 Copperstone Air Photo showing Target Zones & Development
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| | March 04, 2002
Acquisition of 100% of Copperstone Project Complete
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| | RENO, Nevada -- March 4, 2002 - American Bonanza Gold Mining Corp. (the "Company") is pleased to announce that it has completed the acquisition of 100% of the Copperstone property (subject only to a 1% royalty payable to the underlying landowner/lessor of the property) at a cost of US$1,000,000. The Company acquired the remaining 75% interest of the project not already owned from Arctic Precious Metals Inc., a subsidiary of Royal Oak Mines Inc. through a lengthy Court process that commenced in 1999. Funding for this acquisition is by way of a loan of US$1,100,000 from Trilon Financial Corporation ("Trilon"). The loan from Trilon is repayable on or before March 4, 2004 and bears interest at the US base rate. The Company has granted Trilon a non-transferable warrant to purchase up to 1,500,000 common shares at $0.13 per share until March 4, 2004, with an option to extend the warrant for three additional one-year terms. Completion of this acquisition paves the way for the Company to proceed with exploration and development of the Copperstone Project.
MRDI Canada, a division of H.A. Simons Ltd., ("MRDI") was retained by the Company during 1999 to assist in a scoping level evaluation of an underground mine at Copperstone, as has been previously announced. Exploration drilling on the project outlined four zones of mineralization defined as the A, B, C and D zones with gold mineralization occurring principally within the Copperstone Fault.
As has been previously announced, the scoping study evaluated the underground mine development of only the C and D zones, and estimated a total resource for the C and D zones of 2.1 million tons at an average uncut grade of 0.58 Au opt, containing over 1.2 million ounces of gold.
The total resource for the C and D zones using cut grades contains 2.1 million tons at an average grade of 0.34 opt Au, containing over 700,000 ounces of gold. This is comprised of an Indicated resource containing 892,000 tons grading 0.32 opt Au (285,700 ounces of gold) and an Inferred resource containing 1.19 million tons grading 0.35 opt Au (423,000 ounces of gold).
This resource contains a diluted, recoverable resource included in the mine design plan of 827,400 tons at a cut and capped grade of 0.56 opt Au (459,500 ounces Au).
To study this diluted, recoverable resource included in the mine design plan, economic mining cut-off grades were based on a gold price of $300 per ounce, a milling recovery of 90% and estimates of operating costs were determined for each zone and varied from about 0.25 to 0.30 opt Au. A planned daily processing rate of 500 tons per day was used. The resources available for mining are based on the material within a geologic grade envelope of 0.10 opt Au and greater, and having overall diluted grades greater than the calculate cut-off grades. The resource for each zone has been factored for 95% mining recovery and 10% mining dilution at a grade of 0.08 opt Au. Material excluded from the mining plan includes that with diluted grades less than 0.25 opt Au, totalling about 474,000 tons at a grade of 0.183 opt Au, and that in the hangingwall zones which is based on limited drill hole data and totals about 105,000 tons at a grade of 0.998 opt Au.
The MRDI report was completed prior to NI43-101 and was prepared by MRDI Canada, an independent mining engineering consulting firm. The report was prepared to industry standards and is relevant and reliable today, as it was in 1999. MRDI did not independently verify the sample data. The MRDI resource estimate is based on a geological model provided by the Company and an inverse distance weighting to the power 3 block model (IDW3). Gold grades were capped at 2.5 opt Au in the C zone and 4.7 opt Au in the D zone. A 0.00 opt Au block cut-off grade was used for the total resource estimate. The tonnage factor applied was 10.7 cu.ft/ton. The assay database supplied to MRDI contains 30,391 assays from 586 exploration and ore outline drill holes completed during the period 1980 to 1998. A subset of this database containing 71 drill holes with 253 associated assays has been used in this scoping study to develop the geological and resource model of the C and D zones in the Northwest High Grade Zone. According to MRDI, "The Copperstone Gold Project Geological Resource...has been classified into Measured, Indicated and Inferred Resources based upon the level of confidence according to the proposed TSE guidelines using the drilling grid spacing and continuity of mineralization as determined through the geological and geostatistical review of the data." Management is of the opinion that these classifications are materially in compliance with NI43-101. These mineral resources are not mineral reserves and do not yet have demonstrated economic viability -- demonstrating such economic viability is a priority for the Company.
The Company is currently considering various alternatives for the underground exploration and development of the Copperstone Project.
The Company has granted 2,810,000 stock options to directors, officers and consultants of the Company for a period of five years commencing March 4, 2002 at an exercise price of $0.10 per share, subject to regulatory approval.
About American Bonanza
American Bonanza is engaged in the acquisition, exploration and development of high grade precious metal properties. American Bonanza's innovative metallogenic techniques developed at considerable expense represent state-of-the-art tools for modern exploration in the Great Basin of Nevada and other areas. American Bonanza's metallogenic techniques have involved technical pioneering in terms of geological data analysis, hardware and software applications and will be the catalyst for future corporate growth.
Additional information about American Bonanza can be obtained at www.americanbonanza.com
AMERICAN BONANZA GOLD MINING CORP.
(signed) Brian Kirwin
President and Chief Executive Officer
The Canadian Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.
For further information call or write:
Brian Kirwin, President and Chief Executive Officer (775) 824-0707
Giulio T. Bonifacio, Vice President, Finance and Chief Financial Officer (604) 699-0023 |
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