Capstone Reports Additional High Grade Copper-Zinc Intercepts at Kutcho Project
Hole KC10-179 intercepts 4.3% Cu, 7.6% Zn, 1.4g/t Au & 94g/t Ag over 15.8m
(Including 5.1% Cu, 10.2% Zn, 2.4g/t Au & 122g/t Ag over 8.3m)
VANCOUVER, Sept. 7 /PRNewswire-FirstCall/ - Capstone Mining Corp. (CS: TSX) today announced additional high grade intercepts from drilling on its high grade Kutcho Copper-Zinc Project. In order to advance the project towards a pre-feasibility study, the high grade Esso deposit, (one of three volcanogenic massive sulphide ("VMS") deposits that comprise the Kutcho Project) is being drilled for the purposes of increasing the confidence in approximately 1.1 million tonnes of inferred mineral resources, mostly located in a 60m wide gap in the current resource model, and to provide metallurgical samples, as recommended in the Preliminary Economic Assessment ("PEA") announced on July 13, 2010. Results for the initial two drill holes were announced August 5, 2010 and highlights of results from nine additional holes are summarized below, while full results are attached. In situ copper equivalent grades are also provided for illustrative purposes, based on the metal prices assumed in the PEA.
Highlights of Esso Drilling - Kutcho Project
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Hole ID Target From To Interval Interval Copper Zinc Gold Silver CuEq
Area (m) (m) (m)* (ft)* (%) (%) (g/t) (g/t) (%)**
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KC10-173 Esso 477.4 491.6 14.2 46.6 2.03 17.77 1.05 53.7 9.40%
(13.3) (43.6)
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including 483.8 486.8 3.0 9.8 4.53 17.81 1.18 63.3 12.07%
(2.8) (9.2)
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KC10-175 Esso 513.7 527.5 13.8 45.3 3.85 8.81 3.23 201.7 10.53%
(13.1) (43.0)
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including 516.4 526.1 9.7 31.8 4.66 3.93 4.14 200.2 10.09%
(9.2) (30.2)
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KC10-176 Esso 474.0 491.0 17.0 55.8 3.85 10.18 2.23 93.5 9.52%
(15.5) (50.6)
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including 474.0 481.7 7.7 25.3 5.91 15.07 3.69 122.9 14.38%
(7.0) (23.0)
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KC10-179 Esso 468.0 483.8 15.8 51.8 4.30 7.64 1.40 93.6 8.61%
(14.5) (47.6)
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including 474.7 483.0 8.3 27.2 5.11 10.21 2.45 122.4 11.16%
(7.6) (24.9)
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KC10-180 Esso 548.8 556.3 7.5 24.6 3.94 0.60 0.65 166.5 5.97%
(6.3) (20.7)
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including 550.6 554.0 3.4 11.2 8.11 0.95 0.87 266.6 11.26%
(2.9) (9.5)
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* The values in parentheses are estimated true thicknesses based upon
the current 3D interpretation of the Esso horizon.
** In situ Copper Equivalent Grades (CuEq) are calculated using the
same US$ metal price assumptions used in the July 6, 2010
Preliminary Economic Assessment (Copper = $2.25/lb;
Zinc = $0.80/lb; Gold = $850.00/oz;
Silver = $13.50/oz).
"These most recent intercepts from the infill drilling of the Esso deposit at Kutcho are very encouraging," said Stephen Quin, President of Capstone. "These results are not only moving us towards our objective of increasing confidence in the inferred mineral resource to levels appropriate for use in reserve estimations, but the grades are significantly exceeding expectations within this sparsely drilled area that lies between two other high grade areas in the thickest part of the deposit," he said. "As a result, we expect to not only move mineral resource classification up to a higher level, but also expect to increase the grade of the overall Esso mineral resource." Given these results, and that the high grade trend remains open to expansion, Capstone has approved an additional $500,000 in expenditures to allow further in fill and step-out drilling along the margins of the Esso deposit.
Kutcho Work Program
As reported in the August 5, 2010 news release, Capstone is undertaking a work program based on the recommendations of the recently completed PEA on the Kutcho Project. The PEA demonstrated potential for robust economics through the underground extraction of high grade copper-zinc-gold-silver mineralization from the "Main" and "Esso" deposits, followed by conventional flotation and production of copper and zinc concentrates for sale overseas. The PEA recommended advancing the project through completion of a Pre-feasibility Study ("PFS") and contained a number of recommendations in order to achieve that objective, including:
1. Infill drilling the inferred mineral resources utilized in the PEA to
at least the indicated category so they could be used in the PFS.
Inferred mineral resources comprised approximately 10.1% of the
mineral resource utilized in the PEA mine plan, and lies principally
within the Esso deposit. The results in this release are part of that
program.
2. Continued metallurgical optimization focused on copper recoveries,
copper concentrate grade and zinc recoveries. The infill drill
program discussed above will provide the requisite material for
testing of the Esso deposit, while available core from the Main
deposit is being prepared for delivery to the metallurgical test
facilities.
3. Step-out drilling on the Esso deposit, where the high grade mineral
resource may remain open to expansion, particularly up and down dip,
which is the purpose of the additional $500,000 in approved
expenditures noted herein.
4. Continued optimization of capital and operating parameters, with a
particular emphasis on power cost reductions, which will commence
shortly.
For current drillhole locations please view the accompanying map: http://www.capstonemining.com/i/photos/kutcho/2010-37CS_DrillholeLocationsWithCuXmetres.jpg
For a current view of drill results in priority areas across the property please view the accompanying map: http://www.capstonemining.com/i/photos/kutcho/2010-37CS_DrillholeLocationsWithZnXmetres.jpg
Quality Assurance
The technical information in this news release has been prepared in accordance with Canadian regulatory requirements set out in National Instrument 43-101 and reviewed by Stephen P. Quin, P. Geo., President of Capstone Mining Corp. and Brad Mercer, P. Geo., Vice President Exploration of Capstone. The exploration activities at the Minto project site are carried out under the supervision of Brad Mercer, P. Geo., VP Exploration of Capstone.
The analytical method for the copper and silver analyses is aqua regia digestion of the samples followed by atomic absorption spectroscopy. Gold is analysed by fire assay fusion with atomic absorption spectroscopy finish for gold. Analyses are carried out by ALS CHEMEX in North Vancouver. When visible gold is noted in drill core samples or regular fire assay values appear abnormally high, the pulp and screen metallic assay method is used to determine the total gold content and gold contents of different size fractions. This is considered industry best practice when dealing with coarse gold mineralization where a nugget effect is suspected. This determination is accepted as the most representative value and is used in the assay database for mineral resource calculations. Blank and standard samples are used for quality assurance and quality control. Where more than two check samples assay outside expected ranges, the entire batch is re-assayed. After the completion of planned drill programs at Minto, random check assays will be carried out by Acme Analytical of Vancouver.
Forward-Looking Statements
This document may contain "forward-looking information" within the meaning of Canadian securities legislation and "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995 (collectively, "forward-looking statements"). These forward-looking statements are made as of the date of this document and Capstone Mining Corp. (the "Company") does not intend, and does not assume any obligation, to update these forward-looking statements.
Forward-looking statements relate to future events or future performance and reflect Company management's expectations or beliefs regarding future events and include, but are not limited to, statements with respect to the estimation of mineral reserves and mineral resources, the realization of mineral reserve estimates, the timing and amount of estimated future production, costs of production, capital expenditures, success of mining operations, environmental risks, unanticipated reclamation expenses, title disputes or claims and limitations on insurance coverage. In certain cases, forward-looking statements can be identified by the use of words such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or statements that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved" or the negative of these terms or comparable terminology. By their very nature forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Such factors include, among others, risks related to actual results of current exploration activities; changes in project parameters as plans continue to be refined; future prices of mineral resources; possible variations in ore reserves, grade or recovery rates; accidents, labour disputes and other risks of the mining industry; delays in obtaining governmental approvals or financing or in the completion of development or construction activities; as well as those factors detailed from time to time in the Company's interim and annual financial statements and management's discussion and analysis of those statements, all of which are filed and available for review on SEDAR at www.sedar.com. Although the Company has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements.
Accordingly, readers should not place undue reliance on forward-looking statements.
Details of ESSO Deposit Drill Results - Kutcho Project
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To accompany Capstone Mining News Release Dated September 07, 2010
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Hole ID Target From To Interval Interval Copper Zinc Gold Silver
Area (m) (m) (m)* (ft)* (%) (%) (g/t) (g/t)
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KC10-169 Esso Previously released
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KC10-171 Esso Previously released
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KC10-172 Esso 556.1 570.8 14.7(13.1) 48.2(43.0) 0.43 0.11 0.09 6.7
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KC10-173 Esso 477.4 491.6 14.2(13.3) 46.6(43.6) 2.03 17.77 1.05 53.7
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including 483.8 486.8 3.0(2.8) 9.8(9.2) 4.53 17.81 1.18 63.3
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KC10-174 Esso No significant intercepts
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KC10-175 Esso 513.7 527.5 13.8(13.1) 45.3(43.0) 3.85 8.81 3.23 201.7
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including 516.4 526.1 9.7(9.2) 31.8(30.2) 4.66 3.93 4.14 200.2
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KC10-176 Esso 474.0 491.0 17.0(15.5) 55.8(50.6) 3.85 10.18 2.23 93.5
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including 474.0 481.7 7.7(7.0) 25.3(23.0) 5.91 15.07 3.69 122.9
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KC10-177 Esso Hole abandoned short of target
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KC10-178 Esso No significant intercepts
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KC10-179 Esso 468.0 483.8 15.8(14.5) 51.8(47.6) 4.30 7.64 1.40 93.6
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including 474.7 483.0 8.3(7.6) 27.2(24.9) 5.11 10.21 2.45 122.4
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KC10-180 Esso 548.8 556.3 7.5(6.3) 24.6(20.7) 3.94 0.60 0.65 166.5
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including 550.6 554.0 3.4(2.9) 11.2(9.5) 8.11 0.95 0.87 266.6
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* The values in parentheses are estimated true thicknesses based upon
the current 3D interpretation of the ESSO horizon.
SOURCE Capstone Mining Corp.
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