Farallon announces G-9 mineral reserve and resource estimates
2.0 Mt of Proven and Probable Mineral Reserves Now Estimated
VANCOUVER, March 29 /PRNewswire-FirstCall/ - Dick Whittington, President and CEO of Farallon Mining Ltd. ("Farallon" or the "Company") (TSX:FAN) is pleased to announce Mineral Reserve and Resource estimates for its G-9 mine site as at December 31, 2009. The Mineral Resources have increased as a result of drilling and underground development activity since the previous estimate in March 2008. In addition, a portion of the Resources have now been classified as Mineral Reserves.
The following is a summary of the Mineral Resources for the G-9 mine inclusive of Mineral Reserves.
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Mineral Resources at December 31, 2009
Inclusive of Mineral Reserves Contained Metal*
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Zn Cu Ag Au
Category 000s Zn Cu Ag Au mm mm 000 000
Tonnes % % (g/t) (g/t) lb lb oz oz
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Measured 1,418 8.65 1.23 239 3.64 270 38 10,896 166
Indicated 1,606 10.04 1.39 185 2.72 355 49 9,552 140
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G-9 Mine M&I 3,024 9.39 1.31 210 3.15 626 87 20,417 306
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Inferred 930 9.17 1.14 187 2.50 188 23 5,591 75
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* There may be some minor differences in totals due to rounding.
The following is a summary of the Mineral Reserves for the G-9 mine.
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Mineral Reserves at December 31, 2009 Contained Metal*
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Zn Cu Ag Au
Category 000s Zn Cu Ag Au mm mm 000 000
Tonnes % % (g/t) (g/t) lb lb oz oz
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Proven 525 10.36 1.28 274 3.69 120 15 4,619 62
Probable 1,425 9.87 1.37 187 2.77 310 43 8,547 127
G-9 Mine ----------------------------------------------------------------
Total 1,950 10.00 1.34 211 3.03 430 58 13,197 190
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* There may be some minor differences in totals due to rounding.
The following is a comparison of the above Mineral Resource estimate to the previous estimate in March 2008.
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G-9 Measured and Indicated Resource Estimates**
and Total Ore Mined at G-9
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000s Zn Cu Ag Au
Estimate Date Tonnes % % (g/t) (g/t)
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March 2008 2,575 9.9 1.39 209 3.09
December 31, 2009 3,024 9.39 1.31 210 3.15
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Ore Mined at G-9
to Dec 31, 2009 640 10.5 1.40 200 2.59
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**Mineral resource estimates stated at 3% zinc grade cut-off.
The following table summarizes the estimated Mineral Resources for the Company at its other deposits on its 100% owned Campo Morado Property.
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Mineral Resources at December 31, 2009 Contained Metal*
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Zn Cu Ag Au
Category 000s Zn Cu Ag Au mm mm 000 000
Tonnes % % (g/t) (g/t) lb lb oz oz
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South West
Zone Inferred 242 6.10 0.83 169 2.51 33 4 1,315 20
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Indicated 2,860 6.69 0.34 124 0.79 422 21 11,402 73
El Largo ----------------------------------------------------------------
Inferred 241 6.43 0.42 151 1.41 34 2 1,170 11
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El Rey Indicated 323 5.88 0.53 162 2.98 42 4 1,682 31
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Naranjo Indicated 577 6.00 0.66 178 3.11 76 8 3,302 58
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Reforma Indicated 1,173 5.9 0.58 262 4.74 153 15 9,881 179
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Indicated 4,933 6.37 0.45 166 2.14 693 49 26,267 340
Total ----------------------------------------------------------------
Inferred 483 6.26 0.63 160 1.96 67 7 2,485 30
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*There may be some minor differences in totals due to rounding.
Farallon's President and CEO, Dick Whittington, commented "We are very pleased to announce the first estimate of Proven and Probable Reserves for the G-9 mine. At the same time, we have also increased our Mineral Resources by 18% even though we have mined 640,000 tonnes of ore since mid 2008 and despite having curtailed exploration activity for over 15 months to focus on commissioning the mine and the mill. Our success since re-starting exploration drilling in October 2009 gives us confidence that we will be able to continue to build our resource base further in 2010."
We have also initiated a study on the Mineral Resources at El Largo, El Rey, Naranjo and Reforma with the intention of determining the economic viability of processing these deposits through the existing G-9 milling facility. With a strong base of Mineral Reserves and Resources and significant exploration potential, Farallon will look to capitalize on the opportunity to enhance shareholder value through organic growth at G-9 and the Campo Morado district in 2010. This organic growth strategy will complement our strategy of growth via mergers and acquisitions with the goal of becoming a mid-tier, multi-mine company".
For the G-9 Mine, the Mineral Resource estimates were compiled by David Gaunt, P.Geo, Vice President of Resources and Databases, Hunter Dickinson Services Inc. Mr. Gaunt is a qualified person as defined under NI 43-101. The Mineral Resources for G-9 were estimated based on mining activity and exploration drilling completed to December 31, 2009 and are presented at a 3% zinc grade cut-off.
The Mineral Reserves were estimated using the Mineral Resource model provided by David Gaunt. The estimate of Mineral Reserves was prepared by Stephen J. Godden, FIMMM, C.Eng. of S. Godden & Associates Ltd., an independent qualified person as defined under NI 43-101. The Mineral Reserves are stated at a 3% zinc grade cut-off for the Abajo, West Extension and South East zones and a 5% zinc grade cut-off for the North zone. Economic viability was assessed by calculating the average Net Smelter Return ("NSR") for each mineralized area or zone of interest, over a range of zinc grade cut-offs and a range of metal prices, including a scenario of: $0.75/lb zinc, $2.25/lb copper, $750/oz gold and $12/oz silver. The NSR results were then compared with the estimated ranges of cash costs for the G-9 operation. Further details will be provided in a Technical Report to be filed on www.sedar.com. Messrs. Gaunt and Godden have reviewed the requisite information on their Mineral Resource and Mineral Reserve estimates that are included in this news release.
The Mineral Resources for the South West zone, El Largo, El Rey, Naranjo and Reforma Deposits are presented at a 5% zinc cut-off. These estimates were completed in 2005, as detailed in the Company's news release of September 19, 2005 and in technical reports filed on www.sedar.com.
Farallon's G-9 zinc, copper, silver, gold and lead mine at the Campo Morado Property in Mexico reached commercial production in April 2009. The Company is targeting to produce at an annualized production rate of 120 million pounds of zinc and 15 million pounds of copper per year. For further details on Farallon Mining Ltd., please visit the Company's website at www.farallonmining.com or contact Neil MacRae, Investor Relations Manager, at (604) 638-2160 or within North America at 1-877-688-2050.
ON BEHALF OF THE BOARD OF DIRECTORS
J.R.H. (Dick) Whittington
President & CEO
No regulatory authority has approved or disapproved the information contained in this news release
Forward Looking Information
This release includes certain statements that may be deemed "forward-looking statements." All statements in this release, other than statements of historical facts, that address future production, reserve or resource potential, continuity of mineralization, exploration drilling, operational activities, production rates, costs to completion and events or developments that the Company expects, or is targeting, are forward-looking statements. Although the Company believes that the expectations expressed in such forward looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in the forward looking statements and may require achievement of a number of operational, technical, economic, financial and legal objectives. The likelihood of continued future mining at Campo Morado is subject to a large number of risks, including obtaining lower than expected grades and quantities of mineralization and resources, lower than expected mill recovery rates and mining rates, changes in and the effect of government policies with respect to mineral exploration and exploitation, the possibility of local disputes including blockades of the company's property, the possibility of adverse developments in the financial markets generally, fluctuations in the prices of zinc, gold, silver, copper and lead, obtaining additional mining and construction permits, preparation of all necessary engineering for ongoing underground and processing facilities as well as receipt of additional financing to fund mine construction, development and operation, if needed. Such funding may not be available to the Company on acceptable terms or on any terms at all. For more information on the Company and the risk factors inherent in its business, investors should review the Company's Annual Information Form at www.sedar.com.
Information Concerning Estimates of Measured, Indicated and Inferred Resources
This news release uses the terms "measured resources", "indicated resources" and "inferred resources". Farallon advises investors that although these terms are recognized and required by Canadian regulations (under National Instrument 43-101 Standards of Disclosure for Mineral Projects), the U.S. Securities and Exchange Commission does not recognize them. Investors are cautioned not to assume that any part or all of the mineral deposits in these categories will ever be converted into reserves. In addition, "inferred resources" have a great amount of uncertainty as to their existence, and economic and legal feasibility. It cannot be assumed that all or any part of an Inferred Mineral Resource will ever be upgraded to a higher category. Under Canadian rules, estimates of Inferred Mineral Resources may not form the basis of feasibility or pre-feasibility studies, or economic studies except for Preliminary Assessment as defined under 43-101. Investors are cautioned not to assume that part or all of an inferred resource exists, or is economically or legally mineable.
SOURCE Farallon Mining Ltd.
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