Exhibit
99.1
 |
CANARC
RESOURCE CORP.
810-625
Howe Street
Vancouver,
BC V6C 2T6
|
|
|
T: 604.685.9700
F: 604.6685-9744
|
|
|
www.canarc.net
CCM:
TSX
CRCUF:
OTCQB
|
Canarc Announces Robust
Preliminary Economic Assessment on the New Polaris Gold Mine
Delivering Post Tax IRR of 38%
Vancouver,
Canada – March 4, 2019 – Canarc Resource Corp. (TSX:
CCM, OTC-QB: CRCUF, Frankfurt: CAN) announces the completion
of an updated NI 43-101 preliminary economic assessment report
(“PEA”) by Moose Mountain Technical Services (Moose
Mountain”) for the past producing, high-grade New Polaris
gold mine project in northwestern British Columbia.
Scott
Eldridge, Canarc’s CEO, stated: “This new PEA establishes significantly
improved economics for our New Polaris gold mine project,
demonstrating the potential for a high-margin, low-cost gold mine.
The new study incorporates an onsite flotation, bio-oxidation and
CIL leaching facility to produce doré gold bars, a
game-changing modification that offers substantial operational and
financial advantages over the previous production plan of shipping
flotation concentrates by barge and truck to offshore facilities
for final processing. We can now model New Polaris as a fly-in,
fly-out mining operation.”
Highlights:
●
Post-tax internal
rate of return of 38%
●
Post-tax net
present value at 5% of US$216 million
●
Post-tax project
payback of 2.7 years
●
Cash operating
cost: US$433/oz Au
●
Initial capital
expenditure of US$111 million
●
ROM production of
2.3 Mt of 10.3 g/t over 8.7-year mine life
●
Mill throughput of
750 tonnes per day with a process recovery of 90.5% producing
693,000 ozs gold
●
Average annual
life of mine production: 80,000 oz. gold
The
estimated project economics for Canarc to build and operate a 750
tonne per day gold mine at New Polaris using bio-oxidation followed
by a leaching process to produce 80,000 ounces of gold per year in
doré bars at site are reasonably achievable for this
project.
This
new processing option significantly enhances the economics of the
project and simplifies transportation logistics at this remote site
by eliminating the need for seasonal barging of large quantities of
concentrate along the Taku River to a third-party treatment
facility.
Using
updated parameters in the base case economic model for the gold
price (US$1300 per oz), $CA/$US exchange rate (0.77), cash costs
(US$433 per oz) and AISC (US$510 per oz ), the updated Moose
Mountain PEA shows an after-tax NPV (5%) of CA$280 million with an
after-tax Internal Rate of Return (“IRR”) of 38% and a
2.7 year pay-back period.
On a
pre-tax basis, the undiscounted life-of-mine cash flow totals
CA$554 million with a 47% IRR and a 2.3 year pay-back period. Given
the conceptual nature of the PEA, there is no certainty that the
preliminary economic assessment will be realized. Moose Mountain
concludes that “The Updated Preliminary Economic Assessment
indicates that the New Polaris base case has potential for positive
results and therefore further work is recommended to optimize the
project and complete a preliminary feasibility
study”.
The Mineral Resources, ROM Production and PEA Economics are
Summarized Below:
|
Mineral
Resource
|
Indicated
resources of 1,686,000 tonnes at 10.8 g/t Au, Inferred resources of
1,483,000 tonnes at 10.2 g/t Au.
|
|
PEA
Production
|
2,306,000
tonnes (subset of Mineral Resource)
|
|
Production
Rate
|
750
tonnes per day
|
|
Au
Grade
|
10.3
grams per tonne
|
|
Au
Recovery
|
90.5%
gold into doré
|
|
Average
Output
|
80,000
oz gold per year
|
|
Mine
life
|
8.7years
|
|
|
|
|
Gold
Price
|
US $
1300 per oz
|
|
Exchange
Rate
|
US $
1.00 = CA$ 1.30
|
|
Initial
Capital Cost
|
US
$111 million
|
|
Cash
Cost
|
US $
433 per oz
|
|
|
|
|
Cash Flow (LOM)
|
After-TaxCA$ 414 million
|
|
NPV (5%)
|
CA$ 280 million
|
|
NPV (8%)
|
CA$ 222 million
|
|
|
|
|
|
Pre-Tax / After Tax
|
|
Internal Rate of Return
|
47% / 38%
|
|
Payback Period (years)
|
2.3 / 2.7
|
Notes
for Mineral Resource Estimate:
●
The Mineral
Resource Estimate was prepared by Sue Bird, P.Eng. in accordance
with CIM Definition Standards and NI 43-101, with an effective date
of February 28, 2019.
●
A Mineral Resource
is a concentration or occurrence of solid material of economic
interest in the Earth’s crust in such form, grade or quality
and quantity that there are reasonable prospects for eventual
economic extraction. The location, quantity, grade or quality,
continuity and other geological characteristics of a Mineral
Resource are known, estimated or interpreted from specific
geological evidence and knowledge, including sampling.
●
Mineral Resources
are reported within an underground mining shape targeting
mineralization over 4.0 g/t. This target grade shell includes the
following considerations: gold price of US$1,300/oz, exchange rate
of 0.77 US$:CA$; Payable gold % of 99.9%, Offsite refining costs of
US$7/oz, mining costs of CA$65.20/t, process costs of CA$62.70/t,
G&A (General and Administration) costs of CA$37.00, sustaining
capital costs of CA$19.83/t, and a 90.5% process
recovery.
●
An Indicated
Mineral Resource is that part of the Mineral Resource for which
quantity, grade or quality, densities, shape and physical
characteristics are estimated with sufficient confidence to allow
the application of Modifying Factors in sufficient detail to
support mine planning and evaluation of the economic viability of
the deposit. Geological evidence is derived from adequately
detailed and reliable exploration, sampling and testing and is
sufficient to assume geological and grade or quality continuity
between points of observation.
●
An Inferred
Mineral Resource is that part of the Mineral Resource for which
quantity and grade or quality are estimated on the basis of limited
geological evidence and sampling. Geological evidence is sufficient
to imply but not verify geological and grade or quality continuity.
It is reasonably expected that the majority of Inferred Mineral
Resources could be upgraded to Indicated Mineral Resources with
continued exploration.
●
Factors that may
affect the estimates include: metal price assumptions, changes in
interpretations of mineralization geometry and continuity of
mineralization zones, changes to kriging assumptions, metallurgical
recovery assumptions, operating cost assumptions, confidence in the
modifying factors, including assumptions that surface rights to
allow mining infrastructure to be constructed will be forthcoming,
delays or other issues in reaching agreements with local or
regulatory authorities and stakeholders, and changes in land tenure
requirements or in permitting requirement.
Project Description:
The
New Polaris gold mine project is located in north-western British
Columbia about 100 kilometers (“km”) south of Atlin, BC
and 60 km northeast of Juneau, Alaska. There is no road access at
present to the property, but year-round access is available via
light aircraft from either Juneau or Atlin to a 400 meter airstrip
on the property, and summer access is possible via shallow draft
barge from Juneau.
The
property consists of 61 contiguous Crown-granted mineral claims and
one modified grid claim covering 2,100 acres. All claims are 100%
owned and held by New Polaris Gold Mines Ltd., a wholly owned
subsidiary of Canarc, subject to a 15% net profit interest held by
Rembrandt Gold Mines Ltd. that can be reduced to a 10% net profit
interest.
The
deposit is an early Tertiary, mesothermal gold mineralized vein
system occupying shear zones cross-cutting late Paleozoic andesitic
volcanic rocks. It was mined by underground methods from 1938 to
1942, and from 1946 to early 1951, producing approximately 245,000
oz gold from 740,000 tonnes of ore at an average grade of 10.3 g/t
gold. Three main veins (“AB, C and Y”) were mined to a
maximum depth of 150 m and have been traced by drilling for up to
1,000 m along strike by up to 800 m down dip, still open for
expansion.
The
gold occurs dominantly in finely disseminated arsenopyrite within
the stock-work veins and altered wall-rocks. The next most abundant
mineral is pyrite, followed by minor stibnite and a trace of
sphalerite. Individual mineralized zones range up to 250 m in
length and up to 14 m in width but mineralized widths more commonly
average around 2 to 5 m.
Mineral Resource Estimate:
Canarc
explored the “C” vein system between 1988 and 1997, and
carried out infill drilling in 2003 through 2006, to better define
the continuity and grade of the vein systems. The total New Polaris
database consists of 1,056 diamond drill holes with a total of
31,514 sample intervals. A Mineral Resource Estimate dated February
28, 2019 was based on ordinary kriging of 174 drill holes and 1,464
gold assay intervals with 1,320 m of drill intercepts within the
modelled domains.
Targeting
mineralization over 4.0 gram per tonne (g/t) gold, a mining shape
has delineated a Mineral Resource Estimate:
●
Indicated Mineral
Resource totals 1,687,000 tonnes grading 10.8 g/t gold containing
586,000 oz gold.
●
Inferred Mineral
Resource totals 1,483,000 tonnes grading 10.2gpt gold containing
485,000 oz gold.
The
mine plan and ROM production targets mineralization over 6.0 g/t
gold within the 4.0 g/t resource shell, and uses a combination of
conventional cut and fill and longhole stoping, depending on
mineralization thickness and continuity. Development will include a
decline from surface, extraction drifts on sublevels across the
footwall of the orebody, and ventilation raises to the
surface.
An
onsite mill will produce a float concentrate feeding a bio-leaching
and CIL plant to produce doré. Process water will go through
the ASTER treatment process and reclaim water will be stored in
surface settling ponds near the plant.
Tails
will be thickened with 42% being pumped underground to a paste
plant and dispersal system into mined out voids and the remaining
58% filtered to a semi-dry state and hauled and dumped into a
secure co-disposal facility (CDF) with waste rock from the
underground development.
Sensitivity Analysis:
The Net
Present Values and life of mine net cash flows are shown at various
discount rates. Cash costs include all costs to produce a
gold-sulphide concentrate followed by Bio-Oxidation and CIL
leaching process to produce
doré gold bars at site.
This
preliminary economic assessment is based on resources, not
reserves, and a portion of the modeled resources in the mine plan
are in the inferred resource category. Given the inherent
uncertainties of resources, especially inferred resources compared
to reserves, the New Polaris gold mine project cannot yet be
considered to have proven economic viability.
Qualified
Person
The Qualified Person (“QP”) pursuant to NI 43-101 for
the updated preliminary economic assessment report is Marc Schulte,
P. Eng.
"Scott Eldridge”
____________________
Scott Eldridge, Chief Executive
Officer
CANARC
RESOURCE CORP.
About Canarc - Canarc Resource Corp. is
a growth-oriented gold exploration company focused on generating
superior shareholder returns by discovering, exploring and
developing strategic gold deposits in North America. The
Company is currently advancing two core assets, each with
substantial gold resources, and has initiated a high impact
exploration strategy to acquire and explore new properties that
have district-scale gold discovery potential. Canarc shares
trade on the TSX: CCM and the OTCQB: CRCUF.
For More Information - Please contact:
Scott
Eldridge, CEO
Toll
Free: 1-877-684-9700
Tel: (604)
685-9700
Cell: (604)
722-5381
Email:
scott@canarc.net
Website:
www.canarc.net
Cautionary Note Regarding Forward-Looking Statements
This news release contains “forward-looking statements”
within the meaning of the United States private securities
litigation reform act of 1995 and “forward-looking
information” within the meaning of applicable Canadian
securities legislation. Statements contained in this news release
that are not historic facts are forward-looking information that
involves known and unknown risks and uncertainties. Forward-looking
statements in this news release include, but are not limited to,
statements with respect to the future performance of Canarc, and
the Company's plans and exploration programs for its mineral
properties, including the timing of such plans and programs. In
certain cases, forward-looking statements can be identified by the
use of words such as "plans", "has proven", "expects" or "does not
expect", "is expected", "potential", "appears", "budget",
"scheduled", "estimates", "forecasts", "at least", "intends",
"anticipates" or "does not anticipate", or "believes", or
variations of such words and phrases or state that certain actions,
events or results "may", "could", "would", "should", "might" or
"will be taken", "occur" or "be achieved".
Forward-looking statements involve known and unknown risks,
uncertainties and other factors which may cause the actual results,
performance or achievements of the Company to be materially
different from any future results, performance or achievements
expressed or implied by the forward-looking statements. Such risks
and other factors include, among others, the Company’s
ongoing due diligence review in relation to the Acquisition, risks
related to the uncertainties inherent in the estimation of mineral
resources; commodity prices; changes in general economic
conditions; market sentiment; currency exchange rates; the
Company's ability to continue as a going concern; the Company's
ability to raise funds through equity financings; risks inherent in
mineral exploration; risks related to operations in foreign
countries; future prices of metals; failure of equipment or
processes to operate as anticipated; accidents, labor disputes and
other risks of the mining industry; delays in obtaining
governmental approvals; government regulation of mining operations;
environmental risks; title disputes or claims; limitations on
insurance coverage and the timing and possible outcome of
litigation. Although the Company has attempted to identify
important factors that could affect the Company and may cause
actual actions, events or results to differ materially from those
described in forward-looking statements, there may be other factors
that cause actions, events or results not to be as anticipated,
estimated or intended. There can be no assurance that
forward-looking statements will prove to be accurate, as actual
results and future events could differ materially from those
anticipated in such statements. Accordingly, do not place undue
reliance on forward-looking statements. All statements are made as
of the date of this news release and the Company is under no
obligation to update or alter any forward-looking statements except
as required under applicable securities laws.