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Re: News Releases - Wednesday, April 16, 2008
ROCA - MAX Molybdenum Mine Achieves Commercial Production
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VANCOUVER, BRITISH COLUMBIA--(Marketwire - April 16, 2008) - Roca Mines
Inc. (TSX VENTURE:ROK) ("Roca" or "the Company") provides the following
update on operations and development activities at the MAX Molybdenum
Project near Revelstoke, British Columbia. Highlights of this update
include;
- Phase I Commercial Production was achieved on April 12, 2008;
- Startup operations produced approximately 410,000 lbs of contained
molybdenum in concentrate;
- Key Phase II expansion work to be completed in Summer 2008; and,
- Phase I target production rates recently achieved.
Phase I Commercial Production Achieved
In February 2008, while operating at a prescribed lower throughput rate
for startup, the MAX mine and mill achieved continuous daily throughput
of approximately 80% of its Phase I design rate of 500 tonnes per day.
During the period, the mill also achieved molybdenum recovery rates
averaging 90%, exceeding the design recovery of 87%.
Phase I ore grade material has recently been supplied from underground
stopes and delivered directly to the MAX mill and concentrator. Based
on a 10-day average grade of the ore supplied, the diluted head grade
from the mine exceeded 75% of the planned mine-diluted grade of 1.7%
MoS2. As a result of this recent development, the Company is declaring
that Phase I commercial production was achieved on April 12, 2008.
Startup Operations
Startup operations at the MAX Molybdenum Mine have now overcome minor
challenges and disruptions to commissioning resulting from crusher and
mill equipment modifications, process optimization, and reagent quality
control. As planned, the initial operations made use of lower-grade
stockpiled development rock to facilitate the startup production run.
That material was significantly lower in grade than the ore currently
being processed. During the period, the MAX operation delivered
approximately 880,000 dry lbs of concentrates containing an estimated
410,000 lbs of molybdenum, with a gross metal value of $13.5 million
based on average molybdenum oxide prices during the period. Proceeds
received from concentrate sales during startup have been used for
completion costs and to fund ongoing Phase II expansion of the mine and
mill.
Phase II Expansion and Development
Previously, the Company announced the development of a second adit to
the mine working area. Adit #2 recently reached a break-through
location to workings in the mine, and final completion of the
connection is expected early in May 2008. Once connected, the
underground mine will be capable of achieving its Phase II ventilation
requirements. This will allow for concurrent mine development and
production to increase to 1,000 tonnes per day for the first time in
the history of the project.
The Company has also previously announced the acquisition of a third
primary ball mill. The installation of this mill will allow for greater
production flexibility and will provide for a nominal capacity of at
least 1,000 tonnes per day. The third mill has been delivered to the
site and power distribution systems and controls have been prepared.
Engineering of a new mill base is complete and construction will
commence shortly, with the new equipment to be fully commissioned by
the fall of 2008. A concentrate drying system will also be installed
during the month of May 2008, which will assist in controlling moisture
content in the concentrates produced.
The Company plans to seek a graduated permit increase for the operation
of the Phase II mine enabling it to produce at the as-built capacity in
late 2008 and beyond. The application for this increase in production
rate will be submitted after environmental and water quality data is
collected and compiled this spring/summer. The information will
demonstrate that the mine is working well within its compliance
requirements and with minimal impact to the environment.
Production Targets
Phase I target production rates are currently being realized and are
equivalent to approximately 300,000 lbs of contained molybdenum in
concentrate production per month. In the coming weeks, mill throughput
rate is expected to increase as all process operations are raised to
Phase I capacity.
Completion of the Phase II expansion work, as described above, will
provide opportunities for the mine and the mill to operate at nominal
rates of 1,000 tonnes per day. At those throughput rates, and estimated
tonnes and grades available from the mine schedule, the Phase II
production target for the remainder of calendar 2008 is estimated to be
approximately 600,000 lbs of contained molybdenum per month.
Accounting and Financial Reporting
Proceeds from sales of molybdenite concentrates from the date of
commercial production forward will be recorded as revenues and
associated costs treated as operating expenses which will first be
reflected in the Company's financial statements dated May 31, 2008 to
be reported in July 2008. All costs associated with Phase I production,
have been capitalized to date, with any startup concentrate proceeds
recorded as a reduction to capital costs in accordance with Canadian
GAAP. Net pre-production costs will be amortized on a unit of
production basis over the Company's Phase I mine plan.
The permitted Phase I mine plan for MAX will focus on the deposit's
high-grade zone containing 280,000 measured and indicated tonnes
grading 1.95% MoS2 (refer to T.N. Macauley's 43-101 compliant technical
report dated September 2004 available via SEDAR). Molybdenum oxide
currently trades in the US$33-34/lb. range.
ROCA MINES INC.
Scott E. Broughton, P.Eng. - President & CEO
The TSX Venture Exchange does not accept responsibility for the
adequacy or accuracy of this release.
For more information, please contact
Roca Mines Inc.
Doug Fosbrooke
Investor Relations
(604) 684-2900
(604) 684-2902 (FAX)
Email: info@rocamines.com
Website: www.rocamines.com
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Copyright (c) 2008 ROCA MINES INC. (ROK) All rights reserved. For
more information visit our website at http://www.rocamines.com/ or send
mailto:info@rocamines.com
Message sent on Wed Apr 16, 2008 at 3:38:48 PM Pacific Time
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