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Osisko Releases Inferred Resource Update for the Hammond Reef Project / Global Inferred resource increases to 10.52 million ounces gold
Osisko Releases Inferred Resource Update for the Hammond Reef Project / Global Inferred resource increases to 10.52 million ounces gold

MONTREAL, QUEBEC -- 11/07/11 -- Osisko Mining Corporation (TSX: OSK)(FRANKFURT: EWX) is pleased to provide an updated inferred resource estimate for its 100%-owned Hammond Reef gold project, located near Atikokan, Ontario. New drilling by Osisko and Brett Resources from January 2010 to July 2011 (approximately 300,000 metres) has significantly increased the size of the deposit. This update reports both global and in-pit resources in the inferred category. Additional drilling subsequent to July 2011 is anticipated to allow for the upgrade of the entire in-pit deposit to Measured and Indicated category by Q1 2012.

Key points:

-- Global Inferred resource currently stands at 10.52 million ounces gold
(based on 0.30 g/t Au lower cut-off), an increase of 65% or 4.16 million
new ounces from the total resources previously released by Brett
Resources in 2009.

-- The in-pit inferred resource is now 6.86 million ounces at a diluted
grade of 0.63 grams per tonne gold, based on a Whittle-optimized pit
shell using a gold price of US$1200 per ounce, a corresponding lower
cut-off grade of 0.28 grams per tonne gold and a waste/ore strip ratio
of 1.25. This represents an increase of 25% or 1.36 million ounces gold
above the previous in-pit resource estimate released by Brett resources
in 2009.

-- At US$1800 per ounce gold, the in-pit inferred resource increases to
10.8 million ounces at an average grade of 0.50 grams per tonne gold.

-- At a conservative gold price of US$1000, the in-pit inferred resource is
5.32 million ounces at a diluted grade 0.71 grams per tonne gold, with a
low waste/ore strip ratio of 0.96, which is better than the industry

-- The A (Main) and Mitta Zones form a contiguous deposit, while the 41
Zone is separate. The system was modeled as two pits with a total strike
length of 2500 metres (sections 870E to 3370E). Exploration drilling
around the Mitta and A zones has been successful in extending the
deposit in the down-dip (southeast) direction, to a maximum distance
(along dip) of 850 metres.

-- Although the entire resource in this update is reported in the inferred
category, variography indicates that approximately 33 to 48 percent of
the global resource (depending on cut-off grade) could presently be
classified in the indicated category. Osisko will report upgraded
(Measured and Indicated) resource categories in Q1 2012, upon the
completion of a final 130,000 metres of planned definition drilling.

SGS Canada Inc. of Montreal, Quebec ("SGS") are the independent resource estimate consultants who have authorized the release of the following estimates. The global Inferred resource is 10.52 million ounces of gold at an average undiluted grade of 0.62 g/t Au, based on a lower cut-off grade of 0.30 g/t Au. The table below summarizes the SGS estimates using variable lower cut-off grades:

Hammond Reef Global Inferred Resource
Grade (g/t) Tonnes (M) Cut-off Oz (M)
0.41 998.6 0.10 13.24
0.53 701.2 0.20 11.88
0.62 530.6 0.30 10.52
0.67 454.8 0.35 9.73
0.72 384.9 0.40 8.88
0.77 323.4 0.45 8.04
0.83 272.5 0.50 7.27
0.94 193.6 0.60 5.88
1.06 139.4 0.70 4.75
1.17 103.2 0.80 3.88
1.28 77.8 0.90 3.19
1.38 59.0 1.00 2.62

G Mining Services Inc. of Montreal, in collaboration with SGS, also estimated an in-pit inferred resource within a single Whittle-optimized pit shell using a base case gold price of US$1200 per ounce and a dilution factor of 5%. The in-pit inferred resource for the Hammond Reef gold deposit is 6.86 million ounces of gold at an average diluted grade of 0.63 g/t Au, based on a derived lower cut-off grade of 0.28 g/t Au. Sensitivity of the diluted in-pit inferred resource (based on minimum cut-off grade) to gold price is as follows:
Strip Ratio
Gold Price (US$) Grade (g/t) Tonnes (M) (Waste/Ore) Oz (M)
$600 0.96 89.12 1.69 2.76
$700 0.87 126.03 1.29 3.54
$800 0.81 160.12 1.12 4.16
$900 0.75 199.75 1.01 4.81
$1000 0.71 234.40 0.96 5.32
$1100 0.67 263.24 0.91 5.70
$1200 0.63 336.58 1.25 6.86
$1300 0.60 413.13 1.43 7.96
$1400 0.57 469.68 1.47 8.66
$1500 0.55 536.12 1.58 9.51
$1600 0.53 579.81 1.55 9.95
$1700 0.52 630.77 1.63 10.54
$1800 0.51 658.23 1.62 10.79

The table below summarizes the undiluted in-pit estimates using variable lower cut-off grades:

Hammond Reef Undiluted Resource Estimates within
US$1200 Whittle pit shell
Inferred Resources
Grade Tonnes (M) Cut-off (g/t) Oz (M)
0.68 308.3 0.30 6.75
0.77 245.3 0.40 6.05
0.87 187.6 0.50 5.23
0.97 142.1 0.60 4.43
1.09 104.8 0.70 3.66
1.18 82.3 0.80 3.11
1.29 61.4 0.90 2.55
1.38 48.3 1.00 2.15

Sean Roosen, President and CEO of Osisko, commented: "We are very pleased with Osisko's first inferred resource estimate for the Hammond Reef Project, which has achieved a 65 percent increase, or an additional 4.16 ounces of gold in the global resource, with respect to the previous Brett Resources estimate. While there is no doubt that the resource has a lower overall grade than Canadian Malartic, an important point to note is that the new in-pit resource for Hammond Reef has a low strip ratio of 1.25 and is quite robust, as it is based on current processing and mining costs at Canadian Malartic, adjusted for higher electrical costs in Ontario."

"Osisko completed 300,000 metres of diamond drilling in just over a year to get to today's inferred resource numbers, a huge achievement in such a short period of time. By February 2012 we will have completed an additional 130,000 metres of drilling on a 50 x 25 metre grid to allow for the conversion of the entire in-pit resource to Indicated category. To convert approximately one-third of the resource to Measured category, we also plan to drill an additional 70,000 metres on a 25 x 25 metre grid. The next resource update, slated for the end of Q1 2012, will be followed by feasibility for Hammond Reef".

Details on the parameters of the resource estimates are as follows:

-- The database comprised a total of 365,115 metres of drilling completed
and assayed by Brett Resources and Osisko as of the end of July 2011 on
a minimum 50 m x 25 metre grid. (All NQ core assays reported by Osisko
were obtained by standard 50 g fire assaying-AA finish or gravimetric
finish at ALS Chemex laboratories.)

-- The database also comprised a total of 222,947 assays with an average of
1.49 metre per sample for a total of 332,250 assayed metres.

-- The estimates were done using Ordinary Kriging (OK) interpolation as the
geostatistical method based on 5.0 metre analytical composites.

-- All estimates are based on a block dimension of 10 metres E, 10 metres N
and 10 metres height with estimation parameters determined by

-- Geological interpretation identified a Main domain and several smaller
domains (that surround the Main domain. The Main domain is a tabular
zone that dips to the southeast and includes the A, Mitta and 41 zones
on surface. The RAB zone was recognized as a separate domain that was
ignored for the purposes of the in-pit resource estimate.

-- Calculations are based on original samples capped to a maximum of 15 g/t
Au for the Main domain. Capping was not necessary for the smaller
domains. This resulted in an approximate 1.5 percent reduction in the
overall gold content. All 5-metre composites are calculated based on cut
original data.

-- Tonnage estimates are based on a rock density of 2.75 tonnes/cubic metre
for the altered tonalite host rock.

-- The global resource estimates using the lower cut-off of 0.30 g/t Au is
emphasized for reporting purposes as this is very close to the in-pit
cut-off of 0.28 g/t Au estimated for the US$1200 Whittle shell.

-- The US$1200 Whittle shell has approximate maximum dimensions of 2,500
metres in length, 1,050 metres in width and a vertical depth of 380

-- The average gold recovery for this pit shell is 91.0%. Overall slope
angles based on feasibility level geotechnical studies (including
provisions for ramps) are between 41.3 and 50.3 degrees. Total ore-based
cost is US $9.13 with reference mining cost of US $1.61 per tonne mined
plus incremental depth costs of US$0.0338 per 10m bench. Strip ratio is
1.25 for the in-pit resource corresponding to a lower cut-off of 0.28
g/t Au.

Osisko Mining Corporation is currently running the Canadian Malartic gold mine in Quebec as a large-scale open pit, bulk-tonnage operation. The Canadian Malartic mine is slated to be one of the largest single gold producers in Canada when full capacity is achieved in 2012. The Company is well-funded and is carrying out aggressive exploration and project development elsewhere in Canada and Latin America.

Mr. Michel Dagbert, P. Eng. of SGS Canada Inc. (global resource estimate) and Mr. Louis-Pierre Gignac, P. Eng. of G Mining Services Inc. (Whittle-optimized in-pit resource estimate) are the Qualified Persons responsible for the technical information reported herein, including verification of the data disclosed. Mr. Robert Wares, P. Geo. and Executive Vice-President of Osisko, has also reviewed and approved the technical contents of this news release.

Cautionary Notes Concerning Estimates of Mineral Resources

This news release uses the terms measured, indicated and inferred resources as a relative measure of the level of confidence in the resource estimate. Readers are cautioned that mineral resources are not economic mineral reserves and that the economic viability of resources that are not mineral reserves has not been demonstrated. In addition, inferred resources are considered too geologically speculative to have any economic considerations applied to them. It cannot be assumed that all or any part of an inferred mineral resource will ever be upgraded to a higher category. Under Canadian rules, estimates of inferred mineral resources may not form the basis of feasibility or pre-feasibility studies or economic studies except for Preliminary Assessment as defined under NI 43-101. Readers are cautioned not to assume that further work on the stated resources will lead to mineral reserves that can be mined economically.

Forward-Looking Statements

Certain statements contained in this press release may be deemed "forward-looking statements". All statements in this release, other than statements of historical fact, that address events or developments that Osisko expects to occur, are forward looking statements. Forward looking statements are statements that are not historical facts and are generally, but not always, identified by the words "expects", "plans", "anticipates", "believes", "intends", "estimates", "projects", "potential", "scheduled" and similar expressions, or that events or conditions "will", "would", "may", "could" or "should" occur including, without limitation, further development of its Hammond Reef project and increasing of throughput at the mill to achieve design capacity at its Canadian Malartic Mine. Although Osisko believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, including, without limitation, that all technical, economical and financial conditions will be met in order to warrant further development of its Hammond Reef project and that the diligent ongoing optimizing of its operations at Canadian Malartic mine will be achieved and will, accordingly, improve its operating performance, such statements are not guarantees of future performance and actual results may differ materially from those in forward looking statements. Factors that could cause the actual results to differ materially from those in forward-looking statements include gold prices, access to skilled consultants, mining development personnel, results of exploration and development activities, Osisko's limited experience with production and development stage mining operations, uninsured risks, regulatory changes, defects in title, availability of personnel, materials and equipment, timeliness of government approvals, actual performance of facilities, equipment and processes relative to specifications and expectations, unanticipated environmental impacts on operations market prices, continued availability of capital and financing and general economic, market or business conditions. These factors are discussed in greater detail in Osisko's most recent Annual Information Form and in the most recent Management Discussion and Analysis filed on SEDAR, which also provide additional general assumptions in connection with these statements. Osisko cautions that the foregoing list of important factors is not exhaustive. Investors and others who base themselves on forward-looking statements should carefully consider the above factors as well as the uncertainties they represent and the risk they entail. Osisko believes that the expectations reflected in those forward-looking statements are reasonable, but no assurance can be given that these expectations will prove to be correct and such forward-looking statements included in this press release should not be unduly relied upon. These statements speak only as of the date of this press release.

John Burzynski
Vice-President Corporate Development
(416) 363-8653

Sylvie Prud'homme
Director of Investor Relations
(514) 735-7131
Toll Free: 1-888-674-7563

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