RE: NEWS!!! a better takover tgt !Cumberland Resources Ltd (C:CLG)
Shares Issued 56,478,274
Last Close 9/5/2006 $6.10
Wednesday September 06 2006 - News Release
Mr. Kerry Curtis reports
CUMBERLAND REPORTS ON RECENT DRILL RESULTS FROM MEADOWBANK GOLD PROJECT; IMPROVED OUTLOOK FOR CANNU ZONE AS DRILLING CONTINUES
Cumberland Resources Ltd. has released results from continuing exploration drilling at the company's 100-per-cent-owned Meadowbank gold project located 70 kilometres north of the hamlet of Baker Lake, Nunavut. Meadowbank is host to Canada's largest pure gold open-pit reserves with gold reserves estimated at 2.9 million ounces(1). On Aug. 31, 2006, the company received a positive recommendation from the Nunavut impact review board that development of Meadowbank should proceed. Continuing exploration is directed at reserve definition of the Cannu zone, a potentially open-pittable gold zone discovered in the fall of 2005, and exploration for new gold discoveries along the 25-kilometre-long Meadowbank gold trend. Earlier in the 2006 season, the company reported the discovery of the Goose South zone located approximately 400 metres south of the Goose Island deposit.
"Definition drilling at Cannu continues to improve our outlook for this resource," stated Kerry Curtis, president and chief executive officer. "The 2006 drill program has outlined four distinct mineralized lenses at Cannu, including thick mineralization at the Keel lens. This increases our confidence that Cannu represents excellent potential for open-pit expansion and will in the near term become a valued addition to our current reserves."
The company has completed approximately 9,000 metres of diamond drilling at Meadowbank during 2006. Drilling will continue at the Cannu zone until mid-September.
Cannu drilling
The Cannu zone gold mineralization represents a potential 350-metre northern extension to the proposed Portage open pit, which contains an estimated 1.59 million ounces of reserves. With the addition of Cannu, continuous mineralization has been defined over a strike length of approximately 2.15 kilometres in the Portage area. The 2006 exploration program includes systematic infill and step-out drilling to define the extent of the Cannu mineralization and enable a reserve estimate by early 2007. To date, the program has been successful in defining four distinct lenses of mineralization (Keel, 305, Core and East lenses) within a shallow, bowl-shaped structure. Highlights from recent Cannu drilling include:
SELECTED HIGHLIGHTS FROM RECENT CANNU 2006 DRILL HOLES(I)
Hole No. Grade Au Width Depth Lens
(g/t) (m) (metres below
surface)
NP06-642 6.58 3.07 30 East
NP06-648 11.08 5.00 108 Keel
NP06-649 3.96 10.18 125 Keel
NP06-649 51.80 1.74 141 -
NP06-650 68.53 2.80 78 -
NP06-650 5.43 13.39 115 Keel
NP06-653 5.42 3.62 121 Keel
(i) True thickness of intersections ranges from 80 per cent to 100 per cent of intersected widths.
Recent drilling has been successful in outlining the Keel lens, the largest of the four lenses, with a strike length of approximately 250 metres and a width of approximately 100 metres. Within this strike length, a thick portion of the lens has been outlined over a strike length of at least 100 metres. Recent intersections on the Keel lens include 11.08 grams per tonne (g/t) gold over a five-metre width in hole NP06-648; 5.43 g/t gold over a 13.39-metre width in hole NP06-650; and 3.96 g/t gold over a 10.18-metre width in hole NP06-649, all supporting an earlier, previously released intersection of 5.61 g/t gold over a 20.8-metre width in hole NP06-634.
Drilling is presently continuing along the East lens, where shallow, flat-lying mineralization was first intersected in early 2006 with hole NP05-623 yielding 13.51 g/t gold over 3.11 metres at 30 metres below surface. This new, near-surface mineralization was recently intersected 100 metres to the south in hole NP06-642, which yielded 6.58 g/t gold over a 3.07-metre width also at 30 metres below surface.
The 2006 program has also provided improved definition of near-surface mineralization found at the 305 lens and the high-grade Core lens. The 305 lens has consistently been intersected over a strike length of 200 metres with a recent intersection from hole NP06-652 returning 6.61 g/t Au over a 3.9-metre width at approximately 30 metres below surface.
The following Cannu zone inferred resource (based on 30 holes drilled in 2005 and four pre-2005 holes) was calculated in early 2006:
CANNU ZONE MINERAL RESOURCE (APRIL 2006)(2)
Category Tonnes Au Grade (g/t) Contained ounces
Inferred 440,000 6.0 85,000
On-site activities
Cumberland continues with on-site construction activities that have been approved under current exploration licences and permits. Construction of an airstrip was initiated in the summer of 2005 and was recently resurfaced for the use by small aircraft. Construction has also commenced on the foundation pad for a 5.6-million-litre fuel storage tank which is currently on site and planned for assembly in 2007.
Advancing Cumberland's Meadowbank gold project toward mid-tier gold production
The Meadowbank project is host to Canada's largest pure gold open-pit reserves with gold reserves estimated at 2.9 million ounces(1). In August, 2006, the Nunavut impact review board made a positive recommendation for development of the Meadowbank gold project. Cumberland is advancing the Meadowbank project toward open-pit production of 330,000 ounces of gold per year over an 8.1-year mine life with an estimated total cash cost of $201 (U.S.) per ounce based on a bankable feasibility study and subsequent bank due diligence(3) completed in December, 2005. Procurement and staging of materials and supplies to commence construction of a conventional road from the community of Baker Lake to the project is under way.
In March, 2006, the company arranged a gold loan facility for up to 420,000 ounces of gold (15 per cent of reserves) from Barclays Capital, Bayerische Hypo-und Vereinsbank and Societe Generale. Such facility is subject to the satisfaction of certain conditions including, among other things, Cumberland securing all requisite regulatory permits and licences and completion of final loan documentation. At a $600-per-ounce spot gold price, the monetized value of the gold loan would be approximately $250-million. Depending on receipt of permits and licences, operations from three, shallow open pits could commence in late 2008 or early 2009.
MEADOWBANK GOLD PROJECT PRODUCTION PROFILE(3) (DECEMBER, 2005)
(assuming long term $400 (U.S.) per ounce gold and 75 U.S. cents per $1)
Open-pit mineral reserve (proven and probable) 2,890,000 ounces(1)
Mine life 8.1 years
Average annual production rate
Years 1 to 4 400,000 ounces
Life of mine 330,000 ounces
Total cash cost per ounce
Years 1 to 4 US$175
Life of mine US$201
Preproduction capital costs US$235-million
$313-million
MEADOWBANK GOLD PROJECT OPEN-PIT MINERAL RESERVE (PROVEN AND PROBABLE)
(FOURTH QUARTER 2005)(1)
Open pit Category Ore Grade Ounces
(tonnes) (g/t)
Portage Proven 3,020,000 4.8 470,000
Probable 7,990,000 4.4 1,120,000
---------- --- ---------
Proven and probable 11,010,000 4.5 1,590,000
---------- --- ---------
Vault Proven - - -
Probable 8,010,000 3.4 870,000
---------- --- ---------
Proven and probable 8,010,000 3.4 870,000
---------- --- ---------
Goose Proven - - -
Probable 2,310,000 5.7 420,000
---------- --- ---------
Proven and probable 2,310,000 5.7 420,000
---------- --- ---------
Total Proven 3,020,000 4.8 470,000
Probable 18,300,000 4.1 2,420,000
---------- --- ---------
Proven and probable 21,320,000 4.2 2,890,000
---------- --- ---------
Note: 95-per-cent mining recovery and contact dilution applied
Qualified person
Roger March, PGeo, is senior project geologist for Cumberland Resources Ltd. and is the designated qualified person, as defined by National Instrument 43-101, for the Meadowbank project. Mr. March has supervised drill hole planning, implementation and quality-control/quality-assurance programs at the Meadowbank project since 2002. Drill core analysis is performed on split core with standard fire assay procedures and AA finish. QA/QC programs employ random insertion of four internal standards, field duplicates and blank samples. Gravimetric analysis is performed on any sample yielding greater than one g/t gold in fire assay. Primary assaying is performed by IPL Laboratories of Vancouver. Acme Analytical Laboratories of Vancouver provides external reference assaying.
(1) Meadowbank gold reserves (fourth quarter 2005)
The open-pit mineral reserves have been prepared in accordance with National Instrument 43-101. Dr. Mike Armitage, managing director of SRK Consulting (UK) Ltd. is the independent qualified person responsible for preparation of stated reserves.
(2) Cannu resource (April, 2006) -- The inferred mineral resource estimate was prepared in conformance with the requirements set out in National Instrument 43-101 under the direction of Dr. Mike Armitage, managing director of SRK Consulting (UK) Ltd., who is an independent qualified person as defined by National Instrument 43-101.
(3) Meadowbank feasibility study due diligence (December, 2005) -- As a requirement of bank financing, bank-appointed independent engineers SRK Consulting (UK) completed a due diligence audit of the Meadowbank feasibility study completed in early 2005 by AMEC Americas Ltd. The results from the feasibility study by AMEC are summarized in a technical report, dated March 31, 2005, prepared by AMEC in accordance with the standards of disclosure for mineral projects as defined by National Instrument 43-101. Construction scheduling and capital cost estimation have been prepared by Merit International Consultants. Metallurgical and process testwork were completed by SGS Lakefield Research Ltd. Process design was completed by International Metallurgical and Environmental and AMEC. Supporting geotechnical engineering, hydrogeological and geochemical studies were completed by Golder Associates Ltd. Both the SRK and AMEC assumptions include a long-term gold price of $400 (U.S.) per ounce and an exchange rate of 75 U.S. cents per $1.
PHASE I AND II 2006 SPRING DIAMOND DRILLING: CANNU ZONE COMPOSITES(I)
HOLE ID Location From To Grade Width
Easting Northing (m) (m) Au (g/t) (m)
NP06-636 1550N -682E 143.53 146.23 1.16 2.70
NP06-639 1500N -630E 11.26 12.31 7.20 1.05
86.05 87.95 8.04 1.90
NP06-641 1450N -598E 42.57 42.91 348.40 0.34
127.77 130.23 6.73 2.46
NP06-642 1450N -523E 32.53 35.60 6.58 3.07
42.10 45.10 2.29 3.00
NP06-643 1400N -705E 151.30 151.60 4.32 0.30
NP06-644 1400N -575E 16.20 20.15 2.99 3.95
58.60 61.05 7.93 2.55
110.25 113.53 2.48 3.28
NP06-645 1872N -725E 17.00 18.15 1.88 1.15
NP06-646 1450N -475E 22.70 25.29 3.11 2.59
NP06-647 1450N -690E 152.33 153.40 1.14 1.07
NP06-648 1575N -680E 49.11 50.62 25.06 1.51
79.58 82.97 4.20 3.39
116.20 121.20 11.08 5.00
NP06-649 1575N -680E 33.81 36.70 2.63 2.89
121.60 131.78 3.96 10.18
135.94 139.73 5.40 3.79
144.68 146.62 51.80 1.74
NP06-650 1525N -680E 87.26 90.06 68.53 2.80
115.13 117.02 8.74 1.89
122.80 136.19 5.43 13.39
inc. 122.80 128.24 9.97 5.44
NP06-651 1525N -680E 148.64 149.64 4.20 1.00
NP06-652 1575N -666E 33.57 37.47 6.61 3.90
NP06-653 1500N -688E 130.71 134.33 5.42 3.62
(i) True thickness of intersections ranges from 80 per cent to 100 per cent of intersected widths.
© 2006 Canjex Publishing Ltd.
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