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Gold/Mining/Energy : Gabriel resources GBU

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To: TheBusDriver who wrote (32)	2/21/2002 5:07:27 PM
From: I_C_Deadpeople	Read Replies (1) of 41

Gabriel recalculates Rosia Montana economics Gabriel Resources Ltd (2) GBU Shares issued 81,510,954 Feb 21 close $3.40 Thu 21 Feb 2002 News Release Mr. Clifford Davis reports GABRIEL RESOURCES LTD. - BASIC ENGINEERING PHASE OF DEVELOPME ... Gabriel Resources has provided the following update on its activities. Optimum plant capacity Following receipt of two definitive feasibility studies in 2001 on Gabriel's 80-per-cent-owned Rosia Montana project in Romania, Gabriel began the process of determining an appropriate plant capacity upon which to base the basic engineering phase of development. SNC Lavalin Engineers & Constructors Inc. (SLE&C) was engaged to determine an optimal plant capacity and concluded that a nominal plant throughput of 13 million tonnes per year was a suitable rate, based upon proven equipment sizing. Gabriel's subsequent financial analysis indicated that such a plant capacity provided an appropriate blend of strong project economics and capital cost parameters. SLE&C has now been engaged to undertake and complete the basic engineering phase of development by the end of the third quarter of 2002. Updated financial analysis Gabriel has updated its financial analysis of the Rosia Montana project to reflect a 13-mtpa plant throughput. This analysis suggests that the economics of the 13-mtpa scenario closely approximate those of the 20-mtpa case, which formed the basis of the initial definitive feasibility study on Rosia Montana, while requiring substantially less total initial capital. A summary of the updated project economics, on a 100-per-cent project basis and assuming owner mining, is as follows: Plant throughput 13 Mtpa Reserves 10.4 Moz gold 52.0 Moz silver Mine life 16.2 years Average annual gold production(1) 504,000 oz Initial capital cost (millions) US$253 Working capital (millions) US$5.3 Sustaining capital (millions)(1) US$126 Cash operating costs (1)(2) US$107 Total cash costs(1)(2) US$113 Total production costs(1)(2) US$157 Gold price US$275 US$300 Internal rate of return(3) 29.4% 33.8% Net present value (millions) (0% discount)(3) US$911 US$1,102 Net present value (millions) (5% discount)(3) US$489 US$604 Net present value (millions) (10% discount)(3) US$266 US$341 Payback period (years) 2.8 2.5 1. Over the life of the mine 2. Per ounce gold net of silver credits 3. 100-per-cent equity basis Appointment of project manager Gabriel has appointed Jim Tapp as its project manager responsible for supervising the development of the Rosia Montana project. Mr. Tapp is a mechanical engineer with more than 20 years of experience in the development of international projects. Project development timetable Gabriel anticipates that basic engineering will be completed by the end of the third quarter of 2002, thereby allowing the tender and awarding of an EPC or EPCM contract to be completed during the first quarter of 2003. Commencement of construction is currently targeted to begin during the second quarter of 2003. WARNING: The company relies upon litigation protection for "forward-looking" statements. (c) Copyright 2002 Canjex Publishing Ltd. stockwatch.com

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