The following corrects and replaces the release issued at 11:31 am ET, on
October 26, 2010, for Creston Moly Corp. In the second table, "2010 Conceptual
Pit Resources (JDS)", on the "Mea + Ind" line, in the "Mo(%)" column, the number
read 0.71, and should have read 0.071. The complete, corrected release follows.
Creston Moly Corp. ("Creston" or the "Company") (TSX VENTURE:CMS) is pleased to
announce that resources for the Company's 100% owned El Creston molybdenum
deposit located in Sonora State, Mexico have been increased. The Resource
Estimate, completed by SRK Consulting (Canada) Inc. ("SRK") is an update from
the 2009 Pre-Feasibility Study ("PFS") undertaken by M3 Engineering & Technology
Corporation of Tucson, Arizona ("M3"), and incorporates the results of the 2010
drill program reported before September 27th, 2010. Results of the final sixteen
holes drilled, were not used in the calculation of this Resource, but will
subsequently be used in future estimates.
The Resource Estimate, when constrained by a conceptual optimized pit prepared
by JDS Energy & Mining Inc. ("JDS"), includes the following highlights:
-- The Measured and Indicated Resources are estimated to be 215.4 million
tonnes averaging 0.071 % Mo and 0.059 % Cu containing 335.5 million lbs
of molybdenum and 280.5 million lbs of copper.
-- The Measured and Indicated Resource represents a 34.2 % increase in
contained lbs molybdenum and a 76.6 % increase in contained lbs copper
when compared to the Proven and Probable Reserve in the 2009 Pre-
Feasibility.
-- The stripping ratio is now estimated to be 0.94:1 versus a stripping
ratio of 1.23:1 in the M3 2009 PFS. Mineralization still remains open to
expansion.
Since the merger of Creston with Tenajon Resources in September of 2009,
management has embarked on an ambitious program which included the compilation
of all historical work, field mapping, prospecting, sampling and geophysical
surveying of selected targets. Diamond drilling was completed to test areas for
resource expansion, provide required grade fill-in information, and to collect
structural data for geotechnical analysis.
The program has developed a focused understanding of the exploration potential
in the region and thus far resulted in the physical expansion of the Main Zone,
the verification of grades and subsequent addition of the Red Hill Zone to the
deposit resources. This new data has initiated optimization modeling of a new
conceptual pit plan for the El Creston molybdenum deposit.
Bruce McLeod, President and CEO of Creston said; "These new resources are the
fundamental underpinning for the completion of a Feasibility Study ("FS"). With
the increase in resources, and a significant reduction in the strip ratio using
lower molybdenum and copper prices than were used in the previous Pre
Feasibility Study we are confident that we can significantly increase the asset
value of this project going forward. A Preliminary Economic Assessment ("PEA")
and development of a new open pit mining plan has commenced and indications are
that the increased resource within the conceptual optimized pit will support
increasing the processing plant throughput from the 40 ktpd (used in the
Pre-Feasibility Study) to 50 ktpd. The PEA will incorporate the additional
resources defined with the new SRK study. In conjunction, metallurgical test
work and plant re-design is well advanced for completion of the FS. JDS Energy &
Mining Inc. expects to complete the PEA by December 2010 and the FS in the 2nd
quarter of 2011."
MINERAL RESOURCE ESTIMATES
The updated resource estimate was completed in October 2010 by SRK with Gilles
Arseneau, P. Geo. acting as the Independent Qualified Person under NI 43-101.
The tables presented below are intended to show the contained metal improvement
from the 2009 Pre-Feasibility with the additional resources (due to drilling)
and the potential to improve the plant throughput to 50 ktpd at an improved
stripping ratio.
M3 2009 PFS
--------------------------------------------------------------------------
0.037% Mo Mo Lbs Cu Lbs
cut-off Tonnes Mo (%) Cu (%) Millions Millions
--------------------------------------------------------------------------
Proven Reserves 44,736,000 0.079 0.053 78.024 52.217
--------------------------------------------------------------------------
Probable Reserves 101,968,000 0.076 0.047 171.924 106.614
--------------------------------------------------------------------------
Proven & Probable 146,705,000 0.077 0.049 249.948 158.831
--------------------------------------------------------------------------
The stripping ratio of the pit in the M3 2009 pre-feasibility is 1.23:1
and includes ramps using Mo $12/lb and Cu $1.60/lb. Note that
Mo-Equivalent % = Mo% + (Cu%/7.5)
2010 Conceptual Pit Resources (JDS)
-------------------------------------------------------------------------
0.036% Mo Mo-Eq Mo Lbs Cu Lbs
cut-off Tonnes Mo (%) Cu (%) (%) Millions Millions
-------------------------------------------------------------------------
Measured 56,325,346 0.074 0.058 0.082 91.3 71.6
-------------------------------------------------------------------------
Indicated 159,101,604 0.07 0.06 0.078 244.2 208.9
-------------------------------------------------------------------------
Mea + Ind 215,426,950 0.071 0.059 0.079 335.5 280.5
-------------------------------------------------------------------------
(i) The stripping ratio in this conceptual pit is estimated to be 0.94:1.
This includes an allowance for an additional 5% waste in lieu of design
ramps, plus approximately 4.4% inferred material also considered waste
for this exercise.
The development of the comparative tables has relied on the work of other
experts as described in this release. The following factors should also be
noted:
-- Mineral resources were estimated in conformance with the CIM Mineral
Resources and Mineral Reserves definitions referred to in National
Instrument 43-101, Standard of Disclosure for Mineral Properties.
-- The updated resource includes the results of holes EC10-66 to 106 and
GT10-001 to 009 representing 7,952 metres of the cumulative 11,000 metre
drill program. The remaining geotechnical and exploration holes had not
been sampled in time for the SRK modeling.
-- Prior to the 2010 drill program 114 diamond and 18 reverse circulation
drill holes respectively totaling 31,860 and 4,998 metres in length had
tested the Creston Main and Red Hill Zones. Some of the pre-2010 holes
were not included in the 2009 PFS resource estimate due to poor core
recovery and the lack of assay certificates which resulted in Red Hill
being discarded. The additional 2010 infill drilling enabled SRK to
include Red Hill in their Resource Estimate.
-- JDS' conceptual open pit optimization & production scheduling for the El
Creston Project was completed using Maptek Systems Inc. Vulcan(TM)
software.
-- A simplified 3D block model for the Creston deposit was produced by SRK
in Gemcom Software International's GEMS(TM) software from the work of
Dr. Riccardo Aque, Consultant Geologist to the Company. This new 3D
model was imported directly into Vulcan, and used to define the Creston
open pit resources that were used for pit optimization and preliminary
scheduling.
-- The JDS conceptual Lerchs-Grossman optimized pit shell is based on a
large-scale open pit operating at a rate of approximately 50,000 tonnes
per day. All mineral resources are contained within the pit using the
parameters listed below to generate a preliminary in pit mineral
resource that the Company believes can be economically extracted.
-- Pit slope angles, operating costs and recoveries are from the "Creston
Project Pre-Feasibility Study Sonora, Mexico" report dated March 23,
2009 and completed by M3 Engineering & Technology Corporation (M3). All
the projected costs and recovery figures should be considered
preliminary.
-- Note that the metal prices used here to create the resource constraining
conceptual optimized pit are lower than that used in the 2009 PFS
optimum pit shell ($US 12.00/lb Mo and $US 1.60/lb Cu).
--------------------------------------------------------------------------
Parameter Unit Value
--------------------------------------------------------------------------
Moly Price $US/lb $11.00
--------------------------------------------------------------------------
Copper Price $US/lb $1.47
--------------------------------------------------------------------------
Owner Mining Cost $US/tonne mined $1.05
--------------------------------------------------------------------------
Processing Cost $US/tonne processed $6.23
--------------------------------------------------------------------------
G&A Cost $US/tonne processed $0.75
--------------------------------------------------------------------------
Moly Smelting & Refining Cost $US/lb $1.11
--------------------------------------------------------------------------
Copper Smelting & Refining Cost $US/lb $0.30
--------------------------------------------------------------------------
Moly Recovery % of Feed 88.40%
--------------------------------------------------------------------------
Copper Recovery % of Feed 84.00%
--------------------------------------------------------------------------
Overall Pit Slope Angle Degrees 45.9 degrees
--------------------------------------------------------------------------
Maximum Mining Rate Total Tonnes per Year (Mt) 45
--------------------------------------------------------------------------
Maximum Ore Processing Rate Ore Tonnes per Year (Mt) 18.25
--------------------------------------------------------------------------
Details of the SRK and M3 Resources at various cut-offs are listed below. The
first table is SRK's Mo-Eq% cutoff and second is from Table 1.3-8 (page 1-142)
of the M3 2009 PFS with the 0.030 Mo-Eq% marked with an (x) in both cases.
---------------------------------------------------------------------------
SRK
MoEq% Resource Grade Grade Contained Contained
Cut-off Class Mo% Cu% Tonnes Mo lbs Cu lbs
---------------------------------------------------------------------------
0.030% Measured 0.068 0.06 67,600,000 101,600,000 88,400,000
------------------------------------------------------------------
Indicated 0.062 0.05 204,500,000 277,800,000 247,400,000
------------------------------------------------------------------
Inferred 0.045 0.05 21,700,000 21,400,000 23,400,000
------------------------------------------------------------------
Mea+Ind (x) 0.063 0.06 272,100,000 379,400,000 335,800,000
---------------------------------------------------------------------------
0.035% Measured 0.071 0.06 62,600,000 98,500,000 84,400,000
------------------------------------------------------------------
Indicated 0.065 0.06 187,900,000 267,800,000 233,400,000
------------------------------------------------------------------
Inferred 0.050 0.05 17,300,000 19,000,000 18,200,000
------------------------------------------------------------------
Mea+Ind 0.066 0.06 250,500,000 366,300,000 317,800,000
---------------------------------------------------------------------------
0.040% Measured 0.075 0.06 57,800,000 95,100,000 80,200,000
------------------------------------------------------------------
Indicated 0.068 0.06 171,000,000 255,700,000 219,500,000
------------------------------------------------------------------
Inferred 0.055 0.05 13,600,000 16,400,000 14,900,000
------------------------------------------------------------------
Mea+Ind 0.070 0.06 228,800,000 350,800,000 299,700,000
---------------------------------------------------------------------------
0.045% Measured 0.078 0.06 53,200,000 91,400,000 76,100,000
------------------------------------------------------------------
Indicated 0.071 0.06 155,600,000 243,100,000 206,000,000
------------------------------------------------------------------
Inferred 0.060 0.05 10,600,000 14,000,000 11,700,000
------------------------------------------------------------------
Mea+Ind 0.073 0.06 208,800,000 334,500,000 282,100,000
---------------------------------------------------------------------------
0.050% Measured 0.081 0.07 48,900,000 87,500,000 71,700,000
------------------------------------------------------------------
Indicated 0.074 0.06 140,000,000 228,800,000 190,800,000
------------------------------------------------------------------
Inferred 0.064 0.05 8,700,000 12,300,000 9,700,000
------------------------------------------------------------------
Mea+Ind 0.076 0.06 188,900,000 316,300,000 262,500,000
---------------------------------------------------------------------------
Estimation tabulated within a Whittle shell at various Mo equivalent%
cut-offs.
---------------------------------------------------------------------------
M3
MoEq% Resource Grade Grade Contained Contained
Cut-off Class Mo% Cu% Tonnes Mo lbs Cu lbs
---------------------------------------------------------------------------
0.030% Measured 0.074 0.050 52,240,000 85,490,000 58,080,000
------------------------------------------------------------------
Indicated 0.070 0.044 124,650,000 192,720,000 121,060,000
------------------------------------------------------------------
Inferred 0.051 0.061 16,300,000 18,320,000 21,860,999
------------------------------------------------------------------
Mea+Ind (x) 0.071 0.046 176,890,000 278,210,000 179,140,000
---------------------------------------------------------------------------
0.040% Measured 0.079 0.054 46,880,000 81,690,000 55,930,000
------------------------------------------------------------------
Indicated 0.076 0.047 108,620,000 181,550,000 113,600,000
------------------------------------------------------------------
Inferred 0.061 0.065 11,410,000 15,340,000 16,330,000
------------------------------------------------------------------
Mea+Ind 0.077 0.049 155,500,000 263,240,000 169,530,000
---------------------------------------------------------------------------
0.050% Measured 0.085 0.058 40,260,000 75,770,000 51,670,000
------------------------------------------------------------------
Indicated 0.082 0.049 93,690,000 168,480,000 101,840,000
------------------------------------------------------------------
Inferred 0.072 0.056 7,878,888 12,540,000 11,520,000
------------------------------------------------------------------
Mea+Ind 0.083 0.052 133,950,000 244,250,000 153,510,000
---------------------------------------------------------------------------
0.060% Measured 0.092 0.060 33,810,000 68,930,000 44,680,000
------------------------------------------------------------------
Indicated 0.088 0.05 79,120,000 152,860,000 87,450,000
------------------------------------------------------------------
Inferred 0.084 0.059 5,600,000 10,410,000 7,260,000
------------------------------------------------------------------
Mea+Ind 0.089 0.053 112,930,000 221,790,000 132,130,000
---------------------------------------------------------------------------
0.080% Measured 0.108 0.061 22,630,000 53,790,000 30,600,000
------------------------------------------------------------------
Indicated 0.101 0.051 50,820,000 113,620,000 57,320,000
------------------------------------------------------------------
Inferred 0.105 0.057 3,010,000 6,980,000 3,780,000
------------------------------------------------------------------
Mea+Ind 0.103 0.054 73,450,000 167,410,000 87,920,000
---------------------------------------------------------------------------
Gilles Arseneau, P. Geo., SRK Consulting is the Independent Qualified Person
responsible for the Mineral Resource Estimate.
Mike Makarenko, P. Eng., JDS Energy and Mining Inc. is the Independent Qualified
Person responsible for the conceptual optimized pit Resource calculations.
Dave Visagie, P. Geo., a Qualified Person as defined by NI 43-101 is responsible
for the technical information contained in this release.
About the El Creston Molybdenum Deposit
The El Creston molybdenum deposit, located in the state of Sonora and 175
kilometres south of the US Border, boasts excellent infrastructure with close
proximity to power, roads and railway. A semi-desert climate allows for year
round development. In 2009 a NI 43-101 compliant Pre-Feasibility Study ("PFS"),
was issued by M3 Engineering & Technology Corporation of Tucson, Arizona ("M3").
Using a base case scenario of $15/lb Mo and $1.75/lb Cu M3 determined that the
El Creston molybdenum deposit has an after-tax Net Present Value ("NPV") at an
8% discount rate of USD$306.02 million and an Internal Rate of Return ("IRR") of
20.2%. The Company is focusing on the completion of optimization projects
designed to further improve the economics of the project by increasing the size
of the resource and re-engineering certain key components of the project.
On Behalf of the Board of Directors
CRESTON MOLY CORP.
D. Bruce McLeod, President & CEO
Forward-Looking Statements
This document may contain "forward-looking statements" within the meaning of
Canadian securities legislation and the United States Private Securities
Litigation Reform Act of 1995. These forward-looking statements are made as of
the date of this document and Creston does not intend, and does not assume any
obligation, to update these forward-looking statements.
Forward-looking statements relate to future events or future performance and
reflect Creston management's expectations or beliefs regarding future events and
include, but are not limited to, statements with respect to the estimation of
mineral reserves and resources, the realization of mineral reserve estimates,
the timing and amount of estimated future production, costs of production,
capital expenditures, success of mining operations, environmental risks,
unanticipated reclamation expenses, title disputes or claims and limitations on
insurance coverage. In certain cases, forward-looking statements can be
identified by the use of words such as "plans", "expects" or "does not expect",
"is expected", "budget", "scheduled", "estimates", "forecasts", "intends",
"anticipates" or "does not anticipate", or "believes", or variations of such
words and phrases or statements that certain actions, events or results "may",
"could", "would", "might" or "will be taken", "occur" or "be achieved" or the
negative of these terms or comparable terminology. By their very nature
forward-looking statements involve known and unknown risks, uncertainties and
other factors which may cause the actual results, performance or achievements of
Creston to be materially different from any future results, performance or
achievements expressed or implied by the forward-looking statements. Such
factors include, among others, risks related to actual results of current
exploration activities; changes in project parameters as plans continue to be
refined; future prices of resources; possible variations in ore reserves, grade
or recovery rates; accidents, labour disputes and other risks of the mining
industry; delays in obtaining governmental approvals or financing or in the
completion of development or construction activities; as well as those factors
detailed from time to time in Creston's interim and annual financial statements
and management's discussion and analysis of those statements, all of which are
filed and available for review on SEDAR at www.sedar.com. Although Creston has
attempted to identify important factors that could cause actual actions, events
or results to differ materially from those described in forward-looking
statements, there may be other factors that cause actions, events or results not
to be as anticipated, estimated or intended. There can be no assurance that
forward-looking statements will prove to be accurate, as actual results and
future events could differ materially from those anticipated in such statements.
Accordingly, readers should not place undue reliance on forward-looking statements.
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