Candente Copper Corp. (TSX:DNT)( BVLAC:DNT) ("Candente") is pleased
to provide an update on the impact of the new Peru Mining Tax Law
on the Canariaco Norte economics, the Canariaco Norte Copper
Feasibility Study being prepared by AMEC Americas Limited ("AMEC")
and on general corporate activities.
New Peru Mineral Tax
An assessment of the new tax rates in Peru confirms the robust
economics of the Canariaco Norte project. AMEC has completed an
assessment of the impact to the Canariaco Norte project economics
resulting from the new Mineral Taxation Law recently enacted in
Peru. The new tax rates were applied to the financial model
developed by AMEC as part of the Pre-Feasibility Study Progress
Report completed in March 2011. In order to complete a direct
assessment of the new tax rates, all other aspects of the financial
assessment including metal prices were held constant as per the
March 2011 Financial Model. Under the new tax rates, the after tax
NPV, IRR and payback period for the Canariaco Norte project are
$912 million, 17.2% and 4.4 years respectively, at a long term
copper price of US$2.25 per pound and a discount rate of 8%. The
after tax NPV, IRR and payback period reported in March 2011 in the
Pre-feasibility Study Progress report were US$1.063 billion, 18.8%
and 4.2 years respectively.
Feasibility Study
Feasibility design work is well underway by AMEC and Knight
Piesold. As part of the Feasibility Study program, AMEC completed
an analysis of the potential benefit of increased daily throughput.
Four different production rates were evaluated which considered the
impacts on mining, processing, ancillary facilities, water balance,
project footprint and project financials including capital and
operating costs. Based on the analyses a larger SAG mill and larger
ball mills will be incorporated into the Canariaco Norte process
plant. Specifically, a 40 foot diameter SAG mill will be used. The
larger 4o foot SAG mills are rapidly becoming the preferred size
for large mining operations. Preliminary modelling indicates that
the larger SAG mill will achieve a processing rate in the range of
100,000, to 110,000 tonnes per day, which is an increase from the
95,000 tonne per day rate projected in the Prefeasibility Study
Progress Report. This increase in processing rate will result in
higher levels of annual copper, gold, and silver production,
however the resulting increase in metal production totals are still
under assessment, pending completion of the Feasibility level mine
design.
As part of the production rate increase, Knight Piesold
conducted a review of tailings containment options to ensure the
proposed tailings site provided sufficient capacity for the
proposed increase. This analysis identified several options and
resulted in the selection of a new tailings containment area
significantly closer to the proposed process plant than the
tailings facility presented in the Prefeasibility Study Progress
report.
In addition, AMEC has completed a review of the potential mine
access routes. The review indicates that development of a southern
route that follows the current access road route would provide
several key benefits including shorter haul distance to the Port at
Eten and lower life of mine cost. In addition, the power line may
be constructed along this road route thereby simplifying the
logistics of power line construction.
Canariaco Drilling Programs
Candente has significant drilling programs planned for the
Canariaco project. Exploration drilling is planned for the
Canariaco Sur area where drilling, by Candente in 2008 and prior to
Candente's ownership, by BHP Billiton, identified the presence of a
significant copper-gold porphyry system. The exploration drilling
is planned to test for lateral and depth extensions of the Sur
system.
Exploration drilling is also planned at Quebrada Verde to test
for copper-gold mineralization. Geological, geochemical and
geophysical surveys carried out by Candente have delineated
strongly anomalous copper, gold and molybdenum levels in rock
samples and soil samples that coincide with magnetic and
chargeability highs identified by magnetic and induced polarization
(geophysical) surveys.
Canariaco Sur and Quebrada Verde have excellent potential for
the discovery of additional copper and gold mineralization in very
close proximity to the Canariaco Norte project.
Planned drilling on Canariaco Norte includes geotechnical,
metallurgical and geological drilling for Feasibility Study design
of the open pit and ancillary facilities, as well as a small amount
of infill drilling for the resource.
In addition to the planned drilling, Candente plans to conduct a
geophysical survey over the entire Canariaco property. The
objective of this program is to search for new geophysical
anomalies that could be indicative of underlying porphyry systems.
Geophysical surveys completed to date have focussed solely on the
Canariaco Norte, Canariaco Sur and Quebrada Verde areas. The
Canariaco property covers over 16,000 hectares and the majority of
it is under explored. The property wide geophysical survey will be
a key tool to assist evaluation of exploration potential beyond the
Canariaco Norte, Sur and Quebrada Verde areas.
Permitting
As part of new requirements for advanced drilling permits in
Peru, AMEC (Peru) S.A. ("AMEC E&E") completed a semi-detailed
Environmental Impact Assessment ("EIASD") in July 2011. A community
workshop (also as required) was conducted on the EIASD findings in
October 2011. AMEC E&E has now completed all of the studies and
responses required for the drilling application and it has been
submitted to the Peruvian Ministry of Environmental Affairs.
Pending approval times, management anticipates that drilling should
commence in the first quarter of 2012. In addition to the drilling
application, a long term agreement for surface rights access is
also being discussed with the local community.
Sustainable Development and Community Programs
Candente has formed an alliance with local communities, regional
government and two well recognized Non-Governmental Organizations
to ensure local interests and needs guide the Company's sustainable
development, cultural and community initiatives.
CICAP, a Peruvian based Livelihood Development organization,
will join our team and international specialists in initiatives
for: coffee growers and other agricultural producers, to improve
quality and reach new markets (including organic and fair trade);
micro-finance ventures; water security; and technical training for
tradesmen.
Save the Children initiatives will focus on improving health,
nutrition, education, hygiene and individual's rights. These will
include: local clinics and support systems in the promotion of
traditional food and culture while enhancing childrens'
development, maternal health and reducing domestic violence.
Candente is also very pleased to be assisting the Clinton
Giustra Sustainability Global Initiative and Lyons Club of
Lambayeque which are now carrying out campaigns for eye care which
includes cataract surgeries and the distribution of free eye
glasses. Sight improvement for both the young and aged has an
enormous impact on their quality of life and livelihoods.
Feasibility Schedule
Due to the additional project optimization work conducted to
date as part of the Feasibility Study and the longer period
required to complete the drilling application process, the
completion date for the Feasibility Study has been extended. The
schedule remains highly dependent on Ministry approval of the
Canariaco Norte drilling program application which has no firm
timeline but is expected within 3 months. Timeline for completion
of the Feasibility Study will be updated once drilling
commences.
Corporate Update
Canariaco Norte is one of the largest undeveloped copper
deposits currently under 100% control of a junior mining company
and a number of major and mid-size International companies have
communicated interest to Candente regarding an investment in the
Canariaco Norte project. Candente has entered into a
Confidentiallity Agreement with several of the third parties, and
these companies are conducting technical reviews of project data
and have or are scheduled to visit the Canariaco project site.
"We continue to be extremely pleased with the progress of the
Canariaco Norte Feasibility program, and although our feasibility
schedule has been extended due to the additional engineering
assessment and drilling application process, we believe the
improvements made to the scope of the project development will
provide significant benefit to the Canariaco Norte project,"
commented Sean Waller, P.Eng., President of Candente Copper.
About Candente Copper
Candente Copper's flagship project is the 100% owned, 7.5
billion pound, Feasibility stage Canariaco Norte Copper Project
located in northern Peru's prolific mining district. The Canariaco
Norte deposit contains a Measured and Indicated resource of 752.4
million tonnes grading 0.49% copper equivalent(i), and an Inferred
Resource of 157.7 million tonnes at 0.44% copper equivalent(i).
Sean Waller, P.Eng., President, and Joanne C. Freeze, P.Geo.,
CEO, are the Qualified Persons as defined by National Instrument
43-101 for the projects discussed above. They have reviewed and
approved the contents of this release. (i)The 'Measured and
Indicated Resource' listed above consists of Measured Resources of
338.1Mt at 0.48% Cu, 0.08 g/t Au, and 2.0/t Ag (0.52% Cu Eq.), plus
Indicated Resources of 414.3Mt at 0.43% Cu, 0.06 g/t Au, and 1.8
g/t Ag (o.46% Cu Eq.). All resources quoted in this release are
based on a 0.30% copper cut-off grade and 229 drill holes completed
to March 2008. (i)Copper equivalent grade including gold and
silver, metal recoveries (gold 55%; silver 50%) and smelter returns
(copper 96.5%; gold 93%; silver 90%) applied. Copper grade
equivalent calculation: Cu Eq% = (Cu % + ((Au grade x Au price x Au
recovery x Au smelter return%)+(Ag grade x Ag price x Ag recovery x
Ag smelter return%))/(22.0462 x Cu price x 31.0135 g/t x Cu
recovery x Cu smelter return%). The metal prices used are: copper
US$2.50/lb, gold US$1,035/oz and silver US$17.25/oz.
This news release may contain forward-looking statements
including but not limited to comments regarding the timing and
content of upcoming work programs, geological interpretations,
receipt of property titles, potential mineral recovery processes,
etc. Forward-looking statements address future events and
conditions and therefore involve inherent risks and uncertainties.
Actual results may differ materially from those currently
anticipated in such statements. Candente relies upon litigation
protection for forward-looking statements.
CAUTIONARY NOTE TO U.S. INVESTORS
We advise U.S. investors that this news release uses terms that
are not recognized by the United States Securities and Exchange
Commission ("SEC"), including "mineral resources", "measured
resources", "indicated resources" and "inferred resources". The
estimation of measured and indicated resources involves greater
uncertainty as to their existence and economic feasibility than the
estimation of proven and probable reserves. U.S. investors are
cautioned not to assume that mineral resources in these categories
will be converted to reserves. The estimation of inferred resources
involves far greater uncertainty as to their existence and economic
viability than the estimation of other categories of resources.
U.S. investors are cautioned not to assume that estimates of
inferred mineral resources exist, are economically mineable, or
will be upgraded into measured or indicated mineral resources. U.S.
investors are cautioned not to assume that mineral resources in any
of these categories will be converted into reserves.
On behalf of the Board of Candente Copper Corp.
Sean Waller, P.Eng., President & Director
NR-031
Contacts: Candente Copper Corp. John Foulkes, VP Corporate
Development mobile: +1 (604) 614-2999 or local: + 1 (604) 689-1957
ext 2 toll free: 1 (877) 689-1964 ext
2info@candentecopper.comwww.candente.com Candente Copper Corp.
Walter Spagnuolo Manager, Investor Relations mobile: +1 (604)
306-8477 local: + 1 (604) 689-1957 ext 3
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