Mustang Tables Positive Prefeasibility for Maskwa Nickel Project
TORONTO, ONTARIO–(June 26, 2008) – Mustang Minerals Corp., (TSX VENTURE:MUM)(FRANKFURT:NJF) today announced it has filed at www.sedar.com the National Instrument 43-101 prefeasibility study completed for the Company’s Maskwa Nickel Project The study was compiled by Micon International Limited with Met-Chem Canada Inc, Wardrop Engineering Inc and Golder Associates. The proposed project envisages a 2,750 tonnes per day open pit mine and milling operation producing an average of 9.2 million (payable) pounds of nickel per year in concentrate and other credits including platinum group metals, copper and cobalt. The project is located approximately 140 km northeast of Winnipeg in Manitoba, Canada, a favourable political jurisdiction with low hydroelectric power rates and established infrastructure. Standard grinding and flotation techniques will be utilized to produce a nickel concentrate.Micon concluded that “the Maskwa Project contains an economic mineral reserve and warrants continued development to the full feasibility stage.”
“The prefeasibility study of the Maskwa Project is a significant milestone towards the re-establishment of a mining operation at the Maskwa site” said Robin Dunbar President of Mustang. “The prefeasibility study indicates that the planned operation at Maskwa has the potential to be a profitable low cost producer of nickel and other by-product metals. Using the assumptions outlined in the prefeasibility study the project will have an attractive cash cost net of credits of CDN $2.77 per pound over its life. We are moving ahead on all fronts at Maskwa to complete feasibility level studies and permitting required for the project”.
Using nickel prices per pound of US $10 for the first two years and US$8 per pound thereafter the project assumed that open pit ore would be mined, milled and a concentrate produced for shipment to a Sudbury smelter. The undiscounted pre-tax operating profit generated by the project was CDN$285 million with single peak year earnings of CDN$ 63 million.
Feasibility Underway at Maskwa Project
Mustang is now moving forward aggressively with a feasibility study and permitting activities for the Maskwa Project. Key activities are as follows:
1. Metallurgical Testwork – A feasibility level metallurgical test work program has been initiated by Mustang engaging the services of Xstrata Process Support. The overall feasibility metallurgical program will expand on the test work completed for the prefeasibility study.
2. Updated Resource Calculation – A new resource estimate incorporating additional assay data is planned for the fall of 2008. As part of an updated resource calculation Mustang has;
a) Completed a first phase in-pit sampling program Previously unassayed drill core was split, logged and assayed. All of the drill core assayed were from holes previously drilled inside the proposed Maskwa pit shell and as such is anticipated to add to the existing resource.
b) Drilled and submitted for assay an additional six holes to test for near surface and potential hangingwall mineralization inside the current pit shell.
c) Drilled an additional six drill holes to the east of the current targeting the expansion of the pit in this direction.
3. Environmental Baseline Studies and Permitting – Mustang is currently in the final stages of completing baseline environmental studies at Maskwa. First Nations and other stakeholder engagement are also planned in the coming months as part of permitting activities for the project. Wardrop Engineering Inc. is the consultant working with the Company on these issues.
Additional exploration results are currently pending for the Maskwa Property and Mustang’s East Bull Lake Property.
Carey Galeschuk P. Geo and Ernie Marcotte P. Eng are the Qualified Person for Mustang Minerals Corp. for purposes of National Instrument 43-101.
Disclaimer: The Company notes that assumptions and technical inputs used in the prefeasibility study may vary for the feasibility study. As such the results of a feasibility study will vary from those of the prefeasibility study.
To find out more about Mustang Minerals Corp. (TSX-V: MUM) visit our website at www.mustangminerals.com.
We seek safe harbour.
This news release contains forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995 and forward-looking information within the meaning of the Securities Act (Ontario) (together, “forward-looking statements”). Such forward-looking statements may include the Company’s plans for its mineral projects in Manitoba, the overall economic potential of its properties, the availability of adequate financing and involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements expressed or implied by such forward-looking statements to be materially different. Such factors include, among others, risks and uncertainties relating to potential political risk, uncertainty of production and capital costs estimates and the potential for unexpected costs and expenses, physical risks inherent in mining operations, currency fluctuations, fluctuations in the price of nickel and other metals, completion of economic evaluations, changes in project parameters as plans continue to be refined, the inability or failure to obtain adequate financing on a timely basis, and other risks and uncertainties, including those described in the Company’s Management Discussion and Analysis for the period ended December 31, 2007 and thereafter and Material Change Reports filed with the Canadian Securities Administrators and available at www.sedar.com.
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