Capstone Reports 2009 Year-End Reserve & Resource Estimates
VANCOUVER, March 17 /PRNewswire-FirstCall/ - Capstone Mining Corp. (CS: TSX) today reported mineral reserve and resource estimates for its Cozamin and Minto mines, as well as the Kutcho project, as at December 31, 2009. The new mineral reserve estimate at Cozamin incorporates the mineral resources in the San Roberto deposit and the adjacent San Rafael deposit announced on March 2, 2010, whereas the Minto mineral reserve and resource estimates were included in the Phase IV pre-feasibility study, the results of which were announced December 15, 2009, and the Kutcho mineral resource estimates included in the preliminary economic assessment, the results of which were reported September 15, 2009.
Commenting on the 2009 estimates, Mr. Darren Pylot, Vice Chairman and CEO of Capstone said "Capstone ended 2009 with a robust mineral reserve inventory, sufficient to provide more than eight year operating lives for both of our operating mines. In addition, the mineral resources not yet converted to mineral reserves provide some near term opportunities for continued reserve replacement as additional work is completed, and economics justify. With significant exploration potential at both mines, as well as the development potential at the high grade Kutcho project, Capstone has ample opportunities to continue its record of strong organic growth through near mine exploration."
The following tables summarize the mineral reserve and resource estimates for both of the Company's mines and the Kutcho project as at December 31, 2009.
Capstone Mining - Mineral Reserves Estimates as of December 31, 2009
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Mineral Reserves
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Category 000s Cu Zn Pb Ag Au
Tonnes % % % g/t g/t
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Cozamin
Copper
Deposit Proven 1,610 2.16 1.01 0.52 76.0 0.06
Probable 5,932 1.62 1.57 0.30 59.0 0.11
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Total 7,542 1.73 1.45 0.35 63.0 0.10
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Zinc Deposit Proven - - - - - -
Probable 1,865 0.25 3.12 0.43 37.0 0.47
Total 1,865 0.25 3.12 0.43 37.0 0.47
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Cozamin Proven 1,610 2.16 1.01 0.52 76.0 0.06
Sub-total Probable 7,797 1.29 1.94 0.33 54.0 0.20
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Total 9,407 1.44 1.78 0.37 58.0 0.17
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Minto Proven 9,775 1.69 - - 6.1 0.67
Probable 1,118 1.25 - - 4.3 0.38
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Total 10,893 1.64 - - 5.9 0.64
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Mineral Reserves Contained Metal*
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Ag Au
Category Cu Zn Pb 000s 000s
m lbs m lbs m lbs ozs ozs
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Cozamin
Copper
Deposit Proven 77 36 19 3,951 3
Probable 211 205 40 11,255 21
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Total 288 241 58 15,207 24
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Zinc Deposit Proven - - - - -
Probable 10 128 18 2,233 28
Total 10 128 18 2,233 28
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Cozamin Proven 77 36 19 3,951 3
Sub-total Probable 222 333 57 13,488 49
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Total 298 369 76 17,439 52
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Minto Proven 364 - - 1,911 211
Probable 31 - - 153 14
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Total 395 - - 2,064 224
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Total Mineral Reserves 693 369 76 19,504 277
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* Totals may not add due to rounding
The parameters used to estimate the mineral reserves, as well as the
responsible qualified persons are detailed below. The mineral resources from
which the mineral reserves are derived are tabulated below.
Capstone Mining - Mineral Resource Estimates as of December 31, 2009
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Mineral Resources - inclusive of mineral reserves
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Category 000s Cu Zn Pb Ag Au
Tonnes % % % g/t g/t
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Cozamin
Copper
Deposit Measured 2,078 2.33 1.14 0.53 84.4 0.07
Indicated 6,604 1.73 1.71 0.33 64.4 0.13
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M&I** 8,682 1.88 1.58 0.38 69.1 0.12
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Inferred 2,376 1.44 1.69 0.18 52.6 0.11
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Zinc
Deposit Measured 0 0 0 0 0 0
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Indicated 1,983 0.27 3.33 0.47 41.2 0.50
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M&I** 1,983 0.27 3.33 0.47 41.2 0.50
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Inferred 1,697 0.12 2.95 0.72 30.1 0.64
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Sub-total Measured 2,078 2.33 1.14 0.53 84.4 0.07
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Indicated 8,587 1.40 2.09 0.36 59.0 0.22
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M&I** 10,665 1.58 1.90 0.40 63.9 0.19
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Inferred 4,073 0.89 2.22 0.41 43.2 0.33
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Minto Measured 15,442 1.49 5.48 0.59
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Indicated 14,411 0.94 3.42 0.30
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M&I** 29,852 1.22 4.48 0.45
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Inferred 5,849 0.91 2.93 0.25
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Kutcho Measured 5,421 2.15 2.86 31.4 0.34
Indicated 4,994 2.14 2.83 33.5 0.39
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M&I** 10,415 2.14 2.85 32.4 0.36
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Inferred 1,893 2.09 2.93 33.6 0.46
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Mineral Resources
- inclusive of mineral
reserves Contained Metal
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Ag Au
Category Cu Zn Pb 000s 000s
m lbs m lbs m lbs ozs ozs
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Cozamin
Copper
Deposit Measured 107 52 25 5,638 5
Indicated 253 250 48 13,662 28
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M&I** 360 302 73 19,300 33
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Inferred 76 89 10 4,019 9
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Zinc
Deposit Measured 0 0 0 0 0
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Indicated 12 146 21 2,627 32
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M&I** 12 146 21 2,627 32
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Inferred 5 110 27 1,644 35
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Sub-total Measured 107 52 25 5,638 5
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Indicated 265 395 69 16,289 61
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M&I** 371 447 93 21,928 65
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Inferred 80 199 36 5,662 44
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Minto Measured 506 2,718 293
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Indicated 299 1,588 142
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M&I** 805 4,306 434
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Inferred 117 550 48
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Kutcho Measured 257 342 5,482 59
Indicated 236 312 5,376 62
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M&I** 492 654 10,857 121
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Inferred 87 122 2,047 28
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Total Measured &
Indicated Mineral
Resources 1,669 1,101 93 37,090 620
Additional
Inferred Mineral
Resources 284 322 37 8,260 120
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* Totals may not add due to rounding
** M&I = Measured and Indicated
Cozamin
The mineral reserves estimates for the Cozamin deposits were completed by Capstone staff under the supervision of Robert Barnes P.Eng., of Capstone, using accepted, industry standard, methods that conform to National Instrument 43-101. The reserve model has been developed using Gemcom GEMS(TM).
The data and methodology utilized for the mineral reserve estimate is as follows:
- The Cozamin mineral reserves were estimated using as a basis the
mineral resource model provided by Robert Sim, P.Geo. of SIM
Geological Inc. ("SGI") and announced March 2, 2010. The mineral
reserve estimate was prepared by Cozamin Mine staff under the
supervision of Robert B. Barnes, P.Eng., V.P. Operations Capstone
Mining Corp, a Qualified Person under NI 43-101.
- The mineral resource model was imported into Gemcom GEMS(TM)
software. Mining shapes were created to define the limit of economic
mining blocks from which mineral reserves were estimated. GEMS(TM)
was used to interrogate the resource model and report material within
the confines of the mining shapes. Mining recovery and dilution were
calculated individually for each stope with due consideration given
to the mining method. A minimum mining width was set at 3 meters
including dilution. Dilution estimated at 12% for all mining was
based on mining method, either cut and fill at 13% dilution or long
hole mining at 10% for wide stopes over 7 meters and 14% for stopes
under 7 meters.
- A lower limit economic NSR cut-off value ("COV") of $35 per tonne was
estimated based on historical and projected mining and processing
costs. The basis for the COV came from projected operating costs of
$18/t for mining, $12.50/t for processing and $4.50/t for general and
administration costs. Metal price assumptions used in estimating the
COV were US$2.50 per lb of copper, US$0.80 per lb of zinc, US$0.85
per lb of lead and US$4.00 per oz of silver (the latter is based on a
silver stream agreement).
- Only measured and indicated mineral resource blocks were used in the
estimation of mineral reserves. Inferred resources contained within a
mining shape were treated as dilution at the metal grades attributed
to those blocks in the resource model then treated as follows.
Dilution grades, including any inferred resource blocks, were
calculated as the block grade factored down to 33 % of the block
copper grade; 33 % of the block lead grade; 33 % of the block zinc
grade; and 20 % of the block silver grade.
- The mineral reserve mining blocks were designed with horizontal
(sill) and vertical pillars to provide ground support. Approximately
1.1 million tonnes or approximately 11% of the measured and indicated
resources at 1.82% copper are left as pillars.
Minto
The mineral resources are reported at a 0.5% copper cut-off for all deposits and the mineral reserves are reported at a 0.62%, 0.55%, 0.58% and 0.56% copper cut-off grade (CCOG) for Minto Main, Minto North, Ridgetop and Area 2/118 respectively. Mineral reserves and resources for the Minto Mine, except for the Minto North mineral resources, were estimated by SRK Consulting (Canada) Inc. The qualified persons responsible for the 2009 mineral resources estimate in the Area 2/118 and Ridgetop deposits is Dr. Wayne Barnett, Ph.D., Pr.Sci.Nat., an independent qualified person as this term is defined in National Instrument 43-101. The effective date of this resource estimate is June 1, 2009. Marek Nowak, P.Eng., analyzed the data, reviewed and validated the mineral resource estimates. The Minto North mineral resource estimate was completed by Garth Kirkham, P.Geo., of Kirkham Geosystems Ltd., an independent qualified person as this term is defined in National Instrument 43-101; the effective date of this mineral resource estimate is December 1, 2009.
Dino Pilotto, P.Eng., of SRK Consulting (Canada) Inc. estimated the mineral reserves for all deposits comprising the Minto project as part of the Phase IV Preliminary Feasibility Study ("Phase IV PFS"), the results of which were reported in December 2009. The assumed start date for the Phase IV PFS was January 1, 2010, with remaining mineral reserves in the Minto Main pit forecast to that date. Due to some differences in actual mining production in Q4/09 versus that forecast, the actual remaining mineral reserve at year end is slightly different to that reported herein, but it makes no significant difference to the life of mine plan. Mr. Pilotto is the Qualified Person responsible for the estimates in the Phase IV PFS. Additional details on the mineral resource and mineral reserve estimates for the Minto mine can be found in the technical report filed on SEDAR in December 2009.
Kutcho
The mineral resources for the Kutcho property are reported at a 1.5% copper cut-off for all deposits, as detailed in a news release dated February 9, 2009. The mineral resources for the Kutcho Project were estimated by Garth Kirkham, P.Geo., of Kirkham Geosystems Ltd., an independent Qualified Person as defined by NI43-101. Additional details can be found in the news releases dated February 9, 2009 and September 15, 2009 and in the preliminary economic assessment and technical report filed on SEDAR in September 2009.
The TSX does not accept any responsibility for the adequacy or accuracy of this press release.
Forward-Looking Information
This document may contain "forward-looking information" within the meaning of Canadian securities legislation and "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995 (collectively, "forward-looking statements"). These forward-looking statements are made as of the date of this document and Capstone Mining Corp. (the "Company") does not intend, and does not assume any obligation, to update these forward-looking statements, except as required under applicable securities legislation.
Forward-looking statements relate to future events or future performance and reflect Company management's expectations or beliefs regarding future events and include, but are not limited to, statements with respect to the estimation of mineral reserves and resources, the realization of mineral reserve estimates, the timing and amount of estimated future production, costs of production, capital expenditures, success of mining operations, environmental risks, unanticipated reclamation expenses, title disputes or claims and limitations on insurance coverage. In certain cases, forward-looking statements can be identified by the use of words such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or statements that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved" or the negative of these terms or comparable terminology. By their very nature forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Such factors include, among others, risks related to actual results of current exploration activities; changes in project parameters as plans continue to be refined; future prices of mineral resources; possible variations in ore reserves, grade or recovery rates; accidents, labour disputes and other risks of the mining industry; delays in obtaining governmental approvals or financing or in the completion of development or construction activities; as well as those factors detailed from time to time in the Company's interim and annual financial statements and management's discussion and analysis of those statements, all of which are filed and available for review on SEDAR at www.sedar.com. Although the Company has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements.
Compliance with NI43-101
Unless otherwise indicated, Capstone has prepared the technical information in this news release ("Technical Information") based on information contained in the technical reports and news releases (collectively the "Disclosure Documents") available under Capstone Mining Corp.'s company profile on SEDAR at www.sedar.com. Each Disclosure Document was prepared by or under the supervision of a qualified person (a "Qualified Person") as defined in National Instrument 43-101 - Standards of Disclosure for Mineral Projects of the Canadian Securities Administrators ("NI 43-101"). For readers to fully understand the information in this news release, they should read the Technical Reports (available on www.sedar.com) in their entirety, including all qualifications, assumptions and exclusions that relate to the information set out in this presentation which qualifies the Technical Information. Readers are advised that mineral resources that are not mineral reserves do not have demonstrated economic viability. The Disclosure Documents are each intended to be read as a whole, and sections should not be read or relied upon out of context. The Technical Information is subject to the assumptions and qualifications contained in the Disclosure Documents.
The following employee of Capstone, each a Qualified Person, reviewed Technical Information contained in this news release: Robert Barnes, Professional Engineer, reviewed the mineral reserve estimate and reconciliation related to the Cozamin Mine, Robert Sim, P.Geo., of SIM Geological Inc. ("SGI"), reviewed the mineral resource estimates for the Cozamin mine, and Brad Mercer, P.Geol., reviewed the mineral resource estimates for the Minto mine and Kutcho project and Dino Pilotto, P.Eng., of SRK Consulting (Canada) Inc. reviewed the mineral reserve estimates reported herein for the Minto Mine.
SOURCE Capstone Mining Corp.
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