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ScoZinc updates mine plan for restarting operations at namesake zinc-lead mine

ScoZinc Mining Ltd.'s updated preliminary economic assessment for restarting operations at its ScoZinc zinc-lead mine in Nova Scotia pegged a posttax net present value, discounted at 8%, of C$119.0 million, a 64.8% internal rate of return, and a 2.2-year payback period.

The new study includes a more detailed mine plan and updated costs, and a switch to contract mining, from the owner-operator model in the 2013 report.

The study envisages the sequential development of two open-pit operations on the Main and Northeast deposits, according to the Dec. 19 release.

The total cost of production for the life of mine is expected at 61 U.S. cents per pound of zinc, after accounting for lead credits.

ScoZinc has spent over C$10 million on the mine and the additional C$31.1 million will be used to increase the mill throughput to 2,600 tonnes per day, pre-stripping of waste material in the Main pit, other start-up costs, contingency and working capital.

Average EBITDA is expected at C$36.4 million per annum during the eight-year mine life, at a base case zinc price of US$1.25 per pound and a lead price of US$1.05 per pound.

The company noted that addition of the Getty deposit and expanded mineral resources to the mine plan is expected to add over three years to the current mine life.

ScoZinc started looking at the possibility of restarting the project after it received a 10-year renewal of the site's industrial approval permit in September.