Osisko Metals Inc V.OM

Alternate Symbol(s): OMZNF

Metals & Mining Copper

Osisko Metals Incorporated is a Canadian exploration and development company creating value in the critical metals sector, with a focus on copper and zinc. The Company owns a 100% interest in the past-producing Gaspe Copper mine. The Gaspe Copper mine is located near Murdochville in Quebec's Gaspe Peninsula. In addition to the Gaspe Copper project, the Company is working with Appian Capital Advisory LLP through the Pine Point Mining Limited joint venture to advance the past-producing zinc mining camps, the Pine Point project, located in the Northwest Territories. The Pine Point project is located on the south shore of Great Slave Lake, Northwest Territories, close to infrastructure. Its Mount Copper Expansion Project hosts the undeveloped copper resource in Eastern North America. The Company also owns a group of 199 claims adjacent to its Gaspe Copper Project. The claims cover additional ground near the Gaspe Copper project.

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Osisko Metals Inc

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Post by landlubberon May 05, 2010 10:23pm

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Osisko First Quarter 2010 Results

MONTREAL, QUEBEC--(Marketwire - 05/05/10) - Osisko Mining Corporation (the "Company") (TSX:OSK - News)(Frankfurt:EWX - News) is pleased to report its first quarter financial results for the period ended March 31, 2010.

Highlights

  

  

-- Announced 42.8% increase in reserves to 8.97 million ounces of gold  

(245.8 million tonnes @ 1.13 g/t Au) with the definition drilling of the  

Barnat deposit and the extension of the Canadian Malartic Project.  

-- Continued progress on the construction and development of the Canadian  

Malartic Project with outlays of $99 million.  

-- Announcement of friendly takeover bid on Brett Resources Inc., owner of  

the Hammond Reef gold project.  

-- On-going exploration activities on seven projects with more than 79,000  

metres drilled in the quarter, including commencement of drilling at the  

Duparquet Project.  

-- Extension received for the drawdown of the second tranche of $75 million  

under CPPIB credit facility.  

-- Net income of $1.3 million.

Duringthe first quarter of 2010, the Company's profit amounted to $1.3million (
.00/share) compared to a loss of
.8 million (
.00/share)in the corresponding period of 2009. The profit is mainly attributableto the future income tax recovery of $2.9 million derived from therenunciation of exploration expenses to subscribers of the $14.4million flow-through share issues in 2009, and a $2.9 million gain onforeign exchange, partially offset by higher stock based compensationexpenses.

Canadian Malartic Project

The Canadian MalarticProject is progressing well with the advancement rate reachingapproximately 50% completion. Key milestones during the quarterincluded:

  

  

-- Completion of the detailed engineering;  

-- Finalization of equipment and bulk material purchases;  

-- Awarding of electrical, mechanical and piping installation contracts  

valued at more than $60 million;  

-- Completion of the administrative/truck shop building;  

-- Significant advance on the concrete foundation and steel erection work  

at the process plant;  

-- Initiation of mine pre-stripping work;  

-- Near completion of the relocation program with the delivery of the  

community centre and initiation of the closure of the southern Malartic  

neighbourhood;  

-- Advancement of the electrical infrastructures for the 120kV power line.

Totaldirect investment during the quarter amounted to $99 million. To date,the Company's investment has reached $503 million, with additionalcommitments for $224 million. Total outlays and commitments of $727million represent 78% of budget. The construction of the Project isexpected to be completed in the second quarter of 2011.

Reserve/Resource Growth

TheCompany announced in early February, following the inclusion of theBarnat South deposit and additional drilling at Canadian Malartic, thatproven and probable reserves stood at 245.8 million tonnes at anaverage grade of 1.13 g/t for 8.97 million ounces of gold. The reservesare based on 0.34 g/t cut grade and using $825 per ounce gold price(see February 10, 2010 press release).

The Company is continuingto aggressively pursue the growth on its reserve/resource base withactive drilling campaigns on seven gold projects. Some 78,800 metres ofdrilling were completed during the first quarter.

Friendly Takeover Bid - Brett Resources Inc.

Osiskoformally launched a friendly takeover bid of Brett Resources Inc.,owner of the Hammond Reef Gold Project, by offering 0.34 common shareof Osisko and $ 0.0001 in cash for each common share of Brett. Theoffer is open until May 19, 2010.

A Preliminary Assessment Study(the "Study") was completed by Brett in November 2009 outlining aninitial 14-year mine life operating at 50,000 tonnes per day. Over thefirst six years, on average, Hammond Reef is expected to produce463,000 ounces of gold per year at cash costs of US$382 per ounce(including royalties, net of silver credits). Over the life of mine,Hammond Reef is expected to produce a total of 5.13 million ounces ofgold at an average rate of 369,000 ounces per year and average cashcosts of US$442 per ounce (including royalties, net of silver credits).Using a gold price of US$990 per ounce the Study shows that HammondReef has an after-tax net present value of US$811 million (using a 5%discount rate) and an internal rate of return of 22.9%.

Inaddition to the current resource, Hammond Reef offers excitingexploration potential as recent drilling confirmed continuity ofmineralization along strike two kilometers northeast of the existingresource. Brett has also identified several parallel structures in theproject area that host mineralization similar to the main body.

Mr.Sean Roosen, President and CEO, commented on the first quarter'sactivities: "We are pleased with the on-going progress at the CanadianMalartic Project and with the response that we have received followingthe announcement of our offer to acquire Brett Resources Inc. We arewell on our way to building the next leading intermediate goldproducer."

Highlights from the Company's financial position are as follows (in millions of dollars):

  

  

----------------------------------------------------------  

March 31, 2010 December 31, 2009  

----------------------------------------------------------  

Cash Position(1) 670.6 790.2  

Working Capital 638.0 760.4  

Total Assets 1,357.4 1,338.8  

Shareholders' Equity 1,117.4 1,112.3  

----------------------------------------------------------

(1) Includes Cash and Cash equivalents, Short-term investments, Restricted cash and Cash collateral.

Thefinancial statements and Management Discussion and Analysis for theperiod ended March 31, 2010, will be filed on SEDAR by May 15, 2010.

OsiskoMining Corporation is currently developing the Canadian Malartic golddeposit and evaluating adjacent areas for a large-scale open pit,bulk-tonnage mining operation. The Company is well-funded withapproximately $670 million on hand.

Forward Looking Statements

Certainstatements contained in this Press Release, may be deemed"forward-looking statements". All statements in this release, otherthan statements of historical fact, that address events or developmentsthat the Corporation expects to occur, are forward looking statements.Forward looking statements are statements that are not historical factsand are generally, but not always, identified by the words "expects","plans", "anticipates", "believes", "intends", "estimates", "projects","potential" and similar expressions, or that events or conditions"will", "would", "may", "could" or "should" occur. Although theCorporation believes the expectations expressed in such forward-lookingstatements are based on reasonable assumptions, including, withoutlimitation that all technical, economical and financial conditions willbe met in order (i) to put the Canadian Malartic Project intocommercial production, or (ii) to complete the acquisition of BrettResources Inc., such statements are not guarantees of futureperformance and actual results may differ materially from those inforward looking statements. Factors that could cause the actual resultsto differ materially from those in forward-looking statements includegold prices, access to skilled mining development and mill productionpersonnel, results of exploration and development activities, theCorporation's limited experience with production and development stagemining operations, uninsured risks, regulatory changes, defects intitle, availability of materials and equipment, timeliness ofgovernment approvals, actual performance of facilities, equipment andprocesses relative to specifications and expectations, unanticipatedenvironmental impacts on operations market prices, continuedavailability of capital and financing and general economic, market orbusiness conditions. These factors are discussed in greater detail inthe Corporation's most recent Annual Information Form filed on SEDAR,which also provides additional general assumptions in connection withthese statements. The Corporation cautions that the foregoing list ofimportant factors is not exhaustive. Investors and others who basethemselves on the Corporation's forward-looking statements shouldcarefully consider the above factors as well as the uncertainties theyrepresent and the risk they entail. The Corporation believes that theexpectations reflected in those forward-looking statements arereasonable, but no assurance can be given that these expectations willprove to be correct