MDN Inc.: Tulawaka had a 49% Increase in Gold Production During the First Half of the Year
MDN receives royalties of $1.2 million
Jul. 26, 2011 (Marketwire Canada) --
MONTREAL, QUEBEC -- MDN Inc. ("MDN") (TSX:MDN) reports to its shareholders that African Barrick Gold plc (ABG), the project operator at the Tulawaka gold mine in Tanzania, in which MDN has a 30% participating interest, announced second quarter and first half operational results.
- The underground mining performance was consistently strong throughout the first half leading to significantly higher grades and production;
- The mine life at Tulawaka has been extended to the middle of 2012 and the drill programme in recent months has identified further extensions to the resource base as we look to keep the mine in production into 2013 and beyond;
- A detailed update of the resource and mine life at Tulawaka is planned before the end of the year.
Gold production at Tulawaka (100 %) for the first half was 41,131 ounces, an increase of 49% compared to the same period last year. The increase in production was driven by higher grade underground zones being mined, as well as a greater proportion of the ore milled in the process plant coming from underground compared to the previous year. For the first half 2011, cash costs per ounce of US$ 686 were slightly higher compared to the same period last year (US$ 641/ounce).
Capital expenditures for the six month period ended 30 June 2011 of $9.3 million was 70% higher than the prior year period of $5.5 million. The capital expenditure was focused on increased investment in order to extend the mine life. Specific spending included $2.9 million relating to capitalised underground development costs, $2.8 million relating to security infrastructure, in particular the perimeter wall, and $1.7 million relating to capitalised drilling expenditure.
Serge Bureau, CEO of MDN commented: "The economic outlook of the Tulawaka mine is improving as a result of the investment made in the underground mine since mid year last year. We are very satisfied by the mine development and its extended future potential".
| Tulawaka (reflected as 100 %) |
Three months ended
30 June |
Six months ended
30 June |
|
|
2011 |
2010 |
2011 |
2010 |
| Underground ore tonnes hoisted |
Kt |
43 |
24 |
86 |
51 |
| Ore milled |
Kt |
106 |
123 |
216 |
241 |
| Head grade |
g/t |
6.7 |
3.5 |
6.3 |
3.8 |
| Mill recovery |
% |
95.0% |
92.9% |
94.3% |
93.3% |
| Ounces produced |
oz |
21,517 |
12,926 |
41,131 |
27,517 |
| Ounces sold |
oz |
22,500 |
11,936 |
40,850 |
29,050 |
| Cash cost/ounces sold |
$/oz |
645 |
759 |
686 |
641 |
| Cash cost per tonne milled |
$/t |
138 |
74 |
130 |
77 |
| Capital expenditure |
$('000) |
5,384 |
5,450 |
9,279 |
5,450 |
East Zone Underground Extensions
At Tulawaka East Zone Underground, exploration drilling continued to extend the known high-grade mineralised shoots below current reserves, indicating potential to extend mine life beyond 2012. A total of 62 diamond core holes for 9,675 metres have been drilled to test the Tulawaka East Zone underground extensions between 10 Level and 15 Level (100m to 200m below completed pit floor). A second underground drill rig was commissioned in the first half of 2011 in order to complete the current programme and complete an update of resources and reserves and a new life of mine plan. Drilling to date shows the mineralised quartz veins extend at least down to Level 12, and has intersected visible gold within quartz veining in several drill holes. A selection of the better intersections returned during the period from the 62-hole underground exploration drill programme include:
-
TUGD00305 - 1.5m @ 14.7g/t Au from 103.5m
-
TUGD00306 - 3.0m @ 5.62g/t Au from 105m
-
TUGD00310 - 1.0m @ 7.30g/t Au from 67m
-
TUGD00315 - 1.6m @ 7.81g/t Au from 74.4m
-
TUGD00317 - 3.2m @ 23.6g/t Au from 64.85m
-
TUGD00322 - 2.5m @ 11.3g/t Au from 71.0m
Diamond drilling continues to test depth, plunge and strike extensions to the mineralised lodes 10 and 12 Levels below current reserves throughout the East Zone and is currently focused on increasing reserves and resources for the mid-year update. Further information with respect to the potential mine life extension at Tulawaka will be released once an updated model and reserve optimisation is completed later in the second half of the year.
The samples were analyzed by fire assay at the Tulawaka Mine Laboratory and SGS Laboratory of Mwanza, Tanzania, which both are certified according to international standards. Supervision of the drill program and of the quality analysis verification program are done by ABG Tulawaka Mine Geologists. Marc Boisvert, geological engineer, Vice President, Exploration, and a qualified person under National Instrument 43-101 has reviewed the technical and scientific information in this news release.
The Tulawaka project is a contractual joint-venture between MDN (30% participating interest) and Pangea Goldfields Inc. (70% participating interest), a wholly owned indirect subsidiary of African Barrick Gold plc and project operator and owner through its subsidiary Pangea Minerals Ltd. The information disclosed on the Tulawaka Gold Mine is based on information provided by the Operator.
About MDN
MDN Inc. (TSX:MDN) is a mining exploration and development company exploring and developing projects in Quebec and Tanzania. The Company is also active in the search for new business opportunities that can increase shareholder value. In addition to its 30% interest in the Tulawaka gold mine, MDN is the operator and owner of a majority interest in mineral licenses totalling 757 km2 in the vicinity of the Tulawaka mine. MDN also has a 72.5% interest in Crevier Minerals Inc., which owns an NI 43-101 niobium-tantalum resource in the Lac-Saint-Jean area of Quebec. MDN has an option to increase its equity participation in Crevier Minerals Inc. to a maximum of 87.5%. Additional information is available on MDN's website at www.mdn-mines.com.
Forward looking statements All statements in this release, other than statements of historical fact, that address events or developments that the Company expects to occur, are forward looking statements. Although the Company believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results may differ materially from those in forward looking statements. Factors that could cause the actual results to differ materially from those in forward-looking statements are discussed in greater detail in the Company's most recent Annual Information Form filed on SEDAR, which also provides additional general assumptions in connection with these statements. Investors and others who base themselves on the Company's forward-looking statements should carefully consider the factors mentioned in the Annual Information Form as well as the uncertainties they represent and the risk they entail. The Company believes that the expectations reflected in those forward-looking statements are reasonable, but no assurance can be given that these expectations will prove to be correct and such forward-looking statements included in this press release should not be unduly relied upon. These statements speak only as of the date of this press release.
Serge Bureau, P.Eng.
MDN Inc.
514-866-6500, ext. 221
Marc Boisvert, P.Eng.
MDN Inc.
514-866-6500, ext. 227
Nicole Blanchard, Investor Relations
450-973-6600
Nicole.blanchard@isuncomm.com
Source: Marketwire Canada (Jul 26, 2011 08:34:06 EDT)
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