|Mon Jun 3, 2002|
Sultan Minerals Receives Snowden's Preliminary Study On Kena's Gold Mountain Zone
|Sultan Minerals Inc. (SUL-TSXVX) is pleased to report that it has now received an "Open Pit Cut-off Grade Analysis for the Kena Property", from Snowden Mining Industry Consultants. This study was conducted on the Gold Mountain Zone mineralization of the Company's Kena Property located north of Ymir in southeastern British Columbia. The scope of the study was to determine 'order-of-magnitude thresholds' to be used as a first check point towards a viable mine. The study reviews a number of grade and tonnage scenarios using variables such as processing methods and gold prices ($275/oz to $350/oz). The tonnage, head-grades and cut-off grades, and processing methods proposed by the study are summarized in Table I below.|
Snowden completed the study based on a detailed review of assay data and other technical information provided by the Company. Ore processing options and recoveries are derived from two independent reports addressing processing alternatives for the Kena ore. In addition, processing cost structures for comparable operations were considered in developing costs assumed in the study.
Ore processing unit costs have been developed using preliminary cost estimation guidelines from the USGS (Singer, 1998) and O'Hara (1980). Mining costs are strictly unit costs with no accounting for increased haulage cost related to depth or increased mining cost related to overburden handling.
The calculation of cut-off grade is limited to the incremental or in-pit determination of ore due to lack of information on waste to ore strip ratio. The incremental cut-off grade is a function of the overhead costs, processing cost, average head grade, mill recovery, and price. The mining cost does not factor into this value.
No capital expenditures have been estimated or considered in any portion of this analysis.
Three alternative ore processing methods are considered: 1) flotation with gravity separation producing a concentrate shipped to a smelter, 2) heap leaching with on-site solution processing, and 3) whole ore leaching. The flotation product, a gold-rich concentrate, would be shipped to a smelter, possibly at Trail, BC (approximately 70 kilometres from the property via Highways 6 and 3).
Three scales of flotation milling operations are considered: 20,000, 35,000 and 60,000 tpd. Three scales of heap leach operations are considered: 8,000, 25,000 and 60,000 tpd. And, three scales of whole ore leaching are considered: 2,500, 8,500 and 20,000 tpd.
Using the option of surface mining only, three scales of production were addressed: low-tonnage, medium-tonnage and large-tonnage capacity operations. The approximate cut-off grades and required head grades have been estimated for these different scenarios across four gold prices ($275/oz, $300/oz, $325/oz and $350/oz).
Table I below shows the incremental cut-off grade, tonnage and head grade requirements for the three processing rates across a range of gold prices. The results indicate that flotation would be preferable over heap leaching or whole ore leaching if the ore continues to respond favourably to flotation testing. Although flotation would require permitting and construction of a tailings pond, this option would not require permitting of the use of cyanide. Considering the gold grades identified at Kena to date, a whole ore leaching process such as CIL (Carbon in Leach) does not appear to be economically viable.
This study shows very achievable head grades and cut-off grades with the flotation and heap leach scenarios for the Gold Mountain Zone. Insufficient work (drilling, modelling) has been completed to date to define a geological resource and additional drilling is required to work toward the tonnage goals set by this study. The many highly anomalous target areas on the Kena property certainly have the size potential to host any of the above tonnage capacities.
The Company's consultant, P&L Geological Services, is currently on site at the Salmo office making final preparations for the 2002 exploration and diamond-drilling program. With nearly $1,000,000 in the treasury, the Company is favourably positioned to continue its exploration of the Kena Property.
A.G. Troup, P.Eng.,
For further information please contact:
Investor Relations at the Lang Mining Group
Tel: (604) 687-4622 Fax: (604) 687-4212
Toll Free: 1-888-267-1400 Email: Investor@langmining.com
No regulatory authority has approved or disapproved the information contained in this news release.
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