Champion Minerals Inc.

TSX : CHM
FRANKFURT : P02

October 03, 2011 07:30 ET

Champion Minerals Increases NI 43-101 Resources at the Fire Lake North Project to Over One Billion Tonnes

- Measured & Indicated Resources Total 400.1 Million Tonnes grading 30.6% Total Iron

http://www.marketwire.com/press-release/champion-minerals-increases-ni-43-101-resources-fire-lake-north-project-over-one-billion-tsx-chm-1567873.htm

- Inferred Resources Total 661.2 Million Tonnes grading 27.7% Total Iron

TORONTO, ONTARIO--(Marketwire - Oct. 3, 2011) - CHAMPION MINERALS INC. (TSX:CHM)(FRANKFURT:P02) ("Champion", or the "Company") is pleased to provide results of the updated National Instrument ("NI") 43-101 Mineral Resource Estimate completed on the Fire Lake North Project in Fermont, Quebec. Table 1 presents the current NI 43-101 categorized Mineral Resource Estimate1 at a 15% Total Iron ("FeT") cut-off grade for each of the three coarser grained specular-hematite rich deposits and provides the category totals for the Fire Lake North Project as validated by P&E Mining Consultants Inc. of Brampton, Ontario ("P&E").

Table 1 – NI 43-101 Mineral Resource Estimate at 15% Total Iron Cut-off
Deposit Measured Indicated Inferred
Million
Tonnes Grade
FeT Million
Tonnes Grade
FeT Million
Tonnes Grade
FeT

East Area 2.1 33.9% 177.8 30.0% 209.5 29.0%
West Area 5.9 36.3% 161.7 32.3% 263.4 28.3%
Don Lake 0.4 21.4% 52.2 26.5% 188.3 25.3%
Totals 8.4 35.0% 391.7 30.5% 661.2 27.7%
Table 2 presents the categorized Mineral Resource Estimate Totals at incremental cut-off grades demonstrating the sensitivity of the resource estimates to the cut-off grade.

Table 2 – Mineral Resource Estimate Sensitivity at Incremental Cut-off Grades
Cut-Off Grade Measured Indicated Inferred
FeT% Million
Tonnes Grade
FeT Million
Tonnes Grade
FeT Million
Tonnes Grade
FeT

15% 8.4 35.0% 391.8 30.5% 661.2 27.7%
20% 8.1 35.6% 370.5 31.2% 583.4 29.0%
25% 7.9 36.0% 321.6 32.5% 453.6 30.8%
P&E utilized a $1.00 Cdn/US exchange rate, a mining cost of $1.90/Tonne and $7.97/Tonne for the processing, G&A, and freight costs. A $0.02/Tonne/bench incremental increase was added to the mining cost below the third bench. The process recovery, estimated to be 82%, and an Iron ore price of $1.77/dmtu were used to complete the Whittle pit optimization algorithm input data to estimate the in-situ Mineral Resources. Table 3 presents the results of the In-Pit Optimized Mineral Resource Estimate at a 15% cut-off grade and demonstrates the economic sensitivity of the resource estimates by indicating the portion of the mineral resources that may be potentially economically exploited.

Table 3 – In-Pit Optimized ("Pit-Shell") Mineral Resource Estimate at 15% Total Iron Cut-off
Deposit Measured Indicated Inferred
Million
Tonnes Grade
FeT Million
Tonnes Grade
FeT Million
Tonnes Grade
FeT

East Area 2.1 34.0% 177.8 30.0% 201.7 29.2%
West Area 5.9 36.3% 161.7 32.3% 248.8 28.5%
Don Lake 0.4 21.4% 52.1 26.5% 186.8 25.3%
Totals 8.4 35.0% 391.6 30.5% 637.3 27.7%
Tom Larsen, Champion's President and CEO, commented, "The updated resources at Fire Lake North have resulted in a substantial improvement over the initial estimate and far exceeded our expectations. This latest milestone confirms our team's capability and demonstrates that Champion's iron resources are among the best in the Labrador Trough. These results will have a major impact on the updated Preliminary Economic Assessment on the Fire Lake North project which is expected to be released next month. We believe Fire Lake North will contain sufficient resources to increase the planned sinter feed concentrate production from the 7MT/year provided in the initial PEA and this should significantly improve the project's economics. Champion's total NI 43-101 compliant resources for the Fermont Holdings are now greater than 2.2 billion tonnes plus an additional 620 million tonnes of historical resources2."

Champion's next major milestone is the completion of the updated PEA study, which is expected by late November 2011. Block models and pit-optimized shells have been forwarded from P&E to BBA Inc. (Montreal, QC) for design of the engineered pits, mine production scheduling, and completion of the PEA study. The design and schedule will optimize mining of the near surface, higher grade iron resource followed by incremental push-backs to minimize stripping and maximize grades during the first decade of production.

The 2010 PEA recommended two engineered open pits with a combined In-Pit Inferred Mineral Resource3 of 251 MT grading 30.5% FeT. These engineered open pits contained 82.5% of the In-Pit Optimized Mineral Resources estimated at 304 MT grading 30.4% FeT. Champion expects that a similar percentage of In-Pit Optimized Resources will be contained within the forthcoming 2011 engineered pits, and that a third pit will be designed over the Don Lake deposit.

Champion's statements of expectations for the Fire Lake North Project are "forward-looking statements" and not historical facts. Readers are cautioned that any such statements are not guarantees of future performance, and that actual developments or results may vary materially from those stated herein.

Champion is accelerating certain work programs and studies in advance of receiving results from the PEA study in order to hasten the completion of the Feasibility Study for the Fire Lake North Project. Construction of a 6 km all-season road from Highway 389 to the site of the proposed Advanced Exploration Camp will be completed by year end. The 2012 drill program (permits pending) is being designed to upgrade the category of the current Resource from "Inferred" to "Measured and Indicated", and to satisfy the geotechnical, hydro-geological and condemnation requirements of the Feasibility Study. Drilling is scheduled to commence early in the New Year.

The Fermont Iron Holdings

Champion's Fermont Holdings comprise seventeen properties, three of which - Fire Lake North, Bellechasse and Harvey-Tuttle - host combined NI 43-101 compliant Measured and Indicated Mineral Resources currently estimated at 400 MT grading 30.6% FeT and Inferred Mineral Resources currently estimated at 1.82 Billion Tonnes grading 25.5% FeT, at a 15% FeT cut-off. Seven of Champion's remaining fourteen Fermont properties contain combined Historical Mineral Resource Estimates2 totalling 620 MT grading 31% Total Iron.

The Company will continue drilling with three drill rigs through the remainder of 2011 at the O'Keefe-Purdy and Oil Can projects in order to complete the ongoing 10,000 m and 8,000 m programs, respectively. These drills will be moved to Fire Lake North to commence Feasibility definition-drilling as soon as drilling permits are obtained.

About Champion Minerals Inc.

Champion Minerals is an iron ore exploration and development company with offices in Montreal and Toronto, focused on developing its significant iron ore resources in the provinces of Quebec and Newfoundland & Labrador. The Company's projects include: the Fermont Holdings in Quebec, jointly held by Champion (82.5% interest) and Fancamp Exploration Ltd. (17.5% interest); and the Attikamagen Iron Property in Quebec and Labrador. Champion's Fermont Property Holdings, including the flagship Fire Lake North Project, are located in Canada's major iron ore producing district among three producing mines. Champion's team and advisory board includes mining and exploration professionals with substantial iron ore expertise to effectively advance the Fire Lake North Project into production.

1) The current Mineral Resource estimates were calculated using the Canadian Institute of Mining, Metallurgy and Petroleum (CIM), CIM Standards on Mineral Resources and Reserves, Definitions and Guidelines prepared by the CIM Standing Committee on Reserve Definitions. The current Mineral Resource estimates were prepared by P&E Mining Consultants Inc. (Brampton, ON) and approved by Mr. Antoine Yassa, P. Geo. and Qualified Professional of P&E.

Mineral resources, which are not mineral reserves, do not have demonstrated economic viability. The mineral resource estimate may be materially affected by environmental, permitting, legal, title, taxation, socio-political, marketing, or other relevant issues.

2) All Historical Mineral Resources outlined in the text are non-compliant to NI 43-101 Mineral Resources and Mineral Reserves standards, and should therefore not be relied upon. A Qualified Person has not done sufficient work to upgrade or classify these Historical Mineral Resources as current NI 43-101 compliant Mineral Resources.

3) The quantity and grade of reported inferred resources in this estimation are uncertain in nature and there has been insufficient exploration to define these inferred resources as an indicated or measured mineral resource and it is uncertain if further exploration will result in upgrading them to an indicated or measured mineral resource category.

The technical information in this news release was reviewed and approved by Jean-Luc Chouinard, Ing., Director of Projects for Champion Minerals Inc. and Mr. Antoine Yassa, P. Geo. for P&E Mining Consultants Inc. each Qualified Persons under NI 43-101 standards.

Statements made in this news release that are "forward-looking statements" are not historical facts. Readers are cautioned that any such statements are not guarantees of future performance, and that actual developments or results may vary materially from those stated herein.

Contact Information

Champion Minerals Inc.
Thomas G. Larsen
President and CEO
(416) 866-2200

Champion Minerals Inc.
Jorge Estepa
Vice-President
(416) 866-2200

Champion Minerals Inc.
Salisha Hosein
Director, Investor Relations
(416) 866-2200
www.championminerals.com