Northgate Announces Increase in Gold Reserves at its Stawell Gold Mine
Mine-Life Extended by 1.5 years Until Q4-2011
VANCOUVER, Sept. 8 /CNW/ - (All figures in US dollars except where noted)
- Northgate Minerals Corporation (TSX: NGX, AMEX: NXG) is pleased to announce
that exploration drilling since February 2008 has identified approximately
880,000 tonnes of additional mineral reserves at its Stawell Gold Mine located
in Victoria, Australia. These newly defined reserves contain 140,000 ounces of
gold and will extend the current mine-life by an additional 18 months until
the fourth quarter of 2011.
Reserve Highlights
- 140,000 ounces of additional gold reserves have been delineated in
only five months at a cost of $20/ounce.
- Stawell's mine-life has been extended for an additional 18 months
until Q4-2011.
- The new GG6 reserve zone averages 6.0 g/t gold, which is
approximately 15% higher than the reserve grade in other areas of the
mine.
- GG6 remains open to the north, where there is excellent potential to
add additional high grade reserves.
- High-grade mineralization intersected below GG6 has provided
additional exploration targets, which will further enhance the GG6
zone.
Ken Stowe, President and Chief Executive Officer, remarked, "At the onset
of acquiring the Stawell Gold Mine, Northgate allocated $7 million to fund an
aggressive 2008 exploration program, which focused on numerous near mine
targets including GG6 and North Magdala. We are pleased to report that after
only five months of drilling, we have already added another 18 months of
reserves at Stawell, extending the current mine-life to the fourth quarter of
2011. These exploration results confirm what we believed from the very
beginning, that there are many more years of life left at the Stawell mine,
which has already had a 25-year history of continuous operation with low
discovery costs."
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Overview of Reserve Additions
A total of 140,000 ounces of additional gold reserves were delineated in
the first half of 2008 at Stawell at a finding cost of approximately $20 per
ounce. Reserves were increased in all areas of the mine, through a combination
of exploration drilling, resource definition drilling, and grade control
drilling. The largest area of reserve addition is the GG6 zone where
61,000 ounces of reserves and 24,000 ounces of inferred resources have thus
far been delineated. The basalt contact gold mineralization in GG6 averages
11.0 g/t gold and overall, GG6 reserves average 6.0 g/t gold, which is 15%
greater than the reserve grade in other areas of the mine. All additional
ounces have been added to the underground reserves as detailed in Table 1.
Table 1 - Summary of Reserve Additions
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Zone Gold (ounces)
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Magdala 18,000
C7 10,000
U3 2,000
GG1 6,000
GG3 - Fury 5,000
GG3 - Rimfire 3,000
GG5 - Statesman 23,000
GG5 - Open Flank 9,000
GG6 61,000
GG9 3,000
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Total Proven and Probable 140,000
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Mineral reserves and resources at the Stawell Gold Mine at June 30, 2008
are shown in Tables 2 and 3. Northgate will be filing a NI 43-101 Technical
Report on SEDAR at www.sedar.com within the next 45 days describing in detail
the reserve additions at the Stawell Gold Mine.
Table 2 - Mineral Reserves: Stawell Gold Mine
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Mineral Reserves - Underground
At June 30, 2008 Tonnes (000) Grade (g/t) Gold (ounces)
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Proven - Underground 55 7.16 13,000
Probable - Underground 1,746 5.33 299,000
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Proven and Probable
- Underground 1,801 5.39 312,000
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Mineral Reserves - Surface
At June 30, 2008 Tonnes (000) Grade (g/t) Gold (ounces)
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Probable - Surface 488 1.68 26,000
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Total Proven and Probable
Reserves 2,289 4.59 338,000
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Table 3 - Mineral Resources: Stawell Gold Mine
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Mineral Resources - Indicated
At June 30, 2008 Tonnes (000) Grade (g/t) Gold (ounces)
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Indicated - Underground 293 4.97 47,000
Indicated - Surface 2,958 2.08 198,000
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Total Indicated Resources 3,251 2.34 245,000
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Mineral Resources - Inferred
At June 30, 2008 Tonnes (000) Grade (g/t) Gold (ounces)
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Inferred - Underground 427 5.29 73,000
Inferred - Surface 106 2.44 8,000
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Total Inferred Resources 533 4.72 81,000
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Notes:
1. All mineral reserves and mineral resources were estimated in
accordance with the JORC Code and have been reconciled to CIM
Standards as prescribed by National Instrument 43-101.
2. Mineral reserves and resources are rounded to 1,000 tonnes,
0.1 g/t gold and 1,000 ounces. Minor discrepancies in summations may
occur due to rounding.
3. Mineral reserves and resources were calculated using a gold price of
A$825/oz at June 30, 2008 and A$750/oz at December 31, 2007.
Revised Mine Plan
The revised mine plan for Stawell extends the life of the mine until the
fourth quarter of 2011, adding approximately 126,000 recovered ounces of gold
production to the previous plan. Estimated annual production in future years
is shown in Table 4. Development towards GG6, which contains 61,000 ounces of
reserves and 24,000 ounces of inferred resources, is scheduled to begin in
March 2009.
Table 4 - Stawell Gold Mine Production Profile
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2008 2009 2010 2011
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Gold Production (ounces) 105,000 103,000 106,000 82,000
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Continuation of the 2008 Exploration Program
The purpose of the 2008 exploration program at Stawell is to convert
mineral resources into the mineral reserve category and to extend the current
mine life. Since Northgate acquired the Stawell Gold Mine in February 2008,
112 drill holes have been completed totalling approximately 19,600 metres.
The reserve and resource figures included in this news release include
assay results for drill holes completed prior to July 1, 2008. Exploration
drilling in the GG6 and North Magdala zones is continuing with the aim of
defining additional near mine reserve ounces that can be readily accessed and
mined.
Exploration results from the main GG6 reserve zone (Concord block)
indicate that the zone remains open 150 metres along strike to the north
(North Concord block) where there is excellent potential to add additional
high grade resources. Similar exploration potential exists in the zones above
and below the Concord block as shown in Figure 1. Exploration drilling has
also indicated that there is additional potential for resource additions below
the Gamay fault where drill holes MD5281 and MD5282 intersected high grade
gold mineralization similar to GG6.
Figure 1 - GG6 Zone
www.northgateminerals.com/Theme/Northgate/files/Releases/GG6-Jul08.jpg
Northgate is continuing to revisit, through geological modeling and
resource definition drilling programs, previously-mined areas of
mineralization in the upper reaches of the mine, with the goal of finding
additional resource and reserve ounces. The main area of interest in this
regard is the Magdala zone shown in Figure 2.
Figure 2 - Stawell Gold Mine Long Section
www.northgateminerals.com/Theme/Northgate/files/Releases/LS-SGM-Jul08.gif
Qualified Persons
The program design, implementation, quality assurance/quality control and
interpretation of the results is under the control of Northgate's geological
staff that includes a number of individuals who are qualified persons as
defined under NI 43-101. Overall supervision of the program is by Dean
Fredericksen, BSc(Hons), MAusIMM, Principal Consultant, Fredericksen
Geological Solutions Pty. Ltd. on behalf of Northgate Australian Ventures
Corporation Pty. Ltd.
Note to US Investors:
The terms "Mineral Reserve", "Proven Mineral Reserve" and "Probable
Mineral Reserve" are Canadian mining terms as defined in accordance with NI
43-101 Standards of Disclosure for Mineral Projects under the guidelines set
out in the Canadian Institute of Mining, Metallurgy and Petroleum (the "CIM")
Standards on Mineral Resources and Mineral Reserves Definitions and Guidelines
adopted by the CIM Council on August 20, 2000. The terms "Mineral Resource",
"Measured Mineral Resource", "Indicated Mineral Resource", and "Inferred
Mineral Resource" used in this news release are Canadian mining terms as
defined in accordance with NI 43-101-Standards of Disclosure for Mineral
Projects under the guidelines set out in the CIM Standards.
Northgate Minerals Corporation is a mid-tier gold and copper producer
with mining operations, development projects and exploration properties in
Canada and Australia. The company is forecasting 385,000 ounces of unhedged
gold production in 2008 and is targeting growth through further acquisitions
in stable mining jurisdictions around the world. Northgate is listed on the
Toronto Stock Exchange under the symbol NGX and on the American Stock Exchange
under the symbol NXG.
Forward-Looking Statements:
This news release contains certain "forward-looking statements" and
"forward-looking information" 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," or "continue" or the negative thereof or
variations thereon or similar terminology. Forward-looking statements are
necessarily based on a number of estimates and assumptions that are inherently
subject to significant business, economic and competitive uncertainties and
contingencies. Certain of the statements made herein, including any
information as to the future activities of and developments related to the
business activities of Northgate Minerals Corporation (Northgate) and its
subsidiaries, the market position, and future financial or operating
performance of Northgate, are forward-looking and subject to important risk
factors and uncertainties, many of which are beyond the corporations' ability
to control or predict. Known and unknown factors could cause actual results to
differ materially from those projected in the forward-looking statements. Such
factors include, among others: gold price volatility; impact of any hedging
activities, including margin limits and margin calls; discrepancies between
actual and estimated production, between actual and estimated reserves and
resources and between actual and estimated metallurgical recoveries; costs of
production, capital expenditures, costs and timing of construction and the
development of new deposits, success of exploration activities and permitting
time lines; changes in national and local government legislation, taxation,
controls, regulations and political or economic developments in any of the
countries in which either corporation does or may carry out business in the
future; risks of sovereign investment; the speculative nature of gold
exploration, development and mining, including the risks of obtaining
necessary licenses and permits; dilution; competition; loss of key employees;
additional funding requirements; and defective title to mineral claims or
property. In addition, there are risks and hazards associated with the
business of gold exploration, development and mining, including environmental
hazards, industrial accidents, unusual or unexpected formations, pressures,
cave-ins, flooding and gold bullion losses (and the risk of inadequate
insurance or inability to obtain insurance, to cover these risks), as well as
the factors described or referred to in the section entitled "Risk Factors" in
Northgate's Annual Information Form for the year ended December 31, 2006 or
under the heading "Risks and Uncertainties" in Northgate's 2006 annual report,
both of which are available on SEDAR at www.sedar.com, and which should be
reviewed in conjunction with this document. Accordingly, readers should not
place undue reliance on forward-looking statements. Neither corporation
undertakes any obligation to update publicly or release any revisions to
forward-looking statements to reflect events or circumstances after the date
of this document or to reflect the occurrence of unanticipated events, except
in each case as required by law.
%CIK: 0000072931
For further information: Ms. Keren R. Yun, Director, Investor Relations, Tel:
(416) 216-2781, Email: ngx@northgateminerals.com, Website:
www.northgateminerals.com
.
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