Halifax, Nova Scotia, October 14th 2009 - Etruscan Resources Inc. (EET.TSX) announced today that it completed an update of its December 2008 feasibility study of the Agbaou Gold project which has resulted in a significant increase in both the reserves and the project economics. For the update, the gold price assumption for economic modeling and pit optimization was set at $1,000/oz versus $850/oz (pit at $750/oz) in the past feasibility study. This change resulted in an increase in reserve ounces to 731,000 ounces, a 29% increase from the past study, and a pre-tax project internal rate of return (IRR) of 24.9% based on 100% equity financing.
The table below compares the feasibility outputs to those of the 2009 update:
Dec 08 Feasibility
2009 Update
Gold Price
US$850/oz (pit @ US$750)
US$1,000/oz
Waste Tonnes
58 mt
77 mt
Ore Tonnes
7.4 mt
10.9 mt
Mill Grade
2.37 g/t
2.08 g/t
In-situ Au
567 kozs
731 kozs
Recovered Au
516 kozs
665 kozs
Capex
US$113 mil
US$106 mil
IRR
9.4%
24.9%
U/D NPV
US$48 mil
US$188 mil
The Agbaou project is now based on ore reserves of 10.9 million tonnes with an average grade of 2.1 grams per tonne containing 665,000 of recoverable ounces. Using an un-hedged gold price of $1,000 per ounce, the base case scenario concludes that Agbaou will produce an average of 77,000 ounces per year at a cash operating cost of $US516 over a 9.1 year mine life. The study proposes open pit mining of three pits via owner operated mining equipment with the ore to be processed through a conventional gravity-CIL (carbon-in-leach) plant with a design capacity of 1.2 million tonnes per annum. The average gold recovery and mining strip ratio are 91% and 7/1 respectively. Initial capital costs for the Project are estimated to be US$106 million.
The study team comprised a number of highly qualified, industry-recognized technical groups. MDM Engineering International Ltd.(MDM) of South Africa was engaged to provide plant and infrastructure design and costing, as well as the overall study management. Mineral resource estimation, open pit optimization, mineral reserves and mining costs were provided by Coffey Mining of Australia. African Mining Consultants of Botswana was contracted to complete the Environmental Impact Assessment for the Project. Metallurgical testwork was performed by Mintek of South Africa. Golder and Associates of Reno, Nevada performed the geotechnical work and the tailings dam design and hydrology was completed by Knight Piesold of South Africa.
The resource estimate which formed the basis of the feasibility study was prepared by Coffey Mining in accordance with National Instrument 43-101 and is summarized as follows:
Cut-off
Indicated Resource
Inferred Resource
Grade
g/t
Mt
Grade
g/t
Ounces
Mt
Grade
g/t
Ounces
0.5
16.6
1.9
1,015,000
5.1
1.7
272,000
1.0
10.5
2.6
871,000
2.8
2.5
218,000
1.5
6.8
3.3
727,000
1.7
3.3
176,000
2.0
4.7
4.0
610,000
1.1
4.1
143,000
The feasibility update study has been submitted to the Government of Cote d'Ivoire in support of an application that will be filed for the issuance of an exploitation permit. In accordance with the laws of Cote d'Ivoire a new company must be established to hold the mining permit with the company being owned 85% by Etruscan, 10% by the State and 5% by SODEMI, the state owned mining company and original holder of the Agbaou permit.
Robert Harris, P.Eng., Vice President of Operations of Etruscan, is the Qualified Person overseeing the feasibility work on Agbaou and has reviewed and approved this press release.
About Etruscan Resources Inc.
Etruscan Resources Inc. is a gold focused Canadian junior mining company with dominant land positions in district scale gold belts covering more than 10,000 square kilometers in West Africa. Its principal mine development projects include the Youga Gold Project in Burkina Faso, the Agbaou Gold Project in Côte d'Ivoire and the Finkolo Gold Project in Mali. Advanced and early stage exploration projects are on-going in Burkina Faso, Mali, Côte d'Ivoire, Ghana and Namibia. Etruscan also has a 47.4% interest in Etruscan Diamonds Limited which has a dominant land position in the Ventersdorp Diamond District located in South Africa. The common shares of Etruscan are traded on The TSX Exchange under the symbol "EET". More extensive information on Etruscan can be found on its home page at http://www.etruscan.com
The common shares of Etruscan are traded on the TSX Exchange under the symbol "EET". More extensive information on Etruscan can be found on its home page at http://www.etruscan.com
For more information from Etruscan contact:
Richard Gordon, Investor Relations, email: Tel: (877) 465-3674/ Fax (902) 832-6702
This press release may contain certain forward-looking statements which involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Forward-looking statements may include statements regarding exploration results and budgets, mineral reserve and resource estimates, work programs, capital expenditures, mine operating costs, production targets and timetables, future commercial production, strategic plans, market price of precious metals or other statements that are not statements of fact. Although the Company believes the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to have been correct. Various factors that may affect future results include, but are not limited to: fluctuations in market prices of precious metals; foreign currency exchange fluctuations; risks relating to mining exploration and development including reserve estimation and costs and timing of commercial production; requirements for additional financing; political and regulatory risks, and other risks and uncertainties described in the Company's annual information form filed with the Canadian Securities regulators on SEDAR (www.sedar.com). Accordingly, readers should not place undue reliance on forward-looking statements.
NO REGULATORY AUTHORITY HAS APPROVED OR DISAPPROVED THE CONTENT OF THIS RELEASE
