Nevada Copper Provides Additional Operational and Financial Update
YERINGTON, Nev., July 01, 2022 (GLOBE NEWSWIRE) — Nevada Copper (TSX: NCU) (OTC: NEVDF) (FSE: ZYTA) (“Nevada Copper” or the “Company”) provides an update on operations at its Pumpkin Hollow underground copper mine located in Yerington, Nevada (the “underground mine”) and on its financial liquidity.
Response to Restricted Worksite Access and Levee Advancement
As previously reported on June 6, 2022, an unidentified weak rock structure encountered in the East South Zone main ramp has restricted access to the Company’s planned East South stoping areas. In response to this event, the Company has taken steps to reduce operating activities while developing plans to resolve this issue.
The Company continued to develop its priority heading through the dam structure and into the East North mining area, which is expected to have significantly higher copper grades and better geotechnical conditions compared to the East South area. Although nearly complete, additional work is required to complete the levee crossing.
Due to the liquidity issues mentioned below, the Company may not be able to undertake further work on the access ramp to the East-South zone or on the dyke crossing.
As previously reported, the Company has sought to raise additional funds to continue its operations, including the ramp-up of the underground mine. The Company is in discussions with third parties and the Company’s financial partners, including its main lender, KfW IPEX-Bank, and Pala Investments Limited (“Palace”), the Company’s largest shareholder, regarding the additional financing and other financial arrangements. The Company has drawn US$11.5 million under Pala’s previously disclosed US$20 million promissory note. Additional drawdowns under the promissory note are subject to the agreed use of proceeds and the conclusion of satisfactory arrangements with certain creditors and sellers (which have not yet been concluded). There can be no assurance that further drawings under the Promissory Note will be available.
While these discussions continue, the Company is taking steps to significantly reduce underground mine site and other operating expenses, including suspending most mining activities. The Company has defaulted on payments due to certain creditors and suppliers, including its mining contractor and working capital supplier, and is in discussions with them regarding the timing of payments, services and supplies. As a result, the Company is in breach of its obligations under certain financial and contractual arrangements.
Although the Company is continuing discussions with its financial partners and suppliers to obtain additional financing and other satisfactory arrangements, there can be no assurance that such financing and other arrangements will be obtained on time and in sufficient quantity, if at all. . In the absence of such arrangements, the Company will not be able to continue its operations in the normal course of business and may have to initiate protection proceedings against its creditors. The Company’s creditors may also seek to initiate enforcement actions, including the enforcement of their security interest in the Company’s assets.
The technical information and data contained in this press release has been reviewed by Steven Newman, Registered Member – SME, Vice President, Technical Services for Nevada Copper, who is a non-independent qualified person within the meaning of NI 43-101.
About Nevada Copper
Nevada Copper (TSX: NCU) is a copper producer and owner of the Pumpkin Hollow copper project. Located in Nevada, USA, Pumpkin Hollow has significant reserves and resources including copper, gold and silver. Its two fully licensed projects include the high-grade underground mine and processing facility, which are now in production, and a full-scale open-pit project, which is progressing towards feasibility status.
President and CEO
For more information, please visit the company’s website at www.nevadacopper.comor contact:
Tracey Thomas | Vice President, IR and Community Relations
+1 775 391 9029
Caution Regarding Forward-Looking Statements
This press release contains “forward-looking information” and “forward-looking statements” within the meaning of applicable Canadian securities laws. All statements in this press release, other than statements of historical facts, are forward-looking statements. Such forward-looking information and forward-looking statements specifically include, but are not limited to, statements relating to financing needs, discussions with financial partners and suppliers and creditor protection proceedings.
Forward-looking statements and information include statements regarding management’s expectations and beliefs. Often, but not always, forward-looking statements and forward-looking information can be identified by the use of words such as “anticipates”, “expects”, “potential”, “is expected”, “planned”, “is targeted”, “budget”, “planned”, “estimates”, “anticipates”, “intends”, “anticipates” or “believes” or their negative aspects or variations of such words and expressions or statements that certain actions , events or results “may”, “could”, “might”, “could” or “will” be taken, occur or be realized. Forward-looking statements or information should not be construed as guarantees of performance and results. are subject to known and unknown risks, uncertainties and other factors that may cause actual results and events to differ materially from any future results, performance or achievements expressed or implied by such statements. or computer ons prospective.
These risks and uncertainties include, but are not limited to, those relating to: additional capital requirements and no assurance can be given as to the availability thereof; the outcome of discussions with creditors and sellers; a possible creditor protection proceeding; the Company’s ability to complete the ramp-up of the underground mine within anticipated timeframes and cost estimates; the impact of COVID-19 on the Company’s business and operations; the state of financial markets; history of losses; dilution; adverse events related to milling operations, construction, development and ramp-up, including the Company’s ability to resolve underground development and processing plant issues; ground conditions; cost overruns related to the development, construction and ramp-up of the underground mine; loss of material properties; interest rates rise; Mondial economy; limited production history; future fluctuations in metal prices; speculative nature of exploration activities; periodic interruptions to exploration, development and mining activities; environmental risks and liability; industrial accidents; failure of processing and mining equipment to perform as intended; labor disputes; supply issues; the uncertainty of production and cost estimates; interpretation of drilling results and estimation of mineral resources and reserves; changes in project parameters as plans continue to be refined; possible variations in ore reserves, mineralization grade or recovery rates from management’s expectations and the difference may be material; legal and regulatory proceedings and community actions; accidents; the title matters; regulatory approvals and restrictions; increased costs and physical risks associated with climate change, including extreme weather events, and new or revised climate change regulations; permits and licenses; dependence on management information systems and cybersecurity risks; the volatility of the market price of the Company’s securities; Insurance; competition; hedging activities; currency fluctuations; the loss of key employees; other risks of the mining industry as well as the risks discussed in the Company’s MD&A for the year ended December 31, 2021 and the quarter ended March 31, 2022 and in the section entitled “Risk Factors” of the annual report of the Company. Information Statement dated March 31, 2022. The forward-looking statements and information contained in this press release are based on assumptions that management believes are reasonable, including, without limitation: no adverse developments regarding the ownership or operations of the project ; no material changes to applicable laws; ramping up operations at the underground mine in accordance with management’s plans and expectations; no worsening of current work restrictions related to COVID-19; reduced impacts of COVID-19 in the future; the Company will be able to obtain sufficient additional financing to complete the ramp-up, no material adverse change in the price of copper from current levels; and the absence of any other factor that could cause actions, events or results to differ from those anticipated, estimated or intended.
Forward-looking information and statements are made as of the date hereof. The Company disclaims any intention or obligation to update any forward-looking statements or information, except as required by law. Although the Company has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in the forward-looking information and statements, there may be other factors that could cause that the actions, events or results are not as anticipated, estimated or anticipated. Specific reference is made to “Risk Factors” in the Company’s MD&A for the year ended December 31, 2021 and the quarter ended March 31, 2022 and to “Risk Factors” in the Company’s Annual Information Form dated March 31, 2022. , for a discussion of factors that may affect forward-looking statements and information. Should one or more of these risks or uncertainties materialize, should other risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results and events could differ materially from those described in the forward-looking statements and information. . For more information about the Company and the risks and challenges of its business, investors should consult the Company’s filings which are available at www.sedar.com.
The Company does not guarantee that forward-looking statements and information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements or information. Accordingly, readers should not place undue reliance on any forward-looking statements or information.