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TORONTO, ONTARIO--(Marketwire - Dec. 1, 2010) - Lake Shore Gold Corp.
(TSX:LSG) ("Lake Shore Gold" or the "Company")
today announced the completion of an initial resource estimate for the
Company's wholly owned Bell Creek Mine property located in Timmins,
Ontario. The reported resource contains 8,427,000 tonnes
with an average grade of 4.40 grams per tonne
Au ("gpt") for a total of 1,192,900
contained ounces in the inferred category and 1,790,000 tonnes at 4.36 gpt for
251,200 contained ounces in the measured and indicated categories. The
base case resource was estimated assuming a long term gold price of
US$1,125 per ounce of gold and a cut off grade of 2.20 gpt. Approximately 80% of the base case measured
and indicated resources, and 50% of inferred resources, are contained
in the North A Zone (see Table 1), which has an estimated average
horizontal width of 6.9 metres.
Capped Grade(g/t Category Tonnes Au)(i) Oz Au Measured 410,000 4.51 59,300 Indicated 1,380,000 4.32 191,800 --------------------------------------------------------------------------- M & I 1,790,000 4.36 251,200 Inferred 8,427,000 4.40 1,192,900
(i)Resource
estimation completed using Inverse Distance to the power 2 (ID2)
interpolation method with all gold assays capped to 34 gpt. The resource estimate includes approximately
1.1 million tonnes of internal dilution.
Tony Makuch, President and CEO of Lake Shore
Gold, commented: "The initial resource estimate at the Bell Creek
Mine highlights the robust nature of this project with attractive
grades and good widths that improve at depth. We are also encouraged by
the sensitivity analysis done, which highlights the increase in
resource grades at lower gold prices and higher cut-off grades. This
initial resource estimate represents a strong starting point as we
continue to advance the Bell Creek deposit forward towards production,
with our expectation being that significant potential exists to add
ounces as more drill holes are included and more work is completed.
Engineering studies are progressing for access design and mining of
deeper thick zones as part of a pre-feasibility study for the Bell
Creek Complex. We fully expect that as mine planning progresses,
internal dilution can be reduced which we believe will allow us to
improve the resource grades by at least 0.35 gpt."
The total resources reported are contained in six separate zones,
namely the North A Zone, North A2 Zone, North A3 Zone, North A
Extension Zone, North B Zone and the North B2 Zone with the bulk of the
resources being contained with the North A, North A2 and North B Zones.
Approximately 80 percent of the total measured and indicated ounces
(204,000 ounces) and 50 percent of the Inferred ounces (653,000 ounces)
are contained within the North A Zone which has an estimated average
horizontal width of 6.9 metres. The North A
Zone was previously the main source of feedstock for the Bell Creek
Mine. A detailed report of the estimated tonnages and grades for each
of these six zones is presented in Table 1.
Included within the mineral resource estimate is a sensitivity analyses
from the base case resource estimate using various cut off grades
between 2.50 and 5.00 gpt. Results from the
sensitivity analyses are summarized below with additional detail
provided in Table 2 and on the attached tonnage-grade curve (Figure 1).
The analyses indicate the robust nature of the overall resource and
potential to host substantially higher grades at reduced gold prices
and increased cut off grades.
Gold Price Grade Contained Cut-Off Grade (gpt) (US$/oz) Tonnes (gpt)(i) Ounces 2.2 (Base Case) 1,125 10,217,000 4.40 1,443,900 2.5 1,019 9,447,000 4.58 1,392,500 3.0 849 8,385,000 4.84 1,305,800 4.0 637 6,412,000 5.40 1,113,400 5.0 510 4,457,000 6.05 892,200
(i)The
sensitivity analysis is inclusive of internal dilution.
The base case resource estimate and sensitivity calculations were
calculated using an assumed minimum mining width of two metres, US$/C$ exchange rate of 0.95, average
mining costs of $76.20 per tonne and average
processing recoveries of 93%.
The reported resource extends from surface to a vertical depth of
approximately 1,200 metres, with the deposit
remaining open to depth. Of importance, the average width and ounces
per vertical metre are shown to be increasing
with depth and averaging greater than 2,000 ounces per vertical metre below the 925 metre
level from surface to at least 1,215 metres,
with only limited testing below this level. No resources are reported
for the Vogel or Marlhill Mine properties at
this time, with resource estimates from these properties to follow.
Qualified Person
Lake Shore Gold intends to file Technical Report that is in compliance
with the requirements of National Instrument 43-101
("NI43-101") within 45 days of the issue of this news
release. The report is being prepared by Scott Wilson Roscoe Postle Associates under the direct supervision of
Mr. Reno Pressacco, P. Geo. Mr. Pressacco is
independent of Lake Shore Gold and a Qualified Person according to the
definitions of NI 43-101.
About Lake Shore Gold
Lake Shore Gold is a rapidly growing mining company with a vision is to
become a mid-tier gold producer through the successful exploration,
development and operation of its properties in the Abitibi Greenstone
belt in Northern Ontario and Quebec, starting with its strong base in
Timmins, Ontario. In Timmins, the Company is currently carrying out
pre-production development at the Timmins Mine, where it is using both
a shaft and ramp to mine the Timmins deposit, and has intersected
mineralization underground at the adjacent Thunder Creek deposit, which
is being developed using the same infrastructure and as part of the
Timmins Mine project. Progress is also being made with an underground
advanced exploration program at its Bell Creek Mine, located on the
east side of the City of Timmins, which is moving forward to become the
Company's second mining operation in the Timmins Gold Camp. The
Company's wholly owned mill (located on the Bell Creek property) has
been refurbished and is currently operating at 2,000 tonnes per day. The Company continues to invest
aggressively in exploration primarily in the Timmins Gold Camp and in
its other properties in Northern Ontario and Quebec, and owns a large
land position in Mexico. The Company's common shares trade on the TSX
under the symbol LSG.
Forward-looking Statements
Certain statements in this press release relating to the Company's
exploration activities, potential for increasing resources, project
expenditures and business plans are "forward-looking
statements" within the meaning of securities legislation. The
Company does not intend, and does not assume any obligation, to update
these forward-looking statements. These forward-looking statements
represent management's best judgment based on current facts and
assumptions that management considers reasonable, including that
operating and capital plans will not be disrupted by issues such as
mechanical failure, unavailability of parts, labour
disturbances, interruption in transportation or utilities, or adverse
weather conditions, that there are no material unanticipated variations
in budgeted costs, that contractors will complete projects according to
schedule, and that actual mineralization on properties will not be less
than identified mineral reserves. The Company makes no representation
that reasonable business people in possession of the same information
would reach the same conclusions. Forward-looking statements involve
known and unknown risks, uncertainties and other factors which may
cause the actual results, performance or achievements of the Company to
be materially different from any future results, performance or
achievements expressed or implied by the forward-looking statements. In
particular, fluctuations in the price of gold or in currency markets
could prevent the Company from achieving its targets. Readers should
not place undue reliance on forward-looking statements. More
information about risks and uncertainties affecting the Company and its
business is available in Lake Shore Gold's most recent Annual
Information Form and other regulatory filings which are posted on sedar at www.sedar.com.
TABLE 1 ESTIMATED BASE CASE MINERAL RESOURCE BY DOMAIN (NOVEMBER 2010)
Lake Shore Gold Corp. - Bell Creek Mine Deposit
Category Tonnes Capped Grade (g/t Au) Oz Au North A Domain Measured 375,000 4.49 54,200 Indicated 960,000 4.86 149,800 Inferred 4,462,000 4.55 653,000 North A2 Domain Measured - 0.00 - Indicated 44,000 2.95 4,200 Inferred 1,728,000 5.14 285,400 North B Domain Measured - 0.00 - Indicated 229,000 3.05 22,500 Inferred 1,580,000 3.48 177,000 North A3 Domain Measured - 0.00 - Indicated 147,000 3.24 15,300 Inferred 148,000 2.84 13,500 North B2 Domain Measured - 0.00 - Indicated - 0.00 - Inferred 509,000 3.92 64,100 North A Extension Domain Measured 34,000 4.65 5,100 Indicated - 0.00 - Inferred - 0.00 - GRAND TOTAL Measured 410,000 4.51 59,300 Indicated 1,380,000 4.32 191,800 --------------------------------------------------------------------------- M & I 1,790,000 4.36 251,200 Inferred 8,427,000 4.40 1,192,900
Notes:
1. CIM definitions were followed for classification of Mineral Resources. 2. Mineral Resources are estimated at a cut-off grade of 2.2 g/t Au. 3. Mineral Resources are estimated using an average long-term gold price of US$1,125 per ounce, and a US$/C$ exchange rate of 0.95. 4. A minimum mining width of 2 metres was used. 5. Capped gold grades are used in estimating the Mineral Resource average grade. 6. Sums may not add due to rounding. 7. There are no Mineral Reserves estimated for the Bell Creek property. 8. Metallurgical recoveries are assumed to average 93% 9. Mining costs are assumed to average $76.20/tonne
TABLE 2 CUT-OFF GRADE
SENSITIVITY ANALYSIS (INCLUSIVE OF INTERNAL DILUTION)
Lake Shore Gold Corp. - Bell Creek Mine Deposit
Gold Price Domain (US$/oz) Tonnes Au Cap Contained Oz --------------------------------------------------------------------------- Cut-Off Grade: 2.2 g/t Au 1,125 10,217,000 4.40 1,443,900 Cut-Off Grade: 2.5 g/t Au 1,019 9,447,000 4.58 1,392,500 Cut-Off Grade: 3.0 g/t Au 849 8,385,000 4.84 1,305,800 Cut-Off Grade: 3.5 g/t Au 728 7,299,000 5.11 1,198,800 Cut-Off Grade: 4.0 g/t Au 637 6,412,000 5.40 1,113,400 Cut-Off Grade: 4.5 g/t Au 566 5,052,000 5.82 945,300 Cut-Off Grade: 5.0 g/t Au 510 4,457,000 6.05 867,600 Gold Price Domain (US$/oz) Tonnes Au No Cap Contained Oz --------------------------------------------------------------------------- Cut-Off Grade: 2.2 g/t Au 1,125 10,217,000 4.49 1,474,200 Cut-Off Grade: 2.5 g/t Au 1,019 9,447,000 4.68 1,422,400 Cut-Off Grade: 3.0 g/t Au 849 8,385,000 4.95 1,335,700 Cut-Off Grade: 3.5 g/t Au 728 7,299,000 5.23 1,227,000 Cut-Off Grade: 4.0 g/t Au 637 6,412,000 5.53 1,140,200 Cut-Off Grade: 4.5 g/t Au 566 5,052,000 5.98 970,800 Cut-Off Grade: 5.0 g/t Au 510 4,457,000 6.23 892,200
Notes:
1. Capped grades are capped using 34 g/t Au capping grade 2. Sums may not add due to rounding 3. Tonnages and grades are reported on an unclassified basis for information purposes only
To view Figure 1 - Tonnage-Grade Graph: http://media3.marketwire.com/docs/lsg_12_01_2010_fig_1.pdf
To view Figure 2 - Ounces Per 25 Metre
Vertical Inverval: http://media3.marketwire.com/docs/MetreVertical.pdf
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