Orvana Announces Commercial Production and Increas Orvana Announces Commercial Production and Increases Gold and Silver Guidance at the Upper Mineralized Zone ("UMZ") Copper-Gold-Silver Mine, Bolivia
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TORONTO, ONTARIO--(Marketwire - April 10, 2012) - Orvana Minerals Corp. (TSX:ORV) ("Orvana" or the "Company"), through its wholly-owned subsidiary, Empresa Minera Paititi ("EMIPA"), reports that commercial production was achieved at UMZ in the second quarter of fiscal 2012. Fiscal year 2012 production guidance for gold increases from 11,000 ounces to 12,500 ounces, silver increases from 425,000 ounces to 500,000 ounces, and copper decreases from 6,000 tonnes to 5,500 tonnes.
The Company also provides an operations update and comments on the updated reserve estimate issued on January 18, 2012.
Operations
The Leach-Precipitation-Flotation ("LPF") circuit was operable for only 40 days during the second quarter ended March 31, 2012 due to repairs and maintenance required on the sulphuric acid plant as well as higher than expected acid consumption of the ore. Copper recovery remained stable, but the copper grade in the concentrate improved (see table below).
During January and February, transition ore was fed directly through the flotation circuit at the same time as laboratory testing of this ore proceeded. In March, based on the results of both the processing at the mine site and the laboratory testing, transition ore was processed by conventional flotation for 14 days at an average throughput of about 2,500 tonnes per day (see table below). A copper concentrate with high lead content was produced.
"We made changes in the LPF circuit that will eventually improve performance, but due to increased acid consumption of the ore, we cannot run the LPF circuit continuously even though we have stabilized daily throughput at 1,900 tonnes per day," said Jim Jacques, Orvana's Vice President, Operations. "However, we have successfully processed the transition ore by conventional flotation and stabilized throughput at 2,700 tonnes per day, which will allow us to maintain high plant utilization, and thus, high production levels in the future."
Total March production was 462 tonnes of copper, 1,232 ounces of gold, and 52,560 ounces of silver from a throughput of 53,269 tonnes (see table below). For the second quarter, unaudited direct operating cash costs (C1) were
.73 per pound of copper net of by-product versus $1.65 per pound of copper net of by-product in the first quarter. Unlike the concentrate produced by the LPF process, the majority of expected revenue to be generated from the flotation-only processing of transition ore will be from precious metals.
To date, over 6,000 dry metric tonnes of concentrate with grades over 40% copper, over 25 grams per tonne gold, and over 800 grams per tonne silver have been produced, most of which has been transported to the ocean port in Arica, Chile. Shipments of most of this concentrate have been made to customers. Marketing of the high-lead copper concentrate is ongoing.
Updated Reserve and Mine Plan
The updated reserve estimate, and its corresponding mine plan, announced on January 18, 2012 was reviewed given the findings and results described above. In April, oxide ore is planned to be processed by the LPF circuit at 1,900 tonnes per day for 10-12 days in order to comply with a concentrate sales contract, after which repairs, maintenance, and certain upgrades to both the sulphuric acid plant and the leach-precipitation circuit will be completed. Through September, transition ore is planned to be processed through the flotation circuit at a planned throughput of 2,700 tonnes per day with an availability of 90%; two 15-day campaigns of LPF processing of oxide ore at 1,900 tonnes per day are planned in that period. Flotation testing of oxide ores will proceed and results from those tests will determine the future treatment of oxide ores and the overall future mine plan.
"This revised mine plan maximizes plant availability and production, which in turn will result in higher productivity of saleable product," said Bill Williams, President and Chief Executive Officer of the Company. "We are confident this change will result in a significant improvement in cash flow as well as increased production of gold and silver from the UMZ."
The information presented herein was compiled by Bill Williams, Ph.D., CPG, President and Chief Executive Officer of Orvana Minerals Corp., who is a qualified person for the purposes of National Instrument 43-101.