|July 26, 2005|
Crowflight Begins Surface Drill Program to Expand Resources at Bucko Deposit
News Release No. 23 / 05
CROWFLIGHT MINERALS INC. (TSX Venture Exchange: CML) is pleased to announce the commencement of its surface diamond drill program designed to upgrade a significant portion of the Inferred Resource to the Indicated Resource category. Based on an updated revision to the resource model for the Bucko Deposit and studying grade-thickness intervals within the resultant Inferred Resource (refer to Figure 2, Bucko Longitudinal Section), there is an opportunity to potentially expand the Indicated Resources at Bucko by as much as 300,000 tonnes through a targeted ten hole approximate 5,000 metre surface diamond drill program. Given the grade-thickness contouring there is further potential that this drilling could intersect grades above the average for the Indicated Resource.
Crowflight President and CEO, Tom Atkins commented on the summer program stating: "Three dimensional resource modeling identified areas within the resource model where potential exists to increase the Indicated Resource at Bucko. The previously announced summer drill program has been modified slightly to take into account advancements in the resource model and grade-thickness contouring to highlight areas of greatest potential. We are targeting a significant increase in resources and if successful this program should enhance the economics of the Bucko Deposit and the value of Crowflight. Crowflight currently trades at around $0.30 per pound of nickel Indicated Resource at Bucko whereas the cost of proving-up these 300,000 additional tonnes of Indicated Resource would equate to a finding cost of only $0.07 per pound nickel. This relationship offers terrific value enhancing potential from this drill program."
Crowflight Vice President Exploration, Jean Lafleur added: "Having essentially concluded our resource modeling we have been able to further define the most attractive areas to target our in-fill drilling to increase Indicated Resources in a cost effective manner. This surface program is the first phase program to test the resource expansion potential of the Bucko Deposit. We see excellent continuity in geology and nickel mineralization in deeper holes drilled in the Deposit below the historical workings at the 1000 foot level which, following the surface program, we will begin to focus our attention on additional exploration and in-fill drilling activities to be conducted from the rehabilitated underground workings."
Extreme wet weather in Manitoba over the past weeks forced a brief delay in the commencement of the program, however, drilling is expected to commence prior to the end of the week. Major Drilling has been contracted to perform this work which, depending on the rate of productivity from the rig, is slated for completion in late September-early October. The total cost of the program (including sampling and assaying) is budgeted at $850,000.
The Bucko Deposit
Micon International Limited performed a scoping study on the development of the Bucko Deposit (refer to the press release dated October 28, 2004). The study analysed the potential economics of mining a 1.2 million tonne Indicated Resource grading 2.7% nickel that would yield a recoverable diluted resource of 1.3 million tonnes grading 2.4% nickel that would be mined at the rate of 750 tonnes per day (tpd) to produce approximately 11 million pounds of nickel in concentrate per year plus minor amounts of by-product copper, platinum, palladium and cobalt in concentrate. An additional scenario was considered wherein approximately 0.5 million tonnes of Inferred Resources were added to the Indicated Resource to yield a recoverable diluted resource of 1.8 million tonnes grading 2.2% nickel to be mined at the rate of 1,000 tpd to produce up to 14 million pounds of nickel in concentrate per year. Both scenarios provided a robust pre-tax economic return assuming a US$4.50 per pound nickel price (nickel is currently selling at about US$6.60 per pound) of from US$34 million (under the 750 tpd scenario) and an internal rate of return (at a 15% discount rate) of 67% to US$50 million (under the 1,000 tpd scenario) and an internal rate of return (at a 15% discount rate) of 86% (refer to the press release dated October 28, 2004).
Crowflight is in the midst of studying the economic feasibility of developing the Bucko Deposit. The feasibility study is scheduled for completion in September. Subject to suitable metal prices, timely completion of permitting and the economics of the feasibility study, Crowflight envisions developing the Bucko Deposit for production of a nickel concentrate in 2007.
Terms of Crowflight's Agreements with Falconbridge
Under its agreements with Falconbridge Limited (Falconbridge), Crowflight has an option to earn:
Crowflight Minerals Inc. is a Canadian junior mining exploration and development company listed on the TSX Venture Exchange. The company is focused on nickel, copper and Platinum Group Mineral ("PGM") projects in the Thompson Nickel Belt ("TNB") and Sudbury Basin. The company currently owns and/or has under option approximately 600 km2 of exploration and development properties in Manitoba and Ontario.
In Manitoba, these properties include: (1) the Bucko Nickel Deposit; (2) an earn-in option with Falconbridge Limited on five highly prospective properties (Bucko/Bowden, Resting Lake, Rock Island Lake, Halfway Lake and Gonlin Lake) on the TNB South Project located within 30 kilometres of the Bucko Deposit; and (3) six additional properties (Burntwood River, Birchtree South, Birchtree North, Airport, Moak Lake and Strong Lake) located 100 kilometres to the north on the TNB North Project.
In the Sudbury Basin, these properties include: (1) the 100% owned AER Kidd Project adjacent to Inco's Totten Deposit (10.1 million tonnes @ 1.5% Nickel, 2% Cu, 4.8 g/t PGM's); (2) the Airport Property (a 50/50 joint venture with Millstream Mines Ltd.) located 4 km south, and on-strike, with Falconbridge's Nickel Rim South Deposit (13.2 million tonnes @ 3.5% Cu, 1.7% nickel, 0.8 g/t Au, 4.1 g/t PGM's); (3) the optioned (100% earn-in) Mystery Offset Dyke Property; and (4) the 100% owned Peter's Roost Property.
Further information is available on the Company's web site at www.crowflight.com.
Statements in this release that are not historical facts are "forward-looking statements" within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Readers are cautioned that any such statements are not guarantees of future performance and that actual developments or results may vary materially from those in these "forward-looking statements". The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.
For further information please contact:
President and CEO
Tel: (416) 861 - 5900
Fax: (416) 861 - 8165
Vice President Exploration
Tel: (514) 794 - 3633
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