Bunker Hill Mining (CSE: BNKR) says the Export-Import Bank of the United States may loan it $150 million to help restart and expand the past-producing Bunker Hill silver mine project in Idaho.
The financing from the federal agency could be for a 15-year term, the Vancouver-based company said on Monday. No interest rate was given. It follows a $22.8 million streaming loan in two tranches this year from Phoenix-based Monetary Metals & Co. and a $67 million funding deal with Sprott Private Resource Streaming and Royalty in May 2023.
”We are thrilled to announce this first step in a potential partnership with the Export Import Bank to rapidly expand Bunker Hill’s contribution to US domestic production of critical zinc and silver,” Bunker president and CEO Sam Ash said in a release. “In the face of competition from China, Bunker Hill is proud to play its part in strengthening the US metals supply chain and creating new US mining jobs within the disadvantaged Shoshone County of northern Idaho.”
Bunker Hill received a letter of intent from the bank which is to conduct due diligence on the project. The developer says it will submit a formal loan application to the bank by year’s end.
Tailings upgrade
The first stage of the restart, due to begin by June, carries a $54.8 million capital cost, according to a 2022 prefeasibility study. However, the company said this year it’s choosing a more expensive pressure filtration system for tailings, over the disk filter system in the study, for better environmental management and easier expansion.
Bunker Hill plans an updated resource in next year’s first quarter followed by more drilling as the company preps the initial 1,800-tonne-per-day operation. Engineering studies are to be conducted to support an expansion to 2,500 tonnes a day, but it was unclear exactly when expansion would be done. The mine has a five-year life, according to the 2022 study.
The expansion plan would increase mining and processing of the Quill-Newgard ore zones, the company said. It would later access the deeper, higher-grade silver-bearing galena veins that were extracted from the mine’s lower levels when Gulf Resources closed it in 1981, Bunker said.
Higher costs for environmental compliance and declining metal prices forced the shutdown, it said. Little production occurred under a new owner from 1988 to 1991, which also faced low metal prices.
Shares in Bunker Hill traded at C$0.16 apiece on Tuesday, valuing the company at C$52.4 million. They’ve traded in a 52-week range of C$0.09 to C$0.19.
Coeur d’Alene
The former mine in Idaho’s historical Coeur d’Alene mining district started in 1887 and produced 35 million tons of mineralization grading 8.76% lead, 3.67% zinc and 5.49 oz. per ton (188.2 grams per tonne) silver. The mine remained in care and maintenance until 2020 when Placer Mining took over the project, and sold it to Bunker Hill in 2022.
The project has an after-tax net present value of $52 million at an 8% discount rate and an internal rate of return of 36%, according to the prefeasibility study.
The site holds 3.2 million probable tonnes grading 1.12 grams silver per tonne, 2.59% lead and 5.81% zinc for 3.6 million oz. silver, 166 million lb. lead and 372.1 million lb. zinc, according to a 2022 resource.
Source: MINING.COM – Read More
