Comaplex releases Meliadine preliminary scoping study

2009-02-02 08:38 EST - News Release

Mr. George Fink reports

PRELIMINARY ASSESSMENT INDICATES STRONG ECONOMICS FOR THE MELIADINE GOLD PROPERTY

Comaplex Minerals Corp. has released the results of an independent NI 43-101-compliant preliminary assessment (PA or scoping study) on the Meliadine gold property located near Rankin Inlet, Nunavut. The PA includes gold deposits located on both the Meliadine West property (owned 78 per cent by Comaplex and 22 per cent by Meliadine Resources Ltd., a private company owned 100 per cent by Resource Capital Fund III LP of Denver) and the neighbouring Meliadine East property (owned 50:50 with Meliadine Resources). Comaplex has an option to increase its interest to 80 per cent on the Meliadine West property.

In July, 2008, Comaplex entered into a technical services agreement with independent consultant, Micon International Ltd., to complete an NI 43-101-compliant preliminary assessment for public release during the fourth quarter of 2008. In view of the rapid changes in world economic conditions that have taken place in the last five months, Comaplex modified and recalculated numerous areas of the study. This has resulted in delays in its completion. A positive aspect of the delay is that it enabled Comaplex to complete an NI 43-101-compliant resource estimate for the F zone on the Meliadine West property that included 2008 drilling results, and to add this deposit to the study. The PA does not include the results of the 2008 drilling programs on the Tiriganiaq and Discovery gold deposits. Updated resource estimates for these deposits are presently being compiled.

The preliminary assessment indicates that production of gold from the Meliadine property is feasible using current and projected future economic conditions. This preliminary assessment is preliminary in nature. It includes inferred mineral resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves, and there is no certainty that the results of the preliminary assessment will be realized.

The proposed gold mine at Meliadine would be a combination of open-pit and underground mining. A series of three different open pits at Tiriganiaq, Discovery and F zone will contribute ore sequentially to the mill. The open pits would be conventionally mined at a rate of 500,000 tonnes per year.

The underground mine on the Tiriganiaq deposit would be a ramp-access operation with mining by blasthole and cut-and-fill methods. The study proposes to access and mine potentially higher-grade underground material from the Western Deeps area of the Tiriganiaq gold deposit early in the mine life, which will result in higher initial capital costs, but will accelerate payback of capital.

The postulated facility would mill 985,000 tonnes per annum of diluted mineralized material (indicated and inferred resources) over a mine life of 9.5 years for the production of 2.29 million ounces of gold. The nominal processing rate would be 3,000 tonnes per day, 328 days per year. Of this, approximately 1,700 tonnes per day would come from the Tiriganiaq underground mine and the balance from the pits. The combined open-pit (500,000 tonnes per annum) and underground mining rate (approximately 720,000 tonnes per annum) will typically exceed the mill capacity. This will result in the buildup of a stockpile, but will ensure a continuous maximum processing rate.

A mill would be built on the site, treating mineralized material by conventional crushing and grinding with a gravity-flotation-cyanidation circuit with a 92.6-per-cent gold recovery. All tailings would be treated by a cyanide destruction circuit. The PA reviews two alternative tailings deposition sites: a land-based option and a subaqueous (shallow-lake) option.

A fully catered permanent camp would be built on the site for employee accommodation, together with infrastructure appropriate to an isolated mine site. Site power would be diesel generated with the fullest possible use of waste heat. An all-season road would connect the mine site with the hamlet of Rankin Inlet.

Total payroll is estimated in the order of 430 people, with a total work force on site at any time of 230 to 240 people. These people would be employed partially from local Inuit communities, with the balance on a fly-in/fly-out rotation. Recruitment would maximize employment opportunities for inhabitants of Rankin Inlet and other Arctic communities.

Estimated life of mine costs (including appropriate contingencies)

Capital expenditure (note 1) $382-million (Canadian)

Operating cost per tonne of ore processed $ 91 (Canadian) per tonne

Cash operating cost per ounce of gold produced $366 (Canadian) per ounce gold

Payback 2.6 years

Note 1: This includes approximately $85-million of sustaining capital (of which $28.75-million is for reclamation costs) that will be financed from cash flow after the commencement of production.

Economic performance (gold price of $700 (U.S.) per ounce and an 85 U.S. cent exchange rate)

After-tax IRR: 22.9 per cent

After-tax NPV -- 7.5-per-cent discount rate: $194-million

Net cash flow before tax: 0-per-cent discount (note 1): $626-million

Net cash flow after tax: 0-per-cent discount (note 1): $444-million

Note 1: This is net after recovery of capital.

A complete NI 43-101-compliant report on the preliminary assessment will be released on SEDAR within 45 days of the date of this release.

The mineral resource estimates evaluated in the PA comprise the Tiriganiaq, Discovery and F zone deposits. Mineral resources that are not mineral reserves do not have demonstrated economic potential. The Tiriganiaq and Discovery resource estimates were previously released and are attached. The F zone resource estimate is new and is detailed in the following section. Gold mineralization in all three of the deposits is open to depth.

New resource estimate -- F zone deposit (Meliadine West property)

A total of 2,014 metres in 19 holes were completed on the F zone satellite gold deposit in 2008. The drilling tested the open-pit potential of four shallow targets in the zone to contribute ore to a possible future mine at the Tiriganiaq deposit located four kilometres to the northwest of the zone. Modelling of the F zone gold deposit took place in November and early December, 2008.

In late December, 2008, an updated mineral resource estimate was completed on the company's F zone gold deposit by Snowden Mining Industry Consultants Inc. (Snowden) of Vancouver. The updated resource, disclosed in accordance with NI 43-101 requirements, is incorporated into the preliminary assessment report and includes all of the drilling conducted on the deposit, including that completed during the 2008 field season.

Multiple indicator kriging, restricted to the interpreted mineralized iron formation domain, was used to estimate gold grades into the block model. Ordinary kriging, inverse power of distance and nearest neighbour estimates were also generated for the F zone block model for model validation purposes.

Mineral resources for the F zone are reported and categorized in the attached summary tables, consistent with the CIM definitions required by NI 43-101. Mineral resources that are not mineral reserves do not have demonstrated economic viability.

Indicated resources for 2008 (F zone) equals 111,000 ounces gold. Inferred resources for 2008 (F zone) equals 113,600 ounces gold.

Current total indicated resources (all three deposits) equals 2,158,000 ounces gold. Current total inferred resources (all three deposits) equals 1,647,950 ounces gold.

Preliminary mine planning and cost estimation studies were undertaken so that possible cut-off criteria could be applied for the reporting of the F zone classified mineral resource. The analysis suggested that open-pit mining may be possible to a depth of approximately 80 metres below surface (9,980-metre elevation). A cut-off grade of 2.5 grams per tonne gold has been applied to resources reported above this elevation and is supported by the results of the preliminary mine planning study. No economic study was conducted on the F zone mineral resource below the 9,980-metre elevation. The resource below the 9,980-metre elevation is reported at the same preliminary cut-off grade of 6.5 grams per tonne gold as that proposed for the Tiriganiaq deposit. Further studies will be required to determine if this remains an appropriate cut-off and if underground mining is economically viable in the F zone deposit. A gold price of $700 (U.S.) per ounce (0.85 exchange) has been assumed in the preliminary analysis for the deposit.

Snowden conducted numerous validation steps on the F zone resource model and considers that the model reasonably reflects grade and geological continuity of the input drilling data in the inferred and indicated parts of the resource. Snowden notes that the block model is in particularly good agreement with the input drilling data in that portion of the resource classified as indicated.

2009 Meliadine West exploration program

In view of the results from the PA, Comaplex intends to continue with the rapid advancement of the Meliadine project towards feasibility and production. While details on field exploration programs for the Meliadine West and East properties have not been finalized, regulatory permitting for the project will commence as soon as possible. Comaplex has a long history of effective engagement with the local community and will continue to develop this relationship.

General

Comaplex is competently staffed to advance its studies on the Meliadine project and will commence with financing as required. Comaplex presently has cash and liquid investments of approximately $21.25-million.

Key near-term objectives include:

• Final metallurgical, geotechnical, environmental, or other studies required prior to or during a feasibility-level study of the project;
• Arrange financial requirements;
• Completion of updated Tiriganiaq and Discovery resource estimates (plus resource estimation of additional satellite deposits);
• Investigation of the potential for additional production from underground at the Discovery and F zone deposits;
• Refinement of underground and open-pit mine plans;
• Movement of additional ounces from inferred to the indicated and measured resource categories.

Dr. Warwick Board, PGeo, MAusIMM, PrSciNat, of Snowden, Doug Dumka, PGeo, and Mark Balog, PGeo, of Comaplex, are qualified persons as defined by NI 43-101. Dr. Board is independent of Comaplex. Snowden has verified the technical information contained in this news release pertaining only to the F zone deposit gold resource estimate. Mr. Balog and Mr. Dumka have verified the technical information contained in this news release. Mr. Dumka, PGeo, is the chief geologist for Comaplex and is the designated qualified person as defined by NI 43-101 for the Meliadine West project.

Drill core analysis is performed on cut, half NQ core with standard fire assay procedures and a gravimetric finish (two-assay-ton, 1,000-gram pulp). Quality assurance/quality control programs employ the insertion of external standards (low- to high-grade gold), blanks and core duplicates every 20 samples. All assaying was completed by TSL Laboratories Ltd. based in Saskatoon, Sask. TSL completes its own internal quality assurance/quality control by inserting a standard, blank, pulp duplicate and coarse reject duplicate in every batch of 20 analyses. Quality assurance/quality control compliance was rigorously checked on a continuous basis during the exploration program.

The footnotes below apply to the resource tables within this release:

1. Resource classifications conform to the CIM Standard Definitions (2005) on Mineral Resources and Mineral Reserves referred to in National Instrument 43-101.
2. Mineral resources that are not reserves do not have demonstrated economic viability.
3. Measured and indicated mineral resources are that part of a mineral resource for which quantity and grade can be estimated with a level of confidence sufficient to allow for the application of technical and economic parameters to support mine planning and evaluation of the economic viability of the deposit.
4. An inferred mineral resource is that part of a mineral resource for which quantity and grade can be estimated on the basis of geological confidence and limited sampling and reasonably assumed, but not verified.
5. The ounces of gold represent contained metal in the ground and have not been adjusted for the metallurgical recovery of gold.

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