Malbex Releases First Resource Estimate for Rojo Grande Gold-Silver Deposit
TORONTO, ONTARIO -- (Marketwire) -- 09/12/11 -- Malbex Resources Inc. (TSX VENTURE: MBG) today announced the first National Instrument (NI) 43-101-compliant, inferred mineral resource estimate for the Rojo Grande zone at its Del Carmen Norte high-sulphidation gold-silver project in San Juan, Argentina. The in-pit, inferred resource is 25.4 million tonnes of oxide material grading 1.00 g/t gold and 13.3 g/t silver for 816,600 ounces of contained gold and 10.9 million ounces of contained silver, at a lower average gold equivalent cutoff grade of 0.3 g/t. Drilling in the coming field season will aim to extend and expand the deposit, which remains open to the southwest. Drilling will also target areas within the modelled pit that have not yet been tested and are currently assigned as waste.
The table below summarises the inferred in-pit mineral resource estimate:
------------------------------------------------------------------------
Million Gold Grade Silver Grade Gold Silver
Tonnes (g/t) (g/t) Ounces Ounces
------------------------------------------------------------------------
25.4 1.00 13.3 816,600 10,853,000
------------------------------------------------------------------------
(1) Mineral resources which are not mineral reserves do not have
demonstrated economic viability. The estimate of mineral resources may be
materially affected by environmental, permitting, legal, title, taxation,
socio-political, marketing, or other relevant issues. (2) The quantity and
grade of reported inferred resources in this estimation are conceptual in
nature and there has been insufficient exploration to define these inferred
resources as an indicated or measured mineral resource. It is uncertain if
further exploration will result in upgrading them to an indicated or
measured mineral resource category. (3) The 0.3 g/t gold equivalent cutoff
grade was derived from an assumed open pit/heap leach operation with
recoveries of 70% for gold and 40% for silver, a mining cost of
US$1.50/tonne for ore and $1.40/tonne waste, process cost of US$3.50/tonne
and general & administrative costs of US$2.50/tonne. The costs were derived
from similar operations and the recoveries from initial metallurgical
testwork. Assumed prices of $1,125/oz for gold and $20/oz for silver, based
on 3-year trailing averages, were also employed.
'We're very pleased with this first-ever resource estimate for our flagship Del Carmen project,' said Tim Warman, President and CEO. 'The near-surface, oxide mineralization at Rojo Grande occupies only one small area within the much larger Del Carmen Norte alteration system, and the deposit remains open to the southwest. This season's field program will aim to expand Rojo Grande and test additional targets via 15,000 metres of drilling as well as generate new targets using geophysical surveying to better identify favourable alteration. Sampling for the second phase of metallurgical test work on Rojo Grande will also commence shortly.'
Notes on the methodology of estimation of the inferred resource:
-- The inferred resource estimate was carried out by Micon International
Limited (Micon).
-- The database comprised a total of 23 diamond drill holes, 4,185 metres
of mainly HQ drilling (lesser amounts of PQ and NQ) and 3,446 gold and
silver assays.
-- An interpreted mineralised envelope was modeled into a wireframed solid
in Gemcom, Approximate dimensions of the envelope were 750 metres in
length (northeast-southwest), 80 to 200 metres in width (northwest-
southeast), and up to 280 metres in vertical extent.
-- Estimates are based on a parent cell dimension of 20 metres east, 20
metres north and 5 metres vertically.
-- Grade interpolation was based on 5.0 metre composites cut to a maximum
of 12.6 g/t gold and 161 g/t silver.
-- Tonnage estimates are based on 71 bulk density measurements carried out
by Malbex which were interpolated into the mineralized domain of the
block model. Bulk density values for the Rojo Grande mineralised rock
ranged from 1.68 to 2.67 tonnes/m3. The incompetent nature of certain
zones of powdery quartz-alunite alteration made it difficult to obtain
reliable density measurements for a small portion of the mineralized
envelope. Due to this rock condition, and after a statistical analysis
of the frequency of density results, a low-value outlier population was
identified and all density measurements less than 2 tonnes/m3 were not
used. All waste blocks and a small volume that did not get an
interpolated density value were assigned the average density of 2.32
tonnes/m3.
-- The resource at a 1.00 g/t gold grade was reported within a preliminary
conceptual open-pit mining envelope with the purpose of delineating
mineralization with a reasonable prospect of economic extraction. The
Whittle open pit model was constructed using a gold price of
US$1,125/oz, and heap leach gold recoveries of 70%. The resulting,
unoptimized pit has a strip ratio of 2.09:1.
The mineral resources in this press release were estimated using the Canadian Institute of Mining, Metallurgy and Petroleum (CIM) Standards on Mineral Resources and Reserves, Definitions and Guidelines prepared by the CIM Standing Committee on Reserve Definitions and adopted by CIM Council December 11, 2005.
Messer's. B. Terrence Hennessey, P.Geo., and Richard Gowans, P.Eng., of Micon will be the authors of an NI 43-101-compliant Technical Report on the Mineral Resource Estimate for the Rojo Grande deposit, to be filed within 45 days of this news release. They are Qualified Persons in accordance with NI 43-101, and are responsible for the information presented in this news release. Mr. Hennessey is independent of Malbex as defined by NI 43-101.
Metallurgy
Malbex has previously (PR of January 20, 2011) reported that results from preliminary metallurgical testing (bottle roll) show average gold recoveries of 76.5% for five Del Carmen Norte samples (three from Rojo Grande, two from Naciente Quebrada Pedregosa target). The above quoted recoveries are for material crushed to 6.3 millimetres (mm). Four of five 6.3 mm samples range from 78.3% to 83.1% gold recovery while the fifth sample showed 61.4% recovery. Overall, the test results indicate good potential for heap leach cyanidation treatment and for whole ore milling/cyanidation treatment of the materials represented by the five composite samples. Silver recoveries range from 15% to 65% for those samples with detectable silver (four of five) and were generally higher for milled compared to crushed material. Importantly, cyanide consumption was low with a reported average for all samples of 0.16 kg/t.
Sample selection and collection for follow-up metallurgical testing is currently underway. This next round of testing will involve several column leach tests to evaluate the amenability, feed size sensitivity and ore variability of Rojo Grande ores to heap leaching. The testing will also include additional bottle roll tests, petrographic characterization (gold deportment), load and permeability testing and evaluation of the acid generating ability of the leached residues.
Further information on the Del Carmen project, including maps, sections and a complete assay table, can be accessed at www.malbex.ca/Projects/Del_Carmen.
Mr. B. Terrence Hennessey, P.Geo., of Micon is a Professional Geoscientist in the Province of Ontario, and is the Qualified Person as defined by NI 43-101 responsible for the technical information presented in this news release. Dr. Peter Stewart, P.Geo., is the Qualified Person responsible for the conduct of Malbex's exploration program.
Technical information
Diamond drill hole samples consist of core that is sawn in half by electric saw on site. Core samples are sealed in new plastic bags, which are inserted into rice sacks for transport by Malbex personal or commercial trucking service to ALS Global prep lab in Mendoza. All samples are crushed and pulped and powders sent by ALS to one of their laboratories (typically La Serena, Chile or North Vancouver, BC). Fire assay for gold is conducted on 30 gram (g) pulps with atomic absorption finish. Over limits (greater than 10 g/t gold) are fire assayed with gravimetric finish. In addition, all samples receive multi-element analysis including silver by ICP after aqua regia digestion and mercury by cold vapour atomic absorption.
Malbex's quality assurance-quality control (QA-QC) program consists of the insertion in every 20 samples of at least one certified standard of known gold content, one blank (sample known to consist of very low levels of gold to ensure adequate cleaning of the sample preparation equipment between samples) and one field duplicate. Samples of significant drill intercepts will be sent to two additional independent laboratories to verify gold and silver analyses when necessary. Metallic screen fire analyses for gold will also be run regularly on discovered mineralization as an additional QA-QC check. The half core remaining after sampling is stored in a Malbex-run facility in San Juan for verification and reference purposes.
About Malbex
Malbex Resources Inc. is a gold exploration company led by experienced management and directors with projects in Argentina and Peru. In April 2010, Malbex made a near-surface, gold-silver oxide discovery at Del Carmen, its lead project in Argentina. Released in September 2011, the first-ever National Instrument 43-101-compliant, inferred mineral resource estimate for the Rojo Grande zone at Del Carmen measured 25.4 million tonnes grading 1.00 g/t gold and 13.3 g/t silver for 816,600 ounces of contained gold and 10.9 million ounces of contained silver. The Del Carmen project is located in the El Indio Gold Belt, which contains more than 35 million ounces of gold in current reserves and past production, including Barrick's Veladero mine and Pascua-Lama project. For more information, please visit www.malbex.ca.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION: This news release includes certain information that may constitute 'forward-looking information' under applicable Canadian securities legislation. Forward-looking information includes, but is not limited to, statements about strategic plans, spending commitments, future operations, results of exploration, anticipated financial results, future work programs, capital expenditures and objectives. Forward-looking information is necessarily based upon a number of estimates and assumptions that, while considered reasonable, are subject to known and unknown risks, uncertainties, and other factors which may cause the actual results and future events to differ materially from those expressed or implied by such forward-looking information, including the risks identified in the Company's annual information form under the heading 'Risk Factors'. There can be no assurance that such information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information. Accordingly, readers should not place undue reliance on forward-looking information. All forward-looking information contained in this press release is given as of the date hereof and is based upon the opinions and estimates of management and information available to management as at the date hereof. The Company disclaims any intention or obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by law.
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.
Contacts:
Malbex Resources Inc.
Tim Warman
President and Chief Executive Officer
(416) 628-0215
ir@malbex.ca
Malbex Resources Inc.
Marla Gale
VP Investor Relations
(416) 628-0215
ir@malbex.ca
www.malbex.ca