Nautilus Minerals Inc.

Nautilus Minerals Inc.

June 01, 2015 07:28 ET

Nautilus Minerals' Solwara 1 Project Has the Potential to Significantly Reduce Social and Environmental Impacts Compared to Terrestrial Copper Mines

Earth Economics' Report highlights the need for sustainable copper mining and that the proposed Solwara 1 project is expected to be "far superior" to existing and proposed terrestrial comparison mines

TORONTO, ONTARIO--(Marketwired - June 1, 2015) - Nautilus Minerals Inc. (TSX:NUS)(OTCQX:NUSMF) ("Nautilus") is pleased to announce that an independent Environmental and Social Benchmarking Analysis (the "Report"), based on natural capital accounting, on Nautilus' Solwara 1 project has been released by Earth Economics. The Report concludes that the Solwara 1 project has the potential to significantly reduce social and environmental impacts commonly associated with large surface terrestrial copper mines.

Earth Economics was commissioned by Nautilus to conduct an independent, objective environmental and social benchmarking analysis of the proposed deep seabed Solwara 1 project with terrestrial copper mines. Solwara 1 is expected to be the world's first commercial high-grade seafloor copper-gold mine project. The Report was released on May 31, 2015.

Specifically, the Report compares the social and environmental impacts of the proposed Solwara 1 project with three terrestrial mines: Bingham Canyon (Utah, USA), Prominent Hill (South Australia, Australia) and Intag (a proposed mine in Intag Province, Ecuador).

Key findings of this natural capital accounting report include:

  • World demand for copper continues to rise, with increasing global economic development, expanding renewable energy supplies (wind, hydro, wave geothermal, tidal power) and growing copper plumbing, electronics and communications sectors.
  • Recycling is likely limited to around 35% of the supply of copper. Copper ore concentrations are declining. Environmental and social impacts of copper mining are rising.
  • There is an urgent need to meet world copper demand while reducing fresh water use and contamination, damaging impacts to communities, mine footprints and CO2 emissions from copper mining.
  • Seafloor mining has the potential to minimize the impact of copper mining by producing more copper with fewer natural capital inputs, fewer damaging outputs and a smaller area of impact.
  • The proposed Solwara 1 project when compared to the terrestrial mines, entails far less environmental and social impact and less short and long-term risks.
  • Terrestrial mines have significant impacts. Measured on the basis of impacts per ton of copper, the Solwara 1 project would outperform terrestrial mines:
    • People will not be displaced by the proposed Solwara 1 project
    • There will be no impact to food production
    • There will be no impact to surface or groundwater fresh water supplies
    • There will be no significant risk of disaster (e.g. mine tailing slide into communities)
    • There will be no impact to pollination, soil formation, erosion, historic and cultural values
  • The monetary damages (measured in terms of USD/year) resulting from terrestrial mines is estimated to be significantly more than that of the proposed Solwara 1 project (4 to 13 times per ton of copper produced for the three mines used in the comparison).
  • The long-term mining liabilities for freshwater contamination, tailings and overburden failures that threaten downstream communities do not exist in Solwara 1.

Mike Johnston, Nautilus' CEO, commented, "Growing copper demand requires our industry to look at more sustainable ways to meet this demand. As showcased in Earth Economics' Report, seafloor mining has the potential to not only provide economic benefits within the communities nearest to the operations while minimizing the impact of copper mining, it also has the potential to change the physical nature of the mining industry for the better."

"We believe that the proposed Solwara 1 project will launch a new frontier in the blue economy and resource sector. As the first publicly-listed company in the world to commercially explore seafloor mining opportunities, Nautilus is committed to leading the way and setting a high bar for developing an environmentally and socially responsible approach for the industry. Commissioning this report is part of our ongoing process to review, estimate and evaluate project impacts through objective third-party experts," he added.

Solwara 1 is located in the Bismarck Sea of Papua New Guinea and it is anticipated that the proposed Solwara 1 project will commence operations in the first half of 2018 subject to project financing and completion of the Company's seafloor production equipment and vessel.

Earth Economics was selected for conducting the research because it is an independent, non-partisan, non-profit organization dedicated to research and economic, environmental and social solutions and it houses the most comprehensive database of natural capital valuation studies in the world. Earth Economics provides independent analyses for a wide range of national and international clients, including government agencies, private companies, Tribes and private foundations (for example, the Federal Emergency Management Agency and San Francisco Public Utilities Commission). To help promote and encourage transparency, any scientists or research groups that Nautilus collaborates with are free to publish the results of their studies, regardless of the outcome.

The full Report can be downloaded from Nautilus Minerals' website and Earth Economics' website:

About the Earth Economics Natural Capital Accounting Report

The analysis for the Report was conducted utilizing a natural capital accounting approach that is internationally recognized based on improvements to the Millennium Ecosystem Assessment and the Economics of Ecosystems and Biodiversity methods. The Report does not contain any economic analysis of the Solwara 1 project and Nautilus has not completed a preliminary economic assessment or other economic study on the Solwara 1 project.

The three producing or proposed mines that were used in the Report, for the analysis comparison with the proposed Solwara 1 project in the Report, were selected for the following reasons:

  • The Bingham Canyon mine is typical of the large scale terrestrial copper porphyry deposits that currently account for most of the world's copper supply.
  • The Prominent Hill mine holds a copper deposit that yields an annual amount of copper that may be similar to copper yields from the proposed Solwara 1 project (annual copper yields assumed for the Solwara 1 project were used solely for the environmental and social impact analysis comparison in the Report).
  • The proposed Intag mine is located in an area containing cloud forest that is considered to be a unique and sensitive terrestrial ecosystem with significant species endemism. Similarly, the vent ecosystems of the deep sea are also considered a unique and sensitive ecosystem with notable species endemism.

Any scientific or technical information contained in this news release and the Report concerning the Company's Solwara 1 project has been reviewed and approved by Mike Johnston, the President and CEO of the Company, who is a "qualified person" under National Instrument 43-101.

Neither the TSX nor the OTCQX accepts responsibility for the adequacy or accuracy of this press release.

Certain of the statements made in this news release may contain forward-looking information within the meaning of applicable securities laws, including statements relating to the Company's plans to commence production of minerals from the Solwara 1 project in the first half 2018 and that the Solwara 1 project is expected to be the world's first commercial high-grade seafloor copper-gold project. We have made numerous assumptions about such statements, including assumptions relating to the funding, completion and operation of the Company's seafloor production system. Please refer to the Company's most recently filed Annual Information Form in respect of material assumptions and risks related to the prospects of extracting minerals from the seafloor and other risks relating to the Company's business and plans for development of its Solwara 1 project. Even though our management believes the assumptions made and the expectations represented by such statements are reasonable, there can be no assurance that they will prove to be accurate. Forward-looking information by its nature involves known and unknown risks, uncertainties and other factors which may cause the actual results to be materially different from any future results expressed or implied by such forward-looking information. Risks related to advancing towards production in 2018 include the risk that the Company will be unable to obtain at all or on acceptable terms the remaining financing necessary to fund completion of the build and deployment of the Company's seafloor production system. In addition, the Company has not completed, and does not intend to complete, a preliminary economic assessment, pre-feasibility study or feasibility study before proceeding with the completion of the construction of equipment and commencement of production at the Solwara 1 project. Management considers the Company's best interests would be served by first demonstrating that existing offshore technologies could be adapted to cut and recover high grade seafloor massive sulphides from the deep ocean floor. There is significant risk with this approach and there can be no assurance that the Company's production plans will, if fully funded and implemented, successfully demonstrate that seafloor resource production is commercially viable. Accordingly you should not place undue reliance on forward-looking statements or information. Except as required by law, we do not expect to update forward-looking statements and information as conditions change and you are referred to the full discussion of the Company's business contained in the Company's reports filed with the securities regulatory authorities in Canada.

About Nautilus Minerals Inc.

Nautilus is the first company to explore the ocean floor for polymetallic seafloor massive sulphide deposits. Nautilus was granted the first mining lease for such deposits at the prospect known as Solwara 1, in the territorial waters of Papua New Guinea, where it is aiming to produce copper, gold and silver. The Company has also been granted its environmental permit for this site.

Nautilus also holds approximately 420,000 km2 of highly prospective exploration acreage in the western Pacific; in PNG, the Solomon Islands, Fiji, Vanuatu and Tonga, as well as in international waters in the eastern Pacific.

A Canadian registered company, Nautilus is listed on the TSX:NUS stock exchange and trades on the OTCQX:NUSMF. Its corporate office is in Brisbane, Australia. Its major shareholders include MB Holding Company LLC, an Oman based group with interests in mining, oil & gas, which holds a 28.14% interest, Metalloinvest, the largest iron ore producer in Europe and the CIS, which has a 20.89% holding and global mining group Anglo American, which holds a 5.99% interest (each on a non-diluted basis, excluding loan shares outstanding under the Company's share loan plan).

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