Cyprium Metals: Restarting the Nifty Copper Mine as a Large-Scale Open Pit Operation

About Cyprium Metals

Cyprium Metals Limited (ASX: CYM) is an Australian copper company aiming to become a significant mid-tier copper producer through a multi-asset growth strategy. The company is focused on acquiring, developing and exploring copper projects using modern, responsible mining methods to minimize environmental impacts and optimize resource utilization.

Cyprium's key projects are located in the Paterson and Murchison regions of Western Australia, hosting multiple copper and gold deposits. The company's flagship project is the Nifty Copper Mine, a past producing asset with substantial development upside. Along with nearby deposits at Maroochydore and Paterson, Cyprium's Paterson projects form a hub of copper resources totaling over 1 million tonnes of contained copper metal.

In the Murchison region, Cyprium has an interest in the Hollandaire deposit at the Cue Copper-Gold Project and the Nanadie Well Copper-Gold Project. These copper-gold assets add further resources and exploration potential to the company's portfolio.

With a strengthened balance sheet from a recent oversubscribed equity raising, Cyprium is positioned to advance technical studies at Nifty and finalize a development funding package to restart the mine as a large-scale open pit operation.

Major Equity Raising to Fund Nifty Restart

In September 2023, Cyprium completed an oversubscribed equity raising totaling A$31.6 million to fund advancement of the Nifty Copper Mine.

The raising comprised a A$24 million placement to institutional and sophisticated investors at $0.04 per share. It was strongly supported by new and existing domestic and offshore institutions and natural resource investors.

An entitlement offer to existing shareholders raised an additional A$5 million, and was oversubscribed, with a further A$2.6 million placed in the shortfall. This demonstrated strong demand from new and existing shareholders.

Participants in the equity raising received one free attaching option for every two shares subscribed, exercisable at $0.06 by end of 2024.

The successful raising provides Cyprium with the capital to progress technical studies at Nifty over the next 12 months and finalize an appropriate development funding package to restart the mine.

Key Appointments to Lead Growth Strategy

Alongside the equity raising, Cyprium announced several board and management appointments to lead its growth strategy:

• Clive Donner as Managing Director: a mining financing expert who will lead further capital raising and oversee the restart of Nifty as a large open pit mine.
• Matt Fifield from major shareholder Pacific Road Capital as Non-Executive Interim Chair: brings extensive capital markets experience and responsible investment approach.
• Milan Jerkovic as Chief Operating Officer: a mining veteran who will drive operational excellence at Nifty and other projects.

These appointments align with Cyprium's renewed focus on realizing Nifty's potential as a long-life, large-scale copper mining operation in the Pilbara region of Western Australia.

Nifty Copper Mine: Restart Plan as Large Open PitThe Nifty Copper Mine is located 330km southeast of Port Hedland in the Paterson mineral province. Between 1993-2019 under previous owners, Nifty produced over 1.7Mt of copper metal from underground mining.

Cyprium acquired Nifty in 2020 and sees opportunity to restart the mine as a large open pit operation, significantly expanding production volumes over the remaining 10+ year estimated mine life.

Key advantages of restarting Nifty as an open pit include:

• Access to large near-surface copper oxide resources not extracted by the former underground mine.
• Lower operating costs than underground mining.
• Opportunity to expand production beyond previous ~40,000 tonne per annum ore throughput.
• Upside potential from ongoing exploration to further grow resources and extend mine life.

In 2022, Cyprium published an updated Mineral Resource estimate for Nifty, showing:

• Open pit resources of 27.2Mt at 1.3% Cu for 348,500 tonnes of contained copper metal.
• Additional underground resources provide further optionality.
• Total resources at Nifty now stand at 940,200 tonnes of contained copper.

With the recent equity injection, Cyprium can continue advancing feasibility studies into 2023 to finalize technical parameters and costs to develop a 10+ year, open pit copper mine producing 30-40,000tpa of copper metal.

Subject to studies and permitting, first copper production could potentially occur in 2025. The capital cost is expected to be funded 80% by debt and 20% by equity.

Cyprium is also assessing a staged production ramp-up focused initially on heap leaching oxide copper mineralization, transitioning to processing of copper sulphide ores. This provides flexibility to match capital costs with early cash flows.

Nifty would position Cyprium as a new mid-tier copper producer to benefit from demand growth as global electrification accelerates.

Nearby Growth Projects to Support Nifty HubIn the Paterson region, Cyprium controls additional growth projects located within trucking distance of Nifty to provide future mine life extensions and production expansion:

Maroochydore Copper Deposit

• Shallow 2012 JORC resource of 486,000t contained copperiii suitable for open pit mining.
• Scoping study has targeted a +10 year mine producing 20-30,000tpa copper by heap leach SX-EW.
• Development slated to follow successful ramp-up of Nifty using shared infrastructure.

Paterson Exploration Project

• Farm-in JV signed with IGO Ltd covering 2,400km2 of exploration tenure.
• IGO sole funding $32M over 6.5 years to earn 70% interest in JV.
• Initial target is Nifty/Maroochydore style copper mineralization.
• Drilling by IGO has intersected encouraging signs of copper mineralizationiv.

These adjacent projects provide Cyprium with options to sustain the Nifty production hub over 15+ years, establishing a long-life copper business in the Paterson region.

Murchison Copper-Gold ProjectsOutside the Paterson, Cyprium's Murchison portfolio includes early stage copper-gold projects being explored in conjunction with joint venture partners. These represent secondary assets that can provide future growth options:

Cue Copper-Gold Project

• JV with Musgrave Minerals Ltd over the Hollandaire copper-gold deposit.
• Existing JORC resource of 51,500t contained coppert.

Nanadie Well Copper-Gold Project

• Existing copper-gold resource of 162,000t contained coppert.
• Exploration continuing to expand footprint.

While current focus is on Nifty restart, positive results from Murchison exploration could warrant future development. The assets provide Cyprium with flexibility for longer term growth.

Conclusion

With the recent completion of an oversubscribed $31.6 million equity raising, Cyprium Metals is funded to advance feasibility studies to restart the Nifty Copper Mine as a large-scale open pit operation.

The raising attracted strong support from new and existing institutions, reflecting confidence in Cyprium's growth strategy. Key appointments have also been made to drive operational delivery.

Restarting Nifty as an open pit is expected to significantly boost production volumes and mine life compared to past underground mining. Studies will refine operating parameters during 2023 with first production potentially by 2025.

Nifty can form the foundation of a copper production hub for Cyprium, with nearby resources at Maroochydore and exploration upside in the Paterson region providing future growth options.

Murchison copper-gold projects add longer term flexibility and leverage to positive exploration results. However, near-term focus remains on realizing value at Nifty.

With renewed funding, leadership and strategy, Cyprium is positioning to become a significant new Australian copper producer just as global demand enters a period of strong growth. The company offers investors copper leverage at a time when new production is limited.