Foran conditionally approved for $20M gov’t funding for McIlvenna Bay infrastructure

Foran Mining (TSX: FOM; US-OTC: FMCXF) has conditional Energy and Natural Resources Ministry (NRCan) approval for up to $20 million in support of clean energy infrastructure at its McIlvenna Bay project.

The Canadian government allocated $1.5 billion to the Critical Minerals Infrastructure Fund (CMIF). It funds projects that close infrastructure gaps in critical minerals production.

“In its drive to produce copper without polluting more, Foran’s project is to help reinforce Canada’s position as a global supplier of choice for clean technology, clean energy and the resources the world needs to build a prosperous economy,” NRCan Minister Jonathan Wilkinson said in a statement Friday.

The $20 million CMIF funding, pending due diligence and a deal, is to build a hydroelectric transmission line, an on-site substation, and EV chargers at McIlvenna Bay. Foran’s CEO, Dan Myerson, was upbeat about the NRCan’s support.

“The investment in developing a hydro transmission line and supporting infrastructure will deliver renewable hydropower to our operations and open up a new critical minerals and mining district in Canada for generations to come – a key step in our plan to achieve net-zero carbon copper production,” he said in a statement Friday.

The McIlvenna Bay project is in the Flin Flon greenstone belt. It is a world-class area that runs for over 225 km from Snow Lake, Manitoba, through Flin Flon to Foran’s ground in eastern Saskatchewan.

The property has the region’s largest undeveloped VHMS (volcanic-hosted massive sulphide) deposit. Its indicated resource is 39 million tonnes, with a grade of 1.20% copper, 2.16% zinc, 0.41 grams gold per tonne, and 14 grams silver. That’s a 2.04% copper equivalent.

A 2022 feasibility study outlined an 18-year mine capable of producing an average of 65 million lb. of copper equivalent annually (34.5 million lb. of copper, 58.6 million lb. of zinc, 17,500 oz. of gold and 435,200 oz. of silver).

In the base case, the project’s initial capital is $368 million. The life-of-mine sustaining capital would need another $481 million. The after-tax net present value (at a 7% discount) is $466 million, with an internal rate of return of 22%.

In early Friday trading, Foran shares rose 1.8% to $4.01 apiece for a market capitalization of under $1.6 billion. The stock traded as high as $4.69 over the past 12 months and as low as $3.43.