| ||October 20, 2011|
Abacus provides update on Feasibility Study progress
| ||Vancouver, British Columbia -- October 20, 2011. Abacus Mining & Exploration Corporation (TSXV: AME "Abacus") is pleased to provide an update on the progress of the Feasibility Study (the "FS") on its jointly owned Ajax copper-gold project. |
The majority of the project inputs have now been received from a team of widely recognized consultants led by Wardrop Engineering as the project's general QP. Comprehensive trade-off studies have been incorporated to maximize operations over the life of mine and enhance project value, over the original Preliminary Economic Assessment (PEA) of June 22, 2009. These studies include the use of high pressure grinding rolls vs SAG mill technology for reduced costs and improved recoveries, in-pit crushing and conveying of both ore and waste vs truck and shovel operations, and high density tailings deposition vs conventional tailings storage to improve location logistics and reduce the environmental footprint. A new reserve and resource estimate will also be reported following the extensive delineation and infill diamond drilling programs undertaken by Abacus since the PEA to further define and upgrade resources. The results of the studies are being incorporated into the FS which is anticipated in the fourth quarter of 2011.
Once the FS is delivered to joint venture partner KGHM Polska Miedz SA, KGHM will have a maximum of 90 days from the date of delivery of the FS to acquire a further 29% in the joint venture company for a cash consideration equal to 29% of the Proven and Probable copper equivalent reserve in the FS, to a maximum of US$35 million. Thereafter, KGHM will arrange the financing for its (80%) proportionate interest in the project capex, and Abacus has the option to arrange its own financing for its (20%) proportionate interest or elect to have KGHM do so on commercially reasonable terms.
In the event that KGHM chooses not to increase its interest in the Joint Venture, Abacus has the right to purchase KGHM's 51% interest within a period of 90 days following the above timeframe for a total consideration of US$37 million. Should KGHM choose not to increase its interest and Abacus does not purchase KGHM's interest in its entirety, Abacus' interest in the Joint Venture can be increased to 51% for a consideration of approximately US$1.5 million payable to KGHM.
On Behalf of the Board,
ABACUS MINING AND EXPLORATION CORPORATION
James D. Excell
President & CEO
Director, Investor Relations
Tel: 604-682-0301 | 647-345-0826
Abacus Mining is an exploration and mine development company focused on the development of the Ajax copper-gold project located near Kamloops, B.C. through the KGHM Ajax Joint Venture with KGHM Polska Miedz SA. The project has a positive preliminary economic assessment report (June 22, 2009) that contemplates a 60,000 tonne per day operation producing an average of approximately 110 million pounds of copper (approx. 50,000 tonnes) and 100,000 ounces of gold in concentrate annually. A Feasibility Study is anticipated in the fourth quarter of 2011. The environmental review and permitting process was initiated in January of this year with the submission of the Project Description, a copy of which is available on the Company's website and www.eao.gov.bc.ca.
This release includes certain statements that may be deemed "forward-looking statements". All statements in this release, other than statements of historical facts, that address events or developments that Abacus Mining and Exploration Corp. (the "Company") expects to occur, are forward-looking statements. Forward-looking statements are statements that are not historical facts and are generally, but not always, identified by the words "expects", "plans", "anticipates", "believes", "intends", "estimates", "projects", "potential" and similar expressions, or that events or conditions "will", "would", "may", "could" or "should" occur. Although the Company believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results may differ materially from those in the forward-looking statements. Factors that could cause the actual results to differ materially from those in forward-looking statements include market prices, exploitation and exploration successes, and continued availability of capital and financing, and general economic, market or business conditions. Investors are cautioned that any such statements are not guarantees of future performance and actual results or developments may differ materially from those projected in the forward-looking statements. Forward-looking statements are based on the beliefs, estimates and opinions of the Company's management on the date the statements are made. Except as required by applicable securities laws, the Company undertakes no obligation to update these forward-looking statements in the event that management's beliefs, estimates or opinions, or other factors, should change.
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