CDN$203 Million Net Present Value Forecast for Great Basin's High Grade Gold Project.Business Editors VANCOUVER, British Columbia--(BUSINESS WIRE)--Feb. 11, 2002 Ronald W. Thiessen, President and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. of Great Basin Great Basin, semiarid, N section of the Basin and Range province, the intermontane plateau region of W United States and N Mexico. Lying mostly in Nevada and extending into California, Oregon, Idaho, and Utah, it is bordered by the Sierra Nevada on the west, the Gold Ltd. (OTC OTC See: Over-the-counter. OTC See over-the-counter market (OTC). .BB:GBGLF) (CDNX CDNX See Canadian Venture Exchange (CDNX). :GBG GBG Göteborg (Sweden) GBG Guernsey (International Auto Identification) GBG Good Beer Guide (UK pub guidebook published annually by the Campaign for Real Ale) ) is pleased to announce that the recently completed preliminary economic assessment, for the high-grade, gold-silver veins currently outlined at it's Ivanhoe property on the Carlin car·line or car·lin n. Scots A woman, especially an old one. [Middle English kerling, from Old Norse, from karl, man.] Trend, Nevada has been updated to reflect current market commodity prices. The November 2001 base case preliminary economic assessment was based on metal prices of US$275/oz gold and US$4.50/oz silver. At current metal prices of US$300/oz gold and US$4.40/oz silver, the economic model forecasts the net present value for the Ivanhoe Project at CDN (Content Delivery Network) A system of distributed content on a large intranet or the public Internet in which copies of content are replicated and cached throughout the network. $203 million (US$127 million) at a discount rate of 0% and CDN$157 million (US$98 million) at a discount rate of 6%. The undiscounted stream of annual operating profits before interest, taxes and depreciation yields a project internal rate of return of 136%. The annual operating profits, before interest, taxes and depreciation are estimated to be US$32 million each year with a payback of the US$22 million capital cost in the first 9 months of year 1 operations. The economic operating model Operating Model is a term that is used in many contexts. In essence an operating model describes how an organization operates across both business and technology domains. The Operating Model describes what is important for the organization. predicts steady state annual production of 179,000 oz gold and 920,000 oz silver (193,000 oz gold equivalent) for five years. Cash cost of production is projected to be US$114 per ounce of gold equivalent with total cost of production estimated to be US$134 per ounce of gold equivalent. Great Basin Gold has 38.2 million shares outstanding and a strong working capital position of $7.4 million with no debt. The preliminary economic assessment was carried out by independent qualified person, Ross Glanville B.A.Sc., P.Eng., MBA MBA abbr. Master of Business Administration Noun 1. MBA - a master's degree in business Master in Business, Master in Business Administration and Great Basin's in-house qualified person, Ross Banner, P.Eng. It is based on the recently completed independent Audit of Preliminary Resource Estimate for the High-Grade Gold-Silver Veins of the Ivanhoe District by Behre Dolbear & Company Ltd.; the Ivanhoe Project Report of Milling Studies by Kappes Cassiday & Associates; industry standard vein mining methods and conceptual plans. Information was also obtained from other mining companies, mining contractors, in-house data and field investigations. In a detailed audit by Behre Dolbear & Company Ltd., it was confirmed that, at a cut-off grade of 0.25 ounces of gold per ton (opt) the current inferred mineral resource for the veins totals 719,000 tons at an average grade of 1.29 opt gold and 7.00 opt silver, containing 926,000 ounces of gold and 5,033,000 ounces of silver (1,008,000 ounces gold equivalent). This vein system is open to further expansion with additional drilling and sampling. The economic operating model for the Ivanhoe project assumes underground mining at 600 tons of ore per day, trucking ore to a local toll mill for treatment. The base case model utilizes 50% mining dilution and carbon in leach processing with metallurgical recoveries of 95% for gold and 90% for silver, as indicated by test work undertaken by Kappes Cassiday. Dore treatment charges and refining terms were based on published rates experienced by other operators in the region. The model's underground mining cost of US$55.50/ton ore, toll milling charge of US$25.00/ton milled, plus transportation and G&A costs of US$20.00/ton milled, compare with costs experienced by mine operators in the area and recent publications from Mining Cost Services Ltd. Overall project capital costs of US$22 million were estimated from preliminary project reviews by Dynatec Corporation and Merit Consultants International Inc., both of which have managed recent mining projects in Nevada. Mr. Thiessen stated "the time is now to advance Ivanhoe towards realizing on this economic assessment which clearly demonstrates the significant undervalued Undervalued A stock or other security that is trading below its true value. Notes: The difficulty is knowing what the "true" value actually is. Analysts will usually recommend an undervalued stock with a strong buy rating. nature of this gold project." For further details on Great Basin Gold Ltd. and the Ivanhoe Gold Project please visit the Great Basin website at www.hdgold.com or contact Investor Services at 604/684-6365 or within North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. at 800/667-2114. ON BEHALF OF THE BOARD OF DIRECTORS Ronald W. Thiessen, President and CEO |
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