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Monday, July 13, 2009
Luna Gold Provides Development Update
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Vancouver, July 13, 2009 - Luna Gold Corp. (TSXV-LGC) ("Luna" or the "Company") is pleased to provide an update on its wholly owned Aurizona gold project in Maranh�o State, Brazil.
Progress Highlights
- New life of mine pit design based upon January 2009 Resource Estimate
- Estimated total Proven & Probable gold reserves increased to 729k oz of gold
- Nominal mine life increased to 11 years
- Basic engineering revision completed and detailed engineering in progress
- Site preparation commenced and long lead items being procured
Luna's CEO, Jim Bahan, comments, "Our team has made excellent progress in enhancing the quality of the project and taking it closer to production. The engineering and procurement phase is progressing on schedule. Site clearance is approximately 60% completed and with the seasonal rains expected to finish in the coming weeks, civil engineering site preparation will commence with the view to commencing commercial gold production in the second quarter of 2010 at the Feasibility Study ("FS") rate of 60,000 oz per year. Clearly, the increase in the estimated gold reserves, together with the potential from satellite deposits, provides a platform for a production increase that will be addressed once the current project has reached designed capacity and producing revenue."
Mining Reserves
SRK Consulting (U.S.) Inc was retained to carry out a full pit optimization analysis, revised pit design and detailed production schedule on the updated Piaba resource update announced January 15th, 2009. The gold price used to calculate the cut-off grade (CoG) for the revised mine plan was increased to US$750/oz Au from the US$650/oz Au used in the 2008 Feasibility Study CoG calculation. The resource and price increases resulted in a Proven and Probable (P&P) reserve tonnage estimate increase of 51% to 17.2Mt of ore with a gold grade of 1.32g/t.
A summary of changes from the reserve statement from the July 2008 feasibility are as follows in Table 1. The full breakdown of reserves can be found in Table 2:
Table 1: Summary of Changes in Reserves from July 2008 to July 2009
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July 2008 |
July 2009 |
% Change |
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In-situ Au ozs in Total P&P Reserves |
500,000 |
729,000 |
46% |
|
Tonnage |
11,332,000 |
17,119,000 |
51% |
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Grade |
1.37 |
1.32 |
-7% |
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In-situ Au ozs in Saprolite P&P Reserves |
328,000 |
383,000 |
18% |
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In-situ Au ozs in Transition P&P Reserves |
94,000 |
101,000 |
7% |
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In-situ Au ozs in Fresh P&P Reserves |
82,000 |
245,000 |
200% |
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Mine Life |
7.5 years |
11 years |
46% |
|
Gold Price |
$650.00 |
$750.00 |
15% |
|
Stripping Ratio |
2.64 |
3.32 |
26% |
The estimated global Proven and Probable reserves are now as follows:
Table 2 Proven and Probable Reserves for Piaba (As of June 23, 2009)
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Category |
Rock Type |
g/t-Au |
Ore Tonnes
(kt) |
In-situ
oz-Au
(000's) |
|
Proven |
Saprolite |
1.41 |
1,069 |
48 |
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Probable |
Saprolite |
1.19 |
8,747 |
335 |
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Proven and Probable |
Saprolite |
1.21 |
9,816 |
383 |
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Proven |
Transition |
1.29 |
223 |
9 |
|
Probable |
Transition |
1.34 |
2,138 |
92 |
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Proven and Probable |
Transition |
1.33 |
2,361 |
101 |
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Proven |
Fresh |
1.79 |
217 |
13 |
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Probable |
Fresh |
1.53 |
4,725 |
232 |
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Proven and Probable |
Fresh |
1.54 |
4,942 |
245 |
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Total Proven |
|
1.44 |
1,509 |
70 |
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Total Probable |
|
1.31 |
15,609 |
659 |
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Total
Proven and Probable |
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1.32 |
17,119 |
729 |
Reserves are based on a gold price of US$750/oz;
Full mining recovery is assumed;
Mine reserves are diluted along mineralized boundary to block model SMU of 10mx10mx3m;
An internal CoG of 0.35g/tAu was used on Saprolite Rock within the pit design;
An internal CoG of 0.37g/t-Au was used on Transition Rock within the pit design;
An internal CoG of 0.41g/t-Au was used on Fresh Rock within the pit design;
Internal CoG determination includes metallurgical recoveries of 95% in Saprolite, 93% in Transition, and 91% in Fresh ore;
In situ Au ounces do not include metallurgical recovery losses;
Saprolite is rock between topography and an interpreted floor surface marking the change from highly to moderately weathered rock;
Transition is rock between an (upper) interpreted Saprolite floor surface and an interpreted moderately weathered rock floor surface; and
Fresh rock is rock below an (upper) interpreted Transition floor surface.
The stripping ratio (waste: ore) has increased due to the greater quantity of Measured and Indicated reserves contained within the new pit design in deeper fresh rock. The gold recovery from fresh rock reserves is estimated at 91%, compared with 93% and 95% for transition and saprolite rock types. As a result of the expected increase in fresh rock reserves the overall life of mine recovery grade will be slightly reduced.
The stated Proven and Probable mineral reserves have been prepared in accordance with Canada's National Instrument 43-101 Standards of Disclosure for Mineral Projects. The Qualified Person, as defined by National Instrument 43-101, for the mineral reserve update, is Bret C. Swanson, MAusIMM of SRK.
Engineering and Procurement
Following a review of the basic engineering of the project that considered additional metallurgical tests, site visits to like operations and other site specific considerations; the contract for detailed engineering of the process plant was awarded in late May to INFO Design. INFO has been associated with the project since inception. Luna has an in-house team working with INFO at its offices at Ipatinga, Minas Gerais, Brazil. Drawings are being released for construction on an agreed release schedule.
Luna has already purchased much of the milling plant and this equipment is being assembled at the embarkation port. Other long-lead equipment items are being procured and to-date, orders have been placed for the plant apron feeder, induction furnace and leach plant agitators.
The rainy season is drawing to a close and construction preparation has commenced with bush clearing at the sites of the process plant and tailings storage facility ("TSF"). Work is almost complete on the TSF coffer dam. Certain tests have yet to be completed for TSF detailed design purposes. This data is expected to be completed and available within the next 30 days.
Work is also in progress with expanding stores facilities and lay-down areas, additional accommodation in anticipation of the increased work force in the coming months, and site preparation of the analytical laboratory. The project works are currently on schedule for plant commissioning in the first quarter of 2010.
Exploration and Definition Drilling
The Company has commenced a limited diamond drill program at Piaba with the objective of testing the down-dip continuity, width and grade of the ore deposit in fresh rock. Drilling is being conducted on 200 meter spaced sections within the central portion of the deposit. The result of this work is expected to be press released once the program has been completed and all drill assays received.
In addition, an order has been placed with Atlas Copco for the supply of a reverse circulation drill rig. This machine is expected to be on site in the current quarter and will be used to better define mining blocks for production planning purposes.
A positive final exploration report for the Tatajuba exploration license has been submitted to the Mines Department. Pending approval of the report, an application will be submitted for a mining concession covering this license.
About Luna Gold Corp.
Luna is a mining exploration company focused on the acquisition, exploration, and development of gold resources and advanced stage gold exploration projects in northeastern Brazil.
On behalf of the Board of Directors
LUNA GOLD CORP.
Jim Bahan -- CEO
Website: www.lunagold.com
For further information contact Investor Relations at (604) 689-7317 or toll free at 1-866-689-7317.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Forward-Looking Statements
Statements in this release that are forward-looking statements are subject to various risks and uncertainties concerning the specific factors identified in Luna Gold Corp.'s periodic filings with Canadian Securities Regulators. These factors include the inherent risks involved in the exploration and development of mineral properties, the uncertainties involved in interpreting drill results and other exploration data, the potential for delays in exploration or development activities, the geology, grade and continuity of mineral deposits, the possibility that future exploration, development or mining results will not be consistent with the Company's expectations, accidents, equipment breakdowns, title matters, labor disputes or other unanticipated difficulties with or interruptions in production and operations, fluctuating metal prices, the possibility of project cost overruns or unanticipated costs and expenses, uncertainties relating to the availability and costs of financing needed in the future, the inherent uncertainty of production and cost estimates and the potential for unexpected costs and expenses, commodity price fluctuations, currency fluctuations, regulatory restrictions, including environmental regulatory restrictions and liability, competition, loss of key employees, and other related risks and uncertainties. The Company undertakes no obligation to update forward-looking information except as required by applicable law. Such forward-looking information represents management's best judgment based on information currently available. No forward-looking statement can be guaranteed and actual future results may vary materially. Accordingly, readers are advised not to place undue reliance on forward-looking statements or information. | |
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