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PolyMet drilling program results in additions to NorthMet Mineral Resources and Reserves

ST. PAUL, Minn.--()--Poly Met Mining, Inc., a wholly-owned subsidiary of PolyMet Mining Corp. (together “PolyMet” or the “company”) TSX: POM; NYSE American: PLM, today announced updated Mineral Resources and Reserves for the NorthMet deposit based on results of its 2018-19 drilling program. Highlights include:

“With a fully permitted project, we remain in ongoing discussions with potential lenders about financing while we also continue to identify opportunities to optimize and deliver the project in the most economic way possible.”

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  • Proven and Probable Reserves increased by 14% to 290 million tons;
  • Measured and Indicated Resources increased by 22% to 795 million tons.

“We are pleased with the improvements the drilling program delivered to our mineral resource, with an additional 177 million pounds of copper, 53 million pounds of nickel and 322,000 ounces of precious metals added to the Proven and Probable Reserve category,” said Jon Cherry, president and CEO.

“The drilling program outcomes are indicative of our tremendous NorthMet asset and the progress we continue to make with the project,” Cherry said. “With a fully permitted project, we remain in ongoing discussions with potential lenders about financing while we also continue to identify opportunities to optimize and deliver the project in the most economic way possible.”

The results of drilling that commenced in the fourth quarter of 2018 and concluded in 2019 were used to convert material from the Inferred category into the Measured and Indicated Resource classifications. Subsequently, the Reserve was updated under NI 43-101 guidelines.

Updated NorthMet Mineral Resources and Mineral Reserves

Mineral reserves

The 2018-19 drilling program increased the Proven and Probable Mineral Reserve by 35.7 million tons, or 14%. The January 2018 and September 2019 reserve statements are shown in Table 1. Metal prices used for the reserve calculations are shown in Table 2.

Table 1. Mineral Reserves Statement – January 2018 and September 2019

Class

  

Tonnage

  

2018 Grades (Diluted)

 

 

 

(x 1,000)

 

 

Copper

 

 

Nickel

 

 

Platinum

 

 

Palladium

 

 

Gold

 

 

Cobalt

 

 

Silver

 

 

NSR

 

 

 

 

 

 

(%)

 

 

(%)

 

 

(ppb)

 

 

(ppb)

 

 

(ppb)

 

 

(ppm)

 

 

(ppm)

 

 

$/t

 

Proven

  

121,849

 

 

0.308

 

 

0.087

 

 

82

 

 

282

 

 

41

 

 

74.81

 

 

1.11

 

 

19.87

 

Probable

  

132,820

 

 

0.281

 

 

0.081

 

 

78

 

 

256

 

 

37

 

 

74.06

 

 

1.02

 

 

18.02

 

Total

  

254,669

 

 

0.294

 

 

0.084

 

 

80

 

 

268

 

 

39

 

 

74.42

 

 

1.06

 

 

18.90

 

Contained Metal

  

1.497 Blb

  

427 Mlb

  

0.59 Moz

  

2.00 Moz

  

0.29 Moz

  

37.9 Mlb

  

7.91 Moz

  

 

 

Class

  

Tonnage

  

2019 Grades (Diluted)

 

 

 

(x 1,000)

 

 

Copper

 

 

Nickel

 

 

Platinum

 

 

Palladium

 

 

Gold

 

 

Cobalt

 

 

Silver

 

 

NSR

 

 

 

 

 

 

(%)

 

 

(%)

 

 

(ppb)

 

 

(ppb)

 

 

(ppb)

 

 

(ppm)

 

 

(ppm)

 

 

$/t

 

Proven

  

173,495

 

 

0.288

 

 

0.083

 

 

75

 

 

270

 

 

39

 

 

74.21

 

 

1.05

 

 

19.84

 

Probable

  

116,904

 

 

0.288

 

 

0.081

 

 

76

 

 

256

 

 

37

 

 

73.56

 

 

1.08

 

 

19.60

 

Total

  

290,399

 

 

0.288

 

 

0.083

 

 

75

 

 

264

 

 

39

 

 

73.95

 

 

1.06

 

 

19.74

 

Contained Metal

  

1.674 Blb

  

480 Mlb

  

0.64 Moz

  

2.24 Moz

  

0.33 Moz

  

42.9 Mlb

  

8.96 Moz

  

 

 

Notes:

(1) Mineral Reserves tonnage and contained metal are rounded to reflect the accuracy of the estimate; numbers may not add due to rounding.

(2) The 2019 Mineral Reserves estimate is effective as of September 2019. The QP for the estimate is Herb Welhener, RM-SME, of Independent Mining Consultants, Inc. The mineral reserves statement for January 2018 is extracted from the company’s March 26, 2018 technical report titled “NorthMet Project” (the “NorthMet Technical Report”).

(3) All reserves are stated above a $7.98 Net Smelter Return (NSR) cutoff and bound within the final pit design.

(4) Net Smelter Return includes payable metal values less concentrate transportation and smelting and refining costs.

(5) January 2018 pit; average waste: ore ratio = 1.47. September 2019 pit; average waste: ore ratio = 1.43

(6) Tonnage and grade estimates are in Imperial units. Estimation methodology has not changed from the NorthMet Technical Report.

(7) The risks that could materially affect the development of the NorthMet asset are set out under the heading “Risk Factors” in the company’s Annual Information Form dated March 28, 2019.

Table 2. Reserve metal prices from 2018 and 2019

All Metal Prices

 

Copper

 

 

Nickel

 

 

Platinum

 

 

Palladium

 

 

Gold

 

 

Cobalt

 

 

Silver

 

In US Dollars

 

per lb

 

 

per lb

 

 

per oz

 

 

per oz

 

 

per oz

 

 

per lb

 

 

per oz

 

2018

 

2.93

 

 

6.50

 

 

1286

 

 

734

 

 

1263

 

 

13.28

 

 

19.06

 

2019

 

2.91

 

 

5.54

 

 

889

 

 

1058

 

 

1274

 

 

28.82

 

 

16.19

 

Mineral resources

Mineral Resources statements from 2018 and 2019 are shown in Table 3. The additional drilling increased Measured and Indicated Mineral Resources by 146 million tons while decreasing the Inferred Mineral Resources by 51 million tons. The 2019 Mineral Resources prices are based on a 15% increase from the prices used in the 2019 Mineral Reserves estimates. Metal price assumptions are shown in Table 4.

Table 3. Measured, Indicated and Inferred Mineral Resources from 2018 and 2019

2018 Grades (Undiluted)

 

Class

 

 

Tonnage (X1000)

 

 

Copper (%)

 

 

Nickel (%)

 

 

Platinum (ppt)

 

 

Palladium (ppt)

 

 

Gold (ppt)

 

 

Cobalt (ppm)

 

 

Silver (ppm)

 

 

NSR (US$/t)

 

Measured

  

237,200

 

 

0.270

 

 

0.080

 

 

69

 

 

241

 

 

35

 

 

72

 

 

0.97

 

 

19.67

 

Indicated

  

412,200

 

 

0.230

 

 

0.070

 

 

63

 

 

210

 

 

32

 

 

70

 

 

0.87

 

 

16.95

 

M+I

  

649,400

 

 

0.245

 

 

0.074

 

 

65

 

 

221

 

 

33

 

 

71

 

 

0.91

 

 

17.94

 

Inferred

  

508,900

 

 

0.240

 

 

0.070

 

 

72

 

 

234

 

 

37

 

 

66

 

 

0.93

 

 

17.66

 

2019 Grades (Undiluted)

 

Class

 

 

Tonnage (X1000)

 

 

Copper (%)

 

 

Nickel (%)

 

 

Platinum (ppt)

 

 

Palladium (ppt)

 

 

Gold (ppt)

 

 

Cobalt (ppm)

 

 

Silver (ppm)

 

 

NSR (US$/t)

 

Measured

  

351,500

 

 

0.240

 

 

0.073

 

 

64

 

 

222

 

 

33

 

 

71

 

 

0.88

 

 

19.01

 

Indicated

  

443,700

 

 

0.230

 

 

0.069

 

 

61

 

 

207

 

 

30

 

 

68

 

 

0.87

 

 

17.91

 

M+I

  

795,200

 

 

0.234

 

 

0.071

 

 

62

 

 

214

 

 

31

 

 

69

 

 

0.87

 

 

18.40

 

Inferred

  

457,700

 

 

0.236

 

 

0.067

 

 

63

 

 

225

 

 

32

 

 

56

 

 

0.87

 

 

18.07

 

Notes:

(1) Mineral Resources tonnage and grades are rounded to reflect the accuracy of the estimate, and numbers may not add due to rounding.

(2) The 2019 Mineral Resources estimate is effective as of July 2019. The QP for the estimate is Zachary J. Black, RM-SME, of Hard Rock Consulting, LLC. The mineral resources statement for 2018 is extracted from the NorthMet Technical Report

(3) Mineral Resources are not Mineral Reserves and do not have demonstrated economic viability.

(4) Mineral Resources are reported inclusive of Mineral Reserves at $6.34 Net Smelter Return (NSR) cut-off. The Mineral Resources are considered amenable to open pit mining and are reported within an optimized pit shell. Pit optimization is based on total ore costs of $5.49/ton processed, mining costs of $1.15/ton at surface and increasing $0.02/ton for every 50 feet of depth, and pit slope angles of 48 degrees. Tonnages are reported in short tons (2000lbs)

(5) The Mineral Resources estimation methodology has not changed from the NorthMet Technical Report.

(6) The risks that could materially affect the development of the NorthMet asset are set out under the heading “Risk Factors” in the company’s Annual Information Form dated March 28, 2019.

Table 4. Resource metal prices from 2018 and 2019

All Metal Prices

 

Copper

 

 

Nickel

 

 

Platinum

 

 

Palladium

 

 

Gold

 

 

Cobalt

 

 

Silver

 

In US Dollars

 

per lb

 

 

per lb

 

 

per oz

 

 

per oz

 

 

per oz

 

 

per lb

 

 

per oz

 

2018

 

3.30

 

 

8.50

 

 

1286

 

 

734

 

 

1263

 

 

13.28

 

 

19.06

 

2019

 

3.34

 

 

6.37

 

 

1023

 

 

1216

 

 

1465

 

 

33.14

 

 

18.62

 

Drill hole locations

Drill hole locations from the 2018 and 2019 drilling program in the east and west pit, are shown in Figure 1. Table 5 contains a summary of all 2018 and 2019 drilling assay results. Table 6 contains the drill hole locations.

Table 5. 2018 and 2019 drilling results

Hole

 

 

From ft

 

 

To Ft

 

 

Interval ft

 

 

True
Width

 

 

Rec Cu
Eq %

 

 

Cu Eq
%

 

 

Cu %

 

 

Ni %

 

 

Co
ppm

 

 

Pd
ppb

 

 

Pt
ppb

 

 

Au
ppb

 

 

Ag
ppm

 

 

Unit

 

East Pit Metallurgical Drilling

 

18-001

 

 

6.0

 

 

300.0

 

 

294.0

 

 

Down dip

 

 

0.77

 

 

1.02

 

 

0.43

 

 

0.12

 

 

86

 

 

371

 

 

82

 

 

43

 

 

1.47

 

 

Unit 1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

18-002

 

 

0.0

 

 

62.0

 

 

62.0

 

 

41

 

 

0.49

 

 

0.66

 

 

0.27

 

 

0.08

 

 

66

 

 

238

 

 

46

 

 

20

 

 

0.88

 

 

Unit 1

 

18-002

 

 

87.0

 

 

232.0

 

 

145.0

 

 

96

 

 

0.54

 

 

0.73

 

 

0.21

 

 

0.07

 

 

89

 

 

196

 

 

35

 

 

21

 

 

0.96

 

 

Unit 1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

18-003

 

 

0.0

 

 

129.0

 

 

129.0

 

 

129

 

 

0.66

 

 

0.88

 

 

0.35

 

 

0.10

 

 

87

 

 

345

 

 

79

 

 

34

 

 

1.06

 

 

Unit 1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

18-004

 

 

13.0

 

 

173.0

 

 

160.0

 

 

Down dip

 

 

0.88

 

 

1.15

 

 

0.46

 

 

0.13

 

 

82

 

 

483

 

 

110

 

 

67

 

 

1.39

 

 

Unit 1

 

18-004

 

 

188.0

 

 

300.0

 

 

112.0

 

 

Down dip

 

 

0.74

 

 

1.01

 

 

0.42

 

 

0.14

 

 

130

 

 

281

 

 

68

 

 

35

 

 

1.28

 

 

Unit 1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

18-005

 

 

0.0

 

 

174.0

 

 

174.0

 

 

117

 

 

0.58

 

 

0.78

 

 

0.32

 

 

0.10

 

 

79

 

 

274

 

 

71

 

 

25

 

 

1.04

 

 

Unit 1

 

18-005

 

 

209.0

 

 

294.0

 

 

85.0

 

 

57

 

 

0.55

 

 

0.75

 

 

0.33

 

 

0.10

 

 

107

 

 

155

 

 

43

 

 

19

 

 

1.19

 

 

Unit 1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

18-006

 

 

10.0

 

 

85.0

 

 

75.0

 

 

75

 

 

0.44

 

 

0.60

 

 

0.23

 

 

0.07

 

 

68

 

 

223

 

 

45

 

 

24

 

 

0.79

 

 

Unit 1

 

18-006

 

 

135.0

 

 

160.0

 

 

25.0

 

 

25

 

 

0.34

 

 

0.47

 

 

0.14

 

 

0.05

 

 

65

 

 

225

 

 

84

 

 

16

 

 

0.38

 

 

Unit 1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

18-017

 

 

7.0

 

 

342.0

 

 

335.0

 

 

Down dip

 

 

0.65

 

 

0.88

 

 

0.35

 

 

0.11

 

 

89

 

 

318

 

 

76

 

 

36

 

 

1.19

 

 

Unit 1

 

18-017

 

 

352.0

 

 

407.0

 

 

55.0

 

 

Down dip

 

 

0.42

 

 

0.57

 

 

0.21

 

 

0.06

 

 

69

 

 

253

 

 

50

 

 

21

 

 

0.60

 

 

Unit 1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

18-018

 

 

0.0

 

 

281.0

 

 

281.0

 

 

Down dip

 

 

0.72

 

 

0.97

 

 

0.40

 

 

0.12

 

 

103

 

 

277

 

 

71

 

 

36

 

 

1.32

 

 

Unit 1

 

18-018

 

 

291.0

 

 

456.0

 

 

165.0

 

 

Down dip

 

 

0.59

 

 

0.80

 

 

0.31

 

 

0.10

 

 

96

 

 

280

 

 

65

 

 

34

 

 

0.93

 

 

Unit 1

 

18-018

 

 

471.0

 

 

500.0

 

 

29.0

 

 

Down dip

 

 

0.72

 

 

0.95

 

 

0.41

 

 

0.11

 

 

98

 

 

344

 

 

73

 

 

34

 

 

1.05

 

 

Unit 1

 

West Pit Metallurgical Drilling

 

18-013

 

 

27.0

 

 

159.0

 

 

132.0

 

 

123

 

 

0.73

 

 

0.98

 

 

0.38

 

 

0.10

 

 

91

 

 

348

 

 

123

 

 

94

 

 

2.36

 

 

Magenta

 

18-013

 

 

209.0

 

 

249.0

 

 

40.0

 

 

37

 

 

0.57

 

 

0.75

 

 

0.29

 

 

0.07

 

 

66

 

 

322

 

 

120

 

 

38

 

 

1.12

 

 

Unit 1/3

 

18-013

 

 

264.0

 

 

324.0

 

 

60.0

 

 

56

 

 

0.53

 

 

0.52

 

 

0.11

 

 

0.04

 

 

56

 

 

110

 

 

32

 

 

19

 

 

0.80

 

 

Unit 1/3

 

18-013

 

 

334.0

 

 

494.0

 

 

160.0

 

 

150

 

 

0.43

 

 

0.60

 

 

0.19

 

 

0.08

 

 

83

 

 

215

 

 

66

 

 

31

 

 

0.48

 

 

Unit 1/3

 

18-013

 

 

519.0

 

 

639.0

 

 

120.0

 

 

112

 

 

1.39

 

 

1.82

 

 

0.65

 

 

0.16

 

 

90

 

 

994

 

 

168

 

 

229

 

 

3.23

 

 

Unit 1/3