Queenstake boosts economics of Magistral project
Queenstake Resources Ltd (2) QRL
Shares issued 58,222,954 Jun 3 close $0.33
Tue 4 Jun 2002 News Release
Mr. Chris Davie reports
MAGISTRAL GOLD RESOURCES INCREASED BY 21%, RESERVES BY 26%
Queenstake Resources has reported results of the updated calculation of the
gold resources and reserves at its 50-per-cent-owned Magistral property in
Sinaloa, Mexico. The updated calculation, performed by Pincock Allen and
Holt (PAH) of Denver, was based on extensive drilling on the La Prieta zone
in the Samaniego Hill area carried out since September, 2001, and reported
in news release NR2002-4. The reported resources also reflect a change in
modelling software as the model has been transferred to Mintec's Medsystem
for future use at the mine site.
Resources are classified in five areas corresponding to four discrete
mineralized zones and an old tailings pile. It is anticipated that the
mineralized zones will be mined in four separate pits, known as San Rafael,
Samaniego, Sagrado Corazon and Lupita. PAH reports the updated resources by
zone as follows:
Resources reported by PAH at a cutoff grade of 0.4 gram per tonne are
tabulated as follows:
Measured
Zone Tonnes Gold Contained
(x 1,000) gpt ounces
San
Rafael 2,133 1.75 120,100
Samaniego
Hill 4,596 1.93 284,900
Sagrado
Corazon 978 1.08 33,900
Central,
Lupita 1,257 1.11 44,900
Magistral
mill
tailings 166 2.1 11,200
Total
updated
gold
resource 9,130 1.69 495,000
Indicated
Zone Tonnes Gold Contained
(x 1,000) gpt ounces
San
Rafael 449 1.23 17,800
Samaniego
Hill 1,163 1.87 69,900
Sagrado
Corazon 238 0.82 6,300
Central,
Lupita 842 1.00 27,000
Magistral
mill
tailings - - -
Total
updated
gold
resource 2,692 1.4 121,000
FEASIBILITY STUDY
May, 2000, increase
Total
Zone Tonnes Gold Contained
(x 1,000) gpt ounces
San
Rafael 2,582 1.66 137,900
Samaniego
Hill 5,759 1.92 354,800
Sagrado
Corazon 1,216 1.03 40,200
Central,
Lupita 2,099 1.07 71,900
Magistral
mill
tailings 166 2.1 11,200
Total
updated
gold
resource 11,822 1.62 616,000
Feasibility
study
May, 2000 10,698 1.48 509,900
Increase 1,124 106,100
Using these gold resources as a base PAH has redesigned the Samaniego open
pit in order to derive a new reserve for that zone. Some minor redesign of
the San Rafael pit has also been undertaken, although the block model for
this zone has not changed. The resulting reserves are tabulated below. For
completeness, the Sagrado Corazon and Lupita reserves are included,
although the block models and mine designs have not changed. There are some
minor differences relative to the feasibility study due to changes in
software used. The tailings in the Samaniego area have been included in the
Samaniego reserve estimate.
Proven and probable gold ore reserves determined by PAH are as follows:
Area Gold cut- Tonnes Grade
off grade 1,000s gpt gold
gpt
San
Rafael 0.40 1,324 2.24
Samaniego
Hill 0.42 4,077 2.28
Sagrado
Corazon 0.43 582 1.39
Lupita 0.43 997 1.38
Total
updated
gold
reserve 6,980 2.07
Feasibility
study
May, 2000 6,156 1.86
-----
Increase 824
Area Contained Strip ratio
ounces
gold
San
Rafael 95,500 4.8
Samaniego
Hill 299,500 6.8
Sagrado
Corazon 26,000 1.4
Lupita 44,100 4.2
Total
updated
gold
reserve 465,100 5.6
Feasibility
study
May, 2000 368,400
-------
Increase 96,000
It will be noted that most of the additional resources defined in the
Samaniego area have also become reserves; the geometry of the high-grade
zone now at the bottom of the newly designed pit has widened the pit
dramatically, allowing a more rational design of ramps than was possible at
the time the feasibility study was completed. This has actually resulted in
a reduction in strip ratio of the Samaniego pit in spite of the depth of
the new resources.
Queenstake's president Chris Davie said: "We are delighted by the increase
in reserves, increase in grade and decrease in strip ratio at Samaniego
which will dramatically improve the overall economics of the Magistral
project and are increasingly excited about the unexplored upside potential
on the Magistral project. Significant exploration potential remains in
possible extensions of the La Prieta zone as well as in additional
identified, but as yet not drilled, exploration targets on this
10,000-hectare property. This is an exciting time for gold companies and
their shareholders, and for Queenstake Resources in particular.
Construction at Magistral is firmly in hand, there is cash in the treasury
and the company is debt free. Queenstake is actively seeking new
acquisition opportunities.
"The gold price continues to strengthen and has surpassed $325 per ounce;
by the fourth quarter of 2002 Queenstake will have joined the ranks of gold
producing companies. Achieving production at Magistral is only the first
step in a bigger strategy of building a mining company. The company's
current market value is well underpinned by its existing resource, reserve
and production capability."
WARNING: The company relies upon litigation protection for
"forward-looking" statements.
(c) Copyright 2002 Canjex Publishing Ltd. stockwatch.com |
