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03.06.2009
Osisko Releases South Barnat Updated Resource Estimate
Osisko Releases South Barnat Updated Resource Estimate
Montreal, Quebec, Jun 02, 2009 - Osisko Mining Corporation (TSX: OSK)(FRANKFURT: EWX) is pleased to report the updated National Instrument 43-101 compliant resource estimate for the South Barnat deposit, located on its 100%-owned Canadian Malartic gold property in the Abitibi region of Quebec, Canada. South Barnat is a separate gold deposit located adjacent to the Canadian Malartic deposit. The Canadian Malartic deposit currently hosts a 6.28 million ounce gold reserve (see November 25, 2008 press release and NI 43-101 compliant report filed on SEDAR).
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. Based on a cut-off grade of 1.00 g/t Au, the global Measured and Indicated ("M&I") resource is 1.94 million ounces of gold at an average grade of 2.09 g/t with an additional 100,000 ounces gold at an average grade of 1.86 g/t in the Inferred category. Based on a lower cut-off grade of 0.36 g/t Au, the global Measured and Indicated ("M&I") resource is 2.24 million ounces gold at an average grade of 1.64 g/t, with an additional 120,000 ounces gold at an average grade of 1.40 g/t in the Inferred category. The tables below summarize the BSI estimates using variable lower cut-off grades:
South Barnat global resource estimates
----------------------------------------------------------------------
Measured Indicated Total M&I
----------------------------------------------------------------------
Grade Tonnes Oz Grade Tonnes Oz Grade Tonnes Oz Cut-off
(g/t) (M) (M) (g/t) (M) (M) (g/t) (M) (M) (g/t)
----------------------------------------------------------------------
1.80 6.9 0.40 1.60 35.6 1.84 1.64 42.5 2.24 0.36
----------------------------------------------------------------------
1.82 6.8 0.40 1.64 34.7 1.83 1.67 41.4 2.22 0.40
----------------------------------------------------------------------
1.89 6.4 0.39 1.71 32.6 1.80 1.74 39.1 2.19 0.50
----------------------------------------------------------------------
1.97 6.1 0.38 1.78 30.9 1.77 1.81 37.0 2.15 0.60
----------------------------------------------------------------------
2.04 5.7 0.38 1.84 29.4 1.74 1.87 35.2 2.11 0.70
----------------------------------------------------------------------
2.12 5.4 0.37 1.90 27.8 1.70 1.94 33.2 2.07 0.80
----------------------------------------------------------------------
2.21 5.1 0.36 1.97 26.0 1.65 2.01 31.1 2.01 0.90
----------------------------------------------------------------------
2.30 4.7 0.35 2.05 24.2 1.59 2.09 29.0 1.94 1.00
----------------------------------------------------------------------
----------------------------------------------------------------------
Inferred
----------------------------------------------------------------------
Grade (g/t) Tonnes (M) Oz (M) Cut-off (g/t)
----------------------------------------------------------------------
1.40 2.6 0.12 0.36
----------------------------------------------------------------------
1.45 2.5 0.12 0.40
----------------------------------------------------------------------
1.54 2.3 0.11 0.50
----------------------------------------------------------------------
1.59 2.2 0.11 0.60
----------------------------------------------------------------------
1.63 2.1 0.11 0.70
----------------------------------------------------------------------
1.69 2.0 0.11 0.80
----------------------------------------------------------------------
1.79 1.8 0.10 0.90
----------------------------------------------------------------------
1.86 1.6 0.10 1.00
----------------------------------------------------------------------
BSI, in collaboration with G Mining Services Inc. of Montreal, also estimated an in-pit M&I resource within a Whittle-optimized pit shell using a base case gold price of US$775 per ounce. Based on a cut-off grade of 1.00 g/t Au, the in-pit M&I resource is 1.81 million ounces of gold at an average grade of 2.12 g/t with an additional 50,000 ounces gold at an average grade of 1.87 g/t in the inferred category. Based on a lower cut-off grade of 0.36 g/t Au, the in-pit M&I resource is 2.04 million ounces gold at an average grade of 1.71 g/t, with an additional 70,000 ounces gold at an average grade of 1.47 g/t in the Inferred category. The tables below summarize the in-pit estimates using variable lower cut-off grades:
South Barnat Resource estimates within US$775 Whittle pit shell
----------------------------------------------------------------------
Measured Indicated Total M&I
----------------------------------------------------------------------
Grade Tonnes Oz Grade Tonnes Oz Grade Tonnes Oz Cut-off
(g/t) (M) (M) (g/t) (M) (M) (g/t) (M) (M) (g/t)
----------------------------------------------------------------------
1.82 6.7 0.39 1.68 30.46 1.65 1.71 37.1 2.04 0.36
----------------------------------------------------------------------
1.84 6.6 0.39 1.71 29.75 1.64 1.74 36.3 2.03 0.40
----------------------------------------------------------------------
1.91 6.3 0.38 1.79 28.12 1.61 1.81 34.4 2.00 0.50
----------------------------------------------------------------------
1.99 5.9 0.38 1.84 26.84 1.59 1.87 32.8 1.97 0.60
----------------------------------------------------------------------
2.06 5.6 0.37 1.89 25.82 1.57 1.92 31.4 1.94 0.70
----------------------------------------------------------------------
2.14 5.3 0.36 1.94 24.70 1.54 1.98 30.0 1.91 0.80
----------------------------------------------------------------------
2.23 4.9 0.35 2.00 23.41 1.51 2.04 28.4 1.86 0.90
----------------------------------------------------------------------
2.32 4.6 0.34 2.07 21.97 1.46 2.12 26.6 1.81 1.00
----------------------------------------------------------------------
----------------------------------------------------------------------
Inferred
----------------------------------------------------------------------
Grade (g/t) Tonnes (M) Oz (M) Cut-off (g/t)
----------------------------------------------------------------------
1.47 1.4 0.07 0.36
----------------------------------------------------------------------
1.50 1.4 0.07 0.40
----------------------------------------------------------------------
1.55 1.3 0.06 0.50
----------------------------------------------------------------------
1.59 1.2 0.06 0.60
----------------------------------------------------------------------
1.62 1.2 0.06 0.70
----------------------------------------------------------------------
1.68 1.1 0.06 0.80
----------------------------------------------------------------------
1.78 1.0 0.06 0.90
----------------------------------------------------------------------
1.87 0.9 0.05 1.00
----------------------------------------------------------------------
Sensitivity of the in-pit M&I resource to gold price is as follows (inferred excluded):
----------------------------------------------------------------------
Gold Price (US$) Grade (g/t) Tonnes (M) Oz (M) Strip Ratio
(Waste/Ore)
----------------------------------------------------------------------
$650 1.78 34.0 1.95 5.40
----------------------------------------------------------------------
$775 1.71 37.1 2.04 5.61
----------------------------------------------------------------------
$900 1.65 40.9 2.17 5.88
----------------------------------------------------------------------
$1000 1.61 43.3 2.23 6.08
----------------------------------------------------------------------
Using an ore-based cost of US$6.63 per tonne (as estimated from costs in the Canadian Malartic Feasibility Study; see press release dated November 25, 2008), the corresponding in-pit cut-off grade for the base case US$775/oz Whittle shell is 0.36 g/t gold, giving an in-pit M&I resource of 2.04 million ounces gold with an undiluted grade of 1.71 g/t Au, as shown in the following table:
Distribution of South Barnat resource estimates using base case US$775
Whittle pit shell with a 0.36 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 1.64 42.5 2.24 1.40 2.6 0.12
----------------------------------------------------------------------
In-Pit 1.71 37.1 2.04 1.47 1.4 0.07----------------------------------------------------------------------
Out-of-Pit 1.15 5.4 0.20 1.30 1.2 0.05
----------------------------------------------------------------------
An in-pit project total of 8.46 million ounces gold in the M&I category, at an average grade of 1.22 g/t (using a lower cut-off of 0.36 g/t Au) is estimated from combining the South Barnat in-pit M&I resource with the previously published in-pit M&I resources on the Canadian Malartic deposit (see September 8, 2008 press release and NI 43-101 compliant report filed on SEDAR), as shown in the following table:
Project Total in-pit resource estimates (0.36 g/t Au lower cut-off)
----------------------------------------------------------------------
Total M&I(i) Inferred
----------------------------------------------------------------------
Deposit Grade Tonnes Ounces Grade Tonnes Ounces
(g/t) (M) Au (M) (g/t) (M) Au (M)
----------------------------------------------------------------------
Canadian Malartic 1.12 178.2 6.42 0.81 5.03 0.13
----------------------------------------------------------------------
South Barnat 1.71 37.1 2.04 1.47 1.40 0.07
----------------------------------------------------------------------
Total 1.22 215.3 8.46 1.05 6.43 0.20
----------------------------------------------------------------------
(i) The Measured and Indicated resource includes the reserve of 6.28 M ounces gold released in the Feasibility Study for Canadian Malartic, excluding South Barnat (see November 25, 2008 press release).
A significant higher grade resource totalling 6.30 million ounces gold in the in-pit M&I category (at an average grade of 1.85 g/t) is estimated using a higher cut-off grade of 1.0 g/t Au, as shown in the following table:
Project Total in-pit resource estimates (1.00 g/t Au lower cut-off)
----------------------------------------------------------------------
Total M&I Inferred
----------------------------------------------------------------------
Deposit Grade Tonnes Ounces Grade Tonnes Ounces
(g/t) (M) Au (M) (g/t) (M) Au (M)
----------------------------------------------------------------------
Canadian Malartic 1.76 79.5 4.49 1.59 1.08 0.06
----------------------------------------------------------------------
South Barnat 2.12 26.6 1.81 1.87 0.90 0.05
----------------------------------------------------------------------
Total 1.85 106.1 6.30 1.73 1.98 0.11
----------------------------------------------------------------------
Economic valuation within an optimized engineered pit design will be provided in an updated reserve statement for the entire project by year end, 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 will also be initiated 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 out-of-pit M&I resource is currently estimated at 1.47 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.
Sean Roosen, President of Osisko, commented: "We are very pleased with the new in-pit M&I resource estimate for South Barnat, which has achieved a 100% conversion rate at a similar grade with respect to the previous inferred resource estimate. The new in-pit combined M&I resource estimate of 8.43 million ounces is based on processing and mining costs that were used in the Feasibility Study, and 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. It is worth noting that even at a cut-off of 1 g/t, we are now looking at a project total in-pit M&I of 6.3 M ounces gold at an average grade of 1.85 g/t, which makes this resource very robust at significantly lower gold prices.
We are currently carrying out additional drilling north of Barnat and in the south-east extension of the Canadian Malartic deposit in order to further expand the overall resource, which will be incorporated into an updated project resource statement, including combined optimized pits, to be released in the second half of 2009."
Details on the parameters of the resource estimates are as follows:
- The database comprised a total of 148,450 metres of drilling obtained from 617 inclined diamond drill holes completed and assayed by Osisko as of April 21, 2009 on a 25 m x 25 m grid.
- The database also comprised a total of 96,947 assays with an average of 1.42 metres per sample for a total of 137,602 assayed metres.
- The South Barnat 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 1 percent difference in total ounces at all cut-offs.
- 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.
- The above-reported global resource estimates that are not Whittle-pit constrained were restricted above a true elevation of 0 metres, corresponding to a true depth of approximately 320 metres.
- Geological interpretation identified five high grade domains and two low grade domains, with 84% of the resource being hosted by two main high grade domains.
- Calculations are based on original samples cut to a maximum of 11 g/t to 45 g/t Au depending on the domain. This resulted in an approximate 4.8 percent reduction in the overall gold content.
- 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.
- 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 cutoff of 0.36 g/t Au is emphasized for reporting purposes as this is the in-pit cut-off used in the Feasibility Study completed on the adjacent Canadian Malartic deposit (see November 25, 2008 press release).
- The US$775 Whittle shell has approximate maximum dimensions of 1300 metres in length, 720 metres in width and a vertical depth of 380 metres. This is a stand-alone shell that has not been merged nor optimized with the Canadian Malartic engineered pit.
- This Whittle pit shell is designed to maximize in-pit cash flow at 5% discount rate. The average gold recovery in this shell is 91.9%. Overall slope angles based on preliminary geotechnical studies (including provisions for ramps) are between 39.5 and 47.6 degrees. Total operating expenses (OPEX) are estimated at $US11.59 per milled tonne. Strip ratio is 5.61 for the in-pit resource corresponding to a lower cutoff of 0.36 g/t Au.
Osisko Mining Corp. is currently developing the Canadian Malartic gold deposit and adjacent mineralized zones into a large-scale open pit, bulk-tonnage mining operation. The Company is well-funded with $440 M in working capital and is carrying out an aggressive mine development, reserve definition and exploration campaign.
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. These estimates did not include the South Barnat Zone or any other mineralized zone located outside the main deposit that is currently being evaluated by Osisko. A NI 43-101 compliant report on this updated resource estimate on South Barnat will be filed on SEDAR within 45 days of the date of this press release.
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 including the sampling, analytical and test data underlying the technical information.
Conference Call
Osisko will host a conference call on Tuesday, June 2 at 2:00 PM EDT where senior management will discuss the Study and will be available to respond to questions from analysts and investors. Those interested in participating in the conference call should dial in at 416-850-9144 (Toronto local and international), or 1-866-400-3310 (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
Osisko Mining Corporation
Daniel Boase
Investor Relations
416-742-5600
Toll Free: 1-866-580-8891
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Montreal, Quebec, Jun 02, 2009 - Osisko Mining Corporation (TSX: OSK)(FRANKFURT: EWX) is pleased to report the updated National Instrument 43-101 compliant resource estimate for the South Barnat deposit, located on its 100%-owned Canadian Malartic gold property in the Abitibi region of Quebec, Canada. South Barnat is a separate gold deposit located adjacent to the Canadian Malartic deposit. The Canadian Malartic deposit currently hosts a 6.28 million ounce gold reserve (see November 25, 2008 press release and NI 43-101 compliant report filed on SEDAR).
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. Based on a cut-off grade of 1.00 g/t Au, the global Measured and Indicated ("M&I") resource is 1.94 million ounces of gold at an average grade of 2.09 g/t with an additional 100,000 ounces gold at an average grade of 1.86 g/t in the Inferred category. Based on a lower cut-off grade of 0.36 g/t Au, the global Measured and Indicated ("M&I") resource is 2.24 million ounces gold at an average grade of 1.64 g/t, with an additional 120,000 ounces gold at an average grade of 1.40 g/t in the Inferred category. The tables below summarize the BSI estimates using variable lower cut-off grades:
South Barnat global resource estimates
----------------------------------------------------------------------
Measured Indicated Total M&I
----------------------------------------------------------------------
Grade Tonnes Oz Grade Tonnes Oz Grade Tonnes Oz Cut-off
(g/t) (M) (M) (g/t) (M) (M) (g/t) (M) (M) (g/t)
----------------------------------------------------------------------
1.80 6.9 0.40 1.60 35.6 1.84 1.64 42.5 2.24 0.36
----------------------------------------------------------------------
1.82 6.8 0.40 1.64 34.7 1.83 1.67 41.4 2.22 0.40
----------------------------------------------------------------------
1.89 6.4 0.39 1.71 32.6 1.80 1.74 39.1 2.19 0.50
----------------------------------------------------------------------
1.97 6.1 0.38 1.78 30.9 1.77 1.81 37.0 2.15 0.60
----------------------------------------------------------------------
2.04 5.7 0.38 1.84 29.4 1.74 1.87 35.2 2.11 0.70
----------------------------------------------------------------------
2.12 5.4 0.37 1.90 27.8 1.70 1.94 33.2 2.07 0.80
----------------------------------------------------------------------
2.21 5.1 0.36 1.97 26.0 1.65 2.01 31.1 2.01 0.90
----------------------------------------------------------------------
2.30 4.7 0.35 2.05 24.2 1.59 2.09 29.0 1.94 1.00
----------------------------------------------------------------------
----------------------------------------------------------------------
Inferred
----------------------------------------------------------------------
Grade (g/t) Tonnes (M) Oz (M) Cut-off (g/t)
----------------------------------------------------------------------
1.40 2.6 0.12 0.36
----------------------------------------------------------------------
1.45 2.5 0.12 0.40
----------------------------------------------------------------------
1.54 2.3 0.11 0.50
----------------------------------------------------------------------
1.59 2.2 0.11 0.60
----------------------------------------------------------------------
1.63 2.1 0.11 0.70
----------------------------------------------------------------------
1.69 2.0 0.11 0.80
----------------------------------------------------------------------
1.79 1.8 0.10 0.90
----------------------------------------------------------------------
1.86 1.6 0.10 1.00
----------------------------------------------------------------------
BSI, in collaboration with G Mining Services Inc. of Montreal, also estimated an in-pit M&I resource within a Whittle-optimized pit shell using a base case gold price of US$775 per ounce. Based on a cut-off grade of 1.00 g/t Au, the in-pit M&I resource is 1.81 million ounces of gold at an average grade of 2.12 g/t with an additional 50,000 ounces gold at an average grade of 1.87 g/t in the inferred category. Based on a lower cut-off grade of 0.36 g/t Au, the in-pit M&I resource is 2.04 million ounces gold at an average grade of 1.71 g/t, with an additional 70,000 ounces gold at an average grade of 1.47 g/t in the Inferred category. The tables below summarize the in-pit estimates using variable lower cut-off grades:
South Barnat Resource estimates within US$775 Whittle pit shell
----------------------------------------------------------------------
Measured Indicated Total M&I
----------------------------------------------------------------------
Grade Tonnes Oz Grade Tonnes Oz Grade Tonnes Oz Cut-off
(g/t) (M) (M) (g/t) (M) (M) (g/t) (M) (M) (g/t)
----------------------------------------------------------------------
1.82 6.7 0.39 1.68 30.46 1.65 1.71 37.1 2.04 0.36
----------------------------------------------------------------------
1.84 6.6 0.39 1.71 29.75 1.64 1.74 36.3 2.03 0.40
----------------------------------------------------------------------
1.91 6.3 0.38 1.79 28.12 1.61 1.81 34.4 2.00 0.50
----------------------------------------------------------------------
1.99 5.9 0.38 1.84 26.84 1.59 1.87 32.8 1.97 0.60
----------------------------------------------------------------------
2.06 5.6 0.37 1.89 25.82 1.57 1.92 31.4 1.94 0.70
----------------------------------------------------------------------
2.14 5.3 0.36 1.94 24.70 1.54 1.98 30.0 1.91 0.80
----------------------------------------------------------------------
2.23 4.9 0.35 2.00 23.41 1.51 2.04 28.4 1.86 0.90
----------------------------------------------------------------------
2.32 4.6 0.34 2.07 21.97 1.46 2.12 26.6 1.81 1.00
----------------------------------------------------------------------
----------------------------------------------------------------------
Inferred
----------------------------------------------------------------------
Grade (g/t) Tonnes (M) Oz (M) Cut-off (g/t)
----------------------------------------------------------------------
1.47 1.4 0.07 0.36
----------------------------------------------------------------------
1.50 1.4 0.07 0.40
----------------------------------------------------------------------
1.55 1.3 0.06 0.50
----------------------------------------------------------------------
1.59 1.2 0.06 0.60
----------------------------------------------------------------------
1.62 1.2 0.06 0.70
----------------------------------------------------------------------
1.68 1.1 0.06 0.80
----------------------------------------------------------------------
1.78 1.0 0.06 0.90
----------------------------------------------------------------------
1.87 0.9 0.05 1.00
----------------------------------------------------------------------
Sensitivity of the in-pit M&I resource to gold price is as follows (inferred excluded):
----------------------------------------------------------------------
Gold Price (US$) Grade (g/t) Tonnes (M) Oz (M) Strip Ratio
(Waste/Ore)
----------------------------------------------------------------------
$650 1.78 34.0 1.95 5.40
----------------------------------------------------------------------
$775 1.71 37.1 2.04 5.61
----------------------------------------------------------------------
$900 1.65 40.9 2.17 5.88
----------------------------------------------------------------------
$1000 1.61 43.3 2.23 6.08
----------------------------------------------------------------------
Using an ore-based cost of US$6.63 per tonne (as estimated from costs in the Canadian Malartic Feasibility Study; see press release dated November 25, 2008), the corresponding in-pit cut-off grade for the base case US$775/oz Whittle shell is 0.36 g/t gold, giving an in-pit M&I resource of 2.04 million ounces gold with an undiluted grade of 1.71 g/t Au, as shown in the following table:
Distribution of South Barnat resource estimates using base case US$775
Whittle pit shell with a 0.36 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 1.64 42.5 2.24 1.40 2.6 0.12
----------------------------------------------------------------------
In-Pit 1.71 37.1 2.04 1.47 1.4 0.07----------------------------------------------------------------------
Out-of-Pit 1.15 5.4 0.20 1.30 1.2 0.05
----------------------------------------------------------------------
An in-pit project total of 8.46 million ounces gold in the M&I category, at an average grade of 1.22 g/t (using a lower cut-off of 0.36 g/t Au) is estimated from combining the South Barnat in-pit M&I resource with the previously published in-pit M&I resources on the Canadian Malartic deposit (see September 8, 2008 press release and NI 43-101 compliant report filed on SEDAR), as shown in the following table:
Project Total in-pit resource estimates (0.36 g/t Au lower cut-off)
----------------------------------------------------------------------
Total M&I(i) Inferred
----------------------------------------------------------------------
Deposit Grade Tonnes Ounces Grade Tonnes Ounces
(g/t) (M) Au (M) (g/t) (M) Au (M)
----------------------------------------------------------------------
Canadian Malartic 1.12 178.2 6.42 0.81 5.03 0.13
----------------------------------------------------------------------
South Barnat 1.71 37.1 2.04 1.47 1.40 0.07
----------------------------------------------------------------------
Total 1.22 215.3 8.46 1.05 6.43 0.20
----------------------------------------------------------------------
(i) The Measured and Indicated resource includes the reserve of 6.28 M ounces gold released in the Feasibility Study for Canadian Malartic, excluding South Barnat (see November 25, 2008 press release).
A significant higher grade resource totalling 6.30 million ounces gold in the in-pit M&I category (at an average grade of 1.85 g/t) is estimated using a higher cut-off grade of 1.0 g/t Au, as shown in the following table:
Project Total in-pit resource estimates (1.00 g/t Au lower cut-off)
----------------------------------------------------------------------
Total M&I Inferred
----------------------------------------------------------------------
Deposit Grade Tonnes Ounces Grade Tonnes Ounces
(g/t) (M) Au (M) (g/t) (M) Au (M)
----------------------------------------------------------------------
Canadian Malartic 1.76 79.5 4.49 1.59 1.08 0.06
----------------------------------------------------------------------
South Barnat 2.12 26.6 1.81 1.87 0.90 0.05
----------------------------------------------------------------------
Total 1.85 106.1 6.30 1.73 1.98 0.11
----------------------------------------------------------------------
Economic valuation within an optimized engineered pit design will be provided in an updated reserve statement for the entire project by year end, 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 will also be initiated 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 out-of-pit M&I resource is currently estimated at 1.47 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.
Sean Roosen, President of Osisko, commented: "We are very pleased with the new in-pit M&I resource estimate for South Barnat, which has achieved a 100% conversion rate at a similar grade with respect to the previous inferred resource estimate. The new in-pit combined M&I resource estimate of 8.43 million ounces is based on processing and mining costs that were used in the Feasibility Study, and 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. It is worth noting that even at a cut-off of 1 g/t, we are now looking at a project total in-pit M&I of 6.3 M ounces gold at an average grade of 1.85 g/t, which makes this resource very robust at significantly lower gold prices.
We are currently carrying out additional drilling north of Barnat and in the south-east extension of the Canadian Malartic deposit in order to further expand the overall resource, which will be incorporated into an updated project resource statement, including combined optimized pits, to be released in the second half of 2009."
Details on the parameters of the resource estimates are as follows:
- The database comprised a total of 148,450 metres of drilling obtained from 617 inclined diamond drill holes completed and assayed by Osisko as of April 21, 2009 on a 25 m x 25 m grid.
- The database also comprised a total of 96,947 assays with an average of 1.42 metres per sample for a total of 137,602 assayed metres.
- The South Barnat 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 1 percent difference in total ounces at all cut-offs.
- 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.
- The above-reported global resource estimates that are not Whittle-pit constrained were restricted above a true elevation of 0 metres, corresponding to a true depth of approximately 320 metres.
- Geological interpretation identified five high grade domains and two low grade domains, with 84% of the resource being hosted by two main high grade domains.
- Calculations are based on original samples cut to a maximum of 11 g/t to 45 g/t Au depending on the domain. This resulted in an approximate 4.8 percent reduction in the overall gold content.
- 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.
- 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 cutoff of 0.36 g/t Au is emphasized for reporting purposes as this is the in-pit cut-off used in the Feasibility Study completed on the adjacent Canadian Malartic deposit (see November 25, 2008 press release).
- The US$775 Whittle shell has approximate maximum dimensions of 1300 metres in length, 720 metres in width and a vertical depth of 380 metres. This is a stand-alone shell that has not been merged nor optimized with the Canadian Malartic engineered pit.
- This Whittle pit shell is designed to maximize in-pit cash flow at 5% discount rate. The average gold recovery in this shell is 91.9%. Overall slope angles based on preliminary geotechnical studies (including provisions for ramps) are between 39.5 and 47.6 degrees. Total operating expenses (OPEX) are estimated at $US11.59 per milled tonne. Strip ratio is 5.61 for the in-pit resource corresponding to a lower cutoff of 0.36 g/t Au.
Osisko Mining Corp. is currently developing the Canadian Malartic gold deposit and adjacent mineralized zones into a large-scale open pit, bulk-tonnage mining operation. The Company is well-funded with $440 M in working capital and is carrying out an aggressive mine development, reserve definition and exploration campaign.
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. These estimates did not include the South Barnat Zone or any other mineralized zone located outside the main deposit that is currently being evaluated by Osisko. A NI 43-101 compliant report on this updated resource estimate on South Barnat will be filed on SEDAR within 45 days of the date of this press release.
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 including the sampling, analytical and test data underlying the technical information.
Conference Call
Osisko will host a conference call on Tuesday, June 2 at 2:00 PM EDT where senior management will discuss the Study and will be available to respond to questions from analysts and investors. Those interested in participating in the conference call should dial in at 416-850-9144 (Toronto local and international), or 1-866-400-3310 (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
Osisko Mining Corporation
Daniel Boase
Investor Relations
416-742-5600
Toll Free: 1-866-580-8891
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