| March 22, 2010 |
| Mustang Updates Project Economics at Makwa Nickel Project
Drill Results Announced |
TORONTO, ONTARIO--(Marketwire - March 22, 2010) - The Board of Directors of Mustang Minerals Corp. (TSX VENTURE:MUM) is pleased to announce news of recent activities to develop the Makwa Nickel-Copper-PGM Project located in southeast Manitoba. The Company has reported updated project economics and exploration results from the property.
Improved Project Economics
The project cash flow model developed by Micon International Limited and used to validate the February 05, 2010 Mineral Reserve Estimate, has been updated with recent metal prices and shows enhanced potential economics for the Makwa project. Metal prices used in this exercise, in $US values, were Nickel (9.00/lb), Copper (3.00/lb), Cobalt (20.00/lb), Platinum (1500.00/oz), Palladium (375.00/oz). A dollar exchange rate of 0.90US equals 1.00CDN was used. The nickel price and exchange rate are within the sensitivity range examined in the Prefeasibility Study of May 2008 and filed on SEDAR.
Highlights of the cash flow calculation are as follows, based on the updated Probable Reserve (diluted ) estimate of 9.855Mt grading 0.54% Ni, 0.11% Cu, 0.02% Co and 0.434/t (Pt plus Pd):
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Nickel net cash cost $US/lb 3.81
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Nickel cash cost including byproduct credits $US/lb 2.69
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Project operating profit pre-tax $CDN000 322,980
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Project operating profit after tax $CDN000 263,286
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Pre-production capital $CDN000 129,449
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Project IRR pre-tax % 18.9
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Project IRR after tax % 14.6
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Project NPV 7% pre-tax $CDN000 76,210
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Project NPV 7% after tax $CDN000 43,883
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Drill Program
Mustang recently completed several drill holes at the Makwa Project including two holes designed to test the depth potential of the eastern portion of the deposit beneath the previously known shallower sections. Results follow from these two holes which showed the existence of wide zones of both the hangingwall and main zone of the deposit. Metallurgical testwork completed during the previous year has indicated that the nickel recovery from low grade material within the pit outline is in the range of 50% and that this material exhibits good upgrading to a final concentrate.
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Drill hole Collar From To Interval(i) Ni Cu Co Au+Pt
Location +Pd
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Easting (m) (m) (m) % % % g/t
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MM10-146 325750 119.5 158.5 39.0 0.24 0.07 0.01 0.29
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and 259.0 283.0 24.0 0.40 0.07 0.02 0.45
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MM10-148 325750 134.4 146.5 12.1 0.29 0.09 0.01 0.35
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and 164.5 242.5 78.0 0.32 0.07 0.02 0.40
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including 212.5 239.5 27.0 0.49 0.10 0.02 0.76
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(i)Drilled width.
Exploration drilling also included two holes to examine the potential for near surface mineralization in the area of the adjacent Dumbarton and Dumbarton F zone mines which were operated in the 1970's as underground mines only, producing nickel-copper-PGM ore. Results from these two holes are pending.
Mayville Exploration
The Company has recently received its exploration work permit for the Mayville Property which is located approximately 35 km north of Makwa. Mustang is evaluating the potential to co- process a near surface core of Mayville mineralization with the Makwa deposit. Exploration at Mayville is planned to commence shortly.
Drill core is logged and split on the Makwa site facility by Mustang staff, with half core sent to the laboratory. Mustang conducts an ongoing QA/QC program on the drill core including inserting blanks, duplicates and standards with the samples. Assays noted above were completed at Accurassay Laboratories in Thunder Bay Ontario. For nickel, copper and cobalt assays, aqua regia digestion followed by AA determination was used. For gold, platinum and palladium, fire assay of 30g aliquots followed by AA finish was employed.
Ian Ward P.Eng, Senior Vice President of the Company, is the Qualified Person for the Makwa project information and this press release.
To find out more about Mustang Minerals Corp. (TSX VENTURE: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 most recent financial period and Material Change Reports filed with the Canadian Securities Administrators and available at www.sedar.com.
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