Shafter Update!Aurcana Corporation: Shafter Silver Mine Update
VANCOUVER, BRITISH COLUMBIA--(Marketwire - July 30, 2010) - Aurcana Corporation ("Aurcana" or the "Company") (TSX VENTURE:AUN - News) is pleased to report on their 100% owned Shafter Silver Mine located in SW Texas.
Thesuccessful expansion at Aurcana's La Negra Mine (Mexico) from 1,000 to1,500 tons per day in Q2, 2010 now allows the company to concentrate itsresources on the construction of the Shafter Silver Mine.
Shafteris a historical mine which recovered 35 million ounces of silverbetween 1883 and 1943, when it closed due to war and low silver prices.In 1979 to 1982, an extensive surface and underground drilling programdelineated the extension of the orebody a mile to the east of the oldmine. This resulted in a Measured and Indicated Resource of 25 millionounces of silver and an Inferred Resource of 23 million ounces ofsilver.
The July 2009 Prefeasibility Study (www.aurcana.com andSEDAR) indicates a 25% IRR at $13.55 per ounce of silver, and a 2 yearpayback period. A silver price of $15.55 per ounce will provide a 44%IRR and an 18 month payback.
Aurcana purchased Shafter fullypermitted in 2008, and encouraged by the positive July 2009Prefeasibility Study and high silver prices, is now engaged in securingfinancing to start construction in the third quarter of 2010. Companyresources are focused on project planning and the publication of abankable feasibility study in September 2010.
In May 2010,SNC-Lavalin finished basic engineering of the mill and surfaceinfrastructure. Final adjustments are being made to existing permits toexactly match the project's final configuration. Amendments are minor innature, and the regular interaction with the regulatory agencies hasresulted in the Company receiving positive indications that permits willbe amended on application.
Construction can proceed immediatelyon receipt of financing. Project execution planning is substantiallycomplete, and includes selection of key construction personnel such asthe mine construction manager, the permitting and environmental manager,the plant construction manager, and the selection of an engineeringfirm and a construction company. In all cases project resources arelocal to the US South West.
Mr. Lenic Rodriguez, President and CEO of the Company, comments,
"Whilethe La Negra Mine is a success story for Aurcana, our next step is tostart building Shafter to bring it on stream early in 2012. Shafter is avery good fit for this company as it is a straight-forward project withno barriers to construction or operation. It has an excellent orebody,is fully permitted, and is well-served with infrastructure. With aproduction rate of 3.5 million ounces of silver per year and a cash costof $7.50 per ounce for the first two years, ($8.50 average life ofmine), bringing it into production will significantly boost Aurcana'sprofitability."