Reno, Nevada (June 4,
2009) - Gryphon Gold Corporation (GGN: TSX / GYPH:OTC.BB) announces
that the company is moving forward with a pre-feasibility study for mine
development on the oxide portion of its Borealis gold resource property in
Nevada, which consists of 1,422,500 Measured and Indicated ounces of gold
(M&I) and 1,104,500 Inferred ounces of gold (Infd.).
The study is being prepared by Telesto Nevada Inc. of
Reno entirely on a deferred fee basis to facilitate moving forward prior to
completion of the financing required for mine construction and development.
The pre-feasibility study is the next step toward completing the company?s long-range plan. The
plan anticipates cash flow generated through a mining operation used to fund a
program of drilling for high-grade zones within two additional large, high sulphidation systems discovered under the pediments in
2007, as defined in the company?s NI 43-101 Technical
Report on the Mineral Resource dated April 28, 2008. As well, the plan calls
for completion of technical work to confirm the feasibility of a sulphide mine.
We are moving forward with the at-risk pre-feasibility study on the
Borealis deposit because we believe that the results will assist Gryphon Gold
to begin financing and mine development, says Telesto
Nevada president John Welsh. The estimate for the deferred fee is
$130,000 and is due upon successful financing of the project.
In September 2008, Gryphon Gold released a Preliminary Assessment(1)
produced by Telesto Nevada, accessing the potential
economics of an open pit, heap leach mining operation and the processing of
350,000 ounces of gold yielding 232,000 ounces of recovered gold. This
five-year plan indicated that the project had an unlevered internal rate of
return at 26 per cent assuming a US$775 per ounce gold price. The Preliminary
Assessment indicated that at defined operating costs, for every one per cent
change in the price of gold, the projected internal rate of return changed by
1.7 per cent.
As well, an independent scoping study was commissioned to determine the
potential of mining the sulphide
gold resource which consists of 1,085,000 M&I ounces of gold
and 715,000 Infd. ounces of
gold at an average grade of 0.044 ounces per ton (opt). The scoping study was
delayed in line with the company?s
cash conservation plan and will be re-instituted when cash flow is available.
We’re very optimistic that the pre-feasibility study will lead to
our ability to raise the capital to put a mine into production on this property
that has been a strong gold producer historically and shows so much promise for
the future, says Gryphon Gold CEO John Key.
The Borealis property consists of over 23 square miles of highly altered
rock containing multiple high sulphidation gold
bearing systems. The property has 1.8 million ounces of NI 43-101 compliant measured
and indicated gold resources (M&I) and 1.1 ounces of NI 43-101 compliant
inferred (Infd.) gold resources. Historically, the
property has produced over 500,000 ounces of gold.
The current Borealis gold resource is in two distinct oxidation
horizons:
The Oxide deposit consists of 340,000 M&I ounces of gold (contained
in 15.6 million tons grading at 0.022 opt), composed of 107,000 measured ounces
and 233,000 indicated ounces, and 385,000 Infd. ounces of gold (contained in 26.8 million tons grading at
0.014 opt).
The Sulphide
deposit consists of 1,085,000 M&I ounces of gold (contained in 21.0 million
tons grading at 0.05 opt), composed of 277,000 of measured ounces and 807,000
indicated ounces, and 715,000 Infd. ounces of gold (contained in 22.5 million tons grading at
0.03 opt).
Vancouver-based Gryphon Gold is a Nevada-focused gold
exploration company. Its principal gold resource, the Borealis deposit, is
located in the Walker Lane gold belt of western Nevada. The Borealis gold
system is one of the largest known volcanic-hosted high-sulphidation
gold bearing mineralized systems in Nevada. Nevada Eagle Resources, a
wholly-owned subsidiary of Gryphon Gold, has approximately 54 highly
prospective gold properties located in gold trends in Nevada. Nevada Eagle's
principal properties have a cumulative 900,000 ounces of historical gold (the
historical estimates are based on internal reports prepared by prior owners
prior to February 2001 and were not prepared in accordance with CIM NI 43-101
standards and thus their reliability has not been verified). A number of Nevada
Eagle?s principal properties are subject to joint
venture or farm in agreements in favor of third parties.
For more information please
contact:
www.gryphongold.com
John L. Key, CEO
Alyn Edwards, Peak Communicators
Ph: 775
315-4828
Ph: (604) 689-5559
jkey@gryphongold.com
aedwards@peakco.com