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MONTREAL, QUEBEC--(Marketwire - Oct.
21, 2009) - MDN Inc. (TSX:MDN)
Highlights:
- Team of experts and partners in place to develop the Anita project up
to the production stage and the marketing of strategic metals.
- Management exploring an open-pit only development for more than 18
years .
- Independent firm Roskill Consulting Group confirms that market
conditions could be favourable to the entry of the Anita project as new
producer of niobium oxide and tantalum oxide.
- Drilling program just completed will improve the quality of the
current resource of 25.75 million tones.
- A bulk sample of approximately 70 tonnes of ore is in progress to
provide further information on niobium and tantalum's treatment and
processing costs.
MDN Inc. ("MDN") announces an update on market studies and
technical progress on Anita project, a strategic metals advanced
project located in the Lac St-Jean area of Quebec and currently owned
100% by Les Mineraux Crevier Inc ("MCI").
MDN currently owns 28.75% of MCI and has committed up to $13.5 million
over the next three years, including $7.5 million for the feasibility
study and $6 million to gain 75% equity participation.
Niobium and tantalum are considered strategic metals by the U.S.
administration and are rare in nature. Their unique properties make
them essential to our modern way of living because they are part of
many electronic components, avionics and aerospace industry equipment
as well as for communications systems and national defence equipment.
More than $2.4 million was invested by MDN since the announcement of
the project in April 2009. The engineering firm Met-Chem Canada was
awarded the mandate to perform a scoping study. Other firms were also
mandated for analysis and development of the Anita project, namely: SGS
Geostat to qualify the resource, Roskill Consulting Group for the
market study, Hatch and COREM for metallurgical studies and the
evaluation of ore treatment processes, Golder for the Environmental
Base Line Assessment and Roche for the preliminary assessment of mining
infrastructures, in conformity with environmental laws. Also worth
mentioning are Forages Mario Rouillier for the definition drilling of
the resource, ACTLAB for assay results, MIR Teledetection for
topographical maps production from satellite images and IOS Services
Geoscientifiques for project coordination on the site.
Economic Aspects of the Project
At this point in time, Management of MDN is assessing the potential to
operate the mine as an open pit for more than 18 years instead of the
originally proposed work plan of 6 years as an open pit and 12 years
underground (see press release of April 14, 2009).
Roskill Consulting Group (UK), a world-renowned metals consulting firm,
was contracted to produce a market study for niobium and tantalum. The
scope of the project included the assessment of trends in demand,
pricing, and consumption by various industry segments. Their price
forecasts leads Management to believe that we could expect better
market and better prices in 2012-2013 when the project will have
started its commercial production.
The proposed annual targeted output of the mine is currently of
approximately 1.2 million kg of Niobium oxide (Nb205) and 115,000 kg of
Tantalum oxide / K-salt (Ta2O5 / TaK2F7). Forecasted prices are
estimated at US$45 per kg of Nb205 and US$150 per kg of Ta2O5 / TaK2F7.
In their study, Roskill commented as follows: The project has several
clear advantages... It has a large indicated resource at good head
grades in niobium and tantalum. The deposit is in a location with
excellent infrastructure to support its development. It has the
necessary financing in place and a management team with experience in
niobium production and marketing. It has a short timeline to production
and will begin to supply tantalum and niobium when the market is likely
to be in most need. It is Roskill's view, and one that was confirmed
during the research interviews, that the Anita project has a very high
probability of success."
Technical Aspects of the Project
A diamond drilling program for a total of 5,500 m was completed to
bring a portion of the actual indicated resource of 25.75 million
tonnes from the indicated to the measured category. The remaining
drilling is to explore and confirm the intersections with high grade
values located to the north of the main ore body and intercepted on drill
holes performed by SOQUEM when the deposit was discovered in the 80's.
Geostat will be mandated to proceed with an update of the resource in
compliance with NI 43-101.
A total of 15 new claims were added to the property to secure the space
required for the construction of infrastructures necessary to bring the
project to production.
Preliminary ore flow sheet designs, in particular for the flotation and
lixiviation processes were completed and additional metallurgy testing
is under progress. Operating costs and capital expenditures estimates,
including processing operation costs, tailing treatment costs, water,
roads and electricity costs are about to be completed.
"We are progressing on all fronts to make this a success and bring
to market a new and successful top tier producer of strategic metals.
Our team of experts and partners is focused to fast-track the project
and benefit from the promising trends in global market demand and
supply as well as increasing prices", said Paul-A. Girard, President
and CEO of MDN.
Off-take Agreement with IAMGOLD
A preliminary agreement was entered into with IAMGOLD, currently the
3rd largest producer of ferro niobium in the world, through its Niobec
mine located 190 km south east of the Anita project. The total niobium
oxide production could be, if needed, bought by IAMGOLD for the life of
the mine for the production of ferro-niobium. IAMGOLD currently owns
37.5% of MCI.
Scarcity of Information
Management of MDN and of MCI are facing a scarcity of information concerning
the costs of treatment and processing for niobium and tantalum. It thus
becomes imperative that more precise and detailed estimations of these
costs become available through larger volumes tests. Metallurgical
tests on large volumes are currently underway.
Preliminary design of the open pit, flotation plant, tailing pond and
other mining infrastructure are completed. Only the cost evaluation of
the ore treatment process and of the 161 Kv power line remains to be
done.
Next Steps
A pre-feasibility study is to start in 2010 in order to firmly
establish all the economic parameters of the project. The preliminary
feasibility study may not have the same outcome but, assuming the
economics are positive, Management is targeting the start of the
construction phase for 2011, with production anticipated to start in
2012-2013.
About MDN
MDN is a mining exploration and development company having adequate
financial resources to develop its very promising projects in Quebec
and in Tanzania and to search for new business opportunities that can
raise shareholder value. In addition to its 30% participation in the
Tulawaka gold mine, MDN is the operator and owner of a majority
interest in 35 mineral licenses totaling 621 square kilometers around
the Tulawaka gold mine in Tanzania, and owns a 28.75% interest in a
property with a NI 43-101 niobium and tantalum resource located in the
Lac St-Jean area of Quebec.
About MCI and the Niobium and Tantalum Resource
MCI is a privately-held company whose major shareholders are IAMGOLD
Corporation (37.5%) and MDN Inc. (28.75%). The founding shareholders
and active managers are Messrs. Serge Bureau, Jacques Bonneau and
Claude Dufresne. The mineralized zone was originally discovered by
SOQUEM in 1975, which conducted several phases of exploration from 1975
to 1986. During this period, SOQUEM conducted 6 drilling campaigns
totalling 72 holes. The property was subsequently transferred to
Cambior during the privatization of SOQUEM's productive assets. The
property remained more or less dormant until 2002 when Cambior
conducted a further drilling program of 33 holes totalling over 6,000
metres. In 2006, Cambior was bought by IAMGOLD which became the owner
of the property. In April 2008, MCI bought 100% of the property from
IAMGOLD.
All technical information in this press release was reviewed by Marc
Boisvert, P. Eng.,Vice President Exploration, who is a Qualified Person
as defined in National Instrument 43-101.
Forward looking statements:
Certain statements contained in this Press Release express management's
estimates of MDN's future performance and constitute "forward-
looking statements" on future events or on MDN's future results or
performance. All statements, other than statements of historical fact,
are forward-looking statements. These statements involve known and
unknown risks, uncertainties and other factors that may cause actual
results or events to differ materially from those anticipated in such
forward-looking statements. These risk factors are discussed in greater
detail in MDN's most recent Annual Information Form filed on SEDAR.
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