Bear Creek Announces Corani Feasibility Study: Positive Economics Including Low Cash Costs

Vancouver, B.C. - Bear Creek Mining Corporation (TSX Venture: BCM / BVL: BCM) (“Bear Creek” or the “Company”) is pleased to announce the results of a positive Feasibility Study (the “FS” or “Feasibility Study”), as defined by Canadian Securities Administrators National Instrument 43 - 101, for its 100%-owned Corani silver-lead-zinc deposit located in southern Peru. Highlights of the FS include (all figures in US dollars):

  • The study defines a significant undeveloped silver deposit containing proven and probable mineral reserves of 270 million ounces of silver, 3.1 billion pounds of lead and 1.7 billion pounds of zinc.

  • The base case after-tax net present value (“NPV”) is $463 million at a 5% discount rate with an internal rate of return (“IRR”) of 17.6% ($18/oz silver, $0.85/lb lead and $0.85/lb zinc). On a pre-tax basis, the base case NPV at a 5% discount rate is $907 million with an IRR of 29.7%.

  • At spot metals prices ($34.64/oz silver, $0.89/lb zinc, $0.90/lb lead on November 8, 2011, the date of the FS), Corani has an after-tax NPV of approximately $1.5 billion at a 5% discount rate and a 38% IRR ($2.7 billion NPV and 60% IRR on a pre-tax basis).

  • Average annual payable silver production is 13.4 million ounces per year for the first five years and 8 million ounces per year over the life-of-mine (“LOM”). On a silver equivalent ounce basis, average annual payable production is 23.0 million ounces per year for the first five years and 14.7 million ounces per year over the LOM.

  • Cash cost is a negative $(0.49) per ounce of silver for the first five years, with a LOM cash cost of $3.68 per ounce of silver (net of base metal credits at $0.85/lb lead and $0.85/lb zinc).

  • Project produces marketable Lead and Zinc concentrates. Metallurgical testing has established conventional flotation recoveries.

  • Initial capital cost is $574 million with capital payback of 3.8 years at base case metal prices, and 2.0 years at metal prices on November 8, 2011, the date of the FS.

  • Mine life is 20 years.

  • Mill capacity is 22,500 tonnes per day.

  • Stripping ratio is 1.69:1 (waste:ore).

  • 89 million of measured and indicated silver resource ounces represent potential future reserve conversion. Additional new mineralization was intersected in recent drilling near perimeter of proposed tailings dam.

Conference Call and Webcast Information

Bear Creek will host a conference call and webcast on Thursday, November 10th, 2011 at 6:00 a.m. (Pacific) or 9:00 a.m. (Eastern) to discuss the results. Call-in and webcast information is provided at the bottom of this release.

Project Summary – Under the Feasibility Study, the Corani project has an after-tax IRR of 17.6% and a NPV of $463 million at a 5% discount rate based on metal prices of $18/oz silver, $0.85/lb lead and $0.85/lb zinc. The financial model incorporates the tax and royalty legislation recently approved by the Peruvian government.

Payable silver production in the first five years averages 13.4 million ounces per year. The project will produce an average of 8 million payable ounces of silver, 105 million payable pounds of lead and 37 million payable pounds of zinc annually over a 20 year mine life. Total cash cost for the first five years is a negative $(0.49)/oz silver, with a life-of-mine cash cost of $3.68/oz silver, net of base metals credits. The initial capital investment on the project is estimated to be $574 million with sustaining capital expenditures during mine operations averaging $7.2 million per year over the 20 year mine life. The project achieves payback of initial capital in 3.8 years using base case metal prices.

The Feasibility Study has been prepared using cost bids, estimates and production forecasts provided by qualified engineering consulting groups led by M3 Engineering, Tucson, Arizona. The economic analysis was performed by M3 Engineering.

Andrew Swarthout, CEO, states, “We are very pleased that the Feasibility Study confirms Corani as one of the world’s largest undeveloped silver and base metals deposits. We intend to advance the project to development with permitting applications to be submitted in the first half of 2012 with production scheduled to start-up in early 2015. Using metals prices on November 8, 2011 the date of the FS, of $34.64/oz silver, $0.89/lb zinc and $0.90/lb lead, Corani has an after-tax NPV of $1.5 billion at a 5% discount rate reflecting robust economics with strong leverage to rising metals prices. The Feasibility Study establishes that the project can be built using conventional mining and processing technology. The Feasibility Study maximizes the value of the project by defining a very large primary silver mine that leverages the base metal credits resulting in very low cash costs per ounce of silver for the first five years. Additionally, the production of high-quality lead and zinc concentrates (126,000 tonnes per year) provides for excellent financing alternatives in the form of concentrate off-take agreements.”

Mr. Swarthout continues, “Importantly, the feasibility engineering and metallurgical studies have resolved earlier issues regarding recoveries using conventional flotation. Corani will produce two high quality concentrates. Based upon final metallurgical test work and mine planning, we have established optimized, conventional flotation treatment options for all ores processed in the Feasibility Study mine plan. As a result of this optimization, there was a reduction in zinc recoveries in the lower grade zinc zones of the ore body and a corresponding reduction in silver contained in the zinc concentrate causing a decrease in payable silver of approximately 8% and payable zinc by 19% compared to the 2009 Prefeasibility Study. However, silver contained in the zinc concentrate is only 50% payable after deductions; therefore, the decrease in payable silver is only 4% on an economic basis. More importantly, the recoveries to the lead circuit, having far better terms for silver payment, remain unchanged. As is common in these ore bodies, we expect additional optimization regarding zinc and silver recoveries during commercial operation.”


The reserve and resource estimates were updated in the FS by Independent Mining Consultants the (“IMC”), Tucson, Arizona. M3 Engineering of Tucson, Arizona led the FS with support from Blue Coast Metallurgy and Global Resource Engineering (the “GRE”) for tailings and geotechnical engineering. All are independent engineering and metallurgical testing firms with recent project development experience in Peru.

The FS is based upon assumptions derived from mine planning sequences completed by IMC and metallurgical test work performed by SGS Laboratories in Vancouver, BC and reviewed by Blue Coast Metallurgy. The mining sequence primarily derives ore from the higher-grade starter pits in the early years and moves to lower-grade areas in the later years of production. Operations are for 20 years based on current reserves. Only measured and indicated resources were used to establish the operations plan when converting resources to reserves.

In the mine sequence, only 270 million ounces contained within 156 million tonnes have been used as reserves in this plan. An additional 134 million tonnes of measured and indicated resource (containing 88.7 million ounces of silver at 20.5 g/t) and 49.8 million tonnes of inferred resource (containing 48.0 million ounces of silver at 30 g/t) remain that could be included in later plans of operations. About 89% of these resources are mixed sulfide and transition material peripheral to the reserve pit. About 11% are contained within oxide mineralization, which outcrops at surface.

Key Assumptions for the Corani Project – Base Case
Annual ore production - years 1 to end of life (tonnes) 7,875,000
Overall process recovery - silver - into both lead and zinc cons 64.2%
Overall process recovery - lead - into lead cons 71.1%
Overall process recovery - zinc - into zinc cons 51.6%
Total processed tonnes 156,130,000
Average silver grade (g/t) 53.8 g/t
Average lead grade (%) 0.90%
Average zinc grade (%) 0.49%
Payable ounces of silver net of smelter payment terms (total) 160.2 million
Payable pounds of lead net of smelter payment terms (total) 2.1 billion
Payable pounds of zinc net of smelter payment terms (total) 745 million
Overall stripping ratio 1.69 to 1
Life-of-mine (mining only) years 18
Life-of-mine (processing) years 20

Reserves are based on metal prices of $18.00/oz silver and $0.85 per pound for both lead and zinc. For the resources, metal prices of $30.00/oz for silver and $1.00/lb for both lead and zinc were used, representing the three-year backward and two-year forward metal prices weighted 60:40 from August 2011 which is consistent with the Company’s policy and industry standards.

The positive Feasibility Study recommends proceeding with project development based on:

  • Robust economics at the base case assumptions with excellent exposure to up-side silver and base metals prices;
  • Well-defined resources open to expansion and conversion to reserves;
  • A solid metallurgical process producing highly marketable, separate lead and zinc concentrates;
  • Favorable infrastructure for tailings storage, power and access,
  • Available local water supply;
  • Well-defined permitting process; and
  • Local community acceptance and support.

Sensitivities to various parameters are summarized below for the after-tax case:

NPV @ 5%
NPV @ 0%
Base Case
$463 M
$947 M
Recovery +10%
$604 M
$1,176 M
Recovery -10%
$319 M
$710 M
Metal Price +10%
$658 M
$1,268 M
Metal Price -10%
$261 M
$610 M
Initial Capital Cost +10%
$424 M
$912 M
Initial Capital Cost -10%
$502 M
$981 M
Operating Cost +10%
$386 M
$809 M
Operating Cost -10%
$537 M
$1,077 M
Metal Prices November 8, 2011
$1,497 M

Note: Base case prices are $18.00/oz Silver, $0.85/lb Lead, $0.85/lb Zinc; Spot prices are from November 8, 2011 (the date of the FS) and were $34.64/oz Ag, $0.90/lb Pb and $0.89/lb Zn.

The financial analysis prepared for the Feasibility Study utilizes the tax regime recently enacted by the Peruvian government. For the base case assumptions, the project is expected to generate $636 million of income related taxes (including mandatory workers profit sharing). At metal prices on November 8, 2011 (the date of the FS), the project would generate $1.8 billion in taxes.


Bear Creek Mining, Corani Project Silver Zone
Mineral Reserves and Resources
November 8, 2011

Mineral Reserves, $10.54 NSR cut-off
  Contained Metal Equivalent Ounces
Category Ktonnes Silver Lead Zinc Silver Lead Zinc Eq. Silver Eq. Silver
    G/t % % Million Ozs Million Lbs Million Lbs Million Ozs G/t































Proven + Probable











Mineral Resources in Addition to Reserves, $9.20 NSR cut-off
  Contained Metal Equivalent Ounces
Category Ktonnes Silver Lead Zinc Silver Lead Zinc Eq. Silver Eq. Silver
    G/t % % Million Ozs Million Lbs Million Lbs Million Ozs G/t
Measured 10,878 17.5 0.38 0.33 6.1 91.1 79.1 13.9 39.6
Indicated 123,583 20.8 0.38 0.29 82.6 1,035.3 790.1 166.7 42.0
Measured + Indicated 134,461 20.5 0.38 0.29 88.7 1,126.4 869.2 180.6 41.8
Inferred 49,793 30.0 0.46 0.28 48.0 509.4 305.2 86.2 53.9

Note: See regulatory footnotes for calculation methods used for the reserve and resource and the silver equivalency calculation.

The FS incorporates an updated resource estimation and mine design performed in October 2011 by IMC based upon 93,577 meters of drilling and sampling in 544 diamond drill holes and trenches completed through May of 2009. The Company employs a Net Smelter Return (the “NSR”) method to determine ore and waste, with the cutoff NSR being $10.54 per tonne. Measured and indicated resources contained within the Feasibility Study design pit were used to determine final pit limits and thus converted into proven and probable reserves, respectively. The additional resource material is mostly measured and indicated resource that occurs outside of the Feasibility Study pit but which meets the CIM definition of mineral resource.

Comparing the reserve and resource presented in the 2009 Pre-Feasibility Study (the “PFS”) with the Feasibility Study, the silver reserve ounces have increased by 5%, the measured and indicated reserves have increased by 24% and the inferred resources have increased by 35%. While this is largely the result of higher metals prices, it is important to note that current drilling in the district is intersecting new mineralization indicating significant exploration upside that could potentially increase resources as well.

Metallurgical Testing - The Company has completed two phases of metallurgical optimization tests in order to define recoveries for the purposes of the FS reserve calculation. The results show that the Corani ore body can be divided into two types of ore; mixed sulfide and transitional ores. The mixed sulfide ore, which constitutes 84% of the mill feed, is a conventional polymetallic ore that uses standard processing methods and produces good quality concentrates. The remaining mill feed (16%) is transitional ore which is also treated using standard flotation but has reduced recovery of approximately 5% for silver and 15% for lead. The transitional ore also produces a lower grade concentrate; however, as it only constitutes 16% of the mill feed tonnes, the FS plan effectively blends the transitional ore to produce overall high quality concentrates.

Variance From PFS - The FS more accurately determines the recoveries into the zinc concentrate based upon final metallurgical test work. The recovery of zinc and silver varies with the feed grade of the ore, therefore reducing the recovered zinc and silver at lower zinc head grades (0.3% to 0.7% Zn) from those predicted in the PFS. Importantly, the lead portion of the recovery circuit and the recovery of silver in the lead circuit, where the best silver in concentrate commercial terms are obtained, is not affected by the reduced silver recoveries into the zinc concentrate. The Company believes that improved performance of the zinc circuit and continued improvement of silver recoveries into the lead concentrate at lower zinc feed grades represent opportunities during commercial operation.

Average Recoveries and Concentrate Grades of the Life of the Project

Average Recovery And Con Grades LOM
  Lead Con Zinc Con
  Pb Ag Zn Ag
Recovery 71.70% 60.30% 51.60% 3.90%
Average Concentrate Grades 56.60% 2.9 kg/t 53.00% 437 g/t


Mining will be performed using conventional open pit methods using 135 tonne trucks and a mixture of hydraulic excavators and wheel loaders mining on eight meter high benches. The mine requires minimal pre-production waste stripping of 16.2 million tonnes.

Processing of the ore will be by conventional flotation recovery methods. The ore will be crushed close to the mine and the material conveyed to the processing plant which will be approximately 500m from the mine. The ore will be ground to 80% passing 90 microns in a SAG/Ball mill circuit. The material will then be floated with the rougher concentrates being reground to 80% passing 30 microns prior to cleaning to produce high-value separate lead-silver and zinc concentrates. Concentrates will be trucked to the port of Maturani for ocean shipment to smelters.


The project capital cost estimate has been prepared by three independent engineering companies. The mining costs were prepared by Independent Mining Consultants of Tucson, Arizona, the process and portions of the infrastructure capital cost have been prepared by M3 Engineering of Tucson, Arizona and the Tailings Storage Facility (the “TSF”) and remaining infrastructure costs have been prepared by Global Resource Engineering (the “GRE”). The initial startup capital is estimated to be $574 million and the sustaining capital cost is estimated to be $7.2 million annually over the life of mine. The capital costs include detailed long-term plans for tailing dam expansions as well as ongoing capital (i.e. mine fleet replacement) and mine closure.


Mining costs were prepared on a year by year basis with costs varying mostly due to changing haulage distances. The life-of-mine average mining costs will be $1.42 per tonne of total waste and ore mined. The process costs are estimated to be $8.44 per tonne of processed ore and the G&A is estimated to be $1.40 per tonne of processed ore or $11 million per year.


The project has favorable infrastructure. Access will be via a new 63 km road to be built over flat topography resulting in low construction costs. The new road will connect to the Interoceanic Highway; a two-lane, paved highway connecting to the port of Matarani. The mine is 30 km from a new high-voltage power line with abundant capacity to meet the project needs. The project has an excellent low environmental impact site for tailings storage resulting in very low capital and operating costs, as the plant will be located immediately adjacent to the mine and the tailings will be pumped to the TSF. The site is also located in the upper part of drainages with ample surface water supply and as such there are several surface and underground water source alternatives. The FS provides for the construction of a small water storage dam and water capture in the TSF.


The Company has maintained very good working relationships with the local communities and has continued to operate exploration and development activities at Corani without interruption. The Company owns all the land in the area of the mine and plant and is currently negotiating the access rights for the ancillary facilities. The Company’s commitment to the local communities has been further solidified with the recent agreement to provide $1 million in aid over the next three years.

The project is designed to meet and, in many ways exceed, international standards of environmental compliance. The TSF has been designed by GRE to the highest standards of containment and stability. Importantly, the latest design technology will facilitate the permitting process. In the TSF, the Feasibility Study calls for the operation of a sulfide flotation plant that will capture and segregate the sulfide material in the central part of the TSF. This will result in the sulfide material never being exposed to the atmosphere during operations and following mine closure. This will result in a very large reduction in the potential for the TSF to produce acid rock drainage and facilitate the sustainable closure of the TSF; major positive factors for the permitting process.

Furthermore, the waste rock storage facilities are designed to capture and manage any flows that may originate from the waste rock. A buffer layer of inert rock will be placed on the outside of the waste rock piles to mitigate the acid producing potential of the facilities. Additionally, the plan calls for partial backfilling of the mining pits so that long-term pit lakes will not form at closure. Finally, the closure plan provides for the covering of the tailing storage and waste rock facilities assuring safe and environmentally compliant closure of the mine.


The FS defines significant resources (134 million tonnes of measured and indicated containing 88.7 million ounces averaging 20.5 g/t Ag and 49.8 million tonnes of inferred resources containing 48 million ounces of silver averaging 30.0 g/t Ag) that are not included in the current mine plan. Depending upon future silver prices, these resources may be converted into reserves and incorporated into the mine plan. Additionally, numerous opportunities exist to discover new mineralization by continuing district exploration. Recent engineering and condemnation drilling has intercepted mineralization up to five kilometers from the current ore body in previously unexplored areas (see news release dated October 11, 2011).

Call-in details for the conference call are:

Date: Thursday November 10th 2011
Time: 6 a.m. (Pacific) / 9 a.m. (Eastern)
Number: (647) 427-7450
Toll Free: (888) 231-8191

To access the webcast:

A replay of this conference call will be available from November 10th 2011 until November 24th 2011 and will be posted on Bear Creek’s website: The replay numbers are:

Number: 416-849-0833
Toll Free: 1-855-859-2056
Passcode: 26083304

The FS will be filed and available for viewing on SEDAR ( within 45 days following the date of this news release.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

- End -

Andrew Swarthout - CEO, or Patrick De Witt - Investor Relations
Phone: 604-685-6269 Direct: 604-628-1111

For further information, please visit the Company’s website (

Regulatory footnotes:

All of Bear Creek’s exploration programs and pertinent disclosure of a technical or scientific nature are prepared by or prepared under the direct supervision of Marc Leduc, P. Eng., President and COO and Andrew Swarthout, P.Geo., CEO, who serve as the Qualified Persons under the definitions of NI 43-101. The block model estimate, mine design and schedules were prepared by Independent Mining Consultants of Tucson Arizona. John Marek P.E. acted as the independent qualified person as defined by Canada’s National Instrument 43-101. Additionally the methods used in determining and reporting the mineral reserves and resources are consistent with the CIM Best Practices Guidelines. The method used in the resource calculation is equivalent to the method used in the resource calculation shown in our August 23, 2006 Press Release. For this resource estimate we have used metal prices based on a 3-year backward average and a 2-year forward price based on the metal markets in August 2011.

Assumptions used in the mineral reserve and FS model by IMC are: Silver Price=$18.00/oz; Zinc Price=$0.85/lb; Lead Price=$0.85/lb; Mixed Sulfide Material Silver Recovery is fixed at 62% to lead con and an additional14% to the zinc con when zinc head grade is greater than 0.7%, 10.4% Ag recovery when zinc head grade is from 0.7% to 0.5%, 6.3% recovery of silver to the zinc con when zinc head grade is from 0.5% to 0.3% and no silver recovery to the zinc con when zinc head grades are less than 0.3%. Zinc Recovery=67.5% to zinc con when the zinc head grade is greater than 0.7%, 50% Zn recovery when zinc head grade is from 0.7% to 0.5%, 30% recovery of zinc to the zinc con when zinc head grade is from 0.5% to 0.3% and no zinc recovery to the zinc con when zinc head grades are less than 0.3%. Lead Recovery=75% to lead con. For Transitional Material Silver Recovery= 38.5%+.2*Ag Grade (g/t) (Maximum 70% recovery) to lead con and 0% to the zinc con, Zinc Recovery= 0% to zinc con and Lead Recovery= 38%+10.9*Lead Grade (%) (Maximum 65% recovery) to lead con. Average smelter charges including Treatment Charges and Refining Charges (“TCRC”) and metal deducts against saleable metal: Silver= $1.52 per ounce; Zinc= $0.62 per pound; Lead= $0.41 per pound; Mining Costs per tonne= $1.34; Process cost per tonne= $8.00; G&A per processed tonne= $1.20; Pit Slopes= 42 degrees in mineralized tuff and 46 degrees in post-mineralized tuff. The resulting mineral reserve cutoff is $10.54/tonne ore NSR. The mineral reserves are contained within a practical mining plan that utilized the ‘floating-cone” method as an initial guide for design.

The mineral resource portion of the project is contained in a larger pit than the FS design pit, which was a floating cone using the following input assumptions: Silver Price=$30.00/oz; Zinc Price=$1.00/lb; Lead Price=$1.00/lb; Mixed oxide material that was given 0% recovery for the reserves was assumed to have an 85% recovery of silver, all other recoveries remained the same. The Mineral Resource cut-off was $9.20/tonne which represents the internal process cutoff. All metallurgical material types were included in the resource.

All diamond drilling has been performed using HQ diameter core with recoveries averaging greater than 95%. Core is logged and split on site under the supervision of Bear Creek geologists. Sampling is done on two-meter intervals and samples are transported by Company staff to Juliaca, Peru for direct shipping to ALS Chemex, Laboratories in Lima, Peru. ALS Chemex is an ISO 9001:2000-registered laboratory and is preparing for ISO 17025 certification. Silver, lead, and zinc assays utilize a multi-acid digestion with atomic absorption (“ore-grade assay method”). The QC/QA program includes the insertion every 20th sample of known standards prepared by SGS Laboratories, Lima. A section in Bear Creek’s website is dedicated to sampling, assay and quality control procedures.

The FS was prepared by a team of independent engineering consultants. The mining and block model portion was prepared by Independent Mining Consultants of Tucson Arizona, John Marek, PE acting as QP. The process plant design was prepared by M3 Engineering, Dan Neff, PE acting as QP. Metallurgy and Process design criteria developed by Blue Coast Metallurgy Ltd. Chris Martin, CEng acting as QP. And geotechnical, environmental, infrastructure, waste stockpile and tailings designs were prepared by Global Resource Engineering Ltd., Chris Chapman, PE acting as the QP. Each of these individuals has read and approves the respective scientific and technical disclosure contained in this news release. Silver Equivalency calculation represents the contained equivalent silver ounces contained in the ground and is based on the resource metal prices assumptions of $18.00/oz Ag, 0.85/lb Pb and 0.85/lb Zn and recoveries to concentrate of 64.2% for silver and 71.1% for lead and 51.6% for zinc. The calculation does not take into account the net smelter payment terms for the different metals in the two separate concentrates. The resulting equivalency is 1 oz Ag = 19.1 lb Pb and 1 oz Ag = 26.3 lb Zn.

This document contains “forward-looking information” within the meaning of Canadian securities legislation and “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995. This information and these statements, referred to herein as “forward-looking statements” are made as of the date of this news release or as of the date of the effective date of information described in this news release, as applicable. Forward-looking statements relate to future events or future performance and reflect current estimates, predictions, expectations or beliefs regarding future events and include, without limitation, statements with respect to: (i) the amount of mineral reserves and mineral resources; (ii) the amount of future production over any period; (iii) net present value and internal rates of return of the proposed mining operation; (iv) capital costs, including start-up, sustaining capital and reclamation/closure costs; (v) operating costs, including credits from the sale of silver, lead and zinc; (vi) strip ratios and and mining rates; (vii) expected grades and payable ounces and pounds of metals and minerals; (viii) expected processing recoveries; (ix) expected time frames; (x) prices of metals and minerals; and (xi) mine life. Any statements that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions or future events or performance (often, but not always, using words or phrases such as “expects”, “anticipates”, “plans”, “projects”, “estimates”, “envisages”, “assumes”, “intends”, “strategy”, “goals”, “objectives” or variations thereof or stating that certain actions, events or results “may”, “could”, “would”, “might” or “will” be taken, occur or be achieved, or the negative of any of these terms and similar expressions) are not statements of historical fact and may be forward-looking statements.

All forward-looking statements are based on the Company’s or its consultants’ current beliefs as well as various assumptions made by and information currently available to them. These assumptions include, without limitation: (i) the presence of and continuity of metals at the project at modeled grades; (ii) the capacities of various machinery and equipment; (iii) the availability of personnel, machinery and equipment at estimated prices; (iv) exchange rates; (v) metals and minerals sales prices; (vi) appropriate discount rates; (vii) tax rates and royalty rates applicable to the proposed mining operation; (viii) financing structure and costs; (ix) anticipated mining losses and dilution; (x) metals recovery rates, (xi) reasonable contingency requirements; and (xiii) receipt of regulatory approvals on acceptable terms. Although management considers these assumptions to be reasonable based on information currently available to it, they may prove to be incorrect. Many forward-looking statements are made assuming the correctness of other forward looking statements, such as statements of net present value and internal rate of return, which are based on most of the other forward-looking statements and assumptions herein. The cost information is also prepared using current values, but the time for incurring the costs will be in the future and it is assumed costs will remain stable over the relevant period.

By their very nature, forward-looking statements involve inherent risks and uncertainties, both general and specific, and risks exist that estimates, forecasts, projections and other forward-looking statements will not be achieved or that assumptions do not reflect future experience. We caution readers not to place undue reliance on these forward-looking statements as a number of important factors could cause the actual outcomes to differ materially from the beliefs, plans, objectives, expectations, anticipations, estimates assumptions and intentions expressed in such forward-looking statements. These risk factors may be generally stated as the risk that the assumptions and estimates expressed above do not occur, but specifically include, without limitation, risks relating to variations in the mineral content within the material identified as mineral reserves and mineral resources from that predicted; variations in rates of recovery and extraction; developments in world metals and minerals markets; risks relating to fluctuations in the Canadian dollar relative to other currencies; increases in the estimated capital and operating costs or unanticipated costs; difficulties attracting the necessary work force; increases in financing costs or adverse changes to the terms of available financing, if any; tax rates or royalties being greater than assumed; changes in development or mining plans due to changes in logistical, technical or other factors, changes in project parameters as plans continue to be refined; risks relating to receipt of regulatory approvals; the effects of competition in the markets in which the Company operates; operational and infrastructure risks; and the additional risks described in the Company’s Annual Information Form, annual financial statements and management’s discussion and analysis for the year ended December 31, 2010 and in the PFS filed on the SEDAR website in Canada (available at, as well as in the FS to be filed by the Company on the SEDAR website within 45 days following the date of this news release. The foregoing list of factors that may affect future results is not exhaustive.

When relying on our forward-looking statements, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. The Company does not undertake to update any forward-looking statement, whether written or oral, that may be made from time to time by the Company or on behalf of the Company, except as required by law.

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