Toronto, ON - NWM Mining Corporation (�NWM�) is pleased to announce that it has received a mineral reserve estimate for its Lluvia de Oro and La Jojoba properties located in Sonora, Mexico. Calculated as of May 18, 2010 using a US$900 per ounce gold price, it consists of proven and probable reserves of 369,312 contained ounces of gold at 0.20 gAu/t cut-off. This represents the first time that proven and probable reserve ounces have been calculated and published for the Lluvia de Oro and the adjacent La Jojoba gold deposits. The complete NI 43-101 Technical Report, an updated Prefeasibility study to be issued in June, 2010, will include the Resources and Reserves exactly as reported below.
The mineral resources comply with the CIM definitions as required by NI 43-101. Over 80% of the drillhole assays in the resources reported herein have been previously reported in the Company�s NI 43-101 Technical Reports of 2005, 2006 and 2007. The Lluvia resources now include data from 436 new percussion drillholes from 2009 and 2010, which yielded 1303 new samples with assays.
Sample QA/QC procedures used in 2009 and 2010 were the same as previously reported. All new samples were assayed by ALS Chemex of Vancouver, BC. All samples with reported grades above 0.1 gAu/t were check assayed by Firstgold Labs of Lovelock, Nevada. All high-grade assays from Lluvia de Oro were capped at 19 gAu/t; all high-grade assays from La Jojoba were capped at 15 gAu/t.
The Resource studies using MineSight� software highlighted a number of highly prospective target zones for future drilling. The complete NI 43-101 Technical Report will include details on these targets which are recommended for additional drilling by Mr. Abdullah Arik of Mintec.
The mineral reserves comply with the CIM definitions as required by NI 43-101 and are included in the table of Resources, above.
The objective of this NI 43-101 Technical Report is only to report the current status of Resources and Reserves at the Lluvia-Jojoba Project. On-going exploration work has identified many mineralized zones that represent targets close to the Lluvia and Jojoba pit designs detailed in this Reserves report. Therefore, the economics presented below are valid for a �potential open pit mine� that may well be eclipsed by new data from recommended drilling, prior to actual mining of these reported Reserves.
The economics of the potential open pit mine assume the 18.9 million tonnes of Proven and Probable ore (grading 0.607 gAu/t) would be mined at a rate of 7500 tonnes per day, or 2.25 million tonnes per year. Such an open pit mine would extend over 8.4 years, followed by1 additional year of production from the gold plant as the heaps complete leaching.
A gold price of US$900/ounce was used for the mine economics, as in the Reserve calculations. The recovery by cyanide heap leaching was set at 64%, which is a conservative projection, based upon metallurgical testwork and on past mining (1996-1998) at the Lluvia project. The average gold sales would be 28,327 oz. Au per year.
Operating costs per tonne were based upon contractor quotes for open pit mining and actual costs from the installed heap leach facilities, supported by the existing ADR (gold) Plant and the existing SART (copper) Plant at the Lluvia de Oro site. Operating costs applied to the calculation of Reserves were derived from detailed records of actual operating costs recorded at the Lluvia facilities during 2008 and 2009. A reclamation and closure allowance of $0.15 per tonne of ore mined is included in the Process cost shown below.
Using these operating costs, with $900 gold price and 64% process recovery, the break-even cut-off grade and the internal cut-off grade were calculated.
The economics of these initial NI 43-101 compliant Reserves for the Lluvia-Jojoba Project are positive, even though this �potential open pit mine� is fairly small. The economic analyses reported below support the Reserves designation at US$ 900 gold price as determined by Mintec using MineSight� software.
NWM Mining Corp anticipates that these positive economics will encourage further exploration and development work on the Lluvia-Jojoba Project. As previously reported (15.Dec.2009), a 25,000 meter Diamond drilling program is currently underway along the 1.7 km length of the Lluvia Shear Zone where the mineralization has been verified to extend beyond the northeast limits of Creston Pit previously mined. As reported (26.Mar.2010), geochemical sampling has been recently conducted using Enzyme Leach sampling, and geophysical exploration has been completed using Induced Polarization surveys. NWM has committed to providing updates to the NI 43-101 compliant Resources and Reserves as new exploration data becomes available.
The project costs and economics have been reviewed by Ashok Patwardhan, P.Eng., Sr Mechanical Engineer for Mine & Mill Engineering, Salt Lake City. Mr. Patwardhan is the Qualified Person for all operating costs on the Lluvia-Jojoba Project. He has 30 years experience with design and construction of gold heap leach operations.
The technical disclosure in this news release has been reviewed and approved by Mr. Abdullah Arik, the Qualified Person for Resources and Reserves on the Lluvia-Jojoba Project. Mr. Arik is registered with AusImm, and is Principal MineSight Specialist for Mintec Inc, Tucson. He has 33 years of experience with resource modeling.
For further information, please contact Chris Berlet at (416) 364 � 6799.
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