DIB - this came up in conversation recently (I think)
Press Release Source: Dia Bras Exploration Inc.
Dia Bras Provides Clarification on its Pilot-Mining Program in Chihuahua, Mexico and Other Projects
Friday August 11, 11:07 am ET
MONTREAL, QUEBEC--(CCNMatthews - Aug. 11, 2006) - Dia Bras Exploration Inc. (TSX VENTURE:DIB - News), at the request of the Autorite des Marches Financiers (the "AMF"), provides clarification on its ongoing pilot-mining program, at Bolivar in the State of Chihuahua, Mexico and other activities on the Cusi project, also in Chihuahua, Mexico. These clarifications have been requested in connection with the AMF's approval of the Company's short form prospectus concerning the $10 million bought deal financing.
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BOLIVAR PROJECT
In October 2004 Dia Bras Exploration, Inc. acquired certain properties (the "Bolivar Properties") located in the southwest part of the State of Chihuahua, Mexico. The Bolivar Properties included a formerly producing, but abandoned mine (the "Mine"). No data such as mine maps, drill or assay results, or detailed geologic maps of the area were available for the Mine or the Bolivar Properties. The Company's management realized that the easily accessible high contents of copper and zinc minerals exposed and visible in the Mine combined with high metal prices provided an opportunity to fast-track the evaluation of the project. As a result, pilot-mining was started five months after the mine was acquired, without the benefit of a detailed scoping or pre-feasibility study being completed.
Since the acquisition of the Bolivar Properties and the Mine, the Company has conducted around the immediate surface area of the Mine, detailed surveying and sampling of the old mine workings, detailed core drilling (both surface and underground), underground exploration by developing additional mine workings, and detailed geologic mapping and topographic surveying. This work has resulted in a determination and identification of mineral resources in the Mine by Roscoe Postle Associates (RPA) ("Roscoe Postle") of Toronto. The resources findings were disclosed in a press release dated November 1, 2005, which were based on a technical report by Roscoe Postle dated October 30, 2005 filed on SEDAR. This technical report while not current recommended that a scoping study be conducted.
The scoping study at Bolivar, recommended in the October 2005 RPA technical report, has not been completed because the Company is still extending the mineralized zones by drilling and underground exploration. However, Dia Bras expects this study will be completed by December 31, 2006 and will be shortly followed-up by a pre feasibility study, which is anticipated to be completed during the first half of 2007. Hence the Company is not at a pre feasibility phase of work as previously stated.
The Company's current operations include the processing of mineralized rock at the Company's Malpaso mill at the rate of approximately 7,000 tonnes per month. The combination of pilot-mining and milling of the rock is providing essential information on metallurgy of the material processed as well as actual operating costs for mining, milling and transportation. Furthermore, since December 2005 the revenues from sale of copper and zinc concentrates allow the Bolivar pilot-mining program to be self-funding (see press release dated July 12, 2006 for the results of the second quarter). The pilot-mining production for the month of July 2006 is estimated at US$2.3 million while direct operation costs are estimated at US$800,000.
As the Company is conducting test-mining on mineral resources of the Bolivar project as part of a combined scoping and pre-feasibility study, these resources by definition are not mineral reserves. The economic viability of the property has neither been demonstrated nor certified and it is impossible to ensure that the current or proposed exploration programs on the property will result in a profitable commercial mining operation.
CUSI PROJECT
The Cusi project is subject of an on-going exploration program consisting of regional and detailed surface geologic, structural and alteration mapping, diamond core drilling from the surface, detailed mapping, sampling and dewatering of underground workings, and airborne photography directed at producing orthophoto maps and detailed topographic maps. Dia Bras has mandated Scott Wilson RPA to complete by the end of 2006 an independent 43-101 technical report that may justify a bulk sampling program or pilot-mining on the Cusi project.
PROMONTORIO PROJECT
The Promontorio project's reported resources are historical resources and are not NI 43-101 compliant resources as reported in the 2005 Annual Report (p. 11) and in the Annual Report 2004 (page 8).
MALPASO MILL
The Company owns through its nominee 78.42% of the Malpaso Mill.
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