Consolidated Tin Mines Limited (ASX:CSD) Scoping Study Confirms Commercial Potential Of Mt Garnet Tin Project

Brisbane, Australia (ABN Newswire) - Consolidated Tin Mines Limited (ASX:CSD) is pleased to announce results from an in-house preliminary scoping study conducted in conjunction with SEMF Pty Ltd (SEMF) on its Mt Garnet Tin Project near Cairns in North Queensland.

SEMF is a multi-discipline engineering, scientific and management consulting group with strong expertise in the mining sector having previously completed work for King Island Scheelite's (ASX:KIS) (PINK:KISLF) Tasmanian Tungsten Project and Nyrstar (EBR:NYR) (PINK:NYRSF), the world's largest zinc metal producer, at its Hobart smelter.

SEMF have examined the likely capital and operating costs based on the preliminary metallurgical design and other project information for the Mt Garnet Project Based on the preliminary process flowsheet a likely baseline throughput was estimated at 700,000 tonne per annum. This baseline throughput was used for the purpose of equipment sizing and developing capital cost and operating cost estimates.

SEMF have estimated capital costs in the order of A$124 million inclusive of a 10% contingency. The estimate is considered to have an accuracy in the order of -20%/ + 30%. Operating cost estimates were reviewed by SEMF and a range of between A$40-A$50 per tonne of ore processed is considered a reasonable broad estimate for the purposes of the Scoping Study.

As part of the scoping study, and based on the SEMF estimates, indicative project net cash flows before tax for a range of tin ore prices have been developed in-house and are shown in Table 1 below. These project cash flows are based on the following key parameters:

- Throughput of 700,000 tonnes per annum;

- Average feed grade 0.64% tin at a recovery of 68% producing 3,049 tonnes per annum of tin metal in concentrate;

- Production of 236,600 tonnes per annum of magnetite concentrate grading greater than 65% iron at a sales value of A$50 per tonne;

- Operating cost estimates used A$49 per tonne of ore processed being within the SEMF estimated operating cost range of A$40 - A$50 per tonne;

- Resources used are based on all current JORC classifications measured indicated and inferred resources at the project. Project life on throughput of 700,000tpa is estimated to be 7.5 years based on current Mt Garnet Project resources.

Table 1: Indicative project pre tax net cash flows across a range of tin ore prices

-----------------------------------------------------------
Tin (Sn)Price  Iron (Fe)Price  Total Revenue   Net Cashflow
   $AUD/t          $AUD/t         $AUD            $AUD
-----------------------------------------------------------
   16,000           50          454,605,000     199,140,000
   18,000           50          500,340,000     244,875,000
   20,000           50          546,075,000     290,610,000
   22,000           50          591,810,000     336,345,000
-----------------------------------------------------------

Notes to the table:

i) Net cashflows are pre-tax and do not include capital costs for constructing a treatment plant and mine site infrastructure. Freight and smelting costs are not included.

ii) Results of the preliminary scoping study provide preliminary pre-tax cash flow estimates that are subject to completion of resource drill out and more comprehensive studies that include detailed mine designs, metallurgical test work, plant design, site construction and detailed capital and operating cost analysis.

iii) Average $AUD LME cash buyer price for tin for the 6 months to June 2010 was $A 20,224

iv) A portion of the Company's magnetite concentrate will go to coal washing sales, and a conservative average price of AUD$50/tonne has been estimated.

v) Revenue and net cash flow is in the above table are based on annual tin and magnetite production of 3,049 and 236,600 tonnes respectively. This represents a change from the annual production estimates included in the announcement made on 22 June 2010, which were 3,175 tonnes of tin and 326,000 tonnes of magnetite. The amendments to the estimated production tonnes have been made after further work carried out on the flow sheet design.

vi) Future modelling will optimise annual throughput/Capex.

The scoping study for the Mt Garnet Tin Project demonstrates the economic potential of the project at current tin prices. The future addition of resources from future exploration success or acquisition will extend the projects life and is a key factor in the Central Mill Concept with an 8 to 10 year mine life being developed by the company for the Mt Garnet Project Area.

Consolidated Tin's managing director Ralph De Lacey said: 'The results of the Scoping Study for the Mt Garnet Tin project help demonstrate the strong economic potential of the project to deliver significant financial returns for the benefit of the Company and our shareholders. We will now continue with our development plans to position Consolidated Tin as a substantial tin mining company.'

The directors will continue to assess the capital costs of the plant, and endeavour to deliver the required infrastructure in a cost effective manner. Given the high capital cost associated with some process equipment, other methods or equipment may warrant further consideration as part of the ongoing metallurgical testwork and design.

The preliminary scoping study findings are not future revenue or operating forecasts. The scoping study is intended to give shareholders and potential investors an indication of the scope and magnitude of the Mt Garnet Tin Project.

Windermere Project

As an example of a potential Mt Garnet satellite deposit, the Windermere Project hosts tin bearing ironstone skarn outcropping over 2.5 kilometres and has never been drilled. The Company is awaiting grant of the Mineral Development Licence that will give approval to commence drilling at this project. Approval is expected in the near future.

Independent Geologist Les Davis stated in CSD Prospectus dated 20th November 2007:

'At the Windermere Project, exploration for a large tonnage deposit can be justified. The tin-bearing ironstones within the skarn crop out over 2.5 km within which a sizeable body of tin mineralisation could be found. The granite only crops out in the west, so the roof pendant structure may be large and extend to great depth within the granite batholith. (This is in contrast to Gillian and Pinnacles skarns, where the granite surrounds relatively small roof pendants and the granite basement is less than 300 m deep).

Fold thickening of the skarn and ironstone units may give rise to volumes of mineralisation suitable for open pit mining.'

For the complete Consolidated Tin Mines announcement, please refer to the following link:
http://www.abnnewswire.net/media/en/docs/63236-ASX-CSD-496625.pdf

About Consolidated Tin Mines Limited:

Consolidated Tin Mines Limited (ASX:CSD) is an ASX listed exploration company with projects in the lower Herberton Tin Field in northern Queensland, one of Australia’s premier tin producing fields. The Company is focused on discovering and developing major tin deposits at its Mount Garnet project area. The company has acquired an impressive portfolio of advanced tin exploration projects in the area which it plans to transform into a major mining operation to deliver significant returns to the Company’s shareholders.

Source:

Consolidated Tin Mines Limited

Contact:

Ralph De Lacey
Managing Director
Consolidated Tin Mines Limited
Tel: +61-7-4032-3319
Mob: +61-428-163-176
Email: rd@csdtin.com.au
www.csdtin.com.au

James Moses
Investor Relations and Media Relations
Mandate Corporate
Mob: +61-420-991-574
Email: james@mandatecorporate.com.au