Cambridge
Mineral - Rasuhuilca Silver-Gold Feasibility Study Shows Positive..
Project Parameters
FOR: CAMBRIDGE MINERAL RESOURCES PLC
AIM SYMBOL: CMR
August 13, 2008
Rasuhuilca Silver-Gold Feasibility Study Shows Positive Project Parameters
Overview
- Rasuhuilca silver-gold project feasibility study completed
- Potential to yield 1,000,000 ounces of silver and 15,000 ounces of gold over
the five year initial planned
mine life, which the Company plans to extend
- Silver anticipated to be produced on a full capital depreciated cost of under
US$8 per troy ounce
- Potential to expand and convert additional Resources to minable Reserves,
adding significant benefits to the
Project's overall economics
LONDON, UNITED KINGDOM--(Marketwire - Aug. 13, 2008) - Cambridge Mineral
Resources plc (AIM:CMR)('CMR' or 'the
Company'), the AIM listed mining exploration and production company primarily
targeting precious metals in
South America, has completed a feasibility study in relation to its Rasuhuilca
silver-gold ('Ag/Au') project
('Rasuhuilca' or 'the Project') in Peru. This has been conducted by the
Company's own technical team in tandem
with a team of international consultants including CYC Ingenieros, Wardell
Armstrong International and Edwilde
Yoplac Castromonte.
The study utilises spot prices as at the time of the study - silver US$
14.50/oz, and gold US$ 900/oz. Current
prices- silver US$14.50, and gold US$815.
The study concluded that the Rasuhuilca mine can produce silver at a net cost
of
circa US$6 per troy ounce or
on a full capital depreciated cost of less than US$8 per troy ounce. The
operation is expected to yield circa
1,000,000 ounces of silver and 15,000 ounces of gold to generate after tax
profits of approximately US$9
million. The feasibility study indicates that mine development would be
completed within 12 months.
Located on the Patacancha Permits in the Lucanas District, Ayacucho Province in
southern Peru, Rasuhuilca
comprises an intermediate epithermal system within an east-west, steeply dipping
fault zone and comprises three
principle mineralized zones. The feasibility study has estimated that the Main
and two Western Zones contain a
total Resource of 321,100 tonnes @ 185.2 g/t Ag (252g/t Ag equivalent) and 2.15
g/t Au, at a 75 g/t Ag
equivalent cut off (JORC Standard). Additional potential to expand these
resources exists to the west within
two additional zones, Rasuhuilca North West and Rasuhuilca South, around the
4,941 metre level. Within this
Resource, a Proven & Probable Reserve to JORC Standards of 168,700 tonnes @
216
g/t Ag (368 g/t Ag Equivalent)
3.05 g/t Au, has been defined in a mining plan for the Main Zone. Only this
Reserve has been considered in this
study and the potential exists for the conversion of additional resources to
minable reserves within the
overall resource.
The mining plan envisages the blasting of 50,300 tonnes as sub-level and stope
development ore and a mere 2,500
tonnes of waste development due to the extent of a pre-existing mine workings.
Metallurgical testwork completed by CYC Ingenieros (Lima, Peru) and Wardell
Armstrong International (Cornwall,
England), has indicated that the average gold recovery will be circa 85%,
whilst
the average silver recovery
will be circa 65%. The Mill design was completed by Edwilde Yoplac Castromonte,
Consulting Engineer (Lima,
Peru). Mineral processing will involve crushing, grinding and classifying
followed by agitated cyanide-leach to
extract the precious metals. The gold and silver will then be precipitated out
of the solution via the Merrill-
Crowe Process and the resulting filtrate will be sold under contract to a
precious metals smelter and refinery
in Nazca, some 150km from the mine site.
It is anticipated that run-of-mine ore will have a net payable recoverable
precious metal value per tonne of
US$139.39 (at spot prices as at the time of the study - silver US$ 14.50/oz,
and
gold US$ 900/oz) with total
costs averaging US$51.40 per tonne over the life of mine.
On the basis of the financial model within the report, the development of the
Project is expected to require a
capital spend of circa US$3.1 million over a five month period.
The study concludes that the Rasuhuilca deposit is justified and offers a small
but rewarding return on
investment. The Company is currently examining various options to advance the
project.
Importantly, and additionally, a number of small resources already inferred by
the previous title holders,
Buenaventura, have been estimated to total 387,300 tonnes grading 5.31 g/t Au,
286 g/t Ag. These resources are
at various stages of exploration and are not to JORC standards of reporting and
therefore require additional
evaluation. There is also a very good chance that additional resources will be
located on the Patacancha
Permits and these could be processed through this plant. If any of these
prospective resources are confirmed,
significant benefit would be added to the overall economics of Rasuhuilca.
CMR Managing Director Colin Andrew said, 'The feasibility study confirms our
belief that Rasuhuilca provides an
excellent opportunity for rapid mine development and will serve as an
additional
profit stream to augment
revenues expected to commence at the end of the year from our Quintana gold
mine
development in Colombia.
Whilst being a relatively small mine in size, having a plant in this area
offers
CMR tremendous opportunities
for additional deals and further mine development.'
The full feasibility study can be downloaded from the Company's website
www.cambmin.co.uk.
Colin J. Andrew BSc ARSM MIMMM FGS CEng, Managing Director of Cambridge Mineral
Resources plc, and a Qualified
Person as defined by the 'Guidance Note for Mining, Oil and Gas Companies,
March
2006' of the London Stock
Exchange, has reviewed the information contained herein.
For further information, visit www.cambmin.co.uk.
Notes to Editor
Cambridge Mineral Resources plc is an AIM listed mining and exploration company
focussed on becoming a producer
of precious metals with an output equivalent to 100,000 oz gold per annum.
Primarily targeting precious metals
in South America, its strategy is to acquire established resources at advanced
stage exploration or near term
production and develop them to economically mineable reserves through further
exploration. It has a strong
portfolio of mineral projects at varying stages of commercialisation including
its two key projects, the
Quintana gold mine in Colombia, which is anticipated to commence production by
the end of 2008, and the
Rasuhuilca silver-gold mine in Peru. The Company also has a portfolio of assets
in Europe, which it is
currently in the process of seeking to divest through either joint-venture or
sale.
Further Information on the Feasibility Study
The feasibility study was completed using a number of consultants and various
in-house staff members.
The resources and reserve estimates were conducted by Colin J. Andrew BSc ARSM
MIMMM CEng FGS, a competent
person under both the JORC and PERC Codes. Mr. Andrew has over 30 years
experience in completing such estimates
and has visited the site at Rasuhuilca on several occasions.
Metallurgical Studies were completed by CYC Ingeneros, Lima, a well-respected
Peruvian consultancy group and by
Wardell-Armstrong UK, an international mining industry consultancy group. Mill
design was completed by Sn.
Edwilde Yoplac Castromonte, a Peruvian Metallurgical and Mineral Processing
Engineer with many years experience
in assessing and designing plants to treat ores from the southern Peru mineral
districts. Mill capital and
operating costs were estimated by Sn. Castromonte.
Mine design was by Sn. Renan Castillo, a Peruvian Mining Engineer, with over 30
years experience in operating
mines in southern Peru and with specific experience in small mines. Mine
capital
and operating cost estimates
were completed by Sn Castillo.
The operating environment in Peru with regard to permitting has been advised by
the company's legal advisors in
Peru, Sn. Cesar Manrique & Associates.
The financial evaluation was based upon the controlling parameters derived from
the above studies and reflects
normal industry practice.
All assay historical and current CMR assay data was provided from certified
laboratories analyzing batches of
samples which including blanks, field duplicates and laboratory standards and
which were subject to industry
standard QA/QC procedures.
Background
The Peruvian interests were acquired by CMR in February 2005 under the terms of
an arrangement whereby the
company exercised an option to acquire a 50 per cent. equity interest in the
Patacancha project for a payment
of US$320,000.
On 13th September 2005 the company announced that gold production had commenced
at the Marcelita-2 gold mine at
an initial production rate planned at 5-10 tonnes per day at a grade of 1/2 oz
(15g/t) gold per tonne during
the development period.
On 10th January 2007 the Company announced that an option agreement has been
signed with its partner in Peru,
Minera Argento SAC ('Argento'), to acquire Argento's 50% interest in the joint
venture company Minera Sucre
SAC. Minera Sucre holds the Patacancha claims, in southern Peru, on which the
Rasuhuilca silver-gold mine lies.
Under the terms of this Agreement the second instalment of $250,000 was paid on
2nd November to Alberto Leon
representing Argento on 5th November 2007 and the transfer of shares completed
under Notarial Deed.
Consequently Minera Peru Gold SAC, CMR 100% owned subsidiary, is now the title
holder of 100% of the issued
shares of Compania Minera Sucre SA.
Project Details
The Rasuhuilca project is located on the northern flank of Cerro Rasuhuilca
(5097.6m) at elevations between
4,826m and 4,961m. The lower levels (4,826m, 4,863m and 4,890m level are
directly accessible by 4x4 on dirt
track to their portals. The higher levels are only accessible on foot.
The Rasuhuilca vein system trends at around 075 - 080 degrees dipping steeply
at
around 80-85 degrees south to
vertical. The vein system and associated alteration is developed within
porphyritic andesites has been traced
discontinuously at surface and by underground development over 1200m. The
mineralized vein zone typically
averages 6.0m in width but is seen to vary between 4.0 and 17.0m true thickness
in underground workings. The
overall shape of the mineralized body is conical in section and widens upwards
to a maximum true width
approaching 40m near surface. Mineralization extends over a vertical interval
of
around 210m above the 4800m
level.
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The underground development on the Rasuhuilca Vein comprises 5 separate levels
of varying lengths completed by
previous permit-holders in the 1980's. During the period November 2006 to May
2007 CMR reopened all of these
levels and completed some 235.1m of vertical and sub-level development in three
raises (630, 645 and 650) to
connect this pre-existing development on the 4,826m, 4,890m and surface at
around 4936m, for sampling purposes
to investigate the vertical contiguity of the mineralized body and to establish
ventilation connections ahead
of future mining plans. CMR also collected a bulk sample of 50 tonnes from this
activity which formed the basis
of the metallurgical testwork and mill design.
Mining methods envisage a simple downward progressing shrinkage stopes to
drawpoints being mucked by narrow
vein LHD's direct to the various level portals and then being trucked to a mill
constructed immediately below
the lowest level of the mine (the 4,826m Level). Mineral processing will be by
a
simple crush - grind -
classify; agitated CN- leach; solid - liquid separation and recovery of Au / Ag
via Merrill Crowe Process.
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FOR FURTHER INFORMATION PLEASE CONTACT:
Cambridge Mineral Resources plc
Colin Andrew
Managing Director
+44 (0) 20 7663 5618
Email: candrew@iol.ie
OR
Cambridge Mineral Resources plc
Michael Burton
Finance Director
+44 (0) 20 7663 5618
Email: mburton@cambmin.co.uk
Website: www.cambmin.co.uk
OR
Ruegg & Co Limited
Gavin Burnell/Roxane Marffy
+44 (0) 20 7584 3663
OR
Hichens, Harrison and Co
Colin Rowbury
+44 (0) 20 7382 7771
OR
Haywood Securities (UK) Limited
Tom Beattie
+44 (0) 20 7031 8018
OR
St Brides Media & Finance Ltd
Victoria Thomas
+44 (0) 20 7236 1177
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Cambridge Mineral Resources Plc
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