Nevada, northwestern Turkey, and Labrador
Gold exploration & development - advancing big deposits with production potential.
Message: Development Work Progresses at Fronteer's Sandman Gold Project
| October 23, 2008 |
| Development Work Progresses at Fronteer's Sandman Gold Project |
| VANCOUVER, BRITISH COLUMBIA--(Marketwire - Oct. 23, 2008) - Fronteer Development Group Inc. ("Fronteer" or the "Company") (TSX:FRG)(AMEX:FRG) is pleased to announce progress by Newmont Mining Corp. ("Newmont") in its 2008 drilling program designed to further define the multiple gold deposits at the Company's Sandman project in Nevada. The ongoing program is focused on the Southeast Pediment, Silica Ridge, Abel Knoll and North Hill deposits for the purposes of: 1. Confirming the character of near surface gold mineralization; 2. Obtaining bulk metallurgical material for mill grade and potential heap leach metallurgical tests; and, 3. Improving the understanding of the geology and controls on gold mineralization. As of September 30, Newmont had completed 2,800 metres (9,300 feet) of drilling in a total of 37 shallow drill holes. Assay results for all holes are pending. Over the next three months, a 2009 drilling program will be organized to cover additional development drilling at Sandman and initiate a series of exploration drill holes which will cover various property wide target areas based on surface mapping, geophysical and soil sampling results. Sandman currently includes a group of closely spaced resource areas, four of which contribute to a combined NI 43-101 resource estimate of 271,900 ounces (measured and indicated) and 38,000 ounces (inferred) gold. The deposits are near-surface and open-pit mineable, with significant resource expansion and exploration upside potential. Infrastructure surrounding Fronteer's Sandman project is excellent. The property is close to Newmont's Twin Creeks mine, potentially eliminating the need for a stand-alone milling facility and other significant capital expenditures if the project were to proceed to production. As part of its overall business strategy, Fronteer has established important industry relationships with senior mining companies around the world. The Sandman agreement with Newmont is an important template for Fronteer that maximizes the potential for near-term production with an excellent partner, while minimizing cash burn. Under the terms of the agreement, Newmont can earn an initial 51% interest in the project by making a positive production decision by June 2011, spending a minimum of $14 million on exploration and development, making a commitment to fund and construct a mine, and completing a bankable feasibility study. Thereafter, Newmont may earn an additional 9% interest in Sandman by spending a further US$9 million on development. Fronteer can elect to have Newmont arrange financing for its 40% of ongoing development costs in the joint venture. Fronteer retains a 2% Net Smelter Return on production of the first 310,000 ounces at Sandman. Sandman, Northumberland and Long Canyon are currently Fronteer's leading properties among its large, relatively untapped portfolio of gold projects in Nevada. For more information on Sandman and Fronteer's other Nevada projects, visit: http://www.fronteergroup.com/?q=cont... . LIQUIDITY Fronteer has no debt and is not invested in any short-term commercial paper or asset-backed securities. Fronteer has approximately C$84 million in cash that is fully liquid and held with a large Canadian commercial bank. |
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