New NI 43-101 Resource Estimate Significantly Increases CuMo Deposit With Substantial Increases in Silver and Copper

VANCOUVER, British Columbia, April 27, 2011 /PRNewswire/ -- Mosquito Consolidated Gold Mines Limited (TSX.V: MSQ; USOTCQX: MQCMF – "Mosquito" or the "Company")  is pleased to announce that Mr. Shaun M. Dykes, M.Sc. (Eng), P. Geo, Exploration Manager and Director of Mosquito and Mosquito's qualified person under National Instrument 43-101 has  reported the results of a new 43-101 compliant independent mineral resource estimate for Mosquito's CuMo porphyry molybdenum-copper-silver deposit located in Idaho. Snowden Mining Industry Consultants (Snowden), an independent, internationally recognized mineral industry consultant, completed the estimate. The results represent a significant addition to the 2009 resource estimate, most notably substantial increases to the silver and copper estimates, and cover only approximately 60% of the mineralizing system's footprint identified to date.

The results confirm that CuMo is the largest unmined open pit molybdenum deposit in the world, and also one of the world's largest silver deposits, ranking behind the Navidad and the Pitarrilla silver projects.

The NI 43-101 compliant calculation confirms that the CUMO deposit contains, at a $2.50 cutoff:

within an Indicated and Inferred Mineral Resource. (See notes for reason for using this cutoff)

This represents the following increases over previous resource estimates (Giroux 2009):

"I am extremely pleased with the results of CuMo's new 43-101 mineral resource estimate. Together with an increase in the indicated and inferred molybdenum resource, the silver and copper estimates significantly increase CuMo's previous valuations. In addition, independent metallurgical studies show that this deposit offers the potential for high percentage recoveries of these metals. The increases in silver and copper were expected, as recent drilling has outlined an older copper-silver system into which the main molybdenum system intruded," stated Mr. Dykes.

The overall estimated mineral resource is divided into two categories:

The mineralized zones have different metal distributions, thus the overall average grades tend to be misleading due averaging of these zones.  For example: molybdenum is very weak to not present in the Copper-Silver zone, and copper is weak in the molybdenum and Footwall Zones. Mosquito's assay results also indicate the presence of significant quantities of Rhenium, a special metal, which due to the lack of historical assays could not be estimated at this time.

Note: *  Metallurgical study recoveries are  included in the recovered equivalent calculation.  

For calculation of Recovered  values (RCV), Cu Equiv., and  MoS2 equiv.  see description at end of Table 4.

A technical report detailing the CuMo resource estimate will be filed on SEDAR within the next 45 days.  Table 4, below, contains the breakdown of Indicated and Inferred Mineral Resources for the CuMo deposit above varying cut-off grades.  

Snowdon's estimate is based on drill core assay results from 20,335.6 meters (66,718 feet) of drilling in 32 holes Mosquito completed between 2006 and 2010  and 10,178.8 meters (33,395 feet) in 23 diamond drill holes completed by AMAX between 1971 and 1981.  Due to mineral zonation the deposit was split into five mineral zones, or domains, one grading downward into the next: A weathered near-surface zone a Cu-Ag zone, a Cu-Mo zone, a Mo zone, and finally a footwall zone.  Copper and silver were highest within the Cu-Ag and Cu-Mo Domains, while molybdenum was highest in the Cu-Mo, Mo and MSI domains.  The estimated grade distribution for each variable was examined in each zone with erratic high grades capped.  Uniform 20-foot composites were formed that honored the boundaries of the five grade zones.  Variograms were assessed for each metal variable and anisotropic models were fitted to the data.  Grade estimates for each variable were interpolated into 100 x 100 x 50 foot blocks by ordinary kriging with parameters derived from the variograms models.  Specific gravities were obtained from drill core and the metallurgical bulk sample and average values were applied to each zone.  Snowden then applied a very conservative approach to resource classification by restricting the indicated classification to one-half the variograms' range only within the drilled area (interpolated).  All blocks outside of the drilled area (extrapolated) were assigned the Inferred classification irrespective of the variograms' range. A preliminary, conceptual pit design was applied to the overall block model and blocks outside of this preliminary design were removed from the results.

Mosquito has substantiated that the 2011 CuMo estimated resource consists of approximately 60% of the identified mineralized system covered by the property.  This is consistent with AMAX's findings in 1981 and is confirmed by Snowdon's resource calculation.  The current geological block model comprising 100% of the known mineralized system has a total of 453,998 blocks while Snowden calculated 276,244 blocks for a total of 60.85% of the blocks in the geologic model of the mineralized system.  A large portion of the 2011 exploratory drill program will be focused on drilling in the areas of the uncalculated blocks and improving the confidence in the resource.

CuMo is located in southwestern Idaho in an extensively logged, historic gold placer and lode mining area, readily accessible from nearby major centers of Idaho City and Boise. Mineralization consists of copper, molybdenum, silver, tungsten, rhenium and gallium. As a result of the multi-element nature of the mineralization, Mosquito decided to include both a copper and molybdenum equivalent for the estimated resource table. Both equivalents are required as the deposit is zoned, for conceptual purposes, as described in previous press releases and in the resource tables.  See notes below for explanation of the calculation of Recovered Value (RCV), copper equivalent (Cu Equiv.), MoS2 equivalent (MoS2 Equiv.).  The presence of the by-product elements copper, silver, tungsten, and rhenium is significant

Preliminary results of the exploration so far indicate that CuMo has a configuration that will potentially allow for low cost open-pit mining.  The thick mineralization is very continuous and indicates little internal waste and is persistent over a broad area measuring 2 km by 3 km. Mineralization begins at the bedrock surface which is covered by a thin layer of overburden and broken rock ranging from 4 to 20 meters thick.  The deposit is currently 650-850 meters thick and open to the south and west.  If further exploration substantiates these overburden characteristics, development would involve an unusually low strip ratio.

Immediate plans for the CuMo deposit are, to continue drilling to further delineate the mineralized zones and to convert the large part of the inferred resource to measured and indicated.  Engineering and environmental work will aim to produce a feasibility study in two to three years.  Drilling is scheduled to resume in mid-may  on Mosquito's private land.

Logging and sampling of the drill cores are completed at Mosquito's secure facility at Garden Valley, Idaho.  The entire HQ diameter core was sampled and cut in half longitudinally using a diamond saw. Half the core is sent for analysis, the other half has been retained and stored at the secure core storage facility.  Following cutting, the samples are delivered directly by Mosquito personnel to ALS Chemex in Elko, Nevada, a fully accredited analytical laboratory. They are first analyzed for 47 elements using a four acid digestion with analysis by Inductively Coupled Argon Plasma Optical Mass Spectrometer (ICP-MS).  Copper and molybdenum bearing samples are then checked by using a larger 5 gram sample and analyzed using pressed powder pellet X-Ray Fluorescence Spectroscopy (XRF).  In addition, duplicates, blanks, and standards are analyzed to ensure analytical accuracy and reproducibility. All rejects are being kept for further analysis and for use in metallurgical testing.

Drill hole location maps, an outline of the CuMo deposit and mineralized zone, an interactive drill hole model and a complete tabulation of significant intersections from the CuMo drill programs to date may be found on Mosquito's web site at www.mosquitogold.com.

Mr. Shaun M. Dykes, M.Sc. (Eng), P.Geo., Exploration Manager and Director of Mosquito is the designated qualified person for the CuMo Project.  Mr. Dykes prepared the technical information in this news release.  Mr. Ivor Jones (B.Sc(Hons), M.Sc., FAusIMM, CPgeo), Group General Manager of Geosciences, is the independent designated qualified person for Snowden who is responsible for the resource estimate.

On Behalf of the Board

MOSQUITO CONSOLIDATED GOLD MINES LTD.

Brian McClay

President

About Mosquito Consolidated Gold Mines

Mosquito Consolidated Gold Mines Limited is a mining exploration and development company with a diverse portfolio of high potential precious and base metals projects, located in low political risk environments in North America. The Company's primary focus is developing its Idaho-based CuMo project, one of the world's largest molybdenum, copper and silver deposits. For more information about the Company, please visit www.mosquitogold.com and www.CuMoproject.com

THIS NEWS RELEASE WAS PREPARED BY MANAGEMENT WHO TAKES FULL RESPONSIBILITY FOR ITS CONTENTS. THE TSX-VENTURE EXCHANGE does not accept responsibility for the adequacy or accuracy of this release.

This news release includes certain statements that express management's expectation or estimates of future performance and may be deemed "forward-looking statements".  These forward-looking statements include plans, estimates, forecasts and statements as to management's expectations regarding the CuMo Project. These forward-looking statements involve assumptions, risks and uncertainties and actual results may vary materially.  For these reasons shareholders should not place undue reliance on such forward-looking information.

United States residents are cautioned that some of the information that may be published by Mosquito may not be consistent with United States Securities and Exchange Commission disclosure rules and may be materially different from what the Company is permitted to disclose in the United States and therefore United States residents should not rely on such information.

Notes: RCV is a recovered metal value based on the grade and tonnage estimates described above.

$2.50 RCV cutoff was chosen as the base cutoff grade for comparison of global resource as it is the lowest cutoff value that has reasonable prospects of economic extraction.  Especially when current metal prices, (which are significantly higher than those used in the study) are taken into consideration.

Some of the Totals may not sum exactly due to rounding.

Due to TSX exchange rules only the cutoff can be reported prior to feasibility, not the actual values. A Copper equivalent (Cu. Equiv.) and Molybdenite equivalent (MoS2 Equiv.) are based on the following metal prices (all in US$):  Copper $2.10/lb, Molybdenum Oxide ($16/lb), Silver $0.35/gram and Tungsten  $0.22/gram.($7.00 per lb).  Other factors include 1% = 20 pounds; 1 ppm = 1 gm/T;  1000 ppb =1 ppm = 1 gm/T.

Molybdenum is sold as either ferro-molybdenite or molybdenum oxide.

The price used in these estimates is $16 per pound Molybdenum oxide.

To obtain the amount of Molybdenum oxide that can be produced from MoS2, the following is required:  convert MoS2 to Mo by dividing MoS2 by 1.6681 then convert to MoO3 (Molybdenum Oxide) by multiplying by 1.5. Therefore the amount of molybdenum oxide is pounds MoS2 times 1.5 / 1.6681.

Estimated metallurgical recoveries used in the calculations are as follows for each metal zone. Recoveries are slightly lower that those currently reported by SGS in their recent metallurgical study, as they have been adjusted by Ausenco to reflect losses anticipated during the cleaning and roasting stages.

Formulas :

Recovery (recv) for a metal is taken from the above table for each assay/block in a particular zone and is  value percentage/100
RCV= ((Cu*20*$* recv)+((MoS2*20*(1.5/1.6681)*$(MoO3)* recv)+(Ag*$* recv)+(W*$* recv))
Recovered Cu. Equiv. =  RCV / ($(Copper) *20)
Recovered MoS2. Equiv. =  RCV / ((1.6681/1.5)* $(MoO3)*20)

Mineral Resources do not have demonstrated economic viability.

43-101 Resource classification definition based on CIM Standing Committee on Reserve Definitions.

"A 'Measured Mineral Resource' is that part of a Mineral Resource for which quantity, grade or quality, densities, shape, and physical characteristics are so well established that they can be estimated with confidence sufficient to allow the appropriate application of technical and economic parameters, to support production planning and evaluation of the economic viability of the deposit. The estimate is based on detailed and reliable exploration, sampling and testing information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes that are spaced closely enough to confirm both geological and grade continuity."

"An 'Indicated Mineral Resource' is that part of a Mineral Resource for which quantity, grade or quality. Densities, shape and physical characteristics can be estimated with a level of confidence sufficient to allow the appropriate application of technical and economic viability of the deposit. The estimate is based on detailed and reliable exploration and testing information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes that are spaced closely enough for geological and grade continuity to be reasonably assumed."

"An 'Inferred Mineral Resource' is that part of a Mineral Resource for which quantity and grade or quality can be estimated on the basis of geological evidence and limited sampling and reasonably assumed, but not verified, geological and grade continuity. The estimate is based on limited information and sampling gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes."

SOURCE Mosquito Consolidated Gold Mines Limited