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14.12.2009
Osisko Releases New Resource Estimate for Canadian Malartic Project
Osisko Releases New Resource Estimate for Canadian Malartic Project
Global M&I resource increased by 1.28 million ounces gold
MONTREAL, QUEBEC, Dec 14, 2009 -- Osisko Mining Corporation (TSX: OSK)(FRANKFURT: EWX) is pleased to provide an updated resource estimate for its 100%-owned Canadian Malartic project. This new estimate includes the combined, previously-reported resources of the Canadian Malartic deposit and the South Barnat deposit, as well as additional resources defined from ongoing drilling within the previously estimated pit shells and immediately southeast of the pit shells.
Key points:
- Global Measured and Indicated ("M&I") resource is now 11.20 million ounces gold, up 1.28 million ounces from the total of previously released resources. Additional 470,000 ounces remains in the inferred category.
- Total in-pit M&I resource is now 9.17 million ounces at a grade of 1.20 grams per tonne gold, based on a Whittle-optimized pit shell using a gold price of US$825 per ounce and a corresponding lower cut-off grade of 0.34 grams per tonne gold. This represents an increase of 770,000 ounces gold over the total of previous in-pit M&I resource estimates released by Osisko.
- At a US$1100 per ounce gold price, the in-pit M&I resource increases to 10.37 million ounces at an average grade of 1.05 grams per tonne gold, adding more than one million ounces compared to the US$825 pit shell.
- At a conservative lower cut-off of 1 gram per tonne, the in-pit M&I resource is a robust 6.72 million ounces at a grade of 1.85 grams per tonne gold.
- The infill drilling between the Canadian Malartic and South Barnat deposits has been successful in joining the two deposits, allowing for a single pit design to evaluate both deposits. The mineralized system is still open at depth.
- Economic valuation within an optimized engineered pit design will be provided in an updated reserve statement for the entire project by the end of January 2010, which will include revised mining scheduling and stockpiling aimed at maximizing head grade in the early years of production.
- The current mine schedule, as indicated in the previously released Feasibility Study, only includes 6.28 million ounces of reserves at a grade of 1.07 grams per tonne gold.
Belzile Solutions Inc. of Rouyn-Noranda, Quebec ("BSI") are the independent resource estimate consultants for Osisko, and have authorized the release of the following estimates. The global Measured and Indicated ("M&I") resource is 11.20 million ounces of gold at an average undiluted grade of 1.10 g/t Au, with an additional 0.47 million ounces gold at an average grade of 0.73 g/t Au in the Inferred category, based on a lower cut-off grade of 0.34 g/t Au. The tables below summarize the BSI estimates using variable lower cut-off grades:
Canadian Malartic Project global resource estimates
Measured Indicated Total M&I
-------------------------------------------------------------------------
Grade Tonnes Oz Grade Tonnes Oz Cut-off Grade Tonnes Oz
(g/t) (M) (M) (g/t) (M) (M) (g/t) (g/t) (M) (M)
-------------------------------------------------------------------------
-------------------------------------------------------------------------
0.93 33.5 1.00 1.12 282.7 10.20 0.34 1.10 316.2 11.20
-------------------------------------------------------------------------
1.09 25.5 0.89 1.33 219.2 9.35 0.50 1.30 244.7 10.25
-------------------------------------------------------------------------
1.21 21.0 0.81 1.45 189.4 8.83 0.60 1.43 210.4 9.64
-------------------------------------------------------------------------
1.33 17.1 0.73 1.56 166.3 8.35 0.70 1.54 183.4 9.08
-------------------------------------------------------------------------
1.46 14.1 0.66 1.66 148.5 7.92 0.80 1.64 162.6 8.58
-------------------------------------------------------------------------
1.58 11.8 0.60 1.75 133.4 7.50 0.90 1.74 145.1 8.10
-------------------------------------------------------------------------
1.70 9.9 0.54 1.84 120.5 7.11 1.00 1.83 130.3 7.65
---------------------------------------------------
Inferred
---------------------------------------------------
---------------------------------------------------
Grade (g/t) Tonnes (M) Oz (M) Cut-off (g/t)
---------------------------------------------------
---------------------------------------------------
0.73 20.0 0.47 0.34
---------------------------------------------------
0.97 11.5 0.36 0.50
---------------------------------------------------
1.12 8.5 0.31 0.60
---------------------------------------------------
1.30 6.2 0.26 0.70
---------------------------------------------------
1.46 4.8 0.22 0.80
---------------------------------------------------
1.63 3.8 0.20 0.90
---------------------------------------------------
1.79 3.1 0.18 1.00
---------------------------------------------------
---------------------------------------------------
BSI, in collaboration with G Mining Services Inc. of Montreal, also estimated an in-pit M&I resource within a single Whittle-optimized pit shell using a base case gold price of US$825 per ounce. The combined in-pit M&I resource for the Canadian Malartic and South Barnat deposits is 9.17 million ounces of gold at an average undiluted grade of 1.20 g/t Au, with an additional 0.11 million ounces gold at an average grade of 0.90 g/t Au in the inferred category, based on a derived lower cut-off grade of 0.34 g/t Au. The tables below summarize the in-pit estimates using variable lower cut-off grades:
Canadian Malartic Project resource estimates within US$825 Whittle pit shell
Measured Indicated Total M&I
-------------------------------------------------------------------------
Grade Tonnes Oz Grade Tonnes Oz Cut-off Grade Tonnes Oz
(g/t) (M) (M) (g/t) (M) (M) (g/t) (g/t) (M) (M)
-------------------------------------------------------------------------
-------------------------------------------------------------------------
0.97 27.5 0.86 1.23 210.6 8.31 0.34 1.20 238.1 9.17
-------------------------------------------------------------------------
1.13 21.4 0.78 1.40 174.2 7.82 0.50 1.37 195.6 8.60
-------------------------------------------------------------------------
1.25 17.6 0.71 1.51 154.3 7.47 0.60 1.48 172.0 8.18
-------------------------------------------------------------------------
1.38 14.5 0.65 1.61 138.0 7.13 0.70 1.59 152.6 7.78
-------------------------------------------------------------------------
1.50 12.2 0.59 1.70 125.3 6.83 0.80 1.68 137.5 7.42
-------------------------------------------------------------------------
1.62 10.3 0.54 1.78 114.1 6.52 0.90 1.77 124.5 7.06
-------------------------------------------------------------------------
1.75 8.7 0.49 1.86 104.4 6.23 1.00 1.85 113.1 6.72
-------------------------------------------------------------------------
Inferred
---------------------------------------------------------
---------------------------------------------------------
Grade (g/t) Tonnes (M) Oz (M) Cut-off (g/t)
---------------------------------------------------------
0.90 3.8 0.11 0.34
---------------------------------------------------------
1.05 2.9 0.10 0.50
---------------------------------------------------------
1.18 2.3 0.09 0.60
---------------------------------------------------------
1.31 1.8 0.08 0.70
---------------------------------------------------------
1.42 1.6 0.07 0.80
---------------------------------------------------------
1.55 1.3 0.06 0.90
---------------------------------------------------------
1.67 1.1 0.06 1.00
---------------------------------------------------------
Sensitivity of the in-pit M&I resource to gold price is as follows
(inferred excluded):
------------------------------------------------------------------------
Gold Price (US$) Grade Tonnes Oz Strip Ratio
(g/t) (M) (M) (Waste/Ore)
------------------------------------------------------------------------
$700 1.31 195.8 8.25 2.01
------------------------------------------------------------------------
$825 1.20 238.1 9.17 1.91
------------------------------------------------------------------------
$900 1.15 255.8 9.48 1.84
------------------------------------------------------------------------
$1000 1.09 287.8 10.07 1.81
------------------------------------------------------------------------
$1100 1.05 308.0 10.37 1.76
------------------------------------------------------------------------
Using an ore-based cost of US$6.38 per tonne (as estimated from costs in the Canadian Malartic Feasibility Study), the corresponding in-pit cut-off grade for the base case US$825/oz Whittle shell is 0.34 g/t gold, giving the resource distribution shown in the following table:
Distribution of Canadian Malartic Project resource estimates using base case US$825 Whittle pit shell with a 0.34 g/t Au lower cut-off grade
-------------------------------------------------------------------------
Total M&I Inferred
-------------------------------------------------------------------------
Grade
(g/t) Tonnes (M) Oz (M) Grade (g/t) Tonnes (M) Oz (M)
-------------------------------------------------------------------------
Global 1.10 316.2 11.20 0.73 20.0 0.47
-------------------------------------------------------------------------
(In-Pit CM) 1.08 198.9 6.88 0 77 2.9 0.07
-------------------------------------------------------------------------
(In-Pit
Barnat) 1.82 39.3 2.30 1.36 0.9 0.04
-------------------------------------------------------------------------
In-Pit
Total 1.20 238.1 9.17 0.90 3.8 0.11
-------------------------------------------------------------------------
Out-of-Pit 0.81 78.1 2.03 0.69 16.2 0.36
-------------------------------------------------------------------------
Sean Roosen, President and CEO of Osisko, commented: "We are very pleased with the new pit-constrained M&I resource estimate for the Canadian Malartic Project, which has achieved an increase of 770,000 ounces of gold with respect to the total of previous estimates, while maintaining a relatively low strip ratio of 1.91. The new in-pit M&I resource estimate of 9.17 million ounces is very reliable since it is based on processing and mining costs that were used in the Feasibility Study."
"We anticipate that over 95% of this resource is going to be converted into reserves for the entire project, once a new reserve estimate is calculated in January 2010. We anticipate that the new engineered pit will provide a significant increase in mine life and allow for mining sequencing and stockpiling aimed at increasing head grade and overall gold production in the early years in order to accelerate pay back of capital.
Finally, it is worth noting that even at a cut-off of 1 g/t Au, we are now looking at a total in-pit M&I resource of 6.72 million ounces gold at an average grade of 1.85 g/t Au, which makes this resource very robust at significantly lower gold prices. This means that 73 percent of the overall 9.17 million ounce in-pit resource should have an average grade 1.85 g/t Au. In the business of open pit gold mining, this is a relatively high grade disseminated deposit with a surrounding low grade halo. It lowers commodity-driven business risk significantly by allowing for mining flexibility."
Details on the parameters of the resource estimates are as follows:
- The database comprised a total of 228,500 metres of drilling obtained from historical drilling (Canadian Malartic Mines and Lac Minerals) and from approximately 561,200 metres of drilling completed and assayed by Osisko as of the end of September 2009 on a maximum 30 m x 30 metre grid. (All NQ or HQ core assays reported by Osisko were obtained by standard 50 g fire assaying-AA finish or gravimetric finish at ALS Chemex laboratories in Val d'Or, Quebec.)
- The database also comprised a total of 525,105 assays with an average of 1.38 metre per sample for a total of 726,500 assayed metres.
- The estimates were done using Ordinary Kriging (OK) as the geostatistical interpolation method based on 5.0 metre analytical composites. Resources were also estimated using Inverse Distance Squared (ID2) interpolation, which produced similar results, i.e. less than 2 percent difference in total ounces at all cut-offs.
- Calculations are based on original samples cut to a maximum of 10 g/t to 70 g/t Au depending on the domain. This resulted in an approximate 1.7 percent reduction in the overall gold content. All 5m composites are calculated based on cut original data.
- Testing and validation of cut historical Canadian Malartic (CM) drill data using modern (Osisko) drill data revealed negligible bias in the higher grade domains but significant bias (minimum 25%) in the lower grade domains. CM historical data in lower grade domains were therefore discarded for resource estimate and resource classification purposes. CM historical data were used for resource estimate purposes in the higher grade domains but not retained for measured resource classification. Lac Minerals drill core was mostly re-assayed and these data were retained for resource estimate and resource classification purposes.
- All estimates are based on a Parent Cell dimension of 20 metres E, 10 metres N and 10 metres height with estimation parameters determined by variography.
- Geological interpretation identified fourteen high grade domains (higher than 1.0 g/t Au), six low grade domains (between 0.4 and 1.0 g/t Au) and a broad lower grade envelope (greater than 0.2 g/t Au).
- Underground voids were modeled from historical mine plans and adjusted according to positions of drill intersections in stopes and drifts. Void volumes of stopes were increased by one metre along all edges to compensate for uncertainties. The void models were then used to deplete the resource estimate. All samples located within the voids were then removed from the estimate.
- Tonnage estimates are based on rock densities of 2.69 tonnes/cubic metre for the porphyry, 2.75 for altered sediments and 2.90 for altered ultramafic rocks.
- The resource estimates using the lower cut-off of 0.34 g/t Au is emphasized for reporting purposes as this is the in-pit cut-off estimated for the US$825 Whittle shell.
- The US$825 Whittle shell has approximate maximum dimensions of 2,980 metres in length, 1,180 metres in width and a vertical depth of 380 metres.
- The average gold recovery in this pit shell is 86.2%. Overall slope angles based on feasibility level geotechnical studies (including provisions for ramps) are between 43 and 55 degrees. Strip ratio is 1.91 for the in-pit resource corresponding to a lower cut-off of 0.34 g/t Au.
Economic valuation within an optimized engineered pit design will be provided in an updated reserve statement for the entire project by the end of January 2010, which will optimize the combined Canadian Malartic and South Barnat pits. Should Osisko successfully prove up economic reserves at South Barnat, additional steps will be taken to obtain the necessary authorizations to mine the South Barnat deposit and integrate it to the Canadian Malartic project. Additional studies are currently under way to evaluate the deviation of highway 117 that will be required for potential mining of the South Barnat deposit. This study will be carried out in cooperation with the Quebec Ministry of Transport and the town of Malartic. The goal of the study will be to minimize the portion of the highway to be relocated as well as the social impact to the community.
The project out-of-pit M&I resource is currently estimated at 2.03 million ounces gold, and further pit optimizations using modified variables, such as increased pit slopes or gold price, may allow for eventual inclusion of some of this resource within the pit. Additional drilling is required to upgrade the remaining inferred resources.
About Osisko
Osisko Mining Corporation is currently developing the Canadian Malartic gold project into a large-scale open pit, bulk-tonnage mining operation. The Company is well-funded with $825 million in cash resources and is carrying out an aggressive mine development, reserve definition and exploration campaign. The Canadian Malartic deposit currently represents one the biggest gold reserves in Canada for a single deposit, and is still growing through ongoing drilling on new mineralized zones.
A NI 43-101 compliant, 7.7 million ounce gold M&I global resource estimate (6.4 million ounce gold M&I in-pit resource) on the main Canadian Malartic gold deposit was released on September 8, 2008 and has been filed on SEDAR. A NI 43-101 compliant, 6.3 million ounce gold Reserve estimate and Feasibility Study on the main Canadian Malartic gold deposit was released on November 25, 2008 and has been filed on SEDAR. A NI 43-101 compliant, 2.2 million ounce gold M&I global resource estimate (2.0 million ounces gold M&I in-pit resource) on the South Barnat gold deposit was released on June 2, 2009 and has been filed on SEDAR.
Mr. Elzear Belzile, P. Eng. of BSI, Mr. Louis-Pierre Gignac, P. Eng. of G Mining Services Inc. and Mr. Robert Wares, P. Geo. and Executive Vice-President of Osisko, are the Qualified Persons who have reviewed this news release and are responsible for the technical information reported herein, including verification of the data disclosed.
Conference Call
Osisko will host a conference call on Monday, December 14 at 11:30 AM Montreal time, where senior management will discuss the press release and will be available to respond to questions from analysts and investors. Those interested in participating in the conference call should dial in at 416-981-9000 (Toronto local and international), or 1-800-909-4145 (North American toll free). An operator will direct participants to the call.
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 that further work 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 the Corporation 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. Although the Corporation 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 put the Canadian Malartic Project into commercial production, 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 and mill production personnel, results of exploration and development activities, the Corporation'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 the Corporation's most recent Annual Information Form filed on SEDAR, which also provides additional general assumptions in connection with these statements. The Corporation cautions that the foregoing list of important factors is not exhaustive. Investors and others who base themselves on the Corporation's forward-looking statements should carefully consider the above factors as well as the uncertainties they represent and the risk they entail. The Corporation 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.
Contacts:
Osisko Mining Corporation
John Burzynski
Vice-President Corporate Development
514-735-7131
www.osisko.com
Sylvie Prud'homme
Investor Relations
514-735-7131
Toll Free: 1-888-674-7563
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Global M&I resource increased by 1.28 million ounces gold
MONTREAL, QUEBEC, Dec 14, 2009 -- Osisko Mining Corporation (TSX: OSK)(FRANKFURT: EWX) is pleased to provide an updated resource estimate for its 100%-owned Canadian Malartic project. This new estimate includes the combined, previously-reported resources of the Canadian Malartic deposit and the South Barnat deposit, as well as additional resources defined from ongoing drilling within the previously estimated pit shells and immediately southeast of the pit shells.
Key points:
- Global Measured and Indicated ("M&I") resource is now 11.20 million ounces gold, up 1.28 million ounces from the total of previously released resources. Additional 470,000 ounces remains in the inferred category.
- Total in-pit M&I resource is now 9.17 million ounces at a grade of 1.20 grams per tonne gold, based on a Whittle-optimized pit shell using a gold price of US$825 per ounce and a corresponding lower cut-off grade of 0.34 grams per tonne gold. This represents an increase of 770,000 ounces gold over the total of previous in-pit M&I resource estimates released by Osisko.
- At a US$1100 per ounce gold price, the in-pit M&I resource increases to 10.37 million ounces at an average grade of 1.05 grams per tonne gold, adding more than one million ounces compared to the US$825 pit shell.
- At a conservative lower cut-off of 1 gram per tonne, the in-pit M&I resource is a robust 6.72 million ounces at a grade of 1.85 grams per tonne gold.
- The infill drilling between the Canadian Malartic and South Barnat deposits has been successful in joining the two deposits, allowing for a single pit design to evaluate both deposits. The mineralized system is still open at depth.
- Economic valuation within an optimized engineered pit design will be provided in an updated reserve statement for the entire project by the end of January 2010, which will include revised mining scheduling and stockpiling aimed at maximizing head grade in the early years of production.
- The current mine schedule, as indicated in the previously released Feasibility Study, only includes 6.28 million ounces of reserves at a grade of 1.07 grams per tonne gold.
Belzile Solutions Inc. of Rouyn-Noranda, Quebec ("BSI") are the independent resource estimate consultants for Osisko, and have authorized the release of the following estimates. The global Measured and Indicated ("M&I") resource is 11.20 million ounces of gold at an average undiluted grade of 1.10 g/t Au, with an additional 0.47 million ounces gold at an average grade of 0.73 g/t Au in the Inferred category, based on a lower cut-off grade of 0.34 g/t Au. The tables below summarize the BSI estimates using variable lower cut-off grades:
Canadian Malartic Project global resource estimates
Measured Indicated Total M&I
-------------------------------------------------------------------------
Grade Tonnes Oz Grade Tonnes Oz Cut-off Grade Tonnes Oz
(g/t) (M) (M) (g/t) (M) (M) (g/t) (g/t) (M) (M)
-------------------------------------------------------------------------
-------------------------------------------------------------------------
0.93 33.5 1.00 1.12 282.7 10.20 0.34 1.10 316.2 11.20
-------------------------------------------------------------------------
1.09 25.5 0.89 1.33 219.2 9.35 0.50 1.30 244.7 10.25
-------------------------------------------------------------------------
1.21 21.0 0.81 1.45 189.4 8.83 0.60 1.43 210.4 9.64
-------------------------------------------------------------------------
1.33 17.1 0.73 1.56 166.3 8.35 0.70 1.54 183.4 9.08
-------------------------------------------------------------------------
1.46 14.1 0.66 1.66 148.5 7.92 0.80 1.64 162.6 8.58
-------------------------------------------------------------------------
1.58 11.8 0.60 1.75 133.4 7.50 0.90 1.74 145.1 8.10
-------------------------------------------------------------------------
1.70 9.9 0.54 1.84 120.5 7.11 1.00 1.83 130.3 7.65
---------------------------------------------------
Inferred
---------------------------------------------------
---------------------------------------------------
Grade (g/t) Tonnes (M) Oz (M) Cut-off (g/t)
---------------------------------------------------
---------------------------------------------------
0.73 20.0 0.47 0.34
---------------------------------------------------
0.97 11.5 0.36 0.50
---------------------------------------------------
1.12 8.5 0.31 0.60
---------------------------------------------------
1.30 6.2 0.26 0.70
---------------------------------------------------
1.46 4.8 0.22 0.80
---------------------------------------------------
1.63 3.8 0.20 0.90
---------------------------------------------------
1.79 3.1 0.18 1.00
---------------------------------------------------
---------------------------------------------------
BSI, in collaboration with G Mining Services Inc. of Montreal, also estimated an in-pit M&I resource within a single Whittle-optimized pit shell using a base case gold price of US$825 per ounce. The combined in-pit M&I resource for the Canadian Malartic and South Barnat deposits is 9.17 million ounces of gold at an average undiluted grade of 1.20 g/t Au, with an additional 0.11 million ounces gold at an average grade of 0.90 g/t Au in the inferred category, based on a derived lower cut-off grade of 0.34 g/t Au. The tables below summarize the in-pit estimates using variable lower cut-off grades:
Canadian Malartic Project resource estimates within US$825 Whittle pit shell
Measured Indicated Total M&I
-------------------------------------------------------------------------
Grade Tonnes Oz Grade Tonnes Oz Cut-off Grade Tonnes Oz
(g/t) (M) (M) (g/t) (M) (M) (g/t) (g/t) (M) (M)
-------------------------------------------------------------------------
-------------------------------------------------------------------------
0.97 27.5 0.86 1.23 210.6 8.31 0.34 1.20 238.1 9.17
-------------------------------------------------------------------------
1.13 21.4 0.78 1.40 174.2 7.82 0.50 1.37 195.6 8.60
-------------------------------------------------------------------------
1.25 17.6 0.71 1.51 154.3 7.47 0.60 1.48 172.0 8.18
-------------------------------------------------------------------------
1.38 14.5 0.65 1.61 138.0 7.13 0.70 1.59 152.6 7.78
-------------------------------------------------------------------------
1.50 12.2 0.59 1.70 125.3 6.83 0.80 1.68 137.5 7.42
-------------------------------------------------------------------------
1.62 10.3 0.54 1.78 114.1 6.52 0.90 1.77 124.5 7.06
-------------------------------------------------------------------------
1.75 8.7 0.49 1.86 104.4 6.23 1.00 1.85 113.1 6.72
-------------------------------------------------------------------------
Inferred
---------------------------------------------------------
---------------------------------------------------------
Grade (g/t) Tonnes (M) Oz (M) Cut-off (g/t)
---------------------------------------------------------
0.90 3.8 0.11 0.34
---------------------------------------------------------
1.05 2.9 0.10 0.50
---------------------------------------------------------
1.18 2.3 0.09 0.60
---------------------------------------------------------
1.31 1.8 0.08 0.70
---------------------------------------------------------
1.42 1.6 0.07 0.80
---------------------------------------------------------
1.55 1.3 0.06 0.90
---------------------------------------------------------
1.67 1.1 0.06 1.00
---------------------------------------------------------
Sensitivity of the in-pit M&I resource to gold price is as follows
(inferred excluded):
------------------------------------------------------------------------
Gold Price (US$) Grade Tonnes Oz Strip Ratio
(g/t) (M) (M) (Waste/Ore)
------------------------------------------------------------------------
$700 1.31 195.8 8.25 2.01
------------------------------------------------------------------------
$825 1.20 238.1 9.17 1.91
------------------------------------------------------------------------
$900 1.15 255.8 9.48 1.84
------------------------------------------------------------------------
$1000 1.09 287.8 10.07 1.81
------------------------------------------------------------------------
$1100 1.05 308.0 10.37 1.76
------------------------------------------------------------------------
Using an ore-based cost of US$6.38 per tonne (as estimated from costs in the Canadian Malartic Feasibility Study), the corresponding in-pit cut-off grade for the base case US$825/oz Whittle shell is 0.34 g/t gold, giving the resource distribution shown in the following table:
Distribution of Canadian Malartic Project resource estimates using base case US$825 Whittle pit shell with a 0.34 g/t Au lower cut-off grade
-------------------------------------------------------------------------
Total M&I Inferred
-------------------------------------------------------------------------
Grade
(g/t) Tonnes (M) Oz (M) Grade (g/t) Tonnes (M) Oz (M)
-------------------------------------------------------------------------
Global 1.10 316.2 11.20 0.73 20.0 0.47
-------------------------------------------------------------------------
(In-Pit CM) 1.08 198.9 6.88 0 77 2.9 0.07
-------------------------------------------------------------------------
(In-Pit
Barnat) 1.82 39.3 2.30 1.36 0.9 0.04
-------------------------------------------------------------------------
In-Pit
Total 1.20 238.1 9.17 0.90 3.8 0.11
-------------------------------------------------------------------------
Out-of-Pit 0.81 78.1 2.03 0.69 16.2 0.36
-------------------------------------------------------------------------
Sean Roosen, President and CEO of Osisko, commented: "We are very pleased with the new pit-constrained M&I resource estimate for the Canadian Malartic Project, which has achieved an increase of 770,000 ounces of gold with respect to the total of previous estimates, while maintaining a relatively low strip ratio of 1.91. The new in-pit M&I resource estimate of 9.17 million ounces is very reliable since it is based on processing and mining costs that were used in the Feasibility Study."
"We anticipate that over 95% of this resource is going to be converted into reserves for the entire project, once a new reserve estimate is calculated in January 2010. We anticipate that the new engineered pit will provide a significant increase in mine life and allow for mining sequencing and stockpiling aimed at increasing head grade and overall gold production in the early years in order to accelerate pay back of capital.
Finally, it is worth noting that even at a cut-off of 1 g/t Au, we are now looking at a total in-pit M&I resource of 6.72 million ounces gold at an average grade of 1.85 g/t Au, which makes this resource very robust at significantly lower gold prices. This means that 73 percent of the overall 9.17 million ounce in-pit resource should have an average grade 1.85 g/t Au. In the business of open pit gold mining, this is a relatively high grade disseminated deposit with a surrounding low grade halo. It lowers commodity-driven business risk significantly by allowing for mining flexibility."
Details on the parameters of the resource estimates are as follows:
- The database comprised a total of 228,500 metres of drilling obtained from historical drilling (Canadian Malartic Mines and Lac Minerals) and from approximately 561,200 metres of drilling completed and assayed by Osisko as of the end of September 2009 on a maximum 30 m x 30 metre grid. (All NQ or HQ core assays reported by Osisko were obtained by standard 50 g fire assaying-AA finish or gravimetric finish at ALS Chemex laboratories in Val d'Or, Quebec.)
- The database also comprised a total of 525,105 assays with an average of 1.38 metre per sample for a total of 726,500 assayed metres.
- The estimates were done using Ordinary Kriging (OK) as the geostatistical interpolation method based on 5.0 metre analytical composites. Resources were also estimated using Inverse Distance Squared (ID2) interpolation, which produced similar results, i.e. less than 2 percent difference in total ounces at all cut-offs.
- Calculations are based on original samples cut to a maximum of 10 g/t to 70 g/t Au depending on the domain. This resulted in an approximate 1.7 percent reduction in the overall gold content. All 5m composites are calculated based on cut original data.
- Testing and validation of cut historical Canadian Malartic (CM) drill data using modern (Osisko) drill data revealed negligible bias in the higher grade domains but significant bias (minimum 25%) in the lower grade domains. CM historical data in lower grade domains were therefore discarded for resource estimate and resource classification purposes. CM historical data were used for resource estimate purposes in the higher grade domains but not retained for measured resource classification. Lac Minerals drill core was mostly re-assayed and these data were retained for resource estimate and resource classification purposes.
- All estimates are based on a Parent Cell dimension of 20 metres E, 10 metres N and 10 metres height with estimation parameters determined by variography.
- Geological interpretation identified fourteen high grade domains (higher than 1.0 g/t Au), six low grade domains (between 0.4 and 1.0 g/t Au) and a broad lower grade envelope (greater than 0.2 g/t Au).
- Underground voids were modeled from historical mine plans and adjusted according to positions of drill intersections in stopes and drifts. Void volumes of stopes were increased by one metre along all edges to compensate for uncertainties. The void models were then used to deplete the resource estimate. All samples located within the voids were then removed from the estimate.
- Tonnage estimates are based on rock densities of 2.69 tonnes/cubic metre for the porphyry, 2.75 for altered sediments and 2.90 for altered ultramafic rocks.
- The resource estimates using the lower cut-off of 0.34 g/t Au is emphasized for reporting purposes as this is the in-pit cut-off estimated for the US$825 Whittle shell.
- The US$825 Whittle shell has approximate maximum dimensions of 2,980 metres in length, 1,180 metres in width and a vertical depth of 380 metres.
- The average gold recovery in this pit shell is 86.2%. Overall slope angles based on feasibility level geotechnical studies (including provisions for ramps) are between 43 and 55 degrees. Strip ratio is 1.91 for the in-pit resource corresponding to a lower cut-off of 0.34 g/t Au.
Economic valuation within an optimized engineered pit design will be provided in an updated reserve statement for the entire project by the end of January 2010, which will optimize the combined Canadian Malartic and South Barnat pits. Should Osisko successfully prove up economic reserves at South Barnat, additional steps will be taken to obtain the necessary authorizations to mine the South Barnat deposit and integrate it to the Canadian Malartic project. Additional studies are currently under way to evaluate the deviation of highway 117 that will be required for potential mining of the South Barnat deposit. This study will be carried out in cooperation with the Quebec Ministry of Transport and the town of Malartic. The goal of the study will be to minimize the portion of the highway to be relocated as well as the social impact to the community.
The project out-of-pit M&I resource is currently estimated at 2.03 million ounces gold, and further pit optimizations using modified variables, such as increased pit slopes or gold price, may allow for eventual inclusion of some of this resource within the pit. Additional drilling is required to upgrade the remaining inferred resources.
About Osisko
Osisko Mining Corporation is currently developing the Canadian Malartic gold project into a large-scale open pit, bulk-tonnage mining operation. The Company is well-funded with $825 million in cash resources and is carrying out an aggressive mine development, reserve definition and exploration campaign. The Canadian Malartic deposit currently represents one the biggest gold reserves in Canada for a single deposit, and is still growing through ongoing drilling on new mineralized zones.
A NI 43-101 compliant, 7.7 million ounce gold M&I global resource estimate (6.4 million ounce gold M&I in-pit resource) on the main Canadian Malartic gold deposit was released on September 8, 2008 and has been filed on SEDAR. A NI 43-101 compliant, 6.3 million ounce gold Reserve estimate and Feasibility Study on the main Canadian Malartic gold deposit was released on November 25, 2008 and has been filed on SEDAR. A NI 43-101 compliant, 2.2 million ounce gold M&I global resource estimate (2.0 million ounces gold M&I in-pit resource) on the South Barnat gold deposit was released on June 2, 2009 and has been filed on SEDAR.
Mr. Elzear Belzile, P. Eng. of BSI, Mr. Louis-Pierre Gignac, P. Eng. of G Mining Services Inc. and Mr. Robert Wares, P. Geo. and Executive Vice-President of Osisko, are the Qualified Persons who have reviewed this news release and are responsible for the technical information reported herein, including verification of the data disclosed.
Conference Call
Osisko will host a conference call on Monday, December 14 at 11:30 AM Montreal time, where senior management will discuss the press release and will be available to respond to questions from analysts and investors. Those interested in participating in the conference call should dial in at 416-981-9000 (Toronto local and international), or 1-800-909-4145 (North American toll free). An operator will direct participants to the call.
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 that further work 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 the Corporation 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. Although the Corporation 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 put the Canadian Malartic Project into commercial production, 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 and mill production personnel, results of exploration and development activities, the Corporation'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 the Corporation's most recent Annual Information Form filed on SEDAR, which also provides additional general assumptions in connection with these statements. The Corporation cautions that the foregoing list of important factors is not exhaustive. Investors and others who base themselves on the Corporation's forward-looking statements should carefully consider the above factors as well as the uncertainties they represent and the risk they entail. The Corporation 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.
Contacts:
Osisko Mining Corporation
John Burzynski
Vice-President Corporate Development
514-735-7131
www.osisko.com
Sylvie Prud'homme
Investor Relations
514-735-7131
Toll Free: 1-888-674-7563
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