- Proven and probable reserves increase to 195,880 tonnes; - Measured and Indicated resources increase by 104% to 814,096 tonnes; - Inferred resources reach 4.2 million tonnes
MONTREAL, QUEBEC--(Marketwire - Feb. 27, 2012) - Malaga Inc. (TSX:MLG)(OTCQX:MLGAF) is pleased to announce an updated reserve and resource calculation compliant with National Instrument 43-101 of its Pasto Bueno tungsten mine located in Northern Peru. The report was prepared by the independent mining consultancy firm Pincock, Allen & Holt.
The resource estimate includes 195,880 tonnes of proven and probable reserves with a WO3 average grade of 0.66%, 814,096 tonnes of measured and indicated resources with a WO3 average grade of 0.78%, 4,168,216 tonnes of inferred resources comprised of 3,718,216 tonnes with a WO3 grade of 0.83%, and 450,000 tonnes with a WO3 average grade of 0.14% coming from the Huaura tailings pond. The measured and indicated resources are inclusive of reserves. The complete report and its appendixes will be filed on SEDAR (www.sedar.com) in the next 45 days and will also be available on the Company's website.
"We are very pleased with the upgraded resource estimate at the Pasto Bueno mine," said Pierre Monet, President and CEO of Malaga. "We have been increasing resources and reserves every year since restarting the production at the mine in 2007. At current production rates, we have close to two years of reserves."
Mr. Monet noted that these figures do not include the mantos located on the southern part of the property that the Company started to drill in 2011. "There is still significant potential upside to come with future drilling campaigns on this underexplored part of the property. In addition, we are also investigating the feasibility of re-processing 450,000 tonnes of inferred resources from our tailings pond", he said.
|The summarized table of reserves and resources as of November 25, 2011 is as follows:|
NATIONAL INSTRUMENT 43-101 COMPLIANT TECHNICAL REPORT
|TONNES||GRADE % WO3||TONNES||GRADE % WO3||% increase in tonnage|
|Total M&I Resources||814,096||0.78%||398,845||0.75%||104%|
|Total Inferred Resources||4,168,216||0.76%||1,820,641||0.70%||147%|
|* Measured and Indicated Resources include all the Proven and Probable Reserves|
Cut-off for reserves: 0.44% W03
Cut-off for resources: 0.36% W03
Included in the reserves are all the measured resources diluted by 20 cm of width for veins at least one meter wide
The increase in reserves and resources stems from ongoing underground development and exploration at Pasto Bueno. In 2010 and 2011, 1,929 meters of drilling were completed, mainly in the Consuzo area (Loreto vein), which yielded indicated resources of 233,352 tonnes grading 0.75% WO3 and 2,161,572 tonnes of inferred resources grading 0.86% WO3 .
During the second half of 2011 and the early part of 2012, Malaga undertook a first exploratory drilling campaign in the southern part of the property (the mantos), but the results of that campaign are not included in this reserve and resource calculation.
Malaga employs three mining methods including: overhand cut and fill, shrinkage stoping and a variation of room and pillar using backfill. The overhand cut and fill and shrinkage stoping are used on steeply dipping veins while the room and pillar is used on veins dipping 45° or less. The mine production at Pasto Bueno is approximately 350 tpd with a plant capacity of 500 tpd. The processing is uniquely carried out by gravity and the final product is a premium concentrate containing at least 70% WO3. The recently upgraded tailings pond will have, at 500 tpd, a life of 5 to 6 years. The dike will be completed after the rainy season in April.
Strict QA/QC procedures were followed for all the samples and the quality of sample preparation, security, integrity and chemical analyses was equal to or exceeded current industrial standards and the requirements of NI 43-101.
The resource and reserve estimate was prepared by Richard Kehmeier, C.P.G., and Richard Addison, P.E., C.Eng., of Pincock, Allen & Holt, in Golden, Colorado, who are Qualified Persons ("QPs") as defined by NI 43-101. Pincock, Allen & Holt, Mr. Kehmeier and Mr. Addison are not associated in any manner with Malaga Inc. or any of its subsidiaries or affiliates. This Press Release has been read and approved by Malaga's Qualified Person, Mr. Alonso Sanchez, Chief Geologist.
Malaga Inc. owns and operates the Pasto Bueno mine in Peru, and is one of the few publicly-traded producers of tungsten outside of China. Malaga is a low cost producer due to its gravimetric ore concentration process and the availability of hydroelectric power generated on its property. While Malaga's production capacity represents about 10% of the tungsten available for sale outside of China, the Company plans to increase production and is currently exploring the property to develop its reserves and resources.
Certain statements in the foregoing may constitute forward-looking statements which involve known and unknown risks, uncertainties and other factors that may cause Malaga's actual results, performance or achievements or industry results to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. The information provided reflects management's current expectations regarding future events and performance as of the date of this news release.