July
14, 2009
BRACEMAC-MCLEOD ADVANCES TO FEASIBILITY
Vancouver, B.C., July 14, 2009 - Mr. Harvey Keats, Chief Executive
Officer of Donner Metals Ltd. (TSXV-DON), reports that the Company has
received notice from Xstrata Canada Corporation - Xstrata Zinc Canada
Division (Xstrata Zinc), that it is advancing the Bracemac-McLeod
discovery to the feasibility stage effective immediately. This
decision is based on a positive outcome of the recently completed scoping
study conducted by Xstrata Zinc. Under the Matagami
Option and Joint Venture Agreement, Xstrata Zinc has the right to conduct
an "Accelerated Feasibility Study" prior to Donner completing
its earn-in requirements. Under the agreement, Donner can earn a
50% interest in each of five separately designated project areas with
Xstrata Zinc having five separate rights to earn-back a 15% interest in
each project area by incurring up to $20 million on a bankable
feasibility study. Upon completion of this Accelerated
Feasibility Study, and upon Donner completing its earn-in requirements,
Xstrata Zinc will vest its back-in right in the South Flank area of the Matagami Property which will become a 65% Xstrata
Zinc, 35% Donner Metals joint venture. The remaining four project
areas will remain 50/50 joint ventures between the two companies subject
to Xstrata Zinc's remaining back-in rights.
The Bracemac-McLeod discovery is located 6
kilometres southeast of Xstrata's 2,600 tonne per day operating Matagami Mill Complex. Indicated resources are
currently calculated at 3,623,000 tonnes grading 11.52% zinc, 1.60% copper,
31.6 g/t silver and 0.49 g/t gold, with additional inferred resources of
512,000 tonnes grading 1.28% zinc, 1.85% copper, 12.17 g/t silver and
0.18 g/t gold, calculated separately for the less well-defined McLeod
West Zone and the Copper Zone. Mineralization is open in a number
of areas around these resources.
The Bracemac-McLeod Feasibility Study will be
carried out by Xstrata Zinc's development team who were responsible for
the successful development of the Perseverance Mine that was opened in
2008. Continued exploration in the immediate vicinity of Bracemac-McLeod will be conducted as part of the
feasibility stage. In conjunction with the effort at Bracemac-McLeod, the Xstrata Zinc-Donner exploration
team is currently focusing on drilling high priority targets elsewhere in
the Matagami Camp (see news release dated May
25, 2009). The overall objective of the Matagami
Project is to supplement and replace production from the Perseverance
Mine, and to identify a resource base to support the Matagami
Mill over the long term.
Qu�bec Support of Mining: The discovery and advancement of Bracemac and McLeod, as well as the ongoing
exploration in the Matagami Camp is supported
by the Qu�bec Government through their exploration incentive
programs. Donner has consistently used the rebates to advance the Matagami Project which in turn supports the regional
community and employment. Through this support, additional
opportunity for new discoveries is made possible with potential for
long-term impact on the Abitibi region.
PROJECT OVERVIEW
Donner has the option to earn a 50% participating joint venture interest
in the Matagami Project by incurring a total of
$25 million of expenditures on exploration and related work on or before
May 31, 2011. Expenditures to date total $17 million. Upon
earn-in by Donner, five separate joint ventures will be formed, covering
the property and the area of interest. In each of the five joint
venture areas, Xstrata Zinc has the option to earn-back a 15% interest by
incurring up to $20 million on a bankable feasibility study.
The Matagami Project currently has an area of
mutual interest of 4,750 square kilometres and presently includes 3,116
mineral claims covering 663 square kilometres. The project covers
the Matagami Mining Camp which is a world-class
mining district, with 18 known VMS deposits, including 10 past producers
of varying sizes, including the giant Matagami
Lake Deposit (25.64 million tonnes of 8.2% zinc, 0.56% copper, 20.91 g/t
silver and 0.41 g/t gold,) discovered in 1957 and mined from 1963 to
1988. The area is host to historical production of 8,600 million
pounds of zinc and 853 million pounds of copper. The Matagami
area is well serviced by established infrastructure including the town of
Matagami, power, a permitted tailings facility,
railway, airport, and well-developed road and highway networks. Xstrata
Zinc is currently producing from its low-cost and wholly-owned
Perseverance Deposit which feeds its refurbished 2,600 t/day Matagami Mill Complex. Any future development under
the Donner-Xstrata agreement will benefit from the established
infrastructure and facilities. Zinc concentrates produced at Matagami are refined at the Noranda
Income Fund zinc refinery in Valleyfield, Qu�bec. Copper
concentrates are smelted at Xstrata's Horne smelter in Rouyn-Noranda and refined at Xstrata's Canadian Copper
Refinery in Montr�al.
The Company's strategy is to explore for and discover zinc-copper
deposits in the Matagami Camp, and to leverage
the general infrastructure and existing processing facilities within a
known and well-established cost structure for developing VMS
deposits. Donner's exploration objective
is to investigate multiple stratigraphic
horizons with potential for VMS mineralization including the prolific Key
Tuffite horizon throughout the Matagami Camp. To date, Donner has discovered
new mineralization at Bracemac-McLeod, Bell
Channel, and Daniel 1. Within the extensive project area there are
numerous exploration targets with excellent potential for additional
discoveries. Additional information, including maps and sections, is
available at www.donnermetals.com.
SUPPLEMENTARY INFORMATION
Xstrata Zinc is the project operator for the Matagami
Project and is responsible for both fieldwork and resource evaluation
including, but not limited to, sampling, submittal of samples for assay,
assay verification, metallurgical evaluation and QA/QC. Robin
Adair, VP of Exploration for the Company, is the Qualified Person for
Donner Metals and is responsible for the technical information reported
in this news release.
ON BEHALF OF THE BOARD OF
DONNER METALS LTD.
"Harvey Keats"
Chief Executive Officer
For more information please contact:
Vanguard Shareholder Solutions
Tel: 604 608 0824
Toll Free: 1 866 898 0826
www.donnermetals.com
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