Mega Precious Metals Inc. (TSX VENTURE:MGP) ("Mega") announces that, further to
the news release of February 13, 2014, it has filed the National Instrument
43-101 Technical Report entitled "Technical Report and Updated Resource
Estimation on the North Madsen Property, Red Lake, Ontario" dated March 27,
2014, on SEDAR at http://www.sedar.com. The report has also been posted on the
Company's website at http://www.megapmi.com. There is no material differences
between the results of the Technical Report filed today and the disclosure
provided in the February 13, 2014 news release.
The resource estimate has been completed by WSP (formerly GENIVAR). The new
resource at USD $1,200 per ounce gold demonstrates significant improvements in
the metallurgical recoveries, confidence and grade distribution from the
previous resource estimate which used a gold price of USD $1,400 (see news
release dated September 21, 2011). Mega's North Madsen gold deposits are
adjacent to the Madsen and Buffalo Gold mines, which are the subject of a
recently announced proposed acquisition by Laurentian Goldfields Ltd. from
Claude Resources Inc.
Highlights:
-- Surface/near surface (less than 250m from surface) Measured and
Indicated Resources of 0.9 M Ounces of Gold at 1.2 g/t Au
-- Surface/near surface Inferred Resources of 0.38 M Ounces of Gold
-- All resources are open along strike and at depth
-- 91-95% Metallurgical Recoveries
-- Over 40,000 meters in 327 drill holes were incorporated into the
geological model and includes over 25 new holes totaling 8,200 m of
drilling since the previous resource update
-- Improved confidence in the deposit with 70% of the resource in the
Measured and Indicated categories
-- Robust resource using a gold price of USD $1200 USD per ounce ($200 less
than previous resource)
-- Approximately 7 kms trucking distance from Madsen Mine Mill being
acquired by Laurentian Goldfields Ltd. and Goldcorp Inc.'s Red Lake Mill
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Au Grade
Zone Category Tonnes (g/t) Ounces
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11 (Buffalo Diss) Measured 0 0.00 0
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Indicated 122,800 1.07 4,244
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M&I Subtotal 122,800 1.07 4,244
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12 (Buffalo Qtz-Tourm) Measured 0 0.00 0
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Indicated 1,622,100 0.97 50,528
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M&I Subtotal 1,622,100 0.97 50,528
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21 (Laverty Dyke) Measured 996,830 1.67 53,520
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Indicated 303,500 1.33 13,014
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M&I Subtotal 1,300,330 1.59 66,534
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22 (Laverty Granodiorite) Measured 477,670 0.98 15,091
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Indicated 422,600 0.91 12,360
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M&I Subtotal 900,270 0.95 27,452
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41 (Main) Measured 15,253,810 1.26 617,279
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Indicated 3,759,600 1.02 122,716
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M&I Subtotal 19,013,410 1.21 739,995
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All Zones Measured Total 16,728,310 1.28 685,891
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All Zones Indicated Total 6,230,600 1.01 202,862
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All Zones Total M&I 22,958,910 1.20 888,752
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Au Grade
Zone Category Tonnes (g/t) Ounces
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11 (Buffalo Diss) Inferred 613,000 1.32 25,947
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12 (Buffalo Qtz-Tourm) Inferred 1,489,000 1.15 54,896
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21 (Laverty Dyke) Inferred 676,000 1.52 32,929
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22 (Laverty Granodiorite) Inferred 1,669,000 0.84 45,172
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31 (South) Inferred 272,000 1.25 10,939
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41 (Main) Inferred 4,526,000 1.31 190,928
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51 (Central) Inferred 893,000 0.81 23,126
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All Zones Total Inferred 10,138,000 1.18 383,936
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Note: due to rounding, some totals may not appear to total properly
- Current resource calculation used USD $1,200 per ounce of gold
- Mineral resources which are not mineral reserves do not have
demonstrated economic viability. The estimate of mineral resources may
be materially affected by environmental, permitting, legal, title,
socio-political, marketing, or other relevant issues.
All composites have been capped where appropriate. Cut-off grades are
based on a price of USD $1,200 per ounce of gold and a number of operating
cost and recovery assumptions (see details below).
Sensitivity Analysis
The Updated Resource Estimates represents a rigorous evaluation of the drilling,
channel sampling and surface mapping completed to the end of December 2013. The
most notable difference from previous estimates is the increase in overall
ounces of the deposit at multiple cut-off grades (see sensitivity table below)
and the continuing definition of the higher grade Buffalo Extension, South and
Central Zones. Furthermore, the infill drilling program was successful at
converting additional Inferred material into the Indicated category.
The resource remains open along strike and at depth with the deepest hole
drilled to date of 290 vertical meters. The recent discovery at the South and
Central deposits are estimated to contain an Inferred Resource of 34,000 ounces
of gold averaging 0.91 g/t Au, at a 0.6 g/t Au cut-off grade.
The updated resource estimate, which meets the guidelines for reporting mineral
exploration programs as set out in National Instrument 43-101, was based on 327
diamond drill hole totaling over 40,000 metres and 52 channel samples that
tested five deposits across our claims and to a vertical depth of over 250 m and
at drill spacing of 5 to 75 m. For the purpose of this news release, the
resource estimate is reported at a cut-off grade of 0.6 g/t Au. The cut-off was
chosen to better represent the higher-grade core to the mineralized zone and to
provide continuity for future resource estimates when and if the Mega deems it
appropriate.
The sensitivity table below presents the tonnes and grades from the block model
used for the updated Mineral Resource Estimate at a range of cut-off grades in
order to demonstrate the sensitivity of the estimates. The analysis indicates
the robust nature of the overall resource and potential to optimize the grade
and maximize margins.
Sensitivity of the North Madsen Resource Estimates at Various
Cut-off Grades
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Measured and Indicated Resources
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Tonnes Gold (Au) Au Ounces
Cut-off (Au g/t) (000's) Grade (g/t) (000's)
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0.3 52,879,240 0.76 1,291,518
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0.4 38,221,180 0.92 1,128,599
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0.5 29,259,900 1.06 999,564
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0.6 22,958,910 1.20 888,752
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0.7 17,795,260 1.37 781,430
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0.8 14,017,640 1.53 690,584
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0.9 11,199,400 1.70 613,796
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1.0 9,305,570 1.86 556,220
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Inferred Resources
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Tonnes Gold (Au) Au Ounces
Cut-off (Au g/t) (000's) Grade (g/t) (000's)
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0.3 19,469,000 0.81 509,183
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0.4 14,895,000 0.96 458,806
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0.5 11,990,000 1.08 416,464
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0.6 10,138,000 1.18 383,936
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0.7 8,670,000 1.27 353,257
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0.8 7,505,000 1.35 325,218
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0.9 5,103,000 1.58 259,656
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1.0 4,529,000 1.66 242,220
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The cut-off value of 0.6 g/t Au was derived using the parameters listed in the
table below.
For the Updated Resource Estimate the Company has adopted the same approach that
was used in previous estimates by specifically targeting higher-grade
mineralization, modelling each of the mineralized domains, applying a
conservative assay cap and restricting the search radius for all resources. This
allows for a more realistic estimation of contained gold in the deposit and
potential enhancement in the projects economic viability.
Parameters and Assumptions used for North Madsen Resource Cut-off Grade
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Parameter or Assumption North Madsen Deposit
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Date of Data Used December 2013
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Number of drill holes and Surface Samples 327 holes and 36027 assays
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Long Term Gold Price per Ounce ($/oz) 1,200
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Processing $/tonne O/P 17
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Mining $/tonne O/P 6
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Mill Recovery (%) 92
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Assumed O/P Slope Angle 50
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Specific Gravity (SG) 2.68
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Block Model & Interpolation Software Surpac 6.5.1
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Interpolation Method Ordinary Krig
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Block Sizes (mxmxm) O/P 10 x 10 x 10 with sub-cell to
2.5 x 2.5 x 2.5
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Cap Grade (g/t) Varied by Zone (range from no
cap to 46)
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Number of Domains 7
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All costs are in US dollars with 0.9 exchange rate
The mineral resource estimates used the Canadian Institute of Mining, Metallurgy
and Petroleum (CIM), Standards on Mineral Resources and Reserves, Definitions
and Guidelines prepared by CIM Standing Committee on Reserve Definitions and
adopted by CIM Council on November 27, 2010. The mineral resource estimates are
classified as "measured", "indicated", or "inferred" as defined by CIM. The
Corporation intends to file a National Instrument 43-101 ("NI 43-101") compliant
technical report in respect of the updated mineral resource estimate on SEDAR
and on the Corporation's website within 45 days of this news release.
According to the CIM definitions, a Mineral Resource must be potentially
economic in that it must be "in such form and quantity and of such grade or
quality that it has reasonable prospects for economic extraction".
The quantity and grade of reported inferred resources in this estimation are
uncertain in nature and there has been insufficient exploration to define these
inferred resources as an indicated or measured mineral resource and it is
uncertain if further exploration will result in upgrading them to an indicated
or measured mineral resource category.
The QAQC protocols and corresponding sample preparation and shipment procedures
for the North Madsen Project have been reviewed and approved by WSP.
Qualified Person Comments/Quality Control Procedures
This press release has been prepared and revised by Glen Kunz P. Geo., President
and Chief Executive Officer (CEO), Mr. Todd McCracken P.Geo. of WSP (formerly
GENIVAR) all of which are Qualified Persons under the NI 43-101 guidelines. The
resource estimate has been prepared in compliance with National Instrument
43-101 and form NI 43-101F1, which requires that the estimate be prepared in
accordance with the "CIM Definition Standards on Mineral Resources and Mineral
Reserves as prepared by the CIM Standing Committee on Reserve Definitions and as
adopted by CIM Council, December 11, 2005".
Glen Kuntz, P. Geo, President and CEO, is the Qualified Person for the
information contained in this press release and is a Qualified Person defined by
National Instrument 43-101. Glen was Sr. Resource Geologist at the Campbell Gold
Mine and Global Spatial Data Systems Coordinator for Placer Dome, Vice President
Enterprise Mining Solutions for Runge Ltd., and most recently, Chief Operating
Officer with Mega Precious Metals.
Mega Precious Metals Inc. is a leading Canadian-based exploration company with a
high quality pipeline of projects located in the mining friendly jurisdictions
of Manitoba, Northwestern Ontario and Nunavut. The Company's significant
portfolio includes the flagship Monument Bay Gold Tungsten Project in NE
Manitoba as well as the N. Madsen Gold Project in the prolific gold mining
district of Red Lake, Ontario. Mega has established a record of delivering rapid
growth through their focused and low cost approach to exploration and resource
development. The Company's common shares trade on the TSX Venture Exchange under
the symbol MGP.
For further information and presentation material, please review the Mega
website at www.megapmi.com.
Forward-looking Statements
Certain statements in this press release relating to the Company's exploration
activities, project expenditures and business plans are "forward-looking
statements" within the meaning of securities legislation. The Company does not
intend, and does not assume any obligation, to update these forward-looking
statements. These forward-looking statements represent management's best
judgment based on current facts and assumptions that management considers
reasonable. The Company makes no representation that reasonable business people
in possession of the same information would reach the same conclusions.
Forward-looking statements involve known and unknown risks, uncertainties and
other factors which may cause the actual results, performance or achievements of
the Company to be materially different from any future results, performance or
achievements expressed or implied by the forward-looking statements. In
particular, fluctuations in the price of gold or in currency markets could
prevent the Company from achieving its targets. Readers should not place undue
reliance on forward-looking statements. More information about risks and
uncertainties affecting the Company and its business is available in Mega
Precious Metal's filings which are posted on sedar at www.sedar.com.
There is no guarantee that drill results reported in this news release will lead
to the identification of a deposit that can be mined economically, and further
work is required to identify a reserve or resource.
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.
FOR FURTHER INFORMATION PLEASE CONTACT:
Mega Precious Metals Inc.
Glen Kuntz, P.Geo.
President, Chief Executive Officer & Director
807-766-3380 or TF: 877-592-3380
info@megapmi.com
www.megapmi.com
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