Minefinders receives Dolores economic analysis
Minefinders Corporation Ltd MFL
Shares issued 16,300,709 Nov 16 close $1.05
Mon 20 Nov 2000 News Release
Mr. Mark Bailey reports
Minefinders has received preliminary economic analysis from new pit designs
for the updated Dolores resource model reported in September. Results
indicate that the Dolores Main zone deposit has robust economics with
anticipated cash costs of $141 to $149 per ounce Au equivalent and yearly
average production levels of 242,900 ounces Au equivalent that rivals those
of other large-scale precious metals mines worldwide. Two pits, one at
highly discounted gold and silver prices, and one nearer to anticipated
production prices, have been generated, and then modelled at two different
gold and silver price levels.
The table below summarizes preliminary cash flow analysis for two pit
shells at different price sensitivities for gold and silver:
At $200/oz Au At $300/oz Au
Pit-shell and $4/oz Ag and $5/oz Ag
Tonnes
of ore 59.7 million 67.2 million
Gold
grade g/t 0.944 g/t 0.961 g/t
Silver
grade g/t 55.04 g/t 53.63 g/t
Aueq grade
of ore g/t 1.86 g/t Aueq 1.85 g/t Aueq
Strip
ratio 3.7:1 4.2:1
Tonnes of
agglomerate
ore 20.7 million 23.4 million
Gold grade 2.09 g/t 2.09 g/t
Silver
grade 129.9 g/t 124.5 g/t
Aueq grade
of
agglomerate 4.26 g/t Aueq 4.17 g/t Aueq
Contained
gold 1.81 million 2.08 million
oz oz
Contained
silver 105.6 million 115.8 million
oz oz
Gold
recovered 1.6 million 1.8 million
oz oz
Silver
recovered 74.7 million 81.6 million
oz oz
Total Aueq
recovered 2.8 million 3.2 million
oz oz
Capital
cost +15% $77 million $77 million
Cash cost/
oz Aueq $141.9/oz Aueq $149.3/oz Aueq
Total cost/
oz Aueq $180.3/oz Aueq $183.6/oz
Gold and $275/oz and $275/oz and
silver $4.75/oz $4.75/oz
price $325/oz and $325/oz and
$5.50/oz $5.50/oz
NPV at 0%
discount $248.5 million/ $267.2 million/
$378.1 million $412.3 million
Calculated
IRR 22.0%/31.4% 22.6%/32.7%
* all dollar values are U.S.$
* all Aueq is reported at a 60:1 value ratio for silver:gold.
The open-pit minable portion of the Dolores Main zone deposit has
substantially increased to 67.2 million tonnes containing 2.07 million
ounces of gold and 115.8 million ounces of silver. This corresponds to a
43-per-cent increase in tonnage, an 80-per-cent increase in recovered gold
and a 76-per-cent increase in recovered silver. Cash cost per ounce
estimates are significantly lower at $141 to $149 per ounce Au equivalent
than those reported in the 1998 scoping study ($169 to $177 per ounce Au
equivalent). A mine life of 13 years results in production of 138,359
ounces of gold and 6.27 million ounces of silver or approximately 242,900
ounces of gold equivalent metal annually for the life of the open-pit mine.
The new pit shells were generated by the company with the assistance of
Gemcom, using Whittle 3-D software for open-pit mine design. Pit shells
were developed using gold prices ranging from $200 to $300 and silver
prices of $4 to $5 per ounce. Pit wall angles of 50 degrees were set
according to preliminary work conducted by Golder Associates in 1998. All
start-up and sustaining capital costs, mining costs, general and
administrative, and processing costs for agglomerated and leach ore are
consistent with the 1998 scoping study costs. Metallurgical recovery rates
for pulp-agglomerated and leach ore were taken from the latest
pulp-agglomeration column leach data generated by McClelland Labs as
reported in Stockwatch Oct. 25, 2000.
The base of the 3-D computer model was arbitrarily set at an elevation of
1,250 metres and resource calculations and therefore pit shells did not
extend below this level. More than 80 per cent of the Main zone deposit in
the planned open-pit mine area, is now classified as measured and
indicated. Extending known high-grade mineralization (at a
five-gram-per-tonne Au equivalent cutoff) for an additional 200 metres in
depth below the pit bottom could add substantial ounces of gold and silver
to the Main zone deposit. This potential ore and that already identified in
the East Dike, La Bohemia, Sur zone and Norte zone will add significantly
to the ultimate size of the gold-silver deposit on the Dolores property.
Management believes that the updated model fairly represents the
distribution and grade of mineralization, corresponding to drill results
from more than 230 holes totalling 61,000 metres, historical mining and the
detailed geology of the deposit.
Additional infill drilling and engineering work will be required to bring
the open-pit minable resource to a final feasibility. Step-out drilling to
test the high-grade mineralization beneath the pit and satellite
mineralization along strike and adjacent to the Main zone deposit is
expected to significantly increase the overall Dolores gold and silver
resource as the project goes forward.
WARNING: The company relies upon litigation protection for
"forward-looking" statements.
(c) Copyright 2000 Canjex Publishing Ltd. stockwatch.com |
