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American Manganese revises Artillery Peak feasibility report

Keywords: Tags  American Manganese, Artillery Peak, Arizona,


NEW YORK — American Manganese Inc. has been forced to adjust the base case for the feasibility of its Artillery Peak manganese project in Arizona, leading to a negative net present value (NPV) for the project.

"Due to concerns raised by the British Columbia Securities Commission, the company has agreed to change the base case to the more conservative three-year trailing (price) average," Vancouver, British Columbia-based American Manganese said.

In its initial base case, the company used a price forecast by the CPM Group which indicated a $402.9-million net present value at an 8-percent discount rate. Using the trailing average, the project now has a negative net present value of $22.9 million at the same discount rate and is therefore deemed not economic by the securities commission, according to the company.
 
"Accordingly, the report will be amended to show there are no mineral reserves for the project that meet the Canadian Institute of Mining, Metallurgy and Petroleum definition and consequently the mineral reserves for the project are retracted," the company said.

However, a company executive said the revision has not slowed the development of the project.

"I’m still confident that the CPM numbers are correct," president and chief executive officer Larry Reaugh told AMM, adding that the company might have a strategic partner for the project by this fall due to strong interest from the lithium-ion battery sector, which uses manganese dioxide in its production process.


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