- Published: 26 January 2009
- Written by Editor
Osisko Announces Inferred Resource Estimate for South Barnat Deposit
Osisko Mining Corp. (TSX: OSK)(FRANKFURT: EWX) is pleased to announce a National Instrument 43-101 compliant inferred resource estimate on the western portion of the South Barnat Deposit, located on its 100%-owned Canadian Malartic property in the Abitibi region of Quebec, Canada. South Barnat is a separate gold deposit contiguous to the Company's Canadian Malartic deposit, which currently hosts a 6.28 million ounce gold reserve (see November 25, 2008 press release).
Belzile Solutions Inc. of Rouyn-Noranda, Quebec ("BSI"), independent resource estimate consultants for Osisko, has authorized the release of the following estimates.
BSI has estimated a global inferred resource of 1.81 million ounces of gold at an average grade of 2.12 g/t based on a lower cut-off grade of 1.00 g/t Au, and a global inferred resource of 2.03 million ounces of gold at an average grade of 1.74 g/t based on a lower cut-off grade of 0.36 g/t Au. The table below summarizes results of the estimates using different lower cut-off grades:
South Barnat Deposit global Inferred Resource Estimates
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Grade (g/t) Tonnes (M) Lower Cut-off (g/t) Ounces Au (M)
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2.12 26.5 1.00 1.81
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2.04 28.4 0.90 1.86
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1.98 30.0 0.80 1.91
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1.93 31.4 0.70 1.94
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1.87 32.9 0.60 1.97
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1.81 34.4 0.50 2.00
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1.75 35.9 0.40 2.02
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1.74 36.3 0.36 2.03
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1.71 36.9 0.30 2.03
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South Barnat infill drilling on 25 metre centres is continuing and is expected to be completed by the end of February. The Company expects this infill drilling will allow the completion of additional resource work to determine a measured & indicated resource by Q2 of this year.
A global project total of 7.69 million ounces gold in the measured and indicated category (at an average grade of 1.03 g/t) and 2.75 million ounces gold in the inferred category (at an average grade of 1.05 g/t), at a lower cut-off of 0.36 g/t Au, is estimated from combining the South Barnat inferred resource with the previously published global resources on the Canadian Malartic deposit (see September 8, 2008 press release and NI 43-101 compliant report filed on SEDAR), as shown in the following table:
Canadian Malartic project global resource estimates
(0.36 g/t Au lower cut-off)
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Total Measured+Ind(i) Inferred
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Deposit Grade Tonnes Ounces Au Grade Tonnes Ounces Au
(g/t) (M) (M) (g/t) (M) (M)
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Canadian
Malartic 1.03 232.2 7.69 0.60 37.4 0.72
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South Barnat 0.00 0.00 0.00 1.74 36.3 2.03
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Total 1.03 232.2 7.69 1.05 73.7 2.75
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(i) The Measured and Indicated resource includes the reserve of 6.28 M
ounces gold released in the Feasibility Study (see November 25, 2008
press release).
A significant higher grade resource totalling 4.98 million ounces gold in the measured and indicated category (at an average grade of 1.75 g/t) and 1.93 million ounces gold in the inferred category (at an average grade of 1.45 g/t) is estimated using a higher cut-off grade of 1.0 g/t Au, as shown in the following table:
Canadian Malartic project global resource estimates
(1.00 g/t Au lower cut-off)
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Total Measured+Ind(i) Inferred
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Deposit Grade Tonnes Ounces Au Grade Tonnes Ounces Au
(g/t) (M) (M) (g/t) (M) (M)
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Canadian
Malartic 1.75 88.4 4.98 1.45 2.49 0.12
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South Barnat 0.00 0.00 0.00 2.12 26.5 1.81
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Total 1.75 88.4 4.98 2.07 29.0 1.93
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Sean Roosen, President of Osisko, commented: "We are extremely pleased with the inferred resource reported today on South Barnat, as it has exceeded our expectations and offers an opportunity for our shareholders to benefit from a significantly higher grade deposit. At 1.74 g/t Au overall grade, this represents a 69% higher grade resource than the overall grade of the main Canadian Malartic deposit. At a higher cut-off of 1 g/t, we are looking at the potential for a higher grade overall project resource of over 100 million tonnes grading 1.8 g/t gold.
South Barnat is located less than 200 metres away from the Canadian Malartic engineered pit, and presents an opportunity for Osisko to integrate higher grade feed into our milling schedule in the early years, at possibly higher average recoveries. Our mill has a processing capacity of 20M tonnes per year, and our current feasibility study indicates that we will process an average 618,000 ounces of gold per year based on a 1.07 g/t head grade.
It is important to note that for each 0.2 g/t Au increase we can achieve in the head grade to the mill, we add 120,000 to 125,000 ounces of additional annual gold production, as shown in the table below:
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Grade (g/t Au) Mill Annual Recovery Annual Recovery
Production (kt) (%) (oz gold)
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1.1 20,075 85.9 610,000
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1.3 20,075 87.2 731,000
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1.5 20,075 88.4 856,000
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We believe South Barnat significantly increases Osisko's chances to become a low cost producer and to pay down project debt on a faster time line, assuming the higher grade South Barnat resource is converted to reserves.
Management expects that further work on South Barnat will convert most of the inferred resource to an in-pit Measured and Indicated resource, scheduled to be released by Q2 2009. We currently have eight drills turning on the property, five of which are completing the infill drilling at Barnat, with other three aggressively exploring other significant targets on the property."
Details on the parameters of the inferred resource estimates are as follows:
- The database comprised a total of approximately 55,700 metres of drilling completed and assayed by Osisko as of the beginning of December 2008 on a 50 m x 25 m grid along an 855 metre strike length.
- The above-reported global resource estimates for the South Barnat deposit are not Whittle-pit constrained but were restricted above a true elevation of 0 metres, corresponding to a true depth of approximately 320 metres. The system is open below this depth from section 350E to 855E and open along strike to the east.
- The resource estimate using the lower cutoff of 0.36 g/t Au will be emphasized for reporting purposes as this is the cut-off that was the in-pit cut-off used in the Feasibility Study completed on the adjacent Canadian Malartic deposit.
- Mineralization in the South Barnat Zone is located to the north and south of the old Barnat and East Malartic mine workings along the southern edge of the Cadillac fault, where they intersect the Sladen mine workings (Sladen extension of the Canadian Malartic deposit). The disseminated/stockwork gold mineralization comprises multiple subvertical, tabular subzones striking northwest-southeast. These comprise silicified greywackes of the Pontiac Group south of the fault contact. North of the fault, mineralization is mostly hosted in potassic-altered porphyry dykes, but also in schistose, altered (carbonate-biotite) serpentinites. Porphyry dykes also host late quartz veins containing visible gold. The geological model for the South Barnat resource estimate comprises seven domains, with 89 percent of the resource being hosted by two main domains (Sladen extension south of the fault and porphyry dyke swarm north of the fault). - The estimates were done using Ordinary Kriging (OK) as the geostatistical interpolation method, based on 5.0 meter analytical composites. Resources were also estimated using Inverse Distance Squared (ID2) interpolation, which produced similar resources that were 1.0 to 1.2 percent lower than the OK method, depending on the cut-off used.
- All estimates are based on a Parent Cell dimension of 20 metres E, 10 metres N and 10 metres height with estimation parameters determined by variography.
- High assays were cut based on the statistics of the original 1.5 metre samples. High assay cut-offs vary from none to a maximum of 30 g/t depending of the domains. This resulted in an approximate 6.7 percent reduction in the overall gold content.
- Underground void models for Sladen, Barnat and East Malartic mine workings were generated from digitization of historical mine sections and were adjusted according to position of drill interceptions in stopes and drifts. Furthermore, void volumes of stopes were increased by one meter along all edges to compensate for uncertainties. The void models were then used to deplete the resource block model.
- Tonnage estimates are based on rock densities of 2.69 tonnes/cubic metre for the porphyry, 2.75 for altered sediments and 2.90 for altered ultramafic rocks.
Osisko Mining Corp. is currently developing the Canadian Malartic gold deposit and adjacent mineralized zones into a large-scale open pit, bulk-tonnage mining operation. The Company is well-funded and is carrying out an aggressive definition drilling and exploration campaign. Eight drills are currently working on the property, with five dedicated to completing the 130,000 metre infill drilling on the South Barnat Zone by mid-February.
A NI 43-101 compliant, 7.7 million ounce gold Measured and Indicated global resource on the main Canadian Malartic gold deposit was released on September 8, 2008 and has been filed on SEDAR. A NI 43-101 compliant, 6.3 million ounce gold Reserve estimate and Feasibility Study on the main Canadian Malartic gold deposit was released on November 25, 2008 and has been filed on SEDAR. These estimates did not include the South Barnat Zone or any other mineralized zone located outside the main deposit that is currently being evaluated by Osisko. The inferred resource estimate for South Barnat is not known to be materially affected by any environmental, legal, title, taxation, socio-political, marketing or other relevant issues.
Mr. Elzear Belzile, P. Eng. and Mr. Robert Wares, P. Geo. and Executive Vice-President of Osisko, are the Qualified Persons who have reviewed this news release and are responsible for the technical information reported herein, including verification of the data disclosed including the sampling, analytical and test data underlying the technical information.
Conference Call
Osisko will host a conference call on Monday, January 26 at 2:00 PM EST where senior management will discuss the Study and will be available to respond to questions from analysts and investors. Those interested in participating in the conference call should dial in at 647-426-1845 (Toronto local and international), or 1-866-782-8903 (North American toll free). An operator will direct participants to the call.
Cautionary Notes Concerning Estimates of Mineral Resources
This news release uses the terms measured, indicated and inferred resources as a relative measure of the level of confidence in the resource estimate. Readers are cautioned that the South Barnat mineral resources are not economic mineral reserves and that the economic viability of resources that are not mineral reserves has not been demonstrated. In addition, inferred resources are considered too geologically speculative to have any economic considerations applied to them. It cannot be assumed that all or any part of an inferred mineral resource will ever be upgraded to a higher category. Under Canadian rules, estimates of inferred mineral resources may not form the basis of feasibility or pre-feasibility studies or economic studies except for Preliminary Assessment as defined under NI 43-101. Readers are cautioned not to assume that that further work will lead to mineral reserves that can be mined economically.
Forward Looking Statements
Certain statements contained in this press release may be deemed "forward-looking statements". All statements in this release, other than statements of historical fact, that address events or developments that the Corporation expects to occur, are forward looking statements. Forward looking statements are statements that are not historical facts and are generally, but not always, identified by the words "expects", "plans", "anticipates", "believes", "intends", "estimates", "projects", "potential", "scheduled" and similar expressions, or that events or conditions "will", "would", "may", "could" or "should" occur. Although the Corporation believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, including, without limitation that all technical, economical and financial conditions will be met in order to put the Canadian Malartic Project into commercial production, such statements are not guarantees of future performance and actual results may differ materially from those in forward looking statements. Factors that could cause the actual results to differ materially from those in forward-looking statements include gold prices, access to skilled consultants, mining development and mill production personnel, results of exploration and development activities, the Corporation's limited experience with production and development stage mining operations, uninsured risks, regulatory changes, defects in title, availability of personnel, materials and equipment, timeliness of government approvals, actual performance of facilities, equipment and processes relative to specifications and expectations, unanticipated environmental impacts on operations market prices, continued availability of capital and financing and general economic, market or business conditions. These factors are discussed in greater detail in the Corporation's most recent Annual Information Form filed on SEDAR, which also provides additional general assumptions in connection with these statements. The Corporation cautions that the foregoing list of important factors is not exhaustive. Investors and others who base themselves on the Corporation's forward-looking statements should carefully consider the above factors as well as the uncertainties they represent and the risk they entail. The Corporation believes that the expectations reflected in those forward-looking statements are reasonable, but no assurance can be given that these expectations will prove to be correct and such forward-looking statements included in this press release should not be unduly relied upon. These statements speak only as of the date of this press release.
Contacts: Osisko Mining Corporation John Burzynski Vice-President Corporate Development 514-735-7131 Osisko Mining Corporation Daniel Boase Investor Relations 416-742-5600 Toll Free: 1-866-580-8891 www.osisko.com
SOURCE: Osisko Mining Corporation
http://www.osisko.com
