Aurizon Receives Positive Feasibility Study and New Resource Estimate for Casa Berardi.VANCOUVER Vancouver, city, Canada Vancouver, city (1991 pop. 471,844), SW British Columbia, Canada, on Burrard Inlet of the Strait of Georgia, opposite Vancouver Island and just N of the Wash. border. , British Columbia British Columbia, province (2001 pop. 3,907,738), 366,255 sq mi (948,600 sq km), including 6,976 sq mi (18,068 sq km) of water surface, W Canada. Geography -- Aurizon Mines Ltd. (TSX TSX Toronto Stock Exchange (TSE before April, 2002) TSX Transfer from Stack Pointer to Index TSX True Space Extension :ARZ ARZ Allgemeines Rechenzentrum GmbH (Innsbruck, Austria) ARZ Auto-Restricted Zone ARZ Aquatic Ruin Zone (Sonic 2 level) )(AMEX AMEX See: American Stock Exchange :AZK AZK Artikel Zur Krankenpflege (German: articles on health care; Willich, Germany) ) has received the positive Feasibility Study The analysis of a problem to determine if it can be solved effectively. The operational (will it work?), economical (costs and benefits) and technical (can it be built?) aspects are part of the study. Results of the study determine whether the solution should be implemented. (1) prepared by Met-Chem Canada Canada (kăn`ədə), independent nation (2001 pop. 30,007,094), 3,851,787 sq mi (9,976,128 sq km), N North America. Canada occupies all of North America N of the United States (and E of Alaska) except for Greenland and the French islands of Inc. ("Met-Chem") for the mineral reserves located above the 700 metre metre In poetry, the rhythmic pattern of a poetic line. Various principles have been devised to organize poetic lines into rhythmic units. Quantitative verse, the metre of Classical Greek and Latin poetry, measures the length of time required to pronounce syllables, level in the West Mine area of its 100%-owned Casa Berardi Project located in north western Quebec Quebec, city, Canada Quebec, Fr. Québec, city (1991 pop. 167,517), provincial capital, S Que., Canada, at the confluence of the St. Lawrence and St. Charles rivers. , Canada. Aurizon is also pleased to report: - a new mineral resource estimate located below 700 metres for Zone 113, prepared by Met-Chem; - a new mineral reserve estimate on the East Mine crown pillar pillar, freestanding columnar supporting member. It is a general term, little used as an exact architectural definition except as applied to an upright support in the medieval styles, consisting of an assemblage of juxtaposed shafts and moldings; unlike the column, , prepared by Geostat Systems International Inc. ("Geostat"); and - results of an internal Scoping Study(2) which provides an updated economic model including both mineral reserves and indicated mineral resources Noun 1. mineral resources - natural resources in the form of minerals natural resource, natural resources - resources (actual and potential) supplied by nature in the West Mine area. All documents have been prepared in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with the Standards of Disclosure for Mineral Projects as defined by National Instrument 43-101 ("NI 43-101").
HIGHLIGHTS
(All dollar figures expressed in Canadian dollars, except where
indicated)
--------------------------------------------------------------------
Integrated
Feasibility Scoping Feasibility
Study Study and Scoping
(Above 700 m) (Below 700 m) studies
--------------------------------------------------------------------
Assumptions: US$ gold price
of US$400/oz and an
exchange rate of 1.25
--------------------------------------------------------------------
West Mine Mineral Reserves
(gold ounces) 867,900 - 867,900
113 Indicated Mineral
Resources below 700
metres (gold ounces) - 294,700 294,700
(80% of (80% of
368,000oz) 368,000oz)
Total project (gold ounces) 867,900 294,700 1,162,600
--------------------------------------------------------------------
Pre-production Capital Cost
(in millions) $84.1 - $84.1
Sustaining Capital Cost
(in millions) $34.0 $34.9 $68.9
Pre-production period 18 months - 18 months
Total Cost per tonne $54.31 $54.54 $53.99
Cash cost per ounce (US$) US$233/oz US$126/oz US$206/oz
Payback period 3.5 years 1.5 years 3.8 years
Internal rate of return
(before tax(3)) 17.1% 45.9% 22.2%
Average annual production
rate (life of mine) 150,000 oz 70,000 oz 170,000 oz
Average gold grade (life
of mine) 6.2g/t 11.4g/t 7.0g/t
Mine Life 5.5 years 4.0 years 6.5 years
--------------------------------------------------------------------
Notes:
(1) "Feasibility Study" - comprehensive study in which all
geological, engineering, operating, economic and other relevant
factors are considered in sufficient detail that it could
reasonably serve as the basis for a final decision by a
financial institution to finance the development of the deposit
for mineral production.
(2) "Scoping Study" - preliminary economic evaluation of indicated
mineral resources using a financial analysis based on reasonable
assumptions of technical, engineering, operating and economic
factors. There is no certainty that the results of the scoping
study will be realized.
(3) Aurizon has approximately $70 million of accumulated exploration,
development and capital costs, together with loss carry-forwards
available, for deduction against taxable income.
The delivery of the Feasibility Study completes the second stage of Aurizon's Casa Berardi Continuous Development Program. The goal of this Program is to advance the Casa Berardi Project to commercial production, in as short a period as possible, while reducing the pre-production capital costs and lowering the technical and financial risk of the Project. The Feasibility Study lays out an initial 5.5 year start-up Start-up The earliest stage of a new business venture. plan for Casa Berardi, and has been built around a mineral reserve based on drilling above 700 metres depth. The Feasibility Study does not include the high grade component of Zone 113 recently outlined by infill in·fill n. 1. The use of vacant land and property within a built-up area for further construction or development, especially as part of a neighborhood preservation or limited growth program. 2. drilling below 700 metres. The pre-production time required to bring the Project to commercial production is anticipated to be 18 months. Pre-production capital costs are estimated at C$84.1 million (US$67 million), the majority of which will be for underground mine development. Aurizon has received tenders for most of the significant costs related to the Project, thereby reducing capital cost risks. In addition, Aurizon has already retained the required key technical staff to develop and operate the mine. Technical problems encountered prior to the mine's closure in 1997 have all been addressed in the Feasibility Study. The Feasibility Study outlines the first 5.5 years of production from initial stope stope n. An excavation in the form of steps made by the mining of ore from steeply inclined or vertical veins. tr.v. stoped, stop·ing, stopes To remove (ore) from or mine by means of a stope. development above 700 metres on 868,000 reserve ounces of gold. The Scoping Study evaluates the economic impact of including the high grade resources below 700 metres, currently estimated at 368,000 resource ounces of gold, into the mining plan. For the purposes of the Scoping Study, 80% of the indicated mineral resources have been included, based on the resource to reserve conversion previously experienced. Additional production can be obtained from the crown pillar of the East Mine, which are estimated to contain 80,000 reserve ounces of gold. In addition, Aurizon will undertake development and definition drill programs aimed at upgrading an estimated 1,000,000 inferred ounces of gold situated in the vicinity of the West Mine infrastructure, in order to increase the Project's mine life. "Receipt of the Feasibility Study and resource estimates is another important milestone in advancing Casa Berardi to production," said David Hall David Hall may refer to:
The process by which the body uses minerals to build bone structure. Mentioned in: Rickets mineralization, n the bioprecipitation of an inorganic substance. to a depth of up to 1300 metres, but also to pursue other opportunities, utilizing the skills of its experienced technical team." NEW MINERAL RESOURCE ESTIMATE FOR ZONE 113 BELOW LEVEL 700 METRES Met-Chem was commissioned by Aurizon to prepare a new mineral resource estimate based on the recent drill information below the 700 metre level. The new mineral resource estimate, received on January January: see month. 20, 2005, is based on new underground holes drilled by Aurizon, from September September: see month. to December December: see month. 2004, on 35 metre-spaced intervals. The new estimate replaces the previous estimate that was based on surface drill holes. This mineral resource estimate has not been considered in the Feasibility Study mining plan, but is considered in the Scoping Study. Met-Chem constructed a 3D block model inside the ore zone envelopes delineated de·lin·e·ate tr.v. de·lin·e·at·ed, de·lin·e·at·ing, de·lin·e·ates 1. To draw or trace the outline of; sketch out. 2. To represent pictorially; depict. 3. by Aurizon. Indicated mineral resources are estimated at 838,000 tonnes at 13.68 grams of gold per tonne tonne measure of weight or mass; 1 tonne=1000 kg. See also ton. , or 368,000 ounces of gold. These resources are undiluted and no cut-off cut-off Anesthesiology The point at which elongation of the carbon chain of the 1-alkanol family of anesthetics results in a precipitous drop in the anesthetic potential of these agents–eg, at > 12 carbons in length, there is little anesthetic activity, grade has been applied. An upper capping limit of 115 grams of gold per tonne has been applied to the high grade values. ------------------------------------------------ INDICATED MINERAL RESOURCES - ZONE 113 BELOW 700 METRE LEVEL ------------------------------------------------ Tonnes 838,000 ------------------------------------------------ Grade (grams/tonne) 13.68 ------------------------------------------------ Gold Ounces 368,584 ------------------------------------------------ NEW MINERAL RESERVE ESTIMATE FOR EAST MINE CROWN PILLAR Geostat was commissioned by Aurizon to prepare a new mineral reserve estimate based on the drilling information for the upper part of the East Mine included in the crown pillar. The new reserve estimate received on January 19, 2005 is based on existing holes drilled by Aurizon and the previous operator. The new estimate has not been considered in the Feasibility Study or the Scoping Study. The selected mining method consists of a conventional open pit operation utilizing trucks and shovel. Geostat constructed a 3D block model inside the ore zone envelopes delineated by Aurizon. Probable mineral reserves are estimated at 593,958 tonnes at 4.22 grams of gold per tonne, or 80,000 ounces of gold, using a dilution Dilution A reduction in earnings per share of common stock that occurs through the issuance of additional shares or the conversion of convertible securities. Notes: Adding to the number of shares outstanding reduces the value of holdings of existing shareholders. factor of 15%, and a minimum cut-off grade of 4.0 grams has been applied. No upper capping limit has been applied to high grade values. ------------------------------------------------ PROBABLE MINERAL RESERVES - EAST MINE CROWN PILLAR ------------------------------------------------ Tonnes 593,958 ------------------------------------------------ Grade (grams/tonne) 4.22 ------------------------------------------------ Gold Ounces 80,588 ------------------------------------------------ FEASIBILITY STUDY ABOVE 700 METRE LEVEL OF THE WEST MINE Met-Chem was commissioned by Aurizon to prepare a Feasibility Study "A Feasibility Study" is an episode of the original The Outer Limits television show. It first aired on 13 April, 1964, during the first season. It was remade in 1997 as part of the revived The Outer Limits series with a minor title change. report based on the indicated mineral resources above level 700 metres in the West Mine area of the Casa Berardi Project, in accordance with the Standards of Disclosure for Mineral Projects as defined by NI 43-101. History The Casa Berardi project is located 95 kilometres north of La Sarre Sarre: see Saar, river; Saarland. , northwestern Quebec. Previous mining operations were performed from a ramp accessing the upper part of the deposits at the East and West mine sites, from which 3.74 million tonnes, at an average grade of 6.7 grams of gold per tonne were extracted between 1988 and 1997 to produce 688,000 recovered ounces. Following the acquisition of the Project, Aurizon carried out a surface exploration diamond drill program with the objective of increasing the gold resources. This program was followed by underground drilling to increase the confidence level of known resources. Surface and underground infrastructure Existing facilities on site include a 2,200 tonnes per day processing plant, a building complex including warehouse, maintenance, mine dry, a 120KV electrical power line, and ramp access. Mobile equipment remaining from the previous operation is available for the proposed mining operation. Aurizon has already completed construction of the following surface and underground infrastructures: - Surface foundations for headframe, backlegs, hoist hoist: see winch. buildings and silos - 42 metre concrete shaft collar The shaft collar is a simple, yet important, machine component found in many power transmission applications - most notably motors and gearboxes. They are used as mechanical stops, locating components, and bearing faces. The simple design lends itself to easy installation. - Ramp development in Zone 113 to the 570 metre level - Access drift drift, deposit of mixed clay, gravel, sand, and boulders transported and laid down by glaciers. Stratified, or glaciofluvial, drift is carried by waters flowing from the melting ice of a glacier. to the shaft shaft (shaft) a long slender part, such as the diaphysis of a long bone. shaft n. 1. An elongated rodlike structure, such as the midsection of a long bone. 2. and stations on the 280 metre and 550 metre levels - Shaft pilot raise from the 550 metre level to shaft collar - Ventilation ventilation, process of supplying fresh air to an enclosed space and removing from it air contaminated by odors, gases, or smoke. Proper ventilation requires also that there be a movement or circulation of the air within the space and that the temperature and raise from the 550 metre to the 280 metre level (in progress) - Ramp rehabilitation rehabilitation: see physical therapy. from surface down to the 460 metre level Mineral reserves and resources The Casa Berardi deposit is a vein type deposit located close to the contact between sedimentary basin The term sedimentary basin is used to refer to any geographical feature exhibiting subsidence and consequent infilling by sedimentation. As the sediments are buried, they are subjected to increasing pressure and begin the process of lithification. sequence and the volcanic basement This article is about the section of a building. For the foundation, see Basement rock. A basement is one or more floors of a building that are either completely or partially below the ground floor. Slab-on-grade buildings do not have basements. . The deposit extends for a 5 kilometre strike along the Casa Berardi Fault system. Mineral reserves and resource estimations have been classified in accordance with NI-43-101. Met-Chem constructed block models for zones 113 and Lower Inter and has estimated the mineral resources and reserves. Polygonal pol·y·gon n. A closed plane figure bounded by three or more line segments. po·lyg  o·nal adj. estimation estimationIn mathematics, use of a function or formula to derive a solution or make a prediction. Unlike approximation, it has precise connotations. In statistics, for example, it connotes the careful selection and testing of a function called an estimator. was done for the other mineralized min·er·al·ize v. min·er·al·ized, min·er·al·iz·ing, min·er·al·iz·es v.tr. 1. To convert to a mineral substance; petrify. 2. To transform a metal into a mineral by oxidation. 3. zones and was audited by Met-Chem. The selected mining method consists of Sequential One after the other in some consecutive order such as by name or number. Transversal and Longitudinal lon·gi·tu·di·nal adj. Running in the direction of the long axis of the body or any of its parts. Long Hole when the vein is larger than 10 metres and Longitudinal Long Hole Retreat when the vein is less than 10 metres. The stoping sequence includes cemented rockfill of the primary stoping sequence, and unconsolidated rockfill for the longitudinal retreat and secondary stoping sequence. Stope dilution has been calculated on the basis of the stability of the stope openings, ore deposit geometry geometry [Gr.,=earth measuring], branch of mathematics concerned with the properties of and relationships between points, lines, planes, and figures and with generalizations of these concepts. and mining method. With the Sequential Longitudinal and Transversal mining method, dilution will come mainly from internal waste below 4.0 grams per tonne of gold cutoff. With the Longitudinal Retreat mining Retreat mining is a term used to reference the final phase of an underground mining technique known as room and pillar mining. This involves excavating a room, or chamber while leaving behind pillars of material for support. method, dilution will mainly come from waste outside of the stope outlines.
CASA BERARDI MINERAL ESTIMATE
--------------------------------------------------------------------
High Speci
Min Assay fic- Dilu-
Grade Cutoff Cut Grav- tion
grams/ Gold grams/ grams/ ity Fac-
Tonnes tonne Ounces tonne tonne T/m3 tor
--------------------------------------------------------------------
PROBABLE
MINERAL
RESERVES
Zone 113
above 700
metre
level 1,974,749 6.78 430,476 4.0 47.0 2.70 (i)25%
Lower Inter
Zone 1,534,224 6.05 298,436 4.0 40.0 2.77 19%
Northwest
Zone 213,777 5.64 38,766 3.0 23.0 2.77 20%
Southwest
Zone 339,636 4.56 49,795 3.0 18.5 2.77 20%
Zone 111 292,691 5.36 50,441 3.0 27.1 2.77 20%
--------------------------------------------------------------------
West Mine -
Probable
Mineral
Reserves 4,355,077 6.20 867,914
East Mine -
Probable
Mineral
Reserves 593,958 4.22 80,588 4.0 - 2.70 15%
--------------------------------------------------------------------
Total
Probable
Mineral
Reserves 4,949,035 5.96 948,502
--------------------------------------------------------------------
INDICATED
MINERAL
RESOURCES
Zone 113
below 700
metre
level 838,000 13.68 368,584 4.0 115.0
Inter Zone 123,878 4.43 17,644 3.0 18.7
Principal
Zones below
crown pillar 315,666 7.01 71,144 3.0 12.6
to
56.1
Principal
Zones
in crown
pillar 339,139 5.51 60,077 3.0 12.6
to
56.1
--------------------------------------------------------------------
Total
Indicated
Mineral
resources 1,616,683 9.95 517,449
--------------------------------------------------------------------
INFERRED
MINERAL
RESOURCES
Zone 113
below 700
metre
level 2,450 16.80 1,323 4.0 115.0
Lower Inter
Zone 39,906 6.34 8,134 4.0 40.0
Zone 104 115,135 6.62 24,505 3.0 31.0
Zone 109 124,739 9.11 36,535 3.0 44.4
Zones
117-123 1,703,500 6.10 334,090 3.0 No capping
Principal
Zones below
crown
pillar 1,315,964 6.50 274,996 3.0 12.6
to
56.1
Principal
Zones
in crown
pillar 1,646,536 6.43 340,479 3.0 12.6
to
56.1
--------------------------------------------------------------------
West Mine
Total 4,948,230 6.40 1,020,062
East Mine
Total 661,042 7.25 154,063 3.0 31.0
--------------------------------------------------------------------
Total
Inferred
Mineral
Resources 5,609,272 6.50 1,174,125
--------------------------------------------------------------------
(i) External dilution at 1 gram/tonne gold
Notes: All of the above mineral reserve and resource estimates have
been audited and/or prepared by Met-Chem, except for the East
Mine mineral reserves, which were prepared by Geostat.
Mineral resources which are not mineral reserves do not have
demonstrated economic viability
Proposed surface and underground infrastructure The proposed mine infrastructure incorporates a 5.5 metre diameter concrete vertical circular shaft down to 810 metres, related surface and underground infrastructure including a headframe, hoist room, revised electrical distribution, ore and waste passes, ventilation raises, ramps and lateral lateral /lat·er·al/ (-il) 1. denoting a position farther from the median plane or midline of the body or a structure. 2. pertaining to a side. lat·er·al adj. 1. development. All infrastructure has been designed to ensure a long mine life beyond that established in the Feasibility Study.
Underground Mine Operation
---------------------------------------------------------------------
Permanent Infrastructure North of the Casa Berardi fault (massive
volcanics)
Mining operation South of the Casa Berardi fault
(sediments)
Mining method Stopes greater than 10 metres wide -
Sequential Transversal and Longitudinal
long hole
Stopes less than 10 metres wide -
Transversal long hole retreat
Back fill Primary stoping sequence - cemented
rockfill
Secondary stoping sequence -
unconsolidated rockfill
Longitudinal retreat - unconsolidated
rockfill
Production rate 1,800 tonnes/day (first 6 months) 2,400
tonnes/day (life of mine)
Standard stope dimension 20 metres high X 15 metres wide X 10
metres long
Active stopes required 8 active stopes of 9,000 tonnes per month
Hoisting 5.5 metres circular concrete shaft (810
metres)
Hoisting capacity of 300 tonnes per hour
---------------------------------------------------------------------
The underground operation will be designed to sustain a daily production rate of 2,400 tonnes, 7 days a week, 345 days a year. Initial production is expected to be established from higher grade portions of Zone 113, development in low grade material, and a development stock pile. Mining and development sequence flexibility will be achieved by using both longitudinal and transversal mining methods, multiple ore zones, shaft and ramp access. To mitigate mit·i·gate v. To moderate in force or intensity. mit  i·gation n. previous operational ground problems, permanent
infrastructure, such as the shaft, ramp, ore/waste pass systems,
ventilation raises and haulage drifts will be located north of the Casa
Berardi fault within the massive volcanic rocks rocks which have been produced from the discharges of volcanic matter, as the various kinds of basalt, trachyte, scoria, obsidian, etc., whether compact, scoriaceous, or vitreous.See also: Volcanic . The mining operation will be located on the south side of the fault and will not interfere with permanent infrastructure. To ensure long term ground stability, drift and stopes Stopes , Marie Carmichael 1880-1958. British social reformer who opened England's first birth control clinic (1924) in London and later promoted family planning in east Asia. located within 10 metres of major faults will be cable bolted and shotcreted. Based on the results of rock mechanics Rock mechanics is the theoretical and applied science of the mechanical behaviour of rock and rock masses; it is that branch of mechanics concerned with the response of rock and rock masses to the force fields of their physical environment. studies, the stope size will be limited to a 10 metre length by a maximum depth of 15 metres, with a level interval of 20 metres. It is anticipated that previous mill feed problems will be addressed by shaft hoisting and a sufficient stope inventory. Eight active stopes, each averaging 9,000 tonnes, will be required to sustain a planned production rate of 2,400 tonnes per day. Ventilation requirements will be achieved by downcasting In object-oriented programming, downcasting or type refinement is the act of casting a pointer or a reference to a base class to one to a derived class. In most programming languages, it is usually possible to check through RTTI whether the type of the referenced object is fresh air from the existing ventilation raise and the main ramp access. Exhaust Exhaust may refer to: In mathematics:
The ore will be hoisted to surface through the new shaft, loaded into trucks from a storage bin and transported 5 kilometres to the processing plant. Ore processing
---------------------------------------------------------------------
Milling: Intensive cyanidation leaching, gravity
circuit followed by conventional
Carbon-in-leach circuit
Average recovery
(life of mine): 93.0%
Tailings: 1.4 million tonnes (residual capacity),
additional cell in year 2
Mill Operating days: 345 days (94.5% of mill availability)
---------------------------------------------------------------------
Processing of the ore will be performed at the existing facilities, which contain a standard cyanidation carbon-in-leach circuit. Metallurgical met·al·lur·gy n. 1. The science that deals with procedures used in extracting metals from their ores, purifying and alloying metals, and creating useful objects from metals. 2. testwork, performed by SGS SGS Société Générale de Surveillance SGS Symantec Gateway Security (appliance) SGS School of Graduate Studies SGS Subgrid Scale SGS Singapore Government Securities SGS Shell Global Solutions Lakefield Lakefield is the name of several places in the North America:
Existing tailings Tailings (also known as tailings pile, tails, leach residue, or slickens[1]) are the materials left over[2] after the process of separating the valuable fraction from the worthless fraction of an ore. pond capacity is estimated at 1.45 million cubic metres Noun 1. cubic metre - a metric unit of volume or capacity equal to 1000 liters cubic meter, kiloliter, kilolitre metric capacity unit - a capacity unit defined in metric terms . Incremental Additional or increased growth, bulk, quantity, number, or value; enlarged. Incremental cost is additional or increased cost of an item or service apart from its actual cost. storage capacity will be provided by a new cell. In addition to the environmental permits transferred from the previous owners, a series of approvals were obtained by Aurizon. All permits are in force. Modifications to the permits will be required to reflect the proposed mining plan, milling rate and tailings management. Project master schedule The Project master schedule estimates that the shaft, surface and underground facilities, required underground development, underground infrastructure, mill improvements and rehabilitation, and mine site infrastructure should be completed within an 18 month period. The Project master schedule includes permitting, remaining detailed engineering, current productivity rates, labour force availability, lead time for purchasing consumables and project commissioning. Capital costs Direct cost estimates for the shaft development, related surface infrastructure and steel are derived from recent tenders based on detailed engineering studies. Quotes have been received for the other major mine and process equipment. Unit costs for the underground development are based on actual productivity and contract costs that are currently in force. It is anticipated that all underground preproduction pre·pro·duc·tion adj. 1. Taking place or existing before production: preproduction planning. 2. development will be performed by mining contractors utilizing their own mobile equipment. After the preproduction stage, mining operations will be performed by Aurizon using a combination of existing and leased equipment and, therefore, no capital investment has been planned for major mining equipment. A 10% contingency contingency n. an event that might not occur. has been provided on direct costs.
CAPITAL COSTS
------------------------------------------------
$
(000's)
--------
Surface infrastructure
Ore processing mill 6,451
Headframe and hoist room 5,271
Mine site infrastructure 4,014
Cement Plant 925
Tailing disposal 350
Underground infrastructure
Mine development 19,655
Shaft 18,000
Underground services 11,670
------------------------------------------------
Total Direct Costs $66,336
------------------------------------------------
Contingency on direct cost 6,766
Indirect costs
Owner costs 7,931
Detailed engineering, procurement 2,090
Mill (start up, training,
commissioning, spares) 823
Permits 197
------------------------------------------------
Total Pre-Production Capital Costs $84,143
------------------------------------------------
Operating costs
The average total cash cost is estimated in the Feasibility Study at
US$233 per ounce, using an exchange rate of 1.25, for the 5.5 year
period covered.
OPERATING COSTS
------------------------------------------------
($/Tonne)
--------
Mining $30.59
Milling 13.30
Administration 10.00
Restoration 0.42
------------------------------------------------
Total Operating Costs $54.31
------------------------------------------------
Economic model The economic model for the Feasibility Study is based only on mineral reserves above the 700 metre level in the West Mine area only. This represents a start-up base case scenario to quickly advance the project to the production stage. The Feasibility Study has not reviewed the impact of the high grade indicated mineral resources located in the dip extension of Zone 113.
FEASIBILITY STUDY SUMMARY
---------------------------------------------------------------------
Assumptions: US$ gold price of US$400/oz and an exchange rate of 1.25
Tonnes milled 4,355,000 Initial capital $84M
Average gold grade (g/t) 6.2 Sustaining capital $34M
Average mill recovery 93.0% NPV (before taxes) @ 0% $50M
Total Gold Produced
(ozs.) 806,400 NPV (before taxes) @ 5% $28M
Average annual ozs. 150,000 IRR 17%
Average total cash
cost/oz US$233
---------------------------------------------------------------------
Note: Aurizon has approximately $70 million of accumulated
exploration, development and capital costs, together with loss
carry-forwards available, for deduction against taxable income.
The economics of the project are mainly sensitive to fluctuations in
the price of gold and exchange rate.
SENSITIVITY ANALYSIS
--------------------------------------------------------------------
Internal Rate
Change Variation of Return
+ 10% US$440 28%
Gold price - base case - US$400 17%
- 10% US$360 5%
--------------------------------------------------------------------
+ 10% 1.375 28%
Exchange rate - base case - 1.25 17%
- 10% 1.125 5%
--------------------------------------------------------------------
+ 15% US$268 7%
Cash operating
costs/ounce - base case - US$233 17%
- 15% US$198 26%
--------------------------------------------------------------------
+ 15% C$96.7m 13%
Pre-production capital
costs - base case - C$84.1 m 17%
- 15% C$71.5m 23%
--------------------------------------------------------------------
RISK ASSESSMENT - Past vs Present Underground - Previous ground condition risks will be reduced by using cemented rockfill sequencing, locating permanent infrastructure in volcanic rocks, and by using systematic rock mechanics engineering. - Prior mill feed problems will be addressed by using the shaft hoisting method and appropriate stope preparation. - Production rates are expected to be achieved by using appropriate development and stoping sequences, and appropriate mining methods. - Ventilation requirements will be achieved by downcasting fresh air from the existing ventilation raise and the main ramp access. Exhaust air will be discharged through the new shaft and the 280 metre level track drift. Previous crown pillar collapse Aurizon has addressed this issue by using strict ground condition controls with respect to rock mechanics standards, appropriate backfill back·fill n. Material used to refill an excavated area. tr.v. back·filled, back·fill·ing, back·fills To refill (an excavated area) with such material. sequencing, prevention of water infiltration infiltration /in·fil·tra·tion/ (in?fil-tra´shun) 1. the pathological diffusion or accumulation in a tissue or cells of substances not normal to it or in amounts in excess of the normal. 2. infiltrate (2). along the Casa Berardi Fault system, and ensuring all involved staff is dedicated to the highest standards of rock mechanics control. Previous high operating costs operating costs npl → gastos mpl operacionales Aurizon has addressed this issue by implementing appropriate mine planning and development sequencing; appropriate backfill sequencing; having appropriate working standards and procedures in force and by hiring experienced technical staff, most of whom have over 20 years of mining experience, dedicated to mine planning control. Previous poor mill recoveries Aurizon has addressed this issue by ensuring that there will be constant mill feed from the underground operation, by the addition of an intensive cyanide gravity circuit prior to the existing CIL (Common Intermediate Language) The ECMA version of the Microsoft Intermediate Language (MSIL). See CLI. 1. (project) CIL - Component Integration Laboratories. 2. (language) CIL - Common Intermediate Language. circuit and ensuring that key staff are dedicated to mill control. INTERNAL SCOPING STUDY Aurizon has completed a Scoping Study which outlines a mining plan that incorporates both the initial start up plan presented by the Feasibility Study together with a preliminary mining plan for the higher grade indicated mineral resources of Zone 113 below 700 metres. The Scoping Study includes results from the lower level of Zone 113 which were not available at the time of Feasibility Study cut off. For the purpose of the Scoping Study, 80% of the indicated mineral resources have been included in the mining plan based on the resource to reserve conversion ratio experienced on the upper level of Zone 113. The pre-production time has been maintained at 18 months as it is anticipated that the shaft could be deepened 200 metres, six months after the completion of the initial sinking. The Scoping Study utilizes all existing, planned and required infrastructure. The capital cost to access and develop the deeper high grade mineral resource is estimated at C$34.9 million (US$27.9 million), incurred over a 24 month period which could be funded by operating cash flow Operating cash flow Earnings before depreciation minus taxes. Measures the cash generated from operations, not counting capital spending or working capital requirements. . It is anticipated that production from the high grade mineral resources will be blended with the upper level mineral reserves over a 4 year period, commencing in year two of the production cycle, in order to maintain a constant feed and consistent grade to the mill, adding one year to the mine life. It is anticipated that the operating grade will increase to 7.0 g/t Au over the expanded mine life. The Scoping Study considered the impact on the mining method, operating cost and mill recovery used in the Feasibility Study. The Scoping Study, when integrated with the Feasibility Study, indicates that average annual gold production could increase to 170,000 ounces per year, at a reduced total cash cost of US$206 per ounce ounce, in zoology ounce, in zoology: see leopard. ounce, unit of measurement ounce: see English units of measurement. , and that the Project's internal rate of return would increase to 22%. The Scoping Study was completed by Ghislain Fournier Ghislain Fournier (born 26 August 1938 in Saint-Vianney, Quebec) was a member of the Canadian House of Commons from 1997 to 2004. He is a businessman by career, including real estate work. , P. Eng P. ENG Professional Engineer P. ENG process engineer ., Aurizon's Superintendent, Corporate Development, an appropriately Qualified Person as defined by NI 43-101, in conjunction with other members of Aurizon's technical staff, and received on January 28, 2005. INTEGRATED FEASIBILITY AND SCOPING STUDY SUMMARY --------------------------------------------------------------------- Assumptions: US$ gold price of US$400/oz and an exchange rate of 1.25 Tonnes milled 5,159,077 Initial capital $84M Average gold grade (g/t) 7.0 Sustaining capital $69M Average mill recovery 93.05% NPV (before taxes) @ 0% $107M Total Gold Produced (ozs.) 1,080,000 NPV (before taxes) @ 5% $70M Average annual ozs. 170,000 IRR 22% Average total cash cost/oz US$206 --------------------------------------------------------------------- Outlook Aurizon's planned growth strategy anticipates that the Company's gold production will increase from 28,000 ounces in 2005 to an anticipated 190,000 ounces in 2008. The cash cost per ounce should decrease as the higher grade ounces are developed and mined. Aurizon intends to advance the development of the Casa Berardi West Mine as quickly as possible. - discussions with financial institutions and government agencies are currently underway. - a pre-feasibility study will be completed in order to incorporate the high grade indicated resources located below 700 metres into the detailed mine plan. - Aurizon envisages spending C$7.7 million in exploration and definition drilling activities in 2005 in order to increase and upgrade the quality of the resources. Two underground rigs are currently active in the West Mine area. Underground exploration drilling will test the dip extension of the Zone 113 down to 1,100 metres below surface. Underground definition drilling will be initiated up to 500 metres east of the Zone 113 in order to upgrade the quality of the known inferred mineral resources and increase the mine life. Surface exploration drilling will continue in the East mine area and west of the West mine. Additional Information The Feasibility Study will be posted on the Company web site and on SEDAR SEDAR System for Electronic Document Analysis and Retrieval SEDAR Southeast Data, Assessment, and Review within a 30 day period following this news release. All other information previously released on the Casa Berardi project is also available on the Aurizon website. Aurizon is a Canadian-based gold producer with operations and exploration activities in the Abitibi Abitibi may mean:
In geology:
Canada's largest stock exchange, trading approximately 1,200 company stocks and 33 options. under the symbol "ARZ" and on the American Stock Exchange American Stock Exchange (AMEX) Stock exchange in the U.S. Originally known as “the Curb,” it began as an outdoor marketplace in New York City c. 1850. It moved indoors to its present location in the Wall Street area in 1921. under the symbol "AZK". This News Release contains "forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. ", including, but not limited to, statements regarding the Company's expectations as to the market price of gold, strategic plans, future commercial production, production targets and timetables, mine operating costs, capital expenditures, work programs, exploration budgets and mineral reserve and resource estimates. Forward-looking statements express, as at the date of this report, the Company's plans, estimates, forecasts, projections, expectations, or beliefs as to future events or results. We caution that forward-looking statements involve a number of risks and uncertainties, and there can be no assurance that such statements will prove to be accurate. Therefore, actual results and future events could differ materially from those anticipated in such statements. Factors that could cause results or events to differ materially from current expectations expressed or implied by the forward-looking statements, include, but are not limited to, factors associated with fluctuations in the market price of precious metals Precious Metals Valuable metals such as gold, iridium, palladium, platinum, and silver. Notes: Investing in precious metals can be done either by purchasing the physical asset, or by purchasing futures contracts for the particular metal. , mining industry risks and hazards, environmental risks and hazards, uncertainty as to calculation of mineral reserves and resources, requirement of additional financing, risks of delays in construction and other risks more fully described in Aurizon's Annual Report on Form 20-F filed as an alternative form of AIF AIF Annual Information Form AIF Apoptosis-Inducing Factor AIF Agence Intergouvernementale de la Francophonie (French: Intergovernmental Agency for Francophony) AIF Australian Imperial Force with the Securities Commissions of the provinces of British Columbia, Ontario Ontario, city, United States Ontario, city (1990 pop. 133,179), San Bernardino co., S Calif., near Los Angeles, in a region of vineyards; inc. 1891. and Quebec, with the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. Securities and Exchange Commission, and with the Toronto Stock Exchange. Cautionary Note to US Investors The United States Securities and Exchange Commission permits mining companies, in their filings with the SEC to disclose only those mineral deposits that a company can economically and legally extract or produce. We use certain terms in this news release such as "mineral resources" and "inferred resources" that the SEC guidelines guidelines, n.pl a set of standards, criteria, or specifications to be used or followed in the performance of certain tasks. strictly prohibit pro·hib·it tr.v. pro·hib·it·ed, pro·hib·it·ing, pro·hib·its 1. To forbid by authority: Smoking is prohibited in most theaters. See Synonyms at forbid. 2. us from including in our Form 20-F, File No. 0-22672 available from us at Suite 900, 510 Burrard Street Burrard Street is a major thoroughfare in Vancouver, British Columbia, Canada. It is the central street of Downtown Vancouver and the Financial District. The street is named for Burrard Inlet, located at its northern terminus, which in turn is named for Sir Harry Burrard. , Vancouver, B.C. Canada V6C 3A8. You can also obtain this form from the SEC by calling in 1-800-SEC-0330 or visit Aurizon's page on SEDAR, where all of the Company's public documents are filed, including the Form 20-F (reference Annual Information Form). Cautionary Note to U.S. Investors concerning estimates of Indicated Resources - This news release uses the term "indicated" resources. We advise U.S. Investors that while that term is recognized and required by Canadian Canadian (kənā`dēən), river, 906 mi (1,458 km) long, rising in NE New Mexico. and flowing E across N Texas and central Oklahoma into the Arkansas River in E Oklahoma. regulations, the U.S. Securities and Exchange Commission does not recognize it. U.S. investors are cautioned not to assume that any part or all of mineral deposits in this category will ever be converted into mineral reserves. Cautionary Note to U.S. Investors concerning estimates of Inferred Resources - This news release uses the term "inferred" resources. We advise U.S. investors that while this term is recognized and required by Canadian regulations, the U.S. Securities and Exchange Commission does not recognize it. "Inferred resources" have a great amount of uncertainty as to their existence, and great uncertainty as to their economic and legal feasibility. It cannot be assumed that all or any part of an Inferred Mineral Resource will ever be upgraded to a higher category. Under Canadian rules, estimates of Inferred Mineral Resources may not form the basis of feasibility or pre-feasibility studies, except in rare cases. U.S. investors are cautioned not to assume that part or all of an inferred resource exists, or is economically or legally minable. U.S. Registration: (File #0-22672) Form 20-F Aurizon Mines Ltd. (TSX:ARZ) (AMEX:AZK) |
|
||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion