Proven and Probable Reserves Grow by 36% at La Mancha’s Frog’s Leg Mine
PARIS–(Marketwire – Mar 22, 2012) – La Mancha Resources Inc. (TSX: LMA)
- La Mancha’s share of Frog’s Leg P&P reserves grow 36% to 401,000 oz of gold
- Gold grade increases by 12% to average 5.76 g/t Au
- Reserve increase extends mine life by more than two years
- Frog’s Leg underground reserve endowment (including mining depletion) reaches 1.2M oz (100%)
Dominique Delorme, President and CEO of La Mancha, stated that: “The Frog’s Leg mine continues to demonstrate its robust nature, with its second upgraded mine plan since underground operations began. In 2008, reserves stood at 621,600 ounces. Today, with roughly 380,000 ounces already extracted and 787,000 ounces expected to be extracted, Frog’s Leg has become a 1.2-million-ounce endowment. We believe Frog’s Leg still has significant potential, as the mine plan extends to a depth of only 600 metres, whereas neighbouring mines have extended below 800 metres.”
La Mancha Resources Inc. (TSX: LMA, hereinafter “La Mancha” or the “Company”) is pleased to announce that Proven and Probable gold reserves (the “reserves”) at its Australian Frog’s Leg mine have increased by 36% following the successful completion of a new upgraded mine plan that incorporates the significant resource increase announced in March 2011.
The new upgraded mine plan has added 208,000 ounces, net of mining depletion, to the mineral reserve since December 31, 2010 of which 106,000 ounces are attributable to La Mancha. At December 31, 2011, total proven and probable reserves stood at 4.2 Mt grading 5.76 g/t Au, for 787,000 contained ounces, up from 3.5 Mt at 5.14 g/t Au for 578,000 contained ounces. La Mancha’s share of the reserves and resources is shown in the following table.
Table 1: La Mancha’s share of reserves and resources (on a 51% basis)
|As at December 31, 2010||As at December 31, 2011|
|(t)||(g/t Au)||(oz)||(t)||(g/t Au)||(oz)|
|Total P&P reserves||1,784,149||5.14||294,862||2,166,000||5.76||401,000|
|Total M&I resources||2,412,810||6.10||473,280||2,310,000||6.74||500,000|
Reported mineral reserves and resources (inclusive of reserves) as at December 31, 2010 were calculated using a cut-off grade of 3.0 g/t Au. Reported mineral reserves as at December 31, 2011 were calculated using cut-off grades of 3.0 g/t Au for stope ore and 1.5 g/t Au for development ore, whilst mineral resources for the same period were calculated using a cut-off grade of 2.7 g/t Au.
This Proven and Probable reserve estimate represents an 80% conversion of the Measured and Indicated resource reported as at December 31, 2011, compared to 62% for that reported as at December 31, 2010. Increased geological understanding of the orebody, through additional resource drilling and mapping of developed levels, has permitted improved interpretation of mineralisation, resulting in a higher grade resource estimate containing less dilution.
As shown in the table below, as a result of successful exploration campaigns and two upgrades to the mine plan, the Frog’s Leg mine has maintained a mine life of above five years since underground operations began. Moreover, it is important to note that the gold content of the Frog’s Leg reserve is now 27% higher than it was in the 2007 Feasibility Study, despite the mining of 376,738 ounces (192,136 ounces attributable to La Mancha) since operations began in 2008.
Table 2: Total Frog’s Leg gold endowment (on a 100% basis)
|Frog’s Leg underground mine plans|
|Cumulative gold mined (oz)||0||98,638||376,738|
|Remaining gold reserve (oz)||621,648||790,000||787,000|
|Total gold endowment (oz)||621,648||888,638||1,163,738|
|Expected end of mine life||2015||2016||2019|
Jean-Jacques Kachrillo, Vice President, Exploration of La Mancha, noted that: “The fact that the life of the Frog’s Leg mine appears to remain unchanged at five to seven years is very typical of underground mines in the Kalgoorlie area, as exploration drilling is limited by the depth reached by mining activity and the orebodies extend downward. We are therefore confident that we will be able to continue to extend the resource at depth. As such, 11,500 metres of drilling to a depth of 800 metres is planned for 2012”.
PRODUCTION PROFILE UPDATE
A new life-of-mine plan, dated as at February 29, 2012, was completed for the Frog’s Leg mine based on the resource estimate block modelling information (measured and indicated resource only) compiled by La Mancha as at December 31, 2011.
As shown in the table below, La Mancha’s share of the new mine plan provides for the extraction of 2.1 million tonnes of ore at a fully-diluted grade of 5.76 g/t Au, containing 390,400 ounces of gold over the remaining mine life which extends until 2019. The mining method is longhole open stoping, progressing in a top-down sequence utilising cemented paste fill.
Table 3: Updated Frog’s Leg mine plan, as at February 29, 2012 (on a 51% basis)
*Excludes production from January and February 2012.
QUALIFIED PERSONS AND DATA VERIFICATION
This press release was reviewed and prepared under the supervision of James Potter, Exploration Manager of La Mancha Resources Australia, and Nigel Tamlyn, Chief Operating Officer of La Mancha. By reason of their education, affiliation with a professional association (as defined in NI 43-101) and past relevant work experience, both Mr. James Potter and Mr. Nigel Tamlyn are “qualified person” for the purposes of NI 43-101. Both Mr. Potter and Mr. Tamlyn have read National Instrument 43-101 and have ensured that this press release has been written in compliance with that instrument. Both Mr. Potter and Mr. Tamlyn have read and approved the contents of this news release, and have consented to publish the press release in the form and context in which it appears.
James Potter Bsc.(Earth Science) hons MAIG, MAusIMM, Exploration Manager of La Mancha Resources Australia, supervised the drilling program and the geostatistical analysis of the drill data, was responsible for quality control and verification of the drill hole data used by La Mancha Resources Australia in calculating the resource estimates, conducted the resource estimation.
Nigel Tamlyn, Chartered Engineer (UK), Chief Operating Officer of La Mancha Resources Inc., is a member of the IMMM, and member of the SAIMM. Mr. Tamlyn has conducted a review of the Ore Reserve for the Frog’s Leg Gold Mine and has supervised the study and all of the information contained in this release.
The mineral reserves in this press release conforms to the requirements of NI 43-101 and were estimated using the Canadian Institute of Mining, Metallurgy and Petroleum (CIM), CIM Standards on Mineral Resources and Reserves, Definitions and Guidelines prepared by the CIM Standing Committee on Reserve Definitions and adopted by CIM Council. The effective date of the mineral reserves and resources estimate is December 31, 2011. The Mineral reserves estimate is based on only measured and indicated resource block modelling information. Mineral resources which are not mineral reserves do not have demonstrated economic viability.
The mineral reserves were calculated using a mining reserve cut-off grade of 3.0 g/t for stoping and 1.5 g/t for development, a gold price of US$1,350 per ounce, and mining methods, standard assumptions on underground design made to suit operating equipment parameters and current operational experience. The reserve includes a dilution factor of 10.6% based on standard dilution parameters applied to the resource based upon empirical knowledge of the existing Frog’s Leg Underground mine conditions and industry standards. Weighted average LOM gold recovery is estimated at 94.5% based on the geological model and the respective metallurgical recoveries for each rock type generated for the deposit.
The mineral resources were calculated using a cut-off grade of 2.7 g/t Au. The mineral reserve and resource has been rounded to reflect that the numbers are estimates. Gold grades were estimated with a parent block size of 2m x 10m x 10m with sub-celling down to 0.1m x 1m x 1m. Block model grade was estimated using Ordinary Kriging technique from capped 1m composites. Composites were caped between 15g/t and 190 g/t depending on the individual mineralized domain.
The quantity and grade of reported inferred mineral resources in this estimation are uncertain in nature and there has been insufficient exploration to define these inferred mineral resources as indicated or measured mineral resources and it is uncertain if further exploration will result in upgrading them to indicated or measured mineral resource categories.
Analysis of the samples used to calculate the mineral resource complied fully with the Analytical Quality Assurance Program put in place by La Mancha to control and assure the analytical quality of assays in its gold exploration and development. This program includes the systematic addition of blank samples, pulp duplicates and internal material references (“standards”) to each batch of samples sent for analysis. Blank samples are used to check for possible contamination in the laboratory, duplicates allow the overall precision to be quantified and standards determine the analytical accuracy. The majority of drilling samples were generated by cutting the NQ2 diamond core in half, and sending one half to the lab for assaying. Grade control LTK48 diamond drill core (whole core) and ore drive face samples were also included in the estimation to give finer detail in the production areas. All samples generated are based on sampling according to geological boundaries. Samples are assayed at the SGS Laboratory in Kalgoorlie using a 50g Fire Assay analysis.
There are numerous uncertainties inherent in estimating mineral reserves, including many factors beyond the Company’s control. Resource estimation is a subjective process, and the accuracy of any resource estimate is a function of the quality of available data and engineering and geological interpretation and judgment. Results from drilling, testing and production, as well as material changes in metal prices subsequent to the date of an estimate, may justify revision of such estimates. To the best of La Mancha’s knowledge, at the time of estimation there were no known environmental, permitting, legal, title, taxation, socio-economic, marketing, political or other relevant issues that could materially impact on the eventual extraction of the mineral resources.
ABOUT LA MANCHA RESOURCES Inc.:
La Mancha is an international gold producer based in Canada with operations, development projects and exploration activities in Africa, Australia and Argentina. La Mancha’s shares trade on the Toronto (TSX) under the symbol “LMA”. For more information on the Company, please visit its website at http://www.lamancha.ca.
CAUTION CONCERNING FORWARD-LOOKING STATEMENTS
Certain information contained or incorporated by reference in this press release, including any operating performance of La Mancha, may constitute forward-looking information or statements (“Forward-Looking Statements”). All statements other than statements reporting results or statements of historical facts are Forward-Looking Statements. The words “projected”, “set”, “potential”, “will”, “would”, “should”, “plans”, “expects”, “anticipates”, “believes”, “predicts” and similar expressions identify Forward-Looking Statements. This press release contains certain Forward-Looking Statements”, including, but not limited to, the statements regarding the quantity of mineralization in place, particularly in numbers of ounces of gold, the mineable character of the drill results, future gold production and associated cash cost per ounce produced, mining exploration risks, estimation and evolution of mineral resources, potential for resources additions, interpretation of work results and anticipated timetables, in particular as regards the update of the feasibility study work, the economic and technical potential for an underground mining operation and the potential of the mining plan to create additional value for the shareholders. Forward-looking statements express, as at the date of this press release, the Company’s plans, estimates, forecasts, projections, expectations or beliefs as to future events and results. Forward-looking statements involve a number of risks and uncertainties, and there can be no assurance that such statements will prove to be accurate. Therefore, actual results and future events could differ materially from those anticipated in such statements. Risks and uncertainties that could cause results or future events to differ materially from current expectations expressed or implied by the forward-looking statements include, but are not limited to, factors associated with fluctuations in the market price of precious metals, mining industry risks, risks associated with foreign operations, environmental risks and hazards, uncertainty as to calculation of mineral reserves and other risks referred to in La Mancha’s 2010 Annual Information Form filed with the Securities Commissions in Canada, as well as the Toronto Stock Exchange.
PDF version of the release : http://hugin.info/145163/R/1596540/503055.pdf