Minefinders Provides Reserve and Resource Update for Its Dolores Mine
VANCOUVER, BRITISH COLUMBIA -- (Marketwire) -- 05/04/11 -- Minefinders Corporation Ltd. (TSX: MFL)(NYSE Amex: MFN) today announced updated gold and silver mineral reserves and resources for the Dolores Mine.
Fiscal 2010 marked the first meaningful exploration drilling program at Dolores since the commencement of the development of the mine in 2006 and this is the first update of reserves and resources for Dolores since 2008.
The new gold and silver reserves are current to December 31, 2010 and are sufficient to sustain open pit production for the next 16 years at current throughput rates. The open pit gold and silver reserves base at the Dolores Mine consists of 2.024 million ounces of gold and 114.52 million ounces of silver, or 4.226 million gold equivalent ounces ('AuEq').
The new reserves are contained in 107.64 million tonnes of proven and probable ore having an average grade of 0.58 grams per tonne ('gpt') gold and 33.1 gpt silver and using appropriate dollar value cut-off grades based on assumed metal prices of $1,200 per gold ounce and $23 per silver ounce.
Dolores Mine - Proven and Probable Reserves Estimate, December 31, 2010(1)
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Gold Gold Silver Silver AuEq AuEq
Tonnes Ounces Grade Ounces Grade Grade Ounces
(million) (million) (gpt) (million) (gpt) (gpt) (million)
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Proven 62.43 1.254 0.62 68.54 34.2 1.28 2.572
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Probable 45.21 0.770 0.53 45.98 31.6 1.14 1.654
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Proven and
Probable 107.64 2.024 0.58 114.52 33.1 1.22 4.226
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(1) Proven and probable reserves have been estimated as of December 31,
2010 in accordance with definitions adopted by the Canadian Institute
of Mining, Metallurgy and Petroleum. Minefinders personnel prepared
these estimates with independent review by Chlumsky, Armburst and
Meyer. Robert L Sandefur, P.E. is the Qualified Person as defined in
NI 43-101 for this mineral reserve statement. Unless otherwise noted,
the December 31, 2010 proven and probable reserve estimate, uses
appropriate dollar cut-off grades for ore polygons based on assumed
metal prices of $1,200 per gold ounce and $23 per silver ounce and
predicted metallurgical recoveries. Gold equivalent grade is based on
a 52 to one silver to gold ratio without regard to metallurgical
recoveries.
The total measured and indicated mineral resources used for estimation of the mineral reserves at Dolores incorporate all drilling through the end of 2010. The resources are currently estimated at 2.646 million ounces of gold and 139.5 million ounces of silver contained in 151.9 million tonnes. An additional 326,214 ounces of gold and 16.1 million ounces of silver, contained in 27.6 million tonnes are classified as inferred resources. Complete reserves and resources at various cut off grades for the Dolores Mine are presented in the attached tables.
The estimation of the new reserve and resource reflects several improvements in methodology over the prior 2008 model. The most significant of these improvements is the incorporation of mining dilution in the 2010 resource estimate to better predict dilution. The 2008 resource model was undiluted, with dilution applied in generating the reserve model. Additional changes in methodology are as follows:
-- A computer model using 6 discrete structural domains within the deposit
was used for the 2010 resource estimate. The previous estimate used
hand-constructed high-grade and low-grade envelopes and single
interpolation geometry.
-- Drill hole assays are capped separately on gold and silver, with
different capping employed in each of the 6 structural domains,
consistent with the differences in grade distribution within those
domains. The additional capping lowers the predicted average grades
making the model more conservative. Drill holes are composited following
capping using 5 metre composites instead of the 2 metre composites used
in the 2008 model.
-- New resources were interpolated using ordinary kriging of gold and
silver separately for each of the high-grade and low-grade zones and
each structure instead of the inverse distance method used in previous
estimations.
Despite the reduction in gold grades in the reserve, there are a number of factors which increase the economic value of the project at lower grades. Firstly, current silver prices increase the importance of silver to the value of blocks in the estimation with a large number of blocks of moderate silver grade and low gold grade being economic at model silver prices of $23 per ounce. While reducing the average gold grade, inclusion of such blocks is proper practice.
Secondly, higher combined gold and silver prices result in blocks of lower average grade being economic, lowering average grades of both gold and silver. Finally, portions of the pit expansion are in areas with lower average grades than were considered in the original pit design. Inclusion of these new reserves reduces the average grade of the total tonnes. At present, the updated 2010 model is reconciling closely to actual production tonnes and grades.
Future Expansion Opportunities
The Company is continuing to assess the addition of a milling operation at the Dolores Mine and the development of the underground resource at Dolores. Some of the measured, indicated and inferred mineralization is currently located below and adjacent to the updated open pit plan. The Company is evaluating an underground exploration program to target this mineralization for underground mining. Any reserves identified through this program would be accretive to production and additional to the current reserves.
One of the advantages of the scenarios being considered in the mill feasibility is that tonnage diverted from the leach process to the mill makes additional pad space available. This would allow for production of additional leach tonnes, further increasing the available reserves.
In 2011, the Company expects to invest $3.5 million to complete approximately 20,000 metres of drilling at Dolores and will continue to focus on expanding both open pit and underground resources, specifically in the South Extension, North Dome and East Dike target areas, all of which remain open along strike and at depth.
Quality Control and Assurance
The updated resource and reserve estimation for the Dolores Mine was prepared by personnel of Minefinders Corporation Ltd. and was reviewed by Chlumsky, Armbrust and Meyer LLC of Lakewood, Colorado ('CAM').
Robert L Sandefur, P.E. is the 'qualified person' as defined in NI 43-101 for this reserve and resource statement.
About Minefinders
Minefinders is a precious metals mining and exploration company and operates the multi-million ounce Dolores gold and silver mine in Mexico. For more information, please visit our website at www.minefinders.com.
MINERAL RESERVES - PROVEN AND PROBABLE
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Cut-off Gold Gold Silver Silver AuEq
(gpt Tonnes Ounces Grade Ounces Grade Grade
AuEq)(i) (million) (million) (gpt) (million) (gpt) (gpt)(ii)
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0.2 119,137,050 2,075,999 0.542 117,627,167 30.7 1.133
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0.3 103,408,021 2,007,374 0.604 113,135,045 34.0 1.258
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0.4 83,001,463 1,885,293 0.707 105,032,043 39.4 1.368
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0.5 64,824,711 1,746,280 0.838 95,890,106 46.0 1.723
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0.6 51,680,984 1,623,827 0.977 87,746,119 52.8 1.993
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1.0 30,492,690 1,344,830 1.372 70,398,214 71.8 2.753
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1.5 20,515,737 1,118,517 1.696 57,627,587 87.4 3.376
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2.0 13,347,473 890,427 2.075 44,795,968 104.4 4.083
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MINERAL RESOURCES - MEASURED AND INDICATED
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Cut-off Gold Gold Silver Silver AuEq
(gpt Tonnes Ounces Grade Ounces Grade Grade
AuEq)(i) (million) (million) (gpt) (million) (gpt) (gpt)(ii)
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0.2 187,168,418 2,808,351 0.467 148,932,250 24.8 0.934
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0.3 151,904,139 2,646,975 0.542 139,478,988 28.6 1.092
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0.4 113,889,315 2,404,534 0.657 125,737,334 34.3 1.317
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0.5 83,925,445 2,159,102 0.800 111,948,445 41.5 1.598
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0.6 64,789,904 1,969,472 0.946 100,983,618 48.5 1.879
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1.0 36,299,504 1,579,224 1.353 78,879,494 67.6 2.653
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1.5 23,777,543 1,287,636 1.684 63,510,340 83.1 3.282
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2.0 14,962,161 1,004,446 2.088 47,963,848 99.7 4.005
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MINERAL RESOURCES - MEASURED
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Cut-off Gold Gold Silver Silver AuEq
(gpt Tonnes Ounces Grade Ounces Grade Grade(ii)
AuEq)(i) (million) (million) (gpt) (million) (gpt) (gpt)
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0.2 96,587,826 1,605,129 0.517 83,718,850 27.0 1.036
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0.3 80,050,610 1,530,279 0.595 79,241,979 30.8 1.187
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0.4 61,857,757 1,415,775 0.712 72,508,982 36.5 1.414
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0.5 46,836,549 1,293,629 0.859 65,502,085 43.5 1.696
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0.6 36,734,441 1,194,358 1.011 59,652,930 50.5 1.982
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1.0 21,765,502 989,672 1.414 48,087,568 68.7 2.735
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1.5 14,558,872 823,659 1.760 39,004,084 83.3 3.362
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2.0 9,291,428 652,792 2.185 83,718,850 99.9 4.106
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MINERAL RESOURCES - INDICATED
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Cut-off Gold Gold Silver Silver AuEq
(gpt Tonnes Ounces Grade Ounces Grade Grade(ii)
AuEq)(i) (million) (million) (gpt) (million) (gpt) (gpt)
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0.2 90,584,324 1,203,357 0.413 65,206,084 22.4 0.844
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0.3 71,856,401 1,116,743 0.483 60,272,682 26.1 0.985
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0.4 52,033,568 988,672 0.591 53,231,017 31.8 1.203
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0.5 37,090,620 865,371 0.726 46,434,526 38.9 1.474
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0.6 28,057,187 775,032 0.859 41,331,407 45.8 1.740
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1.0 14,534,863 589,634 1.262 30,790,123 65.9 2.529
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1.5 9,219,244 463,983 1.565 24,506,244 82.7 3.155
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2.0 5,671,306 351,683 1.929 18,134,789 99.5 3.842
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MINERAL RESOURCE - INFERRED
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Cut-off Gold Gold Silver Silver AuEq
(gpt Tonnes Ounces Grade Ounces Grade Grade(ii)
AuEq)(i) (million) (million) (gpt) (million) (gpt) (gpt)
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0.2 40,786,301 388,139 0.296 19,459,389 14.8 0.581
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0.3 27,632,397 326,214 0.367 16,133,009 18.2 0.717
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0.4 17,359,931 256,959 0.460 12,764,245 22.9 0.900
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0.5 11,089,833 202,514 0.568 10,118,552 28.4 1.114
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0.6 7,451,842 164,086 0.685 8,219,877 34.3 1.345
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1.0 2,755,033 96,750 1.092 4,788,327 54.1 2.132
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1.5 1,323,119 62,140 1.461 3,223,125 75.8 2.919
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2.0 668,668 40,646 1.891 2,087,209 97.1 3.758
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(i) Gold-equivalent (AuEq) mine cut-off grades are based on a silver to
gold ratio of 75 to one.
(ii) AuEq grade is based on a silver to gold ratio of 52 to one.
Forward Looking Statements
This release contains certain 'forward-looking statements' and 'forward-looking information' as defined under applicable Canadian and U.S. securities laws. Forward-looking statements generally can be identified by the use of forward-looking terminology such as 'may', 'will', 'expect', 'intend', 'estimate', 'anticipate', 'believe', 'continue' or similar terminology. Forward-looking statements are based on forecasts of future results, estimates of amounts not yet determinable and assumptions that, while believed by management to be reasonable, are inherently subject to significant business, economic and competitive uncertainties and contingencies. Certain of the statements made herein by Minefinders are forward-looking and subject to important risk factors and uncertainties, both known and unknown, many of which are beyond the Company's ability to control or predict. Known and unknown factors could cause actual results to differ materially from those projected in the forward-looking statements. Those factors are described or referred to under the heading 'Risk Factors' in Minefinders' Annual Information Form for the year ended December 31, 2010 and under the heading 'Risks and Uncertainties' in Minefinders' Management's Discussion and Analysis for the quarter ended March 31, 2011, both of which are incorporated by reference herein and are available on SEDAR at www.sedar.com. Although the Company has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. Minefinders does not undertake to update any forward looking statements that are incorporated by reference, except in accordance with applicable securities laws.
Contacts:
Minefinders Corporation Ltd.
Jonathan Hackshaw
Director of Corporate Communications
Toll Free: (866) 687-6263
Minefinders Corporation Ltd.
Mike Wills
Investor Relations Representative
Toll Free: (866) 687-6263
www.minefinders.com