Pending approval of the application, a contract with the MEM will be executed after which the Company will be able to recover, on an expedited basis, the IGV taxes associated with its Corani capital investments as described in the approved ESIA and the 2015 Corani Feasibility Study (available at www.sedar.com). Accelerated recovery of IGV taxes is expected to reduce the Initial CapEx requirements for the Corani project, including those costs associated with the Phase I Detailed Engineering.
Source: Bear Creek Mining