Anfield receives first exploitation licence for Mayaniquel

Shares of Anfield Nickel (TSX: ANF) jumped 12% to $2.91 after Guatemala’s Ministry of Energy and Mines approved the first of three exploitation licences the junior has submitted for its Mayaniquel nickel laterite project.

The exploitation licence for the Sechol area of the project, near Lake Izabal in northeastern Guatemala, allows Anfield to mine all of the nickel and iron mineralization contained within the exploitation area for twenty-five years. The licence also comes with an option for the company to extend the licence for a second twenty-five period.

Mayaniquel is made up of exploration licences encompassing about 121 sq. km within the nickel laterite belt surrounding Lake Izabal and lies about 250 km from Guatemala City and about 100 km west of the port city of Puerto Barrios on the Caribbean Sea.

The exploitation licence approval followed a rigorous two-year review of the project by several different governmental agencies, Anfield says. According to a prefeasibility study completed in October 2012, the project has the potential to generate about $2.3 billion in taxes and government royalties payable to the Guatemalan government.

The conventional open-pit operation would mine about 9,000 tonnes per day or 3.30 million tonnes per year of lateritic ore for 22 years. About 24% of the mined ore would be delivered directly to the processing plant, while the remaining mined material (2.5 million tonnes a year) would be sent to an upgrading plant, which would reject low nickel grade and high iron material, and provide the processing plant with a total average feed grade of 1.68% nickel over the life-of-mine.

At a base case nickel price of US$8.50 per lb., the project’s net present value at an 8% discount rate would be $1.39 billion and the internal rate of return 19.9%. Initial capital expenditure is forecast to reach $946 million with life-of-mine total sustaining capex of $1.1 billion.

Mayaniquel contains proven and probable mineral reserves of 69.9 million tonnes grading 1.41% nickel.

Average life-of-mine nickel in ferronickel production will be 36,500 tonnes a year for 22 years with an average nickel in ferronickel grade of 22.5%. Production will peak in year nine with 42,800 tonnes of nickel in ferronickel produced following the commissioning of a second furnace in year five.

Anfield acquired the project in 2009 from BHP Billiton (NYSE: BHP) for US$2.5 million and a 1.5% Net Smelter Royalty.

In Toronto the company’s shares rose 31¢ to $2.91 within a 52-week trading range of $2.55-4.10.