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The processing operating cost estimate has been developed on the basis of a process plant feed tonnage of 1.2 million tonnes per annum. The processing operating cost estimate is US$46 million per annum or US$38 per tonne milled.
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5. Environmental, Legal and Socioeconomic Considerations
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5.1 Environmental
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The Company conducted exploration under Exploration License #00710 issued by the MT DEQ. Regulations include the bonding of exploration disturbances to ensure reclamation is completed. The Company currently has an obligated bond of US$442,147 and a surety bond of US$607,419, totaling US$1,049,566 in bonds, for the reclamation of the 2024/2025 JL LCZ and earlier drill programs. These obligations will be released when the reclamation is completed by the Company and inspected and approved by the MT DEQ. In addition, there are approximately 53 ground water wells (37 monitoring wells/test wells, 1 water well, and 15 piezometers) currently in place that will ultimately need to be removed during closure and reclamation
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Potential short- and long-term impacts caused by mining activities were evaluated from several perspectives: impacts to the environment during operation and closure, issues or impacts that could materially affect the mine’s ability to extract the Mineral Reserves, and socio-economic impacts.
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Potential impacts to the environment were addressed in detail in the Environmental Impact Statement (MT DEQ, 2019 and 2020).
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Including the approved MOP, 28 permits and plans require approval from federal, Montana State, or Meagher County authorities. These permits and plans cover water quality, water rights, potable water supply, wetlands and streambed preservation, aquatics monitoring, dam safety, sewerage disposal, air quality, invasive vegetation, tribal communications, cultural resources, community impact, mining infrastructure, mining operations and emergency response. To date, 23 permits and plans have been approved, including the MOP, and work has been initiated on one of the five outstanding permits/plans, that being plans for a transmission line to site. The outstanding permits/plans involve potable water, sewage disposal, explosives permit, and hazardous waste identification.
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5.2 Legal
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The MOP was designed to meet the requirements of the Montana Metal Mine Reclamation Act and the rules and regulations governing the act. Additional permits, including a Montana Pollutant Discharge Elimination System (“MPDES”), were obtained through the MT DEQ.
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Compliance with the applicable legal requirements is demonstrated by the MT DEQ’s approval of the following: MOP, Air Quality Permit, MPDES and construction storm water permit. A draft Environmental Impact Statement was published by the MT DEQ on March 11, 2019, as required under the Montana Environmental Policy Act, and finalized on March 13, 2020. Subsequently, the MT DEQ issued a Record of Decision for the mine on April 9, 2020, identifying MT DEQ’s decision, the reasons for the decision and special conditions surrounding the decision and its implementation.
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As previously reported, following the 2020 legal challenge to the MOP, on February 26, 2024, the Company received a positive ruling by the Montana Supreme Court reversing a 2021 district court decision and instructed the district judge to have the MT DEQ completely reinstate Tintina Montana Inc.’s Mine Operating Permit for the Black Butte Copper Project. The Montana Supreme Court granted the Company’s request for summary judgement allowing the Company to move forward with construction of its highly engineered, underground copper mine. The Company won on all counts in the Montana Supreme Court with a 5-2 decision upholding the 2020 decision of the MT DEQ to allow copper mining at the Black Butte Copper Project.
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Regarding required water rights, on March 13, 2020, the DNRC issued Preliminary Determinations (“PDGs”) granting the requested water right changes. During the following appeal period, six parties filed objections to the PDGs – these were the Newlan Creek Water Users Association, the Montana Fish Wildlife and Parks, and four conservation groups (collectively, the “Objectors”) who filed a joint objection. The Objectors raised issues of legal availability, adverse effects, and adequacy of proposed diversions. Additionally, the objectors challenged current Montana law and requested that mine water discharged from the mine would be classified as beneficial use and so would require additional mitigation.
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On January 2, 2025, the Montana Supreme Court in a 5-2 decision ruled in favor of Tintina Montana and the DNRC affirming the district court’s determination that mine dewatering is not a beneficial use of water.
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As of this date, there are no remaining legal challenges related to the project with both Montana Supreme Court decisions being in favor of the Company.
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5.3 Socioeconomic
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The Project is expected to provide significant direct and indirect employment and economic benefits to Meagher County and the State of Montana, while operating under stringent environmental and social standards.
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6. Qualified
Persons
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The technical information contained in this news release related to the Johnny Lee Deposit has been reviewed and approved by Berkley Tracy, P.Geo (PGO #3024) of SRK Consulting (U.S.), Inc., Shane McLeay FAusIMM of Entech, Patrick Williamson, PG QP of INTERA Inc., and Deepak Malhotra Ph.D. RM-SME of DM Consulting. LLC. Messrs. Tracy, McLeay and Malhotra are Qualified Persons, as defined in NI 43-101 for Mineral Resources, Mineral Reserves and metallurgical processing respectively. Messrs. Tracy, McLeay, Williamson, and Malhotra are independent of the Company. For additional detailed information on the key assumptions, parameters and methods used to estimate the Mineral Reserves, along with other information about the Johnny Lee Deposit, please refer to the PFS to be filed.
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The technical information contained in this news release related to the Lowry Deposit has been reviewed and approved by Messrs. Tracy and Malhotra. The Mineral Resource block model and estimation for the Lowry Deposit was reviewed and accepted by Messrs. Tracy and Malhotra acting as Qualified Persons for Mineral Resources. The final Mineral Resource classification and calculations were performed by Mr. Tracy using Leapfrog Geo™ and Leapfrog Edge™ software. Domaining of copper mineralization was performed by Sandfire America staff using Leapfrog Geo™ software and reviewed by the qualified persons.
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The Qualified Persons referred to above have verified the data disclosed in this news release, including sampling, analytical, and test data underlying the information or opinions contained in this news release.
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7. Technical Report Filing
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The Company will file the PFS, with an effective date of November 5, 2025, on SEDAR+ at www.sedarplus.ca within 45 days of this news release. Investors are encouraged to read the PFS in its entirety.
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Contact Information: Sandfire Resources America Inc. Nancy Schlepp, VP of Communications and Government Relations Mobile: 406-224-8180 Office: 406-547-3466 Email: [email protected]
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Sandfire Resources America Inc. is a mineral exploration and development company focused on advancing the Black Butte Copper Project, a high-grade underground copper project located in Meagher County, Montana, USA. The Company’s vision is to develop a modern, environmentally responsible underground copper mine that delivers long-term benefits to its shareholders, local communities, and the State of Montana. Additional information on Sandfire Resources America Inc. can be viewed on SEDAR+ under the Company’s profile at www.sedarplus.ca
or on Sandfire Resources America Inc.’s website at www.sandfireamerica.com
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Cautionary Note Regarding Forward-Looking Statements: Certain disclosures in this document constitute “forward looking information” within the meaning of Canadian securities legislation, including, but not limited to, statements regarding: the Mineral Resource
and Mineral Reserve estimates; the PFS, including the results and timing of the filing thereof and the PFS representing a viable development option for the Project; the proposed mining plans and recovery methods; estimates of capital; statements regarding construction, operations and sustaining costs;, estimates of all other costs and payments; the estimated amount of future production, both produced and metal recoveries;
cash
flow;
internal
rate
of
return
(IRR);
pre-
and
post-net
present
value;
mine
life;
payback; gross
sales; the employment and economic benefits expected to be derived from the
Project;
economic returns and statements related to the future plans of the Company.
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Forward-looking statements include statements that are predictive in nature, are reliant on future events or conditions, or include words such as “expects”, “potential”, “anticipates”, “plans”, “believes”, “considers”, “significant”, “intends”, “targets”, “estimates”, “seeks”, attempts”, “assumes”, and other similar expressions.
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In making these forward-looking statements, the Company has applied certain factors and assumptions that the Company believes are reasonable, including those assumptions previously set out in this news release and the following assumptions: that the Company will receive required regulatory
approvals;
the
Company’s
successful
advancement
of
the
Black
Butte
Copper
Project;
the expected positive results from the Project based on the estimates and findings contained in the PFS, including current metal prices and economic factors; that the Company will continue to have access to sufficient funding to execute its plans; that the Company is able to procure equipment and supplies in
sufficient quantities and on a timely basis; that the Company’s exploration and development activities on the Black Butte Copper Project will not be affected by actions of environmental activists or other special interest groups; that the results of exploration and development activities will be consistent with management’s expectations; that the assumptions underlying internal rates of return and net present value are valid; that capital costs and sustaining costs will be as estimated; that the assumptions underlying
Mineral
Resource
and
Mineral
Reserve
estimates
are
valid;
that
no
unforeseen
accident, fire, ground instability, flooding, labor disruption, equipment failure, metallurgical, environmental or
other
events
that
could
delay
or
increase
the
cost
of
development
will
occur;
that
the
current
price and demand for copper and other metals will be sustained or will improve; that general business and economic conditions will not change in a materially adverse manner; and the continuity of economic and political conditions and operations of the Company.
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However, the forward-looking statements in this document are subject to numerous risks, uncertainties
and
other
factors,
including
factors
relating
to
the
Company’s
operation as
a
mineral exploration and development company and the Black Butte Copper Project, that may cause future results to differ materially from those expressed or implied in such forward-looking statements, including
those
risks
previously
set
out
in
this
news
release
and
the
following
risks:
the
risk
that
any of the assumptions on which the forward looking information is based prove to be incorrect or invalid; the risk of unexpected variations in Mineral Resources and Mineral Reserves, grade or recovery rates; the possibility of cost overruns or unanticipated costs and expenses; uncertainties relating
to
the
availability
and
costs
of
financing
needed
in
the
future; risks
that
actual
costs
of
restoration activities
are greater than expected and that changes
in Project parameters as plans continue
to be refined result in increased costs; results of exploration and development activities will not be consistent with management’s expectations; uncertainties involved in the interpretation of drilling results
and
geological tests;
delays
in
obtaining
or
inability
to
obtain
required
government
or
other regulatory
approvals
or
financing,
failure
of
plant,
equipment
or
processes
to
operate
as
anticipated; the risk of accidents, labor disputes, inclement or hazardous weather conditions, unusual or unexpected geological conditions, ground control problems, earthquakes, and flooding; interference with
the
Company’s plans, including
exploration
or
development
activities,
by
environmental
activists
or
other
special interest groups; inability to procure equipment and supplies in sufficient quantities and on a timely basis;
the risk that estimated costs will be higher than anticipated and the risk that the proposed mine plan and recoveries will not be achieved, the risks disclosed in the Company’s most recently filed Management Discussion and Analysis and the Company’s other continuous disclosure filing filed under the Company’s profile at www.sedarplus.caand all of the other risks generally associated with the development and operation of mining facilities.
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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. Readers are cautioned
not
to
place
undue
reliance
on
forward-looking
statements.
The
Company
does
not
intend, and expressly disclaims any intention or obligation to, update or revise any forward-looking statements
whether
as
a
result
of
new
information,
future
events
or
otherwise,
except
as
required
by law.
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CAUTIONARY NOTE TO US READERS. As a Canadian reporting issuer, the Company is subject to rules, policies and regulations issued by Canadian regulatory authorities and is required to provide detailed information regarding its properties in accordance with NI 43-101 and CIM definitions
and standards
which
categories
of
resources
are
recognized
by
Canadian regulations but are not recognized by the United States Securities and Exchange Commission (“SEC”).
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The SEC allows mining companies, in their filings with the SEC, to disclose only those mineral deposits they can economically and legally extract or produce. Accordingly, information contained in
this
News
Release
regarding
our
mineral
deposits
may
not
be comparable
to
similar
information made public by U.S. companies subject to the reporting and disclosure requirements under the United States federal securities laws and the rules and regulations of the SEC thereunder.
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Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
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English (US)