RE: 43-101 is out Paragon Reports Initial Resource Estimate on Lemarchant VMS Deposit
TSX Venture Exchange Symbol: PGR
Shares Issued: 52,999,254
VANCOUVER, Jan. 23, 2012 /CNW/ - Paragon Minerals Corporation (TSX-V: PGR; "Paragon") is pleased to report the first National Instrument 43-101-compliant Mineral Resource Estimate for the Lemarchant volcanogenic massive sulphide ("VMS") deposit on its 100%-controlled South Tally Pond project in central Newfoundland. The Lemarchant Deposit is located 20 kilometres southwest of the producing Duck Pond Cu-Zn Mine/Mill complex operated by Teck Resources Limited.
Gary Giroux, P. Eng. of Giroux Consultants Limited, Vancouver, BC, Canada, an Independent Qualified Person and consultant to Paragon, has prepared and authorized the release of the Mineral Resource Estimate. Highlights include:
Indicated Mineral Resource of 1.24 million tonnes grading 5.38% zinc, 0.58% copper, 1.19% lead, 1.01 g/t gold and 59.17 g/t silver (15.40% ZnEQ) using a 7.5% zinc equivalent grade cut-off.
Inferred Mineral Resource of 1.34 million tonnes grading 3.70% zinc, 0.41% copper, 0.86% lead, 1.00 g/t gold and 50.41 g/t silver (11.97% ZnEQ) using a 7.5% zinc equivalent grade cut-off.
The deposit is defined to a vertical depth of 210 metres and remains open to depth and along strike.
Preliminary metallurgical results indicate positive metal recoveries.
Michael Vande Guchte, President & CEO of Paragon stated "We are very pleased with this initial mineral resource estimate which compares very well against other VMS exploration and mining projects. The Lemarchant Deposit is a new precious metal-rich copper-lead-zinc massive sulphide resource with excellent potential for further expansion. The deposit is located in an area of excellent infrastructure with Teck Resources existing Duck Pond Mine located nearby". Paragon believes the Lemarchant Deposit warrants aggressive follow-up in 2012.
The indicated and inferred mineral resource estimates for the Lemarchant Deposit are tabulated below for a range of zinc equivalent (ZnEQ) cut-off values. The effective date of the resource estimate is January 16, 2011.
Indicated Category
Cut-off
(ZnEQ%) Tonnes > Cut-Off
(tonnes) ZnEQ
(%) Zn
(%) Cu
(%) Pb
(%) Au
(g/t) Ag
(g/t)
5.50 1,520,000 13.74 4.87 0.52 1.07 0.92 51.01
6.50 1,390,000 14.49 5.11 0.54 1.12 0.96 54.62
7.50 1,240,000 15.40 5.38 0.58 1.19 1.01 59.17
8.50 1,110,000 16.21 5.64 0.61 1.25 1.06 63.15
9.50 1,020,000 16.91 5.84 0.64 1.30 1.10 66.73
Inferred Category
Cut-off
(ZnEQ%) Tonnes > Cut-Off
(tonnes) ZnEQ
(%) Zn
(%) Cu
(%) Pb
(%) Au
(g/t) Ag
(g/t)
5.50 2,270,000 9.72 3.18 0.36 0.74 0.77 36.53
6.50 1,810,000 10.67 3.40 0.38 0.80 0.87 41.85
7.50 1,340,000 11.97 3.70 0.41 0.86 1.00 50.41
8.50 1,060,000 13.07 4.02 0.44 0.94 1.06 57.08
9.50 820,000 14.23 4.34 0.47 1.03 1.13 64.23
(i) CIM definitions were followed for the estimation of mineral resources and include drillholes up to September 2011.
(ii) Mineral resources are estimated at a ZnEQ cut-off where ZnEQ% = ((Zn% * 22.05 * Zn Recovery * Zn Price) + (Cu% *22.05 * Cu Recovery * Cu Price) + (Pb%*22.05*Pb Recovery*Pb Price) + (Au * Au Recovery * Au Price / 31.1035) + (Ag *Ag Recovery * Ag Price/31.1035)) / (22.05*Zn Recovery*Zn Price).
(iii) Metal price assumptions are US
.88/lb Zn, US$3.15/lb Cu, US
.91/lb Pb, US$1350/oz Au and US$26.57/oz Ag.
(iv) Metal recovery assumptions are based on preliminary metallurgical results of 68.4% Zn, 83.4% Cu, 92.9% Pb, 75.6% Au and 86.9% Ag.
(v) Zinc, Copper, Lead, Gold and Silver assays were capped at 46.0% Zn, 5.5% Cu, 12.5% Pb, 14.0g/t Au and 800g/t Ag.
(vi) Specific gravity (SG) measurements were taken on most of the samples, where actual measurements were not available either stoichiometric values were calculated or average SG values were used.
(vii) No economic evaluation has been undertaken. A ZnEQ cut-off grade of 7.5% was selected as a reasonable cut-off grade for underground development.
Contained Metal using 7.5% ZnEQ cut-off
Category Zn (lbs) Cu (lbs) Pb (lbs) Au (oz) Ag (oz)
Indicated 147,074,810 15,855,649 32,531,417 40,266 2,358,924
Inferred 109,305,208 12,112,199 25,406,075 43,082 2,171,762
Resource Model
The independent mineral resource estimate prepared by Giroux Consultants Limited ("Giroux") is reported in accordance with Canadian Securities Administrators' NI 43-101 and conforms to the generally accepted Canadian Institute of Mining "Estimation of Mineral Resources and Mineral Reserves Best Practices" guidelines. The mineral resource estimate is on the Lemarchant Main Zone and is based on drillholes completed up to September, 2011. Seventy-four diamond drillholes were used in generating the geological model for the Main Zone, with 31 of the drillholes (10,000 metres) included in the resource estimate. Outlier assays were capped and all assays within the mineralized zones composited to 2.5 metres lengths. All gaps in the assay record were assigned 5 ppm for Cu, Pb, Zn, 0.001 g/t for Au and 0.01 g/t for Ag grades.
Metal grades were estimated using ordinary kriging into a 3D block model with block dimensions of 10 x 10 x 5 metres. Three dimensional geologic solids were constructed by QP Dean Fraser, an independent consultant to Paragon. The geological solids were provided to Giroux for review and utilized for the mineral resource estimate. In general, the solids were limited to material grading > 2% Zn that could be demonstrated to be correlative with definable stratabound zones. As a general rule, solids were extended no more than 50 meters up-dip, down-dip and along strike from a drillhole. One mineralized solid was constructed for the mineral resource estimate and extends to a vertical depth of 210 metres. Blocks were classified as Indicated or Inferred based on the blocks proximity to data.
Readers are cautioned that mineral resources that are not mineral reserves do not have demonstrated economic viability. Additional technical disclosure regarding data verification, exploration including drilling, quality assurance and quality control measures, geological information, analytical and testing procedures and true widths may be found in previous news releases and on the Paragon website. The NI 43-101 Technical Report on the Lemarchant Deposit will be filed on SEDAR within 45 days following the date of this news release.
The South Tally Pond VMS project is located within a proven mining district in central Newfoundland. The Province of Newfoundland & Labrador enjoys a competitive tax regime and stable, predictable permitting and regulatory environment. There are no known environmental, permitting, legal, titles, taxation, socio-political or other relevant issues that materially impact this resource estimate.
Metallurgical Test Results
Preliminary metallurgical test work has been undertaken by SGS Mineral Services of Lakefield, Ontario, Canada ("SGS") on a composite sample of quartered drill core from the Lemarchant Deposit that included representative samples from massive sulphides, semi-massive sulphides, felsic volcanic breccia and massive barite. The program included head characterization, mineralogical analysis (QEMSCAN), grind establishment and metallurgical testing including gravity and flotation tests. Highlights of the test work include:
Mineralogical analyses (QEMSCAN) indicate:
Zinc concentrates of over 57% should be achievable at zinc recoveries above 90%;
Copper concentrates over 30% should be achievable at copper recoveries above 90%; and
Lead concentrates over 80% should be achievable at lead recoveries above 90%
Preliminary flotation tests on the composite sample indicate:
a copper-lead concentrate grade of 48.4% (11.6% Cu, 36.8% Pb) containing 6.96 g/t gold and 1,695 g/t silver can be produced with 83.4% Cu, 92.9% Pb, 75.6% Au and 86.9% Ag metal recoveries; and
a zinc concentrate grade of 60.8% Zn can be produced with a 68.4% Zn metal recovery.
Based on conclusions reported by SGS it is anticipated that the concentrate grades and metal recoveries will improve once the flowsheet is optimized for regrinding and reagents. Additional metallurgical test work is warranted and will be undertaken at a later date. The initial mineral resource estimate for the Lemarchant Deposit utilizes these preliminary metallurgical test studies.
About Paragon Minerals Corporation
Paragon Minerals Corporation is a Canadian-based mineral exploration company focused on gold and base-metal exploration in Newfoundland and northwest Ontario. Paragon's flagship project is the 100%-controlled South Tally Pond VMS project where it is advancing a significant precious metal-rich massive sulphide discovery located in a producing base metal mining district in central Newfoundland. Paragon is also exploring an exceptional portfolio of gold properties through partner and company-funded exploration programs.
PARAGON MINERALS CORPORATION
"Michael Vande Guchte"