TORONTO, ONTARIO--(Marketwire - May 4, 2011) - Queenston Mining Inc. (News - Market indicators)(FRANKFURT:QMI) ("Queenston" or the "Company") is pleased to report the results of a new mineral resource estimate at its 100% owned Upper Beaver gold-copper property located in Gauthier Township, Kirkland Lake. The mineral resource estimate was completed by Watts, Griffis and McOuat Limited ("WGM") Consulting Geologists and Engineers of Toronto, Canada and complies with National Instrument 43-101 ("NI 43-101").
Highlights
- 84% increase in the Indicated mineral resource to 690,000 oz of Au and 36.6 million lbs of Cu
3,074,000 t grading 7.0 g/t Au (capped) with 0.54% Cu. The uncapped grade is 8.8 g/t Au (874,000 oz.)
- 135% increase in the Inferred mineral resource to 616,000 oz of Au and 28.0 million lbs of Cu
3,093,000 t grading 6.2 g/t Au (capped) with 0.41% Cu. The uncapped grade is 7.2 g/t Au (711,000 oz.)
- Potential to further increase resources remains strong
- Permitting process has begun and engineering study proposing an exploration shaft is under review
Charles Page, President and CEO of Queenston said "This important increase in the mineral resources at Upper Beaver combined with the strong potential for finding more ounces supports the next step towards advancing the project to feasibility through an underground evaluation. In order to accomplish this, the Company is reviewing a recently completed engineering study that proposes the sinking of a new shaft on the property to a depth of 750 m. The permitting and consultation process has started and we are targeting later this year to have the required permits in place for ground breaking early in 2012. Also at this time, economic studies are in progress to maximize the economics of establishing a new mine-milling complex in Gauthier Township to process ore from five 100% owned gold deposits: Upper Beaver, Upper Canada, Anoki, McBean and Bidgood".
Table 1: Summary of Upper Beaver Mineral Resources (WGM May 4, 2011)
| Category |
Tonnes |
Cu (%) |
Au (g/t)
(Uncapped) |
Ounces
(Uncapped) |
Au (g/t)
(Capped)* |
Ounces
(Capped)* |
| Indicated |
3,074,000 |
0.54 |
8.84 |
874,000 |
6.98 |
690,000 |
| Inferred |
3,093,000 |
0.41 |
7.15 |
711,000 |
6.19 |
616,000 |
Notes:
- The Mineral Resources in this press release were estimated using the Canadian Institute of Mining, Metallurgy and Petroleum ("CIM"), CIM Standards on Mineral Resources and Reserves, Definitions and Guidelines prepared by the CIM Standing Committee on Reserve Definitions and adopted by CIM Council December 11, 2005.
- Mineral resources are estimated at a cut-off grade of 2.5 g/t Au and a minimum true width of 2.0 m
- Mineral resources are estimated using a three-year rolling average gold price of US$1,050/oz, an exchange rate of US$0.95=CDN$1.00 and metallurgical recoveries of 95%.
- *Individual assays were capped at 50 g/t Au.
- A bulk density of 2.9 t/m3 was used.
- Kurt Breede, P.Eng. of Watts, Griffis and McOuat Limited ("WGM") is the independent Qualified Person ("QP") under NI 43-101 who completed the Mineral Resource estimate.
- Mineral resources that are not mineral reserves do not have demonstrated economic viability. The estimate of Mineral Resources may be materially affected by environmental, permitting, legal, title, socio-political, marketing, or other relevant issues.
- The quantity and grade of reported Inferred Mineral Resources in this estimation are uncertain in nature and there has been insufficient exploration to define these Inferred Resources as an Indicated or Measured Mineral Resource and it is uncertain if further exploration will result in upgrading them to an Indicated or Measured Mineral Resource category.
The new mineral resource is an update of the initial NI 43-101 mineral resource estimate reported at Upper Beaver on September 22, 2008 that outlined 1,373,500 tonnes ("t") grading 8.5 grams per tonne ("g/t") gold ("Au") with 0.43% copper ("Cu") in the Indicated category (375,000 oz.) and 1,061,300 t grading 7.7 g/t Au with 0.39% Cu in the Inferred category (262,500 oz.). The 2008 resource estimate was based on 136 drill holes, while this latest update includes an additional 134 drill holes which have both extended the deposit to depth, and filled in gaps closer to surface.
Four surface Diamond drill rigs continue to explore the property with the focus to expand the strike extent where the deposit remains open to the east and west. Drilling will also begin to target the upper portion of the deposit where historically from 1919 to 1972 the mine intermittently produced 140,000 oz. of Au and 11.9 million lbs. of Cu from 526,700 t grading 8.3 g/t Au and 1% Cu to a depth of 365 m. Recent studies in this area of the deposit suggest there remains unexplored potential for extending the mineral resources closer to surface.
The majority of the mineral resource occurs in a series of breccia zones that dip steeply north (75°) below the old mine workings. These zones contain chalcopyrite, magnetite, pyrite and visible gold within a mineralized corridor that extends over a horizontal length of approximately 500 m and a dip length of approximately 1300 m. The most prominent are the Porphyry Zones that contain approximately 80% of the mineral resource with 556,000 oz. (2,219,000 t grading 7.8 g/t Au) in the indicated category and 535,000 oz. (2,528,000 t grading 6.6 g/t) in the inferred category.
Included within the mineral resource estimate is a sensitivity analysis from the base case resource estimate using various cut off grades ranging between 2.5 g/t and 5.0 g/t. The analysis indicates the potential of higher grades employing higher cut off grades.
Table 2: Resource Estimate Sensitivity Analyses at Various Cut Offs
Cut Off
Grade
(g/t) |
Category |
Tonnes |
Cu
(%) |
Au
(g/t)
(Uncapped) |
Ounces
(Uncapped) |
Au
(g/t)
(Capped) |
Ounces
(Capped) |
2.5
(base case) |
Indicated
Inferred |
3,074,000
3,093,000 |
0.54
0.41 |
8.84
7.15 |
874,000
711,000 |
6.98
6.19 |
690,000
616,000 |
| 3.0 |
Indicated
Inferred |
2,606,000
2,631,000 |
0.58
0.44 |
9.93
7.92 |
832,000
670,000 |
7.74
6.80 |
649,000
575,000 |
| 4.0 |
Indicated
Inferred |
1,934,000
2,005,000 |
0.66
0.49 |
12.15
9.27 |
756,000
598,000 |
9.23
7.84 |
574,000
505,000 |
| 5.0 |
Indicated
Inferred |
1,470,000
1,394,000 |
0.76
0.59 |
14.49
11.3 |
685,000
508,000 |
10.74
9.32 |
507,000
418,000 |
Qualified Persons
The Independent QP for the NI 43-101 compliant mineral resource estimate is Kurt Breede, P. Eng. of WGM. The NI 43-101 technical report on the mineral resource estimate will be filed on SEDAR within 45 days of this news release.
Quality Control
The design of the Queenston's drilling programs, Quality Assurance/Quality Control and interpretation of results is under the control of Queenston's geological staff, many of which are qualified persons as defined by NI 43-101. Supervision of the Upper Beaver project is undertaken by William McGuinty, P.Geo., Queenston's Vice President Exploration. The design of the Queenston's drilling programs, Quality Assurance/Quality Control and interpretation of results is under the control of Queenston's geological staff including qualified persons employing a QA/QC program consistent with NI 43-101 and industry best practices. Said procedures are being reviewed by Independent Qualified Person, Richard Risto, P.Geo., Senior Associate Geologist of WGM. A detailed review of Queenston's QA/QC procedures is filed in the 2010 Annual Information Form on SEDAR.
The drill core is logged and split with half-core samples shipped to Swastika Laboratories of Swastika, Ontario and analyzed employing the appropriate gold fire assaying technique. For QA/QC purposes the Company as well as the lab submits standards and blanks every 25 samples. Approximately 5% of sample rejects and/or pulps are sent to other laboratories for check assaying.
This news release was reviewed by Queenston's Vice President Exploration and QP, William McGuinty, P. Geo.
About Queenston
Queenston is a Canadian mineral exploration and development company with a primary focus on its holdings in the historic Kirkland Lake gold camp that comprises 220 km². Late in 2010 the Company entered into a strategic alliance with Agnico-Eagle Mines Limited with the objective of advancing its key, 100% owned gold projects (Upper Beaver, Upper Canada, McBean, Anoki and Bidgood) at the Kirkland East project towards feasibility and ultimately production. The Company has working capital of approximately $75 million no debt and a fiscal 2011 exploration budget of $25 million.
Forward Looking Statements
Except for historical information this News Release may contain certain "forward looking statements". These statements may involve a number of known and unknown risks and uncertainties and other factors that may cause the actual results, level of activity and performance to be materially different from the Company's expectations and projections. A more detailed discussion of the risks is available in the "Annual Information Form" filed by the Company on SEDAR at www.sedar.com.
