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Metal Tiger plc - Thailand - Receipt of KEMCO Competent Person Report Final Draft, Mineral Resource Estimate & Valuation Update

Metal Tiger Plc

("Metal Tiger" or the "Company")

Thailand – Receipt of KEMCO Competent Person Report Final Draft, Mineral Resource Estimate & Valuation Update

Metal Tiger plc (LON:MTR) the London Stock Exchange AIM listed investor in strategic natural resource opportunities is delighted to advise that the Company has received the final draft SRK Consulting (UK) Ltd (“SRK”) Competent Persons Report (“CPR”) incorporating an independent Mineral Resource Estimate (“MRE”) and Technical Economic Model (“TEM”) for the assets of the Company’s Thai Joint Venture (“KEMCO JV”) over the Song-Toh and Boh-Yai silver-lead-zinc mines (the “Project”) located in Thailand.

It is intended that the KEMCO JV assets, along with Metal Tiger’s other Thai exploration assets, will be transferred to KEMCO Mining PLC (“KEMCO”), which is currently a wholly owned subsidiary of Metal Tiger.As announced on 7 March 2017, it is intended that KEMCO will raise further capital and seek admission to trading on the AIM market of the London Stock Exchange (“AIM”). Post structuring, upon completion of the asset transfer from KEMCO JV, 80% of the Project will be held by KEMCO, resulting in a circa 78% effective dividend interest to KEMCO over the Project. The final CPR is intended to be included in an admission document in relation to KEMCO’s proposed admission to trading on AIM, which is expected to occur by the end of Q3 2017.

The SRK CPR provides an update to the findings of the Preliminary Economic Assessment (“PEA”) undertaken for the Project by ACA Howe in 2013. The SRK report incorporates additional information and data that has become available since 2013, as well as the independent SRK, JORC Code (2012) compliant, MRE and an updated TEM.

SRK has reviewed this news release and have consented to its release. The information in this press release that relates to Mineral Resources is based on information compiled and reviewed by Dr Mike Armitage, who is a full-time employee of SRK and a Competent Person as defined in the 2012 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’.

A summary of the SRK findings and Company comment are provided below.

Michael McNeilly, Chief Executive Officer of Metal Tiger commented: “SRK has delivered a high-quality update to the 2013 Preliminary Economic Assessment of the KEMCO mines.Utilising the significant amount of data that has been compiled by the KEMCO team since 2013, SRK has independently presented a material Mineral Resource upgrade and demonstrated the significant value of the KEMCO Project.

SRK has determined that the Project not only warrants the further technical work required to commence an optimised reopening, but holds the potential for significant Mineral Resource increases and enhancement through ongoing exploration and assessment.

The CPR findings and Mineral Resource upgrade have provided us with a firm base on which to further improve the Project as we work through the Thai mine permitting process and develop our knowledge to a Prefeasibility Study level.

Key Project metrics have seen material improvements since the previous study; over 85% of the JORC compliant Resource is now in the Indicated category, denoting a higher degree of certainty; contained metal has been increased by up to 25%, resulting in a net 12% increase in modelled revenue and operating income (revenue less deductions and operating costs) up 9% to US$202.5M despite silver prices falling from a previously modelled US$30/oz to US$20/oz in the current SRK TEM.

Whilst the Project NPV has fallen, against the 2013 study, to US$45.9M, sensitivity analysis shows this is largely due to the increased provision for up-front capital cost and operating costs based on international dollar terms.The management can see potential for cost savings by utilising Thai engineering capability at competitive local rates and will obtain detailed costings for future valuation updates. We are further encouraged that sensitivity analysis shows that a modest reduction in operating costs combined with a recovery in metal prices offers strong valuation upsides for Project optimisation. Using the 2013 silver price of US$30/oz has the effect of adding some US$20M to the NPV, with all other inputs unaltered."


  • KEMCO JV concerns the reopening of existing mines, which are in good condition with open development, haulage and drainage drives, utilising existing processing plant and much of the existing infrastructure.
  • The Song Toh and Boh Yai silver-lead-zinc mines were put on care and maintenance in 2002, having been in continuous operation since 1978. The processing plant last operated in 2008.
  • The 2017 SRK CPR updates and builds on the findings of the PEA undertaken on the Project by ACA Howe in 2013.
  • SRK has addressed key aspects of the Project, including the MRE and the major Technical Economic Parameters upon which the current development plan is based, to provide an updated TEM and Net Present Value (“NPV”).
  • SRK utilised KEMCO’s newly compiled and updated drill hole databases to produce a new three-dimensional computer model of the geology and orebodies, based on:

    - 949 drill holes totalling 93,612m (489 holes/ 43,513m at Boh Yai mine & 460 holes/ 50,099m at Song Toh mine).

  • SRK’s MRE reports JORC Code (2012) compliant Mineral Resources of:

    - Boh Yai: Indicated 2.9 Mt @ 3.7% Pb, 4.5% Zn and 68.4g/t Ag plus Inferred 0.4 Mt @ 3.5% Pb, 4.2% Zn and 107.2g/t Ag

    - Song Toh: Indicated 1.1 Mt @ 5.1% Pb, 0.8% Zn and 60.1g/t Ag plus Inferred 0.2 Mt @ 8.1% Pb, 0.2% Zn and 76.4g/t Ag

  • The latest MRE reports more Resource in the Indicated category than previously (over 85% Indicated), denoting a higher geological confidence and providing a more accurate model for mine planning purposes.
  • SRK report a higher overall grade though a slightly lower tonnage, with the Boh Yai orebodies forming the majority of the remaining Mineral Resource, albeit as thinner, more variable ore zones than at Song Toh.
  • SRK has taken a conservative approach for the MRE; omitting potentially biased underground development sample data and allowing for Resource sterilisation as well as depletion resulting from previous mining activity, whilst including some Resource blocks which were scheduled for mining at the time of closure in 2002.
  • Modelled Life of Mine (“LoM”) net Project cashflow of US$ 121.4M (pre-finance and post-tax) with:
    - NPV (10%) of US$ 45.9M (at 01/01/2018)
    - IRR of 31%
    - Payback period 4.7 years from 2018
    - Mine life scheduled at 14 years
    - Production target 275ktpa ore processed, scheduled to ramp-up over 3 years.
    - Total Capital Expenditure (“CAPEX”) of US$ 50.3M (Project cost US$ 37,7M, Sustaining cost US$ 9,1M and Closure cost US$ 3,5M).
  • Total Operating Costs of US$ 45.30/t ore processed, with:
    - Mining US$ 29.39/t
    - Processing US$ 13.34/t
    - General & Administration US$ 2.57/t
  • Comparing SRK’s CPR model with the 2013 ACA Howe PEA study:
    - SRK production schedule has slightly lower ore tonnage, though higher grades result in more contained metal and consequently higher quantities of metal recovered to concentrates for sale.
    - Net revenue (i.e. gross revenue less revenue deductions such as smelter charges, royalties and transport costs) higher in the SRK model at US$ 355M compared to US$ 317M in 2013.
    - Overall net project cashflow after tax over the LoM is comparable between models,
    - NPV (10%) in SRK analysis is lower at US$ 46M compared to US$ 62M (2013). Primarily due to higher upfront capital costs and higher operating costs in the current SRK analysis.
    - SRK TEM utilises metal price forecasts, provided to KEMCO by Wood Mackenzie, ACA Howe modelled fixed metal prices over the LoM.
    - Sensitivity analysis shows strong NPV upside though reducing capital and operating costs.
    - Recovery of the silver price to 2013 level of US$ 30/oz would add approximately US$ 20M to the SRK NPV.
  • SRK concludes that while further feasibility work needs to be undertaken to ensure the mines are developed in an appropriate manner and as optimally as possible, SRK considers that the potential of the KEMCO Project justifies this further work.

Competent Person Report Overview

SRK has structured the CPR on a technical discipline basis into sections on Geology, Mineral Resources, Mining Engineering/Design, Mineral Processing, Tailings Management, Infrastructure, Water Management and Environmental and Social Management. The SRK report also contains sections commenting upon Mining Licence aspects, the history of the assets and summarises the technical-economic parameters upon which the current Development Plan is based and presents SRK’s NPV valuation based on this.

SRK provided review and assessment of all material technical issues likely to influence the future performance of the Project.

SRK set out recommendations for work needed, including the level of detail and extra work streams to be undertaken to progress the assets through to the Pre-Feasibility Study (“PFS”) and subsequent Feasibility Study (“FS”) stages prior to the potential recommencement of production.

The CPR summarises the necessary environmental and social approvals to be prioritised as the studies progress to the next level, including details of stakeholder engagements and environmental baselines including water chemistry and water management.

Company Comment

Metal Tiger and KEMCO management and advisers have considered the findings of the SRK study in conjunction with the current work programmes, plans and objectives for the KEMCO JV. The SRK work provides an accurate and unbiased summary of the opportunity potentially offered through the reopening of the Boh Yai and Song Toh mines. SRK has, rightly, presented a conservative view of the capital costs likely to be required ahead of any recommencement.

SRK has worked in conjunction with the KEMCO onsite team to improve the understanding of the deposits through the digitisation of the historical mine plans and sections and compilation of historical drilling and assay data. The resulting new three-dimensional model of the ore bodies has facilitated a greater understanding of the mineralisation geometries enabling more geological certainty in the Resource estimation process, hence enabling the proportion of Resource in the Indicated category to be increased to over 85% Indicated, up by 42% on the proportion in the 2013 Resource Estimate.

The creation of the 3D model has, in turn, enabled SRK to make more informed assumptions regarding the required mining methodologies and the extent of underground development required to optimally extract the ores, especially at Boh Yai. These assumptions have allowed a greater degree of accuracy in the operating cost estimation for the TEM and current valuation.

The 3D model, with its drill string plots, also serves to illustrate the yet untested upside exploration potential of the mines. Much of the mineralisation remains untested at depth with mineralisation open in a number of locations. Specifically, at Boy Yai, the area under Khao Bo Rae mountain, between Hill #11 and Hills #4/5 has not yet been drill tested and the mineralisation at Hill #4 holds potential for additional Mineral Resources.

There is also the potential to add significant upside to the Mineral Resource through detailed underground mapping and sampling, further improving the confidence in, and potentially the categorisation of, the Mineral Resource, ahead of any major exploration drilling commitment.

Through the upgrade of the existing mineral processing plant and the potential addition of modern ore-sorting technologies it is anticipated that lower grade material could be exploited offering the Project higher economic efficiencies.

It is noteworthy that the SRK capital cost estimates are all given in United States Dollar terms. Recognising that these estimates are rightly conservative and based on SRK’s international experience, Metal Tiger sees the opportunity of significantly reducing budget estimates through the use of Thai contactors and technical capability that is available at a discount to international rates.

Next Steps

KEMCO is working with SRK to put in place the various work programmes required to take the level of understanding to a PFS level and ensuring that the PFS elements meet or exceed the level required for successful mine permitting.

KEMCO will be liaising with Thai engineering firms with a view to scoping domestic cost inputs for the various capital cost elements such as the processing plant refurbishment and facilitation of plant upgrade works and the water and tailings management infrastructure.

In its financial modelling, SRK has presented a Net Present Value (NPV) of the Project using a 10% discount rate. The Company will specifically be addressing the various factors which offer the potential to reduce the appropriate discount rate, including, the permitting risk and finance risk through engagement with the governmental authorities and Asian finance and off-take providers.

CPR Key Components

The key components of the CPR are outlined below:

1.SRK Mineral Resource Statement

The SRK independent Mineral Resource Estimate (“MRE”) has been reported for Boh Yai and Song Toh in accordance with JORC Code (2012) guidelines. The SRK MRE (see Table 1.1 below) is based on a 3D geological model of individual veins which was facilitated by database work compiled by the KEMCO team since 2013. The KEMCO databases provide varying data for 949 drill holes totalling 93,612m (489 holes/ 43,513m at Boh Yai and 460 holes/ 50,099m at Song Toh).

SRK’s Mineral Resource has an effective date of May 2017 and comprises:

Boh Yai: Indicated 2.9 Mt @ 3.7% Pb, 4.5% Zn and 68.4g/t Ag plus Inferred 0.4 Mt @ 3.5% Pb, 4.2% Zn and 107.2g/t Ag

Song Toh: Indicated 1.1 Mt @ 5.1% Pb, 0.8% Zn and 60.1g/t Ag plus Inferred 0.2 Mt @ 8.1% Pb, 0.2% Zn and 76.4g/t Ag

The ACA Howe MRE (November 2012) consisted Indicated 2.90Mt @ 3.57% Pb, 2.82% Zn & 72.63g/t Ag plus Inferred 1.96Mt @ 2.95% Pb, 3.08% Zn & 48.89g/t Ag and was reported in accordance with Canadian Institution of Mining (CIM) Standards based on a 3.0% Pb Equivalent cut-off.

SRK has been able to report more Resources in the Indicated category than was previously the case.

SRK overall report a higher grade though a slightly lower tonnage, with the orebodies at Boh Yai forming the majority of the remaining Mineral Resource, albeit as thinner, more variable orezones than at Song Toh.

Table 1.1: Mineral Resource Statement (SRK, May 2017)

JORC Class   Mt   Ag (g/t)   Pb (%)*   Zn (%)*   Fe (%)*   Hg (g/t)*
Boh Yai
Indicated 2.9 68.4 3.7 4.5 0.4 24.8
Inferred 0.4 107.2 3.5 4.2 0.3 40.7
Song Toh
Indicated 1.1 60.1 5.1 0.8 1.6 8.7
Inferred 0.2 76.4 8.1 0.2 2.6 12.9

* Grades given are mean grades.

In reporting the Mineral Resource Statement, SRK notes the following:

  • Mineral Resources have an effective date of May 2017. The Competent Persons for the declaration of Mineral Resources is Dr Mike Armitage, an employee of SRK. The Mineral Resource estimate was prepared by a team of consultants from SRK;
  • Reported Mineral Resources are below the un-mined topography but exclude areas that SRK considers to have been mined out or sterilised by previous mining;
  • The reported Indicated Mineral Resource includes some 190 kt of material in areas blocked out for mining by KEMCO and within areas previously mined.
  • Mineral Resources are reported as undiluted. No mining recovery has been applied in the Statement; and
  • Rounding as required by reporting guidelines may result in apparent summation differences between tonnes, grade and contained metal content.

Resource Depletion

In compiling its independent MRE SRK has taken a conservative approach, omitting underground development sample data from the interpolation process until a study of potential positive grade bias can be completed. This data could be incorporated into the MRE for the PFS, and will allow better local grade estimates to be derived.

Mining records report that 5.3Mt was mined in the period 1978-2002; 4.5Mt at Song Toh and 0.8Mt at Boh Yai. In completing the current MRE SRK removed 1.14Mt from the Camp section of Song Toh and 0.8Mt from Boh Yai, based on denoting a level of confidence to resource blocks potentially previously exploited as judged from available sections and plans. Where resource blocks could be shown as being ready for mining but still unexploited when mining ceased in 2002, they were included in the SRK estimate.

2.Mining Summary

The SRK study considers Room-and-Pillar (“R&P”) and Overhand Open Stoping (“OOS”) as the future mining styles in line with previous operations with R&P utilised in the thicker, relatively shallow dipping orezones and OOS planned for the steeper dipping and relatively thin orezones. The mining recovery factor is assumed as 80% and dilution at 12%.

Diesel powered mobile mining equipment is modelled for ore cleaning and transport, with hydraulic jumbo drill rigs utilised for waste development and pneumatic hand-held drills for ore horizons. The existing mine development constrains the size of the mining equipment, with the number of units geared by LoM predictions for the number of concurrent stopes and development ends required to be in production, rather than just the level of production.

Historical production records show that the Boh Yai orebodies necessitated significantly more development than the Song Toh orebodies, with the Boh Yai mineralised bodies generally being thinner and more discontinuous. Boh Yai is modelled as having a higher development requirement and smaller average stope size.

The CPR sets out parameters for development, ventilation and ore transport with the current LoM scheduled at 14 years.

The current KEMCO production target is 275ktpa ore processed, scheduled to ramp-up over 3 years. For mine production scheduling, the SRK Mineral Resource has been converted into ore-types based on concentrate products; Boh Yai high >2% & low <2% Zn; and Song Toh high >1% & low <1% Zn. SRK scheduled the ore tonnes and grade by ore type in an Excel model. Approximately 55% of the current Mineral Resource is located above the level of the mine dewatering drives.

The total workforce required is modelled at 234 people including 15 at a managerial/senior technical level.

At full production, the average unit mining cost is US$ 28/t increasing to US$ 29.6/t after 8 years when the Song Toh orebodies are depleted.

The unit cost difference supports further exploration at Song Toh to extend the life, and / or consider higher production contributions for Song Toh.

The mining capital cost over the LoM is given as US$ 22.1M including 15% contingency. Mining sustaining capital costs estimated at US$6.8M over the LoM averaging some US$620kpa.

3.Mineral Processing

The mineral processing involves conventional crushing, milling and floatation to produce a Pb concentrate, a bulk Pb-Zn concentrate and a Zn concentrate, either concurrently or individually according to the ore received. The existing processing plant is located at the Song Toh minesite and has a capacity rated at 300ktpa. SRK has assumed an annual processing throughput of 275ktp for the purposes of the TEM and valuation.

No recent mineral processing or metallurgical studies have been carried out. However, historical process statistics show that the plant achieved good Pb recoveries and concentrate grades, with SRK utilising the detailed plant production records, produced between 1996 and 2002, to derive TEM assumptions of:

Pb recovery 79-87% for a 69-75% Pb concentrate.

Zn recovery 80% for a 58% Zn concentrate.

Further modifiers have been derived from work undertaken during 1984 as part of a previous PFS, including metallurgical testwork, ore milling characterisation and ore grade ratio studies. It is noteworthy that the Boy Yai ores were found to require 25% more milling energy than the Song Toh ores.

Ore from both mines shows considerable variety in terms of Pb, Zn and Ag grades and in impurities such as Fe and Hg.

SRK recommends that grinding characteristics for both ores will be required for the PFS to verify that installed power is suitable for the entire LoM requirements. Metallurgical testing should also be conducted to optimise operating parameters and improve metallurgical performance. The possibility of utilising modern automated sorting technology should be investigated as it may offer the opportunity to exploit lower grade ores.

The existing plant was previously inspected for the purpose of estimating refurbishment costs in 2012. Considering the findings of this previous audit and taking into account SRK’s own experience and observations with regard to the state of the plant, SRK has made a provision of US$ 2M for plant refurbishment and replacements to be spent 6 to 12 months prior to re-commissioning.

The SRK average unit operating cost for the operation and maintenance of the concentrator and the tailings facility over the LoM is given as US$ 13.34/t.

4.Tailings Management

The existing tailings storage facility (“TSF”) is adjacent to the processing plant at Song Toh and consists a valley style impoundment containing approximately 5Mt of tailings. The plan is to upgrade this facility to store additional tailings produced when the plant is re-started.

A previous Golder Associates study has presented conceptual plans for a series of upstream rises on the TSF. These have been incorporated into the current study, with the upgraded facility modelled as having sufficient capacity to contain 3.5Mt of tailings representing 13 years’ production at average throughput.

Provisions are included to bring the design of the TSF dam within international guidelines on dam safety, with buttressing of the main embankment and a series of upstream raises designed to accommodate a rate of tailings rise of 1 metre/yr.

SRK sets out recommended field studies including characterisation for the existing tailings for stability, buttress stability, detailed water balance modelling and factoring in the influence of the wet season rains and the possible interaction with the karstic ground conditions (sinkholes and caves).

The capital cost of upgrading the TSF is modelled at US$ 3.46M plus sustaining capital of US$ 0.64M spread over the LoM.

5.Water Management

The CPR sets out considerations and recommendations for surface and underground water management, including hydrology of the karst environment, water quality monitoring, mine dewatering, surface water management, water requirements and balance and water treatment.

With a proportion of the scheduled Resource located below the existing haulage/drainage drifts in both mines, conceptual sub-level drainage development, sumps and pumps are factored into the current model.

At Song Toh, it is envisaged that a new dewatering drive would be established 150m below the existing drift whilst at Boh Yai the deepest new dewatering drive would be located 220m below the existing haulage/dewatering drift.

A provision of US$ 4.85M is given as the capital cost for a complete water handling and treatment facility to address plant water requirements, water recycling and water discharge within permitted environmental criteria.

6.Infrastructure & Logistics

Provisions and recommendations are given for the use and upgrade of existing mine and camp infrastructure, haulage road improvements, fuel, water and power requirements and provision of new medical, firefighting, security and loading equipment and facilities.

The use of the 15km long haul road between the Boh Yai mine and the Song Toh processing plant has been scheduled as part of the model. There is an assumption that capital works are not required for local or national roads and that contractor haulage operations (from Song Toh to port) include a provision of equipment, facilities and labour.

For the study the concentrate is modelled as being shipped in bags stuffed within containers to off-taker smelters in Korea or China. Utilising haulage contractors to undertake the necessary transport and rehandling of concentrate bags between the mine site and port, to take into account various road weight restrictions (necessitating possible concentrate bag re-handling/packing) en route.

Infrastructure related capital costs which have been developed in conjunction with KEMCO amount to US$ 4.315M.

7.Environmental and Social Permitting and Baseline Requirements

The new Thai Mineral Act (B.E.2560 (2017)) will come into effect on 29 August 2017. It is anticipated that there may be a period of interpretation and adjustment to the existing KEMCO mining lease applications and existing land-use applications for the setting ponds, processing plant and TSF, with corresponding possible delays to the approvals process. Remaining documents for the approval process are currently under preparation by KEMCO.

As part of the planned PFS, SRK recommends that KEMCO expands the Environmental Health Impact Assessment (“EHIA”) process for the Project in accordance with Thai Environmental Impact Assessment law and International guidelines, and in line with overall Project development stages. Baseline studies should be continued through the PFS / FS process with some activities critical for the provision of data for the EHIA, Mine Plan and Licence Application procedures. Though beyond legal requirements, SRK also recommends that KEMCO continue to build a strong and stable relationship with local stakeholders and potentially hostile NGOs.

8.SRK Valuation

SRK constructed an Excel based Technical Economic Model (“TEM”) to assess the viability of reopening the Song Toh and Boh Yai mines, based on the technical and economic parameters of the Project through analysis of historical performance data, benchmarking and/or escalating of costs derived from previous studies. The model considers a corporate tax rate of 20% assumed with straight-line depreciation over 5 years and tax losses carried forward and offset against future profits and VAT applied at 7% on 100% of capital costs (“CAPEX”) and 75% of operating costs (“OPEX”), with VAT recoverable in 45 days. The constituent elements of the TEM include:

  • Mining & Processing schedule based on the SRK Mineral Resource Estimate as modified for assumed mining recovery and dilution parameters
  • Process recovery and concentrate parameters
  • Smelter terms
  • Mining OPEX & CAPEX
  • Processing OPEX & CAPEX
  • Tailings OPEX & CAPEX
  • Infrastructure CAPEX
  • Owners development and business services cost
  • Closure costs

The TEM results in a Project LoM net cashflow (pre-finance and post-tax) of some US$ 121.4M which returns a NPV (10%) of US$ 45.9M (at 01/01/2018) and an IRR of 31%. The payback period from 2018 would be 4.7 years.

In comparison with the 2013 PEA conducted by ACA Howe, the latest production schedule has slightly lower ore tonnage, however due to higher grades in the current model there is more contained metal and consequently higher quantities of metal recovered to concentrates for sale.

Whilst lead prices remain comparable between the two models, the current zinc price profile is higher than it was in 2013 whilst the currently modelled price of silver (US$ 20/oz) is significantly below that used in 2013 (US$ 30/oz).

Because of the higher metal recovered for lead and zinc in the current model, gross revenue for both lead and zinc is higher than the 2013 analysis. Despite higher silver recovered to concentrates in the current model, the markedly lower silver price results in a net decrease in silver revenues compared to 2013.

While overall revenue deductions (smelter charges, royalty, transport charges) are proportionally higher in the current model (due to higher overall gross revenue), the net revenue remains higher in the current model at US$ 355M compared to the previous 2013 analysis of US$ 317M.

Operating and capital costs are higher in the current model through a combination of general escalation and re-estimation by SRK.

Overall net project cashflow after tax over the LoM is comparable between models, however the NPV (10%) in the current analysis is lower at some US$ 46M compared to the previous 2013 model of some US$ 62M. The primary reason for the decrease in NPV in the current model, despite comparable LoM undiscounted cashflows between models, is due to the higher upfront capital costs and higher operating costs in the current SRK analysis.

Details of the mine and plant scheduling, concentration production, capital and operating costs and summary cashflows are outlined in appended tables below.

9.SRK Conclusions & Recommendations

The SRK CPR concludes that while further technical work needs to be done to ensure the mines are developed in an appropriate manner and as optimally as possible, SRK considers that the potential of the assets justifies this further work.

Notably, the NPV and IRR for the assets presented demonstrates the value of the Project and this has potential to be enhanced further particularly given the potential for the Mineral Resource to be increased following ongoing exploration and assessment.

Recognising further technical work is required in most areas of study, to bring the level of confidence up to PFS level and enable the reporting of an Ore Reserve, SRK sets out recommendations on the key aspects of this work to take the project to the next level.

10. Competent Person Statement

The information in this press release that relates to Mineral Resources is based on information compiled and reviewed by Dr Mike Armitage, who is a full-time employee of, and Corporate Consultant with, SRK Consulting (UK) Ltd and is a Member of the Institute of Materials, Minerals and Mining (MIMMM), a Fellow of the Geological Society of London (FGS), a Chartered Geologist of the Geological Society of London (CGeol) and a Chartered Engineer, UK (CEng).

Dr Armitage has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2012 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’.

Dr Armitage has consented to the inclusion in the press release of the matters based on his information in the form and context in which it appears.

Appendix: Selected SRK Technical Economic Model Inputs and Output Tables

LoM Mine / Plant Schedule

Plant Feed   3,374,387 t

Metal Grades

  Contained Metal   Plant Recovery & Conc. Grade   Commodity Prices
Pb 4.16 % 140,382 t Scheduled by ore type, moisture content 8%. Pb US$ 1.00 /lb
Zn 3.42 % 115,367 t Zn US$ 1.63 /lb
Ag 69 g/t 231,901 kg Ag Ag US$ 20 /oz
    7,455,797 oz Ag

(variable in model, 2019 given above)

Fe 0.65 %
Hg 21 g/t  

LoM Concentration Production

Concentrate Production   Concentrate Grade

(conc. ave.)

  Contained metal
Pb   Total tonnage (wet)   175,821 t Pb 70.99 %

Zn 8.26 %

Ag 1,073 g/t

Fe 1.37%

Hg 112 g/t

Pb 114,822 t

Zn 13,357 t

Ag 173,619 kg

(Ag 5,581,970 oz)

Total tonnage (dry) 161,755 t
Zn Total tonnage (wet) 150,422 t Pb 4.1 %

Zn 57.01 %

Ag 123 g/t

Fe 0.61%

Hg 192 g/t

Pb 5,678 t

Zn 78,898 t

Ag 16,975 kg

(Ag 545,747 oz)

Total tonnage (dry) 138,388 t

Smelter Terms

Smelter Terms   Units   Pb Conc.   Zn Conc.
Pay for Pb/Zn (%) 95.0% 85.0%
Minimum Deduction (%) 3.0% 8.0%
Treatment Charge (USD/t conc. dry) 220 250
Base Price (USD/t) 2,500 2,500
Escalator Charge (USD/t conc. dry) 0.06 0.05
De-escalator (USD/t conc. dry) - 0.04 - 0.02
Truck transport (USD/t conc. wet) 26 26
Shipping (USD/t conc. wet) 34 34
Pay for (%) 95.0% 70.0%
Minimum Deduction (g) 50 100
Refining charge (USD/oz payable) 1.00 1.00

Metal Prices

Metal Price Forecasts used by SRK (2017 TEM), provided to KEMCO by Wood Mackenzie
Metal   Units   2017   2018   2019   2020   2021   2022   2023   2024   LTP
Lead (USD/lb) 1.04 1.05 1.00 0.98 0.98 0.95 0.93 0.91 1.02
Zinc (USD/lb) 1.46 1.72 1.63 1.35 1.14 1.07 0.96 0.94 1.22
Silver (USD/oz) 20.00 20.00 20.00 20.00 20.00 20.00 20.00 20.00 20.00
Metal Price used in 2013 PEA

(ACA Howe)

Metal   Units   Fixed at
Lead (USD/lb) 1.00
Zinc (USD/lb) 0.95
Silver (USD/oz) 30.00


Royalty   Metal Prices

From (Baht)

  To (Baht)   Royalty Rate (%)
Lead - 8,000 2%
8,000 12,000 5%
12,000 20,000 10%
20,000 999,999 15%
Zinc - 10,000 2%
10,000 20,000 5%
20,000 30,000 10%
30,000 999,999 15%
Silver     10%
LME freight rate (USD/t metal) 75.00  

Capital Costs

Initial Project / Refurbishment Capital Costs   Total

(USD ‘000)

Feasibility & Permitting 750
Owners 250
Plant refurbishment 2,000
Water treatment plant 4,850
TSF 3,460
Infrastructure 4,315
Mining 22,077
Capital Costs   Total

(USD ‘000)

Project 37,702
Sustaining 9,098
Closure 3,470

Project Revenue

Revenue Summary

Conc. Type


(USD ‘000)

Lead 236,893
Zinc 178,911
Silver 106,596
Gross revenue522,401
Smelter charges 74,907
Penalties -
Transport costs 19,575
Royalty 72,523
Net Revenue355,397

Operating Costs

Operating Costs   (USD'000)   (USD/t)
Mining 99,190 29.39
Processing 45,001 13.34
General & Administration 8,669 2.57
* per t processed

Summary Project Cash Flow

Project Cash Flow   Total (USD ‘000)   Total (USD ‘000)
  (2017 TEM)(2013 PEA)
Revenue 355,397 317,463
Operating costs (152,860) (131,266)
Operating Profit202,536186,196
Capital costs (50,270) (37,192)
Corporation tax (30,894) (30,124)
Working capital (0) 0
Net Project cashflow121,372118,880
NPV (10%)45,94161,642

Net Present Value

NPV   2017 TEM Total (USD ‘000)
Discount rate
6% 67,708
8% 55,820
12% 37,674
14% 30,712

Sensitivity Analysis

Sensitivity of NVP 10 % (USD'000) by:   -50%   -40%   -30%   -20%   -10%   0%   10%   20%   30%   40%   50%
Revenue -43.6 -22.7 -4.2 12.9 29.6 45.9 62.2 78.3 94.2 110.1 126.0
OPEX 77.5 71.2 64.9 58.6 52.3 45.9 39.6 33.3 27.0 20.6 14.2
Capital Cost 63.0 59.6 56.2 52.8 49.4 45.9 42.5 39.1 35.6 32.2 28.7

The technical information contained in this disclosure has been read and approved by Mr Nick O'Reilly (MSc, DIC, MAusIMM, FGS), who is a qualified geologist who meets the criteria of a qualified person under the AIM Rules - Note for Mining and Oil & Gas Companies.Mr O'Reilly has visited the Project site. Mr O'Reilly is a consultant working for Mining Analyst Consulting Ltd which has been retained by Metal Tiger PLC to provide technical support.

For further information on the Company, visit: www.metaltigerplc.com:

Michael McNeilly   (Chief Executive Officer)   Tel: +44(0)20 7099 0738
Keith Springall (Finance Director & Company Secretary) Tel: +44 (0)20 7099 0738
Sean Wyndham-Quin

Neil Baldwin

Spark Advisory Partners Limited

(Nominated Adviser)

Tel: +44 (0)20 3368 3555



Nick Emerson

Andy Thacker

SI Capital

(Joint Broker)

Tel: +44 (0)1483 413 500
Andrew Monk

Andrew Raca

VSA Capital Limited

(Joint Broker)

Tel: +44 (0)20 3005 5000
Gordon Poole

James Crothers


(Financial PR)

Tel: +44 (0)20 3757 4980

Notes to Editors:

Metal Tiger plc is listed on the London Stock Exchange AIM Market (“AIM”) with the trading code MTR and invests in high potential mineral projects with a precious and strategic metals focus.

The Company’s target is to deliver a very high return for shareholders by investing in significantly undervalued and/or high potential opportunities in the mineral exploration and development sector timed to coincide, where possible, with a cyclical recovery in the exploration and mining markets. The Company’s key strategic objective is to ensure the distribution to shareholders of major returns achieved from disposals.

Metal Tiger’s Metal Projects Division is focused on the development of its key project interests in Botswana, Spain and Thailand. In Botswana Metal Tiger has a growing interest in the large and highly prospective Kalahari copper/silver belt. In Spain Metal Tiger the Company has tungsten and gold interests in the highly-mineralised Extremadura region. In Thailand Metal Tiger has interests in two potentially near-production stage silver/lead/zinc mines as well as licences, applications and critical historical data covering antimony, copper, gold, silver, lead and zinc opportunities.

The Company has access to a diverse pipeline of new opportunities focused on the natural resource sector including physical resource projects, new natural resource centred technologies and resource sector related fintech opportunities. Pipeline projects deemed commercially viable may be undertaken by Metal Tiger or by an AIM or NEX Exchange (formerly ISDX) partner with whom the Company is engaged.

Note: This announcement contains inside information which is disclosed in accordance with the Market Abuse Regulation.