Sherwood Reports Yukon Utilities Board Approves Revised Power Purchase Agreement
Tuesday May 29, 7:00 am ET
Decision Means Lower Cost Grid Power should be available at Minto Mine by the end of 2008
biz.yahoo.com
VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - May 29, 2007) - Sherwood Copper Corporation (TSX VENTURE:SWC - News; TSX VENTURE:SWC.DB - News) reports that the Yukon Utilities Board ("YUB") has approved the amended power purchase agreement ("PPA") between Sherwood's wholly owned subsidiary Minto Explorations Ltd. ("MintoEx") and Yukon Energy Corporation ("YEC"). As a result, the high grade Minto copper-gold mine should have access to grid power by the end of 2008, significantly reducing mine operating costs and providing potential for material benefits to Yukon stakeholders.
"Sherwood appreciates the support of the Yukon Government in advancing the power purchase agreement to a positive conclusion," said Stephen P. Quin, President of Sherwood Copper. "The amended power purchase agreement with Yukon Energy Corporation provides Sherwood the certainty it needs in respect of capital and operating costs for the power line project, allowing its shareholders to benefit from significantly reduced energy costs at an acceptable level of risk. At the same time, Yukon stakeholders gain significant benefits from incremental energy sales, infrastructure development and taxes while reducing the generation of greenhouse gasses in the Yukon."
The Minto mine has already installed on-site diesel generation capacity sufficient for all operations, including production. The feasibility study supporting the development of the Minto Mine, announced August 28, 2006, assumed the use of diesel power for the entire mine life. However, as announced February 12, 2007, the provision of grid power to the Minto mine offers a "win-win" situation for all stakeholders: grid power would benefit Sherwood's shareholders with lower operating costs for the Minto mine and therefore higher profits, thus generating higher taxes and royalties to the Yukon Government and, through them, to the Selkirk First Nation (SFN), while YEC would gain infrastructure and a substantial stream of revenue by utilizing hydroelectric capacity that is surplus to current customers' needs. In addition, YEC and Yukon benefit from the development of electrical infrastructure, offering longer term opportunities for improved and enhanced power utilization and potentially reduced electrical rates as well as reduced greenhouse gas emissions.
As announced May 15, 2007, key modifications to the PPA announced February 12, 2007 are a fixed rate to the end of 2012 of 10c/kwh, which rate would escalate on an annual basis in accordance with an inflation measure, reduction of the take-or-pay provision from $24 million over eight years to $12 million over four years, and a guarantee to Yukon Energy Corporation by the Yukon Development Corporation of the financing risks related to the Minto capital contribution payments. Yukon Development Corporation will also be responsible for any risk that the amount of the Company's contribution for the main line may increase beyond $7.2 million agreed to in the PPA.
Minto Mine
The Minto Project is a high grade copper-gold deposit located 240km north of Whitehorse, and is owned 100% by Minto Explorations Ltd., a wholly owned subsidiary of Sherwood Copper Corporation. The Minto deposit is being developed as an open pit mining operation followed by conventional crushing, grinding, and flotation to produce copper concentrates with significant gold and silver credits. Production is projected to commence in June 2007.
Sherwood
Sherwood's successful consolidation of the ownership of the Minto Project provides a unique investment opportunity: participation in a fully permitted, Canadian, high-grade, open pit copper-gold mine offering near term, low cost copper-gold production, as well as exposure to the tremendous exploration potential of the Minto property.
Additional Information
Additional information on Sherwood and its Minto Project can be obtained on Sherwood's website at sherwoodcopper.com.
On behalf of the board of directors
SHERWOOD COPPER CORPORATION
Stephen P. Quin, President & CEO
This news release may contain forward looking statements which are not historical facts, such as ore reserve estimates, anticipated production or results, sales, revenues, costs, or discussions of goals and exploration results, and involves a number of risks and uncertainties that could cause actual results to differ materially from those projected. These risks and uncertainties include, but are not limited to, metal price volatility, volatility of metals production, project development, ore reserve estimates, future anticipated reserves and cost engineering estimate risks, geological factors and exploration results. See the Company's filings for a more detailed discussion of factors that may impact expected results.
The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this press release.
Contact:
Stephen Quin
Sherwood Copper Corporation
President
(604) 687-7545 or 1-888-338-2200
Investor Relations
Sherwood Copper Corporation
(604) 687-7545 or 1-888-338-2200
(604) 689-5041
Website: www.sherwoodcopper.com
Source: Sherwood Copper Corporation |
