Fortune River Files Technical Report for Wind Mtn PEA
May 27 2010 - 9:30AM
Marketwired
Fortune River Resource Corp. (TSX VENTURE: FRX)(FRANKFURT: RG7A)
has received and filed on SEDAR the Technical Report for the
Preliminary Economic Assessment (PEA) conducted by Mine Development
Associates (MDA) of Reno for its wholly owned Wind Mountain
Project, located in northwestern Nevada. The study assumes open-pit
mining using conventional trucks, shovels, run-of-mine leaching and
utilizing a base case gold price of US$850 per ounce with a credit
for silver at a price of $14.50 per ounce. The base case economic
model(1) in US dollars indicates:
Resource inside pits = 26.9 million short tons @ 0.012 oz Au/t,
with 0.007 oz Au/t cutoff (approximately 90% Measured + Indicated,
approximately 10% Inferred)
Gold Ounces mined = 320,000
Gold Ounces produced = 198,000
Waste: Ore Strip ratio = 0.7:1
Capital = Initial capital of $41.8 million with $4.4 million
sustaining capital
Mine Life = 4 years active mining with 2 additional years of
residual leaching and rinsing of leach pads
Life-of-mine cash cost per Au ounce = $497 after a silver credit
of $86 per ounce of gold is applied
Total Pre-Tax cost per Au ounce = $719 after a silver credit of
$86 per ounce of gold is applied
IRR = 15%
Pre-tax NVP @ 5% = $13.2 million
(1) Note that Canadian NI 43-101 guidelines define a PEA as
follows: "A preliminary economic assessment is preliminary in
nature and it includes inferred mineral resources that are
considered too speculative geologically to have the economic
considerations applied that would enable them to be classified as
mineral reserves, and there is no certainty that the preliminary
assessment will be realized."
Sensitivity studies by MDA indicate that gold and silver prices
20% higher in the same modeled pit ($1,020/oz Au and $17.40/oz Ag)
will increase the IRR to 38% and the NPV@5% to $43.7 million. Gold
and silver prices that are 10% lower ($765/oz Au and $13.05/oz Ag)
result in the model becoming uneconomic at an NPV@5%. Sensitivities
of the model to capital and operating costs are also provided by
MDA.
Mine Development Associates, Ore Reserves Engineering ("O.R.E.")
and Debra Struhsacker, Environmental Permitting and Government
Relations Consultant, compiled the technical report. Thomas Dyer,
P.E. is a Senior Engineer for MDA and is responsible for sections
of the technical report involving mine designs and the economic
evaluation; Alan C. Noble, P.E. is the Principal Engineer of O.R.E.
and is responsible for sections of the technical report involving
resource modeling and information taken from the 2007 Technical
Report completed entitled "Technical Report on the Wind Mountain
Gold Project"; and Debra Struhsacker is responsible for the section
of the technical report involving environmental issues. These are
the Qualified Persons of the technical report for the purpose of
Canadian NI 43-101, Standards of Disclosure for Economic Analyses
of Mineral Projects. The report is now available on SEDAR and the
company's website, fortuneriver.ca.
About Fortune River
Fortune River Resource Corp. is exploring for high-grade gold
deposits within two prolific gold producing geologic provinces,
Nevada and Ontario. The Wind Mountain, East Manhattan, Highland,
Baxter, Mud Springs, and Buz projects are located in Nevada and the
Drayton project is located in Ontario. The Company's Wind Mountain
project, a past-producing open-pit/heap-leach operation.
On behalf of the Board,
Joseph Anthony Kizis, Jr., President, Fortune River Resource
Corp.
We seek safe harbor
Neither TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
Contacts: Fortune River Resource Corp. Jeff Stuart
1.888.456.1112 or 604.641.2771 jstuart@mnxltd.com Fortune River
Resource Corp. Liana Shahinian 1.888.456.1112 or 604.641.2771
www.fortuneriver.ca
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