Driftwood Creek Project

Driftwood Creek magnesium project in British Columbia. Driftwood Creek is host to a high-grade magnesite deposit currently undergoing permitting and economic analysis.

  • Established Mining District: Resides in Driftwood mining district 164 kilometers north of Cranbrook, B.C.
  • Production Profile: PEA outlines 19-year mine life, 3.5 year payback and C$529.8 million pre-tax NPV

  • Mining and Milling: Potentially amenable to open-pit mining and established beneficiation methods
  • Excellent Infrastructure: Access to rails, road, labor and electricity
  • Exploration Potential: Mineralization traced over 2,000 meters; remains open along strike and at depth

2018 Preliminary Economic Assessment

  • Pre-tax NPV @ 5% of $529.8 million, IRR of 24.5% with a 3.5-year payback
  • Post-tax NPV @ 5% of $316.7million, IRR of 19.3% with a 4.0-year payback
  • Initial capital costs of $235.9 million (Total life-of mine (“LOM”) – $239.8 includes sustaining/closure costs of $3.9 million and contingency costs of $40.0 million)
  • Conventional quarry pit mine with a 1200 tonne per day (“tpd”) process plant using conventional crushing, grinding, flotation upgrading, calcination, and sintering to produce a saleable DBM product
  • Cash costs of $350/tonne MgO
  • All-in sustaining costs (“AISC”) of $351/tonne MgO
  • Average annual MgO production of 169,700 tonnes during an 19 year mine life
  • LOM average head grades of 43.27% MgO
  • LOM MgO recoveries of 90%
  • LOM strip ratio of 2.4 to 1 of rock to mineralized material

The reader is advised that the preliminary economic assessment summarized in this press release is only intended to provide an initial, high-level review of the project. The PEA mine plan and economic model include the use of inferred mineral resources which are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves and there is no certainty that the preliminary economic assessment will be realized.

MGX has consolidated key mining claims throughout the Driftwood mining district and controls the majority of significant known magnesite occurrences in British Columbia as listed by the BCGS (British Columbia Geological Survey – Simandl, 2014).

MGX Minerals Driftwood Mining District

Driftwood CreekBritish ColumbiaDevelopment
MarysvilleBritish ColumbiaExploration
Red MountainBritish ColumbiaExploration
Topaz LakeBritish ColumbiaExploration
ClelandBritish ColumbiaExploration
PondBritish ColumbiaExploration
Botts LakeBritish ColumbiaExploration
Dunbar CreekBritish ColumbiaExploration
 Measured 4,702.7 43.31 1.01 0.95 1.29 5.06 47.83
 Indicated 3,144.4 43.22 1.00 1.05 1.42 4.67 47.99
 M&I 7,847.1 43.27 1.00 0.99 1.35 4.90 47.89
 Inferred 55.8 42.95 0.93 0.66 1.43 6.07 47.46

    1. Mineral Resources are not Mineral Reserves and do not have
      demonstrated economic viability. There is no certainty that all or any
      part of the mineral resources estimated will be converted into Mineral

    2. The Lerchs-Grossman (LG) constrained shell economics used a mining
      cost of US$8.82/t, processing+ g&a costs of US$106/t, and a
      commodity price of US$600.00/t 95%MgO DBM.

    3. Mineral resources are reported within the constrained shell, using a
      cutoff grade of 42.5% MgO (based on a 20-year LOM) to determine
      “reasonable prospects for eventual economic extraction.”

    4. Mineral Resources are reported as undiluted

    5. Mineral Resources were developed in accordance with CIM (2010) guidelines

    6. Tonnages are reported to the nearest kilotonne (kt), and grades are rounded to the nearest two decimal places

    7. Rounding as required by reporting guidelines may result in apparent
      summation differences between tonnes, grade, and contained metal.
      M&I = Measured and Indicated.

    Driftwood Creek Magnesium N.I. 43-101 Preliminary Economic Assessment
    Effective Date: April 16, 2018

    Driftwood Creek Magnesium N.I. 43-101 Mineral Resource Estimate
    Effective Date: September 5, 2016

    Driftwood Creek Magnesium N.I. 43-101 Report
    Effective Date: July 22, 2014