NEWS RELEASE
La Mancha Resources Inc
Symbol C : LMA
Shares Issued 142,715,850
Close 2012-03-23 C$ 3.52
Recent Sedar Documents
View Original Document
La Mancha's P+P reserves increase by 52%
2012-03-26 16:14 ET - News Release
Mr. Dominique Delorme reports
LA MANCHA'S MEASURED AND INDICATED RESOURCES MORE THAN DOUBLE TO 4.8 MILLION OUNCES OF GOLD EQUIVALENT
La Mancha Resources Inc. has provided its mineral reserves and resources for the year ended Dec. 31, 2011. The company's consolidated proven and probable mineral reserves (P&P reserves) and measured and indicated resource (M&I resource) increased by 52 per cent and 140 per cent respectively from last year.
Highlights:
Consolidated P&P gold reserves increased by 316,315 ounces (plus 52 per cent) to reach 929,150 ounces;
Consolidated M&I gold equivalent resources increased by 2,805,818 ounces (plus 140 per cent) to reach 4,811,600 ounces;
Hassai mine's attributable gold reserves increased by 267,930 ounces (plus 205 per cent), mainly due to the Hassai carbon-in-leach feasibility study;
Hassai mine's VMS (volcanogenic massive sulphide) attributable gold-equivalent M&I resources increased by 2,790,834 ounces (plus 2,803 per cent);
Frog's Leg mine's attributable gold P&P reserves increased by 106,138 ounces (plus 36 per cent) due to upgraded mine plan;
Ity mine attributable P&P reserves decreased by 57,748 ounces (minus 41 per cent) to reflect reconciliation problems between mine plan and actual mining activity until the new mine plan is finalized in fourth quarter 2012.
Dominique Delorme, president and chief executive officer of La Mancha, noted: "We are very proud of this new reserve and resource statement as it summarizes the effort made over the past few years to create significant value for our shareholders. Having quadrupled our resource base to nearly five million ounces of gold equivalent since 2007, it is exciting to see that this appears to only be the beginning, as we are just starting to scratch the potential at our Hassai property, where nine more VMS targets remain to be explored."
The attached table highlights the change in La Mancha's consolidated reserves and resources over the previous year. A full description of La Mancha's updated mineral reserves and resources is provided at the end of this press release.
YEAR-OVER-YEAR CHANGE IN MINERAL RESERVES AND RESOURCES
(in gold ounces;
M&I resources inclusive of reserves) As of Dec. 31, % change
2010 2011
Proven and probable reserve 612,835 929,150 +52%
Measured and indicated resource* 2,005,782 4,811,600 +140%
Inferred resource* 2,558,342 1,978,400 -23%
* Includes copper content as gold equivalent ounces, calculated using a gold
price of $1,250 (U.S.) per ounce and a copper price of $2.50 (U.S.) per pound,
assuming 100-per-cent metal recoveries.
The company's consolidated P&P reserves grew by 316,315 ounces, net of mining depletion, to reach 929,150 ounces of gold by year-end 2011. As shown in the attached table, consolidated reserves significantly increased due to A) the announcement of the positive definitive feasibility study for the proposed upgrade to CIL technology at the Hassai mine; and B) the successful completion of a new upgraded mine plan for the Frog's Leg mine.
The company's consolidated M&I resource grew by 2,805,818 ounces to stand at 4,811,600 ounces of gold equivalent as of year-end 2011. As shown in the attached table, this increase is mainly due to significant resource growth at the Hassai VMS project.
DETAILED EVOLUTION OF MINERAL RESERVES AND RESOURCES
(in gold ounces; M&I resources P&P M&I Inferred
inclusive of reserves) reserves resource* resource*
As of Dec. 31, 2010 612,835 2,005,782 2,558,342
Hassai mine +267,930 -4,180 +21,840
Frog's Leg mine +106,138 +26,720 -19,760
Ity mine -57,748 -7,620 +4,435
Hassai VMS project +0 +2,790,834 -586,403
White Foil mine -5 +0 +0
Other properties +0 +64 -54
As of Dec. 31, 2011 929,150 4,811,600 1,978,400
* Includes copper content as gold equivalent ounces, estimated using a gold
price of $1,250 (U.S.) per ounce and a copper price of $2.50 (U.S.) per pound,
assuming 100-per-cent metal recoveries.
Australian operations
Gold reserves at the Frog's Leg mine have increased by 36 per cent from last year following the successful completion of a new upgraded mine plan, as published in the March 22, 2012, press release. This P&P reserve estimate represents an 80-per-cent conversion of the M&I resource reported as at Dec. 31, 2011, compared with 62 per cent for the M&I resource reported as at Dec. 31, 2010.
As a result of successful exploration campaigns and two upgrades to the mine plan, the Frog's Leg mine has maintained a mine life of more than five years since underground operations began. This is very typical of underground mines in the Kalgoorlie area, as exploration drilling is limited by the depth reached by mining activity, and the orebodies extend downward. It is important to note that the gold content of the Frog's Leg reserve is now 27 per cent higher than it was in the 2007 feasibility study, despite the mining of 376,738 ounces (192,136 ounces attributable to La Mancha) since operations began in 2008.
Management believes that Frog's Leg still has significant potential, as the mine plan currently extends to a depth of only 600 metres, whereas neighbouring mines have reached over 800 metres. Drilling of 11,500 metres to a depth of 800 metres is planned in 2012 to confirm this potential.
Gold reserves and resources at the White Foil mine remain unchanged from last year, as gold production came from stockpiled ore, which had been removed from the resource base in the previous resource estimate.
African operations
Gold reserves at the Hassai mine have increased by 205 per cent since last year, largely due to the announcement of the positive definitive feasibility study (DFS) for the proposed upgrade to CIL technology, as published in the May 16, 2011, press release.
A major advantage of the CIL plant is that it should allow the processing of ore that cannot currently be economically processed with the heap leach method. As such, the DFS has allowed for the conversion of 761,000 ounces (304,400 ounces attributable to La Mancha) to mineral reserves. Gold resources are expected to further increase in 2012 as a 5,000-metre drilling program began on the Kamoeb pit earlier this year, with the goal of delineating more resources and converting the existing inferred resource to the indicated category.
At the Ity mine, given that the reconciliation problems first noticed last year between the mine plan and actual mining activity continued into the first half of 2011, a 32,000-metre drilling program began in November, 2011, with the goal of revising the geological model and extending its resources. In the absence of a revised mine plan as at Dec. 31, 2011, the company was obliged to restate some of its reserves as resources until the geological and mine models are updated. As such, Ity's P&P reserves have decreased by 125,815 ounces (57,748 ounces attributable to La Mancha) since last year. A new resource estimate is expected in the third quarter and the corresponding upgraded mine plan is expected by the fourth quarter of 2012.
Hassai VMS project
The Hassai property contains 12 open pits where the mining of the upper gold-rich cap rock has allowed visual identification of VMS structures on the pit floor.
On Feb. 22, 2012, La Mancha announced that the drilling campaign launched following the October, 2010, positive preliminary economic assessment had surpassed its objectives, converting more than the initial 2009 inferred resource to the indicated category while significantly increasing the size of the total resource. A summary of the VMS resource estimates is attached.
EVOLUTION OF VMS MINERAL RESOURCES
(As at Dec. 31, 2011.
On a 100-per-cent basis unless otherwise
indicated) Tonnes Au Cu Total Au
(Mt) (g/t) (%) (oz)
2009 initial resource (as of Dec. 31, 2009)
Indicated 2.9 0.93 1.27 86,700
Inferred 48.5 1.33 1.19 2,078,000
2011 upgraded resource (as of Dec. 31, 2011)
Indicated 80.7 1.26 1.12 3,257,300
Inferred 37.0 1.17 1.09 1,379,700
(As at Dec. 31, 2011.
On a 100-per-cent basis unless otherwise Total AuEq
indicated) Total Cu Total Au Eq (LMA share)
(t) (oz) (oz)
2009 initial resource (as of Dec. 31, 2009)
Indicated 36,800 248,900 99,600
Inferred 576,000 4,617,000 1,846,800
2011 upgraded resource (as of Dec. 31, 2011)
Indicated 900,350 7,226,000 2,890,400
Inferred 401,800 3,150,800 1,260,400
Reported resource figures were calculated using cut-off grades of 0.8 per cent
and 0.5 per cent copper equivalent, long-term copper prices of $2 per pound and
$2.72 per pound, and long-term gold prices of $750 (U.S.) per ounce and $1,100
(U.S.) per ounce in 2009 and 2011, respectively, and assuming 100-per-cent metal
recoveries. In addition to the gold and copper content reported in the table, the
Cu envelope for 2009 also contains 36,000 inferred tonnes of zinc (14,400 tonnes
attributable to La Mancha) calculated using a cut-off of 1 per cent Zn and a zinc
price of $1,911 per tonne. The 2011 Cu envelope also contains 497,500 indicated
tonnes of zinc (199,000 tonnes attributable to La Mancha) and 252,300 inferred
tonnes of zinc (100,920 tonnes attributable to La Mancha) calculated using a cut-off
of 1 per cent Zn and a zinc price of $1,911/t. Gold equivalent ounces are estimated
using a gold price of $1,250 (U.S.) per ounce and a copper price of $2.50 (U.S.) per
pound.
As shown in the table, compared with the initial 2009 estimate, the metal grades of the resource remain fairly stable while its total size has increased significantly. The total indicated resource has grown from 2.9 million tonnes to 80.7 million tonnes, increasing its total gold and copper contents from 86,700 to 3,257,300 ounces and 36,800 to 900,350 tonnes, respectively. Extension drilling also added significantly to the inferred resource base, which now stands at 37.0 million tonnes containing 1,379,700 ounces of gold and 401,800 tonnes of copper.
It is important to note that the drilling campaign mainly focused on expanding the 2009 initial VMS resource, consisting only of the VMS structures below the Hassai South and Hadal Awatib East pits, and converting it to the indicated category. In addition to this, preliminary drilling from the floor of the Hadaymet pit, the third target, confirmed its VMS potential and outlined a first inferred resource, and nine other VMS targets remain to be tested.
We seek Safe Harbor.
La Mancha Resources Inc
Symbol C : LMA
Shares Issued 142,715,850
Close 2012-03-23 C$ 3.52
Recent Sedar Documents
View Original Document
La Mancha's P+P reserves increase by 52%
2012-03-26 16:14 ET - News Release
Mr. Dominique Delorme reports
LA MANCHA'S MEASURED AND INDICATED RESOURCES MORE THAN DOUBLE TO 4.8 MILLION OUNCES OF GOLD EQUIVALENT
La Mancha Resources Inc. has provided its mineral reserves and resources for the year ended Dec. 31, 2011. The company's consolidated proven and probable mineral reserves (P&P reserves) and measured and indicated resource (M&I resource) increased by 52 per cent and 140 per cent respectively from last year.
Highlights:
Consolidated P&P gold reserves increased by 316,315 ounces (plus 52 per cent) to reach 929,150 ounces;
Consolidated M&I gold equivalent resources increased by 2,805,818 ounces (plus 140 per cent) to reach 4,811,600 ounces;
Hassai mine's attributable gold reserves increased by 267,930 ounces (plus 205 per cent), mainly due to the Hassai carbon-in-leach feasibility study;
Hassai mine's VMS (volcanogenic massive sulphide) attributable gold-equivalent M&I resources increased by 2,790,834 ounces (plus 2,803 per cent);
Frog's Leg mine's attributable gold P&P reserves increased by 106,138 ounces (plus 36 per cent) due to upgraded mine plan;
Ity mine attributable P&P reserves decreased by 57,748 ounces (minus 41 per cent) to reflect reconciliation problems between mine plan and actual mining activity until the new mine plan is finalized in fourth quarter 2012.
Dominique Delorme, president and chief executive officer of La Mancha, noted: "We are very proud of this new reserve and resource statement as it summarizes the effort made over the past few years to create significant value for our shareholders. Having quadrupled our resource base to nearly five million ounces of gold equivalent since 2007, it is exciting to see that this appears to only be the beginning, as we are just starting to scratch the potential at our Hassai property, where nine more VMS targets remain to be explored."
The attached table highlights the change in La Mancha's consolidated reserves and resources over the previous year. A full description of La Mancha's updated mineral reserves and resources is provided at the end of this press release.
YEAR-OVER-YEAR CHANGE IN MINERAL RESERVES AND RESOURCES
(in gold ounces;
M&I resources inclusive of reserves) As of Dec. 31, % change
2010 2011
Proven and probable reserve 612,835 929,150 +52%
Measured and indicated resource* 2,005,782 4,811,600 +140%
Inferred resource* 2,558,342 1,978,400 -23%
* Includes copper content as gold equivalent ounces, calculated using a gold
price of $1,250 (U.S.) per ounce and a copper price of $2.50 (U.S.) per pound,
assuming 100-per-cent metal recoveries.
The company's consolidated P&P reserves grew by 316,315 ounces, net of mining depletion, to reach 929,150 ounces of gold by year-end 2011. As shown in the attached table, consolidated reserves significantly increased due to A) the announcement of the positive definitive feasibility study for the proposed upgrade to CIL technology at the Hassai mine; and B) the successful completion of a new upgraded mine plan for the Frog's Leg mine.
The company's consolidated M&I resource grew by 2,805,818 ounces to stand at 4,811,600 ounces of gold equivalent as of year-end 2011. As shown in the attached table, this increase is mainly due to significant resource growth at the Hassai VMS project.
DETAILED EVOLUTION OF MINERAL RESERVES AND RESOURCES
(in gold ounces; M&I resources P&P M&I Inferred
inclusive of reserves) reserves resource* resource*
As of Dec. 31, 2010 612,835 2,005,782 2,558,342
Hassai mine +267,930 -4,180 +21,840
Frog's Leg mine +106,138 +26,720 -19,760
Ity mine -57,748 -7,620 +4,435
Hassai VMS project +0 +2,790,834 -586,403
White Foil mine -5 +0 +0
Other properties +0 +64 -54
As of Dec. 31, 2011 929,150 4,811,600 1,978,400
* Includes copper content as gold equivalent ounces, estimated using a gold
price of $1,250 (U.S.) per ounce and a copper price of $2.50 (U.S.) per pound,
assuming 100-per-cent metal recoveries.
Australian operations
Gold reserves at the Frog's Leg mine have increased by 36 per cent from last year following the successful completion of a new upgraded mine plan, as published in the March 22, 2012, press release. This P&P reserve estimate represents an 80-per-cent conversion of the M&I resource reported as at Dec. 31, 2011, compared with 62 per cent for the M&I resource reported as at Dec. 31, 2010.
As a result of successful exploration campaigns and two upgrades to the mine plan, the Frog's Leg mine has maintained a mine life of more than five years since underground operations began. This is very typical of underground mines in the Kalgoorlie area, as exploration drilling is limited by the depth reached by mining activity, and the orebodies extend downward. It is important to note that the gold content of the Frog's Leg reserve is now 27 per cent higher than it was in the 2007 feasibility study, despite the mining of 376,738 ounces (192,136 ounces attributable to La Mancha) since operations began in 2008.
Management believes that Frog's Leg still has significant potential, as the mine plan currently extends to a depth of only 600 metres, whereas neighbouring mines have reached over 800 metres. Drilling of 11,500 metres to a depth of 800 metres is planned in 2012 to confirm this potential.
Gold reserves and resources at the White Foil mine remain unchanged from last year, as gold production came from stockpiled ore, which had been removed from the resource base in the previous resource estimate.
African operations
Gold reserves at the Hassai mine have increased by 205 per cent since last year, largely due to the announcement of the positive definitive feasibility study (DFS) for the proposed upgrade to CIL technology, as published in the May 16, 2011, press release.
A major advantage of the CIL plant is that it should allow the processing of ore that cannot currently be economically processed with the heap leach method. As such, the DFS has allowed for the conversion of 761,000 ounces (304,400 ounces attributable to La Mancha) to mineral reserves. Gold resources are expected to further increase in 2012 as a 5,000-metre drilling program began on the Kamoeb pit earlier this year, with the goal of delineating more resources and converting the existing inferred resource to the indicated category.
At the Ity mine, given that the reconciliation problems first noticed last year between the mine plan and actual mining activity continued into the first half of 2011, a 32,000-metre drilling program began in November, 2011, with the goal of revising the geological model and extending its resources. In the absence of a revised mine plan as at Dec. 31, 2011, the company was obliged to restate some of its reserves as resources until the geological and mine models are updated. As such, Ity's P&P reserves have decreased by 125,815 ounces (57,748 ounces attributable to La Mancha) since last year. A new resource estimate is expected in the third quarter and the corresponding upgraded mine plan is expected by the fourth quarter of 2012.
Hassai VMS project
The Hassai property contains 12 open pits where the mining of the upper gold-rich cap rock has allowed visual identification of VMS structures on the pit floor.
On Feb. 22, 2012, La Mancha announced that the drilling campaign launched following the October, 2010, positive preliminary economic assessment had surpassed its objectives, converting more than the initial 2009 inferred resource to the indicated category while significantly increasing the size of the total resource. A summary of the VMS resource estimates is attached.
EVOLUTION OF VMS MINERAL RESOURCES
(As at Dec. 31, 2011.
On a 100-per-cent basis unless otherwise
indicated) Tonnes Au Cu Total Au
(Mt) (g/t) (%) (oz)
2009 initial resource (as of Dec. 31, 2009)
Indicated 2.9 0.93 1.27 86,700
Inferred 48.5 1.33 1.19 2,078,000
2011 upgraded resource (as of Dec. 31, 2011)
Indicated 80.7 1.26 1.12 3,257,300
Inferred 37.0 1.17 1.09 1,379,700
(As at Dec. 31, 2011.
On a 100-per-cent basis unless otherwise Total AuEq
indicated) Total Cu Total Au Eq (LMA share)
(t) (oz) (oz)
2009 initial resource (as of Dec. 31, 2009)
Indicated 36,800 248,900 99,600
Inferred 576,000 4,617,000 1,846,800
2011 upgraded resource (as of Dec. 31, 2011)
Indicated 900,350 7,226,000 2,890,400
Inferred 401,800 3,150,800 1,260,400
Reported resource figures were calculated using cut-off grades of 0.8 per cent
and 0.5 per cent copper equivalent, long-term copper prices of $2 per pound and
$2.72 per pound, and long-term gold prices of $750 (U.S.) per ounce and $1,100
(U.S.) per ounce in 2009 and 2011, respectively, and assuming 100-per-cent metal
recoveries. In addition to the gold and copper content reported in the table, the
Cu envelope for 2009 also contains 36,000 inferred tonnes of zinc (14,400 tonnes
attributable to La Mancha) calculated using a cut-off of 1 per cent Zn and a zinc
price of $1,911 per tonne. The 2011 Cu envelope also contains 497,500 indicated
tonnes of zinc (199,000 tonnes attributable to La Mancha) and 252,300 inferred
tonnes of zinc (100,920 tonnes attributable to La Mancha) calculated using a cut-off
of 1 per cent Zn and a zinc price of $1,911/t. Gold equivalent ounces are estimated
using a gold price of $1,250 (U.S.) per ounce and a copper price of $2.50 (U.S.) per
pound.
As shown in the table, compared with the initial 2009 estimate, the metal grades of the resource remain fairly stable while its total size has increased significantly. The total indicated resource has grown from 2.9 million tonnes to 80.7 million tonnes, increasing its total gold and copper contents from 86,700 to 3,257,300 ounces and 36,800 to 900,350 tonnes, respectively. Extension drilling also added significantly to the inferred resource base, which now stands at 37.0 million tonnes containing 1,379,700 ounces of gold and 401,800 tonnes of copper.
It is important to note that the drilling campaign mainly focused on expanding the 2009 initial VMS resource, consisting only of the VMS structures below the Hassai South and Hadal Awatib East pits, and converting it to the indicated category. In addition to this, preliminary drilling from the floor of the Hadaymet pit, the third target, confirmed its VMS potential and outlined a first inferred resource, and nine other VMS targets remain to be tested.
We seek Safe Harbor.
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La Mancha Resources Inc
Symbol C : LMA
Shares Issued 142,715,850
Close 2012-03-23 C$ 3.52
Recent Sedar Documents
View Original Document
La Mancha's P+P reserves increase by 52%
2012-03-26 16:14 ET - News Release
Mr. Dominique Delorme reports
LA MANCHA'S MEASURED AND INDICATED RESOURCES MORE THAN DOUBLE TO 4.8 MILLION OUNCES OF GOLD EQUIVALENT
La Mancha Resources Inc. has provided its mineral reserves and resources for the year ended Dec. 31, 2011. The company's consolidated proven and probable mineral reserves (P&P reserves) and measured and indicated resource (M&I resource) increased by 52 per cent and 140 per cent respectively from last year.
Highlights:
Consolidated P&P gold reserves increased by 316,315 ounces (plus 52 per cent) to reach 929,150 ounces;
Consolidated M&I gold equivalent resources increased by 2,805,818 ounces (plus 140 per cent) to reach 4,811,600 ounces;
Hassai mine's attributable gold reserves increased by 267,930 ounces (plus 205 per cent), mainly due to the Hassai carbon-in-leach feasibility study;
Hassai mine's VMS (volcanogenic massive sulphide) attributable gold-equivalent M&I resources increased by 2,790,834 ounces (plus 2,803 per cent);
Frog's Leg mine's attributable gold P&P reserves increased by 106,138 ounces (plus 36 per cent) due to upgraded mine plan;
Ity mine attributable P&P reserves decreased by 57,748 ounces (minus 41 per cent) to reflect reconciliation problems between mine plan and actual mining activity until the new mine plan is finalized in fourth quarter 2012.
Dominique Delorme, president and chief executive officer of La Mancha, noted: "We are very proud of this new reserve and resource statement as it summarizes the effort made over the past few years to create significant value for our shareholders. Having quadrupled our resource base to nearly five million ounces of gold equivalent since 2007, it is exciting to see that this appears to only be the beginning, as we are just starting to scratch the potential at our Hassai property, where nine more VMS targets remain to be explored."
The attached table highlights the change in La Mancha's consolidated reserves and resources over the previous year. A full description of La Mancha's updated mineral reserves and resources is provided at the end of this press release.
YEAR-OVER-YEAR CHANGE IN MINERAL RESERVES AND RESOURCES
(in gold ounces;
M&I resources inclusive of reserves) As of Dec. 31, % change
2010 2011
Proven and probable reserve 612,835 929,150 +52%
Measured and indicated resource* 2,005,782 4,811,600 +140%
Inferred resource* 2,558,342 1,978,400 -23%
* Includes copper content as gold equivalent ounces, calculated using a gold
price of $1,250 (U.S.) per ounce and a copper price of $2.50 (U.S.) per pound,
assuming 100-per-cent metal recoveries.
The company's consolidated P&P reserves grew by 316,315 ounces, net of mining depletion, to reach 929,150 ounces of gold by year-end 2011. As shown in the attached table, consolidated reserves significantly increased due to A) the announcement of the positive definitive feasibility study for the proposed upgrade to CIL technology at the Hassai mine; and B) the successful completion of a new upgraded mine plan for the Frog's Leg mine.
The company's consolidated M&I resource grew by 2,805,818 ounces to stand at 4,811,600 ounces of gold equivalent as of year-end 2011. As shown in the attached table, this increase is mainly due to significant resource growth at the Hassai VMS project.
DETAILED EVOLUTION OF MINERAL RESERVES AND RESOURCES
(in gold ounces; M&I resources P&P M&I Inferred
inclusive of reserves) reserves resource* resource*
As of Dec. 31, 2010 612,835 2,005,782 2,558,342
Hassai mine +267,930 -4,180 +21,840
Frog's Leg mine +106,138 +26,720 -19,760
Ity mine -57,748 -7,620 +4,435
Hassai VMS project +0 +2,790,834 -586,403
White Foil mine -5 +0 +0
Other properties +0 +64 -54
As of Dec. 31, 2011 929,150 4,811,600 1,978,400
* Includes copper content as gold equivalent ounces, estimated using a gold
price of $1,250 (U.S.) per ounce and a copper price of $2.50 (U.S.) per pound,
assuming 100-per-cent metal recoveries.
Australian operations
Gold reserves at the Frog's Leg mine have increased by 36 per cent from last year following the successful completion of a new upgraded mine plan, as published in the March 22, 2012, press release. This P&P reserve estimate represents an 80-per-cent conversion of the M&I resource reported as at Dec. 31, 2011, compared with 62 per cent for the M&I resource reported as at Dec. 31, 2010.
As a result of successful exploration campaigns and two upgrades to the mine plan, the Frog's Leg mine has maintained a mine life of more than five years since underground operations began. This is very typical of underground mines in the Kalgoorlie area, as exploration drilling is limited by the depth reached by mining activity, and the orebodies extend downward. It is important to note that the gold content of the Frog's Leg reserve is now 27 per cent higher than it was in the 2007 feasibility study, despite the mining of 376,738 ounces (192,136 ounces attributable to La Mancha) since operations began in 2008.
Management believes that Frog's Leg still has significant potential, as the mine plan currently extends to a depth of only 600 metres, whereas neighbouring mines have reached over 800 metres. Drilling of 11,500 metres to a depth of 800 metres is planned in 2012 to confirm this potential.
Gold reserves and resources at the White Foil mine remain unchanged from last year, as gold production came from stockpiled ore, which had been removed from the resource base in the previous resource estimate.
African operations
Gold reserves at the Hassai mine have increased by 205 per cent since last year, largely due to the announcement of the positive definitive feasibility study (DFS) for the proposed upgrade to CIL technology, as published in the May 16, 2011, press release.
A major advantage of the CIL plant is that it should allow the processing of ore that cannot currently be economically processed with the heap leach method. As such, the DFS has allowed for the conversion of 761,000 ounces (304,400 ounces attributable to La Mancha) to mineral reserves. Gold resources are expected to further increase in 2012 as a 5,000-metre drilling program began on the Kamoeb pit earlier this year, with the goal of delineating more resources and converting the existing inferred resource to the indicated category.
At the Ity mine, given that the reconciliation problems first noticed last year between the mine plan and actual mining activity continued into the first half of 2011, a 32,000-metre drilling program began in November, 2011, with the goal of revising the geological model and extending its resources. In the absence of a revised mine plan as at Dec. 31, 2011, the company was obliged to restate some of its reserves as resources until the geological and mine models are updated. As such, Ity's P&P reserves have decreased by 125,815 ounces (57,748 ounces attributable to La Mancha) since last year. A new resource estimate is expected in the third quarter and the corresponding upgraded mine plan is expected by the fourth quarter of 2012.
Hassai VMS project
The Hassai property contains 12 open pits where the mining of the upper gold-rich cap rock has allowed visual identification of VMS structures on the pit floor.
On Feb. 22, 2012, La Mancha announced that the drilling campaign launched following the October, 2010, positive preliminary economic assessment had surpassed its objectives, converting more than the initial 2009 inferred resource to the indicated category while significantly increasing the size of the total resource. A summary of the VMS resource estimates is attached.
EVOLUTION OF VMS MINERAL RESOURCES
(As at Dec. 31, 2011.
On a 100-per-cent basis unless otherwise
indicated) Tonnes Au Cu Total Au
(Mt) (g/t) (%) (oz)
2009 initial resource (as of Dec. 31, 2009)
Indicated 2.9 0.93 1.27 86,700
Inferred 48.5 1.33 1.19 2,078,000
2011 upgraded resource (as of Dec. 31, 2011)
Indicated 80.7 1.26 1.12 3,257,300
Inferred 37.0 1.17 1.09 1,379,700
(As at Dec. 31, 2011.
On a 100-per-cent basis unless otherwise Total AuEq
indicated) Total Cu Total Au Eq (LMA share)
(t) (oz) (oz)
2009 initial resource (as of Dec. 31, 2009)
Indicated 36,800 248,900 99,600
Inferred 576,000 4,617,000 1,846,800
2011 upgraded resource (as of Dec. 31, 2011)
Indicated 900,350 7,226,000 2,890,400
Inferred 401,800 3,150,800 1,260,400
Reported resource figures were calculated using cut-off grades of 0.8 per cent
and 0.5 per cent copper equivalent, long-term copper prices of $2 per pound and
$2.72 per pound, and long-term gold prices of $750 (U.S.) per ounce and $1,100
(U.S.) per ounce in 2009 and 2011, respectively, and assuming 100-per-cent metal
recoveries. In addition to the gold and copper content reported in the table, the
Cu envelope for 2009 also contains 36,000 inferred tonnes of zinc (14,400 tonnes
attributable to La Mancha) calculated using a cut-off of 1 per cent Zn and a zinc
price of $1,911 per tonne. The 2011 Cu envelope also contains 497,500 indicated
tonnes of zinc (199,000 tonnes attributable to La Mancha) and 252,300 inferred
tonnes of zinc (100,920 tonnes attributable to La Mancha) calculated using a cut-off
of 1 per cent Zn and a zinc price of $1,911/t. Gold equivalent ounces are estimated
using a gold price of $1,250 (U.S.) per ounce and a copper price of $2.50 (U.S.) per
pound.
As shown in the table, compared with the initial 2009 estimate, the metal grades of the resource remain fairly stable while its total size has increased significantly. The total indicated resource has grown from 2.9 million tonnes to 80.7 million tonnes, increasing its total gold and copper contents from 86,700 to 3,257,300 ounces and 36,800 to 900,350 tonnes, respectively. Extension drilling also added significantly to the inferred resource base, which now stands at 37.0 million tonnes containing 1,379,700 ounces of gold and 401,800 tonnes of copper.
It is important to note that the drilling campaign mainly focused on expanding the 2009 initial VMS resource, consisting only of the VMS structures below the Hassai South and Hadal Awatib East pits, and converting it to the indicated category. In addition to this, preliminary drilling from the floor of the Hadaymet pit, the third target, confirmed its VMS potential and outlined a first inferred resource, and nine other VMS targets remain to be tested.
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