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December 09, 2009 Formation Metals Inc. Receives Approval from Forest Service to Begin Construction on Idaho Cobalt Mine |
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Vancouver, B.C., December 09, 2009, Formation Metals Inc. (FCO-TSX) ( "Formation") has been informed by its 100% owned subsidiary, Formation Capital Corporation, U.S., (the "Company") that the Company and the United States Department of Agriculture - Forest Service, Salmon Challis National Forest, Salmon/Cobalt ranger District (the "Forest Service") have signed the "Forest Service Evaluation" which approves and finalizes the Company's Mine Plan of Operations for its 100% owned Idaho Cobalt Project (the "ICP"). "What this means", stated Bill Scales, President of Formation Capital Corporation, U.S., "is that the Company can now begin construction activities for the mining and milling operations for the ICP. We can now refer to the Idaho Cobalt Project as the Idaho Cobalt Mine. The Forest Service and the Company have worked very hard to develop a Mine Plan that is economically viable, socially beneficial and environmentally sound. We are pleased to finally be able to get underway." The Forest Service Evaluation states, "This Plan of Operation, including all provisions made herein and attachments thereto, meeting requirements under 36 CFR 228.4, are approved and mutually agreed upon by the UNITED STATES OF America, acting through the USDA-Forest Service, Salmon Challis National Forest, Salmon/Cobalt ranger District and [Formation Capital Corporation, U.S.]:" The financial assurance for reclamation of the ICP has been estimated at US$29.6 million and will be staged commensurate with certain disturbances. The portion of the bond required for surface reclamation is approximately US$9.1 million while the remaining portion is for long term water treatment, should it prove to be necessary. The Company is currently negotiating a suitable financial instrument that will cover the financial assurance obligation while minimizing the outlay of corporate funds. The project construction will be completed in three stages. Stage I is planned for snow and frozen conditions for the period from January 2010 to March 2010 and the Company has already forwarded funds to put the appropriate surface bond in place. This first stage will consist of timber clearing operations for the tailings and waste rock storage facility, topsoil stock pile area, roads around the mill site and concentrator pads. Stage II is scheduled for second quarter of 2010 and will see facility construction and mine development fully underway. Stage III allows for mine development below the water table and is scheduled for the fourth quarter of 2010. Mari-Ann Green, Chairman and C.E.O. of Formation Metals Inc. stated, "I commend the efforts of the Forest Service and our operational team in finalizing the Mine Plan of Operations. We now have a clear path forward to start construction. Once mine financing is in place, we can build the mine and commence cobalt production in early 2011". Formation Metals Inc. is dedicated to the principles of environmentally sound mining and refining practices, and believes that environmental stewardship and mining can co-exist. The Company trades on the Toronto Stock Exchange under the symbol FCO. Formation Metals Inc. "Mari-Ann Green" Mari-Ann Green, C.E.O. |
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