|December 07, 2006|
Crowflight Reports A 32 Percent Increase In Indicated Resources At The Bucko Lake Deposit
|CROWFLIGHT MINERALS INC. (Crowflight, the Company) (TSX Venture Exchange: CML) is pleased to present an updated calculation of mineral resources at the Bucko Lake Nickel Deposit, Wabowden, Manitoba. Surface diamond drilling in 2006 targeted potential extensions of nickel mineralized ultramafic rocks similar to those within the Indicated Resource envelop of the Deposit as defined by previous drilling. The goal of this drilling was to upgrade these portions of Inferred Resources to the Indicated Resource category. As a result of this drilling, the Deposit is now estimated to contain Ni 43-101 compliant Indicated Resources of 2.5 million tonnes grading 2.01% nickel plus Inferred Resources of 1.2 million tonnes grading 2.23% nickel using a 1.40% nickel cut-off grade. This upgrade equates to the addition of 26.6 million pounds of nickel or a 32% increase in Indicated Resources as compared to previously reported Indicated Resources of 1.8 million tonnes grading 2.10% nickel at a 1.50% nickel cut-off grade (refer to NI 43-101 report filed January 2006). |
Greg Collins, Crowflight's Manager of Geology, commented on the results of the program, stating: "We're pleased with the results of this work. The drilling indicates that extensions to mineralization remain consistent with previously delineated portions of the Deposit. Furthermore, the Deposit remains open in a number of directions, including the potential for additional resource expansion at depths greater than 600 metres vertical in the central portion of the Deposit, and at shallower depths in the vicinity of the Hinge Zone. We intend to test some of these shallow features for additional resource expansion potential in early 2007, prior to continuing to expand resources from underground drill stations coincident with our accessing the underground workings later in the year as we advance development of the mine."
Thomas Atkins, Crowflight's President and CEO added: "The Company has made great progress during the year. In addition to the expanded resources, we anticipate announcements on additional project development milestones. These will include: the results of the updated feasibility study that will take into such items as account capital cost savings; a definitive off-take agreement for the purchase of the Bucko Lake nickel concentrate; a committed project loan agreement; and announcements on advancements on project permitting."
Table 1 presents the updated Indicated and Inferred Resource estimates for the Deposit at various cut-off grades. Figure 1 illustrates the area of additional Indicated Resources on a three-dimensional longitudinal section of the Deposit.
---------------------------------------------------------------------- Indicated Resources Inferred Resources Cut-off Tonnes Grade lbs. Ni Tonnes Grade lbs. Ni (% Ni) (millions) (% Ni) (millions) (millions) (% Ni) (millions) 2.0 0.8 2.75 50.8 0.6 2.79 37.1 1.8 1.2 2.51 64.4 0.7 2.67 40.8 1.6 1.7 2.26 83.4 0.9 2.44 48.7 1.4 2.5 2.01 110.4 1.2 2.23 57.4 1.2 3.9 1.75 151.1 1.9 1.86 78.4 1.0 6.2 1.50 206.4 3.7 1.48 122.1 ---------------------------------------------------------------------- Note: (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, sociopolitical, 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 and it is uncertain if further exploration will result in upgrading them to an indicated or measured mineral resource category.
Since the third quarter of 2005 a total of 16,253 metres of drilling in 30 holes has been conducted at a total cost of $2.1 million with a focus on expanding Indicated Resources within the Deposit. This work has resulted in an increase in Indicated Resources totalling 0.6 million tonnes grading 2.01% nickel at a 1.4% cut-off grade. This resource increase translates to an addition of approximately 34 million pounds of nickel at a discovery cost of approximately US$0.05 per pound nickel. Since the beginning of 2006, spot nickel has averaged US$10.64 per pound on the London Metal Exchange.
A feasibility study prepared by Micon on behalf of Crowflight (press release of December 16, 2005) identified that the exploitation of an Indicated Resources totalling 1.8 million tonnes grading 2.1% nickel and a 1.5% nickel cut-off would yield a 23.9% rate of return and a net present value at a 10% discount rate of $22.6 million at an average life-of-mine nickel price of US$5.00 per pound. At a US$6.00 per pound nickel price the rate of return increases to 41.6% and the net present value increases to $53.1 million at a 10% discount rate for an underground mine and surface concentrator plant with daily throughput of 1,000 tonnes per day. At higher nickel prices as have existed throughout 2006, it is expected that lower nickel cut-off grades could be considered in the exploitation of the Bucko Lake Deposit, with the impact of significantly increasing Reserves and Resources within the Deposit as indicated in Table 1. Crowflight intends to study the impact of lowering the cut-off grade on the estimated Reserves of the Deposit coincident with its ongoing activities to develop the mine and mill such that a potentially lower cut-off grade may be employed in mining the Deposit thereby potentially permitting a higher daily rate of mining and production of correspondingly higher amounts of nickel.
Mineral Resource Estimate
The updated resource calculation was completed by P & E Mining Consultants Inc. ("P&E") of Brampton Ontario, an independent third party consulting firm that specializes in the study and determination of mineral resources and reserves. The resource estimate was based on geological data provided by representatives from Crowflight and chemical analysis provided by ALS Chemex. The update incorporates drilling conducted from surface during the first 3 quarters of 2006 consisting of 20 holes for a total of 11,068m. Please refer Figure 1. for an illustration of the location of drill holes completed in 2006 and the location of Indicated Resource Additions. Please refer to news releases dated May 24, July 18, September 20, and November 16, 2006 for information concerning mineralized intercepts.
The determination technique of the mineral resources at Bucko is based on geostatistics and conventional block modeling using the inverse distance squared method of grade interpolation. The database consisted of 57 underground and 96 surface diamond drill holes (including the recent Crowflight holes completed during the 2006 drill campaign), minimum composite lengths of 1.5 metres, an internal dilution of 0.5% nickel (representing the background grade) and assay grade capping. Density of material was determined via a combination of sample analysis and an interpolated density model based on nickel sulphide content where density data was absent. The Indicated Resources used a 35 metre search ellipse with a minimum of 2 drill holes and 3 samples. A 1.1% nickel cut-off grade was used to constrain the interpolation model for consistency with the previous resource estimate.
Qualified Person Comments/Quality Control Procedures
This press release has been prepared and revised by Mr. Greg Collins, P. Geo., Crowflight's Manager of Geology and Mr. Eugene Puritch, P.Eng. of P&E Mining Consultants Inc. both of whom are Qualified Persons under the NI 43-101 guidelines. The resource estimate has been prepared in compliance with National Instrument 43-101 and form NI 43-101F1, which requires that the estimate be prepared in accordance with the "CIM Definition Standards on Mineral Resources and Mineral Reserves as prepared by the CIM Standing Committee on Reserve Definitions and as adopted by CIM Council, December 11, 2005."
The core sampling method applied during the 2006 drill campaign followed NI 43-101 requirements and procedures as set forth in the Diamond Drill Standard Procedures developed by Falconbridge Limited. One control standard and one blank were inserted per 40 samples. Three different internal control standards representing different grades were utilized and the standard was selected with similar grade as the samples submitted. All diamond drill core samples collected during the 2006 drill program were sent to the primary laboratory ALS Chemex in Thunder Bay for preparation and were subsequently analyzed in Vancouver. Fire assays were performed on all the samples for Gold and PGE's which undergo an ICP-AES finish and Sodium Peroxide Fusion. All other metals undergo an ICP-AES finish.
Crowflight -- The Base Metal Builder
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 square kilometres 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 Xstrata plc 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 grading 1.5% nickel, 2.0% copper and 4.8 g/t PGM's); (2) the 100% owned Peter's Roost Property, the subject of a recent joint venture agreement with Wallbridge Mining Co. Ltd.; and (3) the Airport Property (a joint venture with Millstream Mines Ltd.) located 4 kilometres south, and on-strike, with Falconbridge's Nickel Rim South Deposit (13.2 million tonnes grading 1.7% nickel, 3.5% copper and 4.1 g/t PGM's).
Further information regarding Crowflight, including details of its properties, and where relevant its earn-in interests in properties, 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 Company cautions investors that the projections for increases to the Indicated Resources are based on Inferred Resources. There is no certainty that these projections will be added to the Indicated Resources or that they will be economically viable.
For further information please contact:
President and CEO
Tel: (416) 861 - 5900
Fax: (416) 861 - 8165
Tel: (604) 684 - 4743 ext 230
Isometric View of the Bucko Mine Horizon* Looking Northwest
*Figure 1. Is a modelled isometric view of the mineralized Bucko Mine Horizon looking northwest highlighting areas thought to maintain additional exploration potential. Red Areas highlight those areas with a low density of drilling and/or areas with high nickel grade and thickness. Nickel grade thickness values were calculated using a 0.5% nickel cutoff. Values in the legend represent the interpolated value of grade-thickness at any point on the Bucko Mine Horizon multiplied by the square root of the distance to the nearest hole
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