Plains Creek announces filing of feasibility studies for 1 Million tonne/year Beneficiated Rock Concentrate Project and 1.3 Million tonne/year Direct Shipping Phosphate Rock Project for the Farim Phosphate Project, Guinea-Bissau, West Africa

VANCOUVER, Nov. 23, 2012 /CNW/ - Plains Creek Phosphate Corporation ("Plains Creek", the "Company") (TSXV: PCP) is pleased to announce the filing on SEDAR of two feasibility studies (the "Feasibility Studies") for two respective production alternatives: firstly, the 1 Million tonne per year Beneficiated Phosphate Rock Concentrate ("BPRC") Project; and secondly, the 1.3 Million tonne per year Direct Shipping Option ("DSO") Phosphate Rock Project. The Feasibility Studies were previously announced on October 9, 2012 and have now been finalized and filed on SEDAR.  The Feasibility Studies were prepared for GB Minerals AG and the Company by GBM Minerals Engineering Consultants Limited ("GBMMEC") in conjunction with Golder Associates Limited ("Golder"), W.F. Baird & Associates Ltd. ("Baird"), GEEEM Consultants and Tropica Environmental, all of whom are independent of the Company and GB Minerals AG.

These two production alternatives address the first phase of the development of the GB Minerals AG ("GBMAG") Farim Phosphate Project (the "Project") in Guinea-Bissau, West Africa. The second phase is to mine and process the remainder of the Project's phosphate deposit including the production of up to 2 Million tonnes per year of beneficiated phosphate rock concentrate with an open pit mine, processing plant, pipeline, and port construction, which will be assessed in a separate feasibility study.

Background

The Project is located in the northern part of central Guinea-Bissau, West Africa, approximately 25 km south of the Senegal border, approximately 5 km west of the town of Farim and some 120 km north of Bissau, the capital of Guinea-Bissau. The Project consists of a high grade sedimentary phosphate deposit of one continuous phosphate bed (known as the FPA layer), which extends over a known surface area of approximately 40 km².

Studies and investigations have been underway on the Project since February 2011 and as work progressed a number of alternative production scenarios were investigated in order to maximize the project value, reduce the time to production, minimize development capital, accommodate the phosphate market demand and the changing political climate in Guinea Bissau. As a result, GBMAG is now targeting the two-phased development of the Project as an open pit mining operation.

Three production scenario alternatives are planned for the progressive development of the Project, depending on the phosphate market conditions and the off takers requirements, the economic and political climate in Guinea-Bissau, and the availability of capital and skilled manpower to develop the Project have been investigated as follows:

Phase One

  • 1.3 Million tonne per year Direct Shipping Option (DSO) Phosphate Rock product production alternative;
  • 1 Million tonne per year Beneficiated Phosphate Rock Concentrate product (BPRC) production alternative; and

Phase Two

  • 2 Million tonne per year Beneficiated Phosphate Rock Concentrate product alternative, which includes an open pit mine, processing plant, pipeline, and port construction which will be assessed in a separate feasibility study.

Mining Agreement, Mining Lease and Production License

A Mining Agreement was negotiated in May 2009 in terms of which GBMAG was granted a Mining Lease and a Production License for the Project by the Guinea-Bissau Government. Included within this Mining Agreement are numerous permissions and incentives that have influenced the development and production plans for the Project. As the Project progresses, there are ongoing discussions with the Government of Guinea-Bissau regarding certain aspects of the Mining Agreement, such as royalties, tax incentives, project area and others.

Mineral Resources and Reserves

As previously announced by the Company on 5th September 2012, the Mineral Resource Estimate for the Project was completed by the Qualified Person, Dr. Marcelo Godoy of Golder in Santiago, Chile.  Terry Kremmel of Golder has completed the mineral reserves estimates, which are disclosed in the Feasibility Studies. Each of Dr. Godoy and Terry Kremmel meet the requirements of a Qualified Person for the purposes of NI 43-101 reporting and are independent from the Company.

The Mineral Resource Estimate defines a Measured Resource of 64.6 Mt at an average grade of 29.11% P2O5, an Indicated Resource of 28.1 Mt at an average grade of 27.68% P2O5 and an Inferred Resource of 18.3 Mt at an average grade of 28.66% P2O5.  No recoveries or dilution factors have been considered in this estimate and the estimate is strictly in situ, in accordance with NI 43-101 reporting guidelines for resources.

The mineral reserves estimates are based on a minimum thickness of 1.5 m of the FPA layer, maximum in situ strip ratio of 20:1 and a constant dry density of 1.4 t/m3.  On this basis, the total estimated proven and probable reserves are 33.0 Mt (dry) with an average ROM P2O5 grade of 30.4%.

Mining Plan

Based on the estimated proven and probable reserves, a 25 year mine plan has been prepared as part of the Feasibility Studies for either the BPRC production alternative which produces 1 Million tonnes per year of phosphate rock concentrate at an average grade of 33.1% P2O5 and 1.6% Fe2O3 and 1.4% Al2O3; or the DSO production alternative which produces 1.3 Million tonnes per year of phosphate rock at an average grade of 30.4 % P2O5 and 4.4% Fe2O3 and 2.5% Al2O3.

A. 1 Million Tonnes Per Year BPRC Project Feasibility Study Overview

1 Million Tonne Per Year BPRC Project - Process Flow

The BPRC Project Feasibility Study encompasses the following general process flow:

  • Annual production rate of 1 Million tonnes per year of beneficiated phosphate rock concentrate.
  • Contractor mining.
  • Removal of overburden using a combination of excavators and trucks.
  • The overall ROM strip ratio is estimated to be 9.08 bank cubic metres (bcm) per tonne of ROM phosphate matrix. The overall product strip ratio is estimated to be 14.47 bcm per tonne of phosphate rock, requiring the removal of approximately 299.5 million bcm of overburden over the life of the mine.
  • 1.3 Million tonnes per year of Run of Mine (ROM) phosphate matrix removed by excavator and truck to a 130,000 tonne ROM pad for storage and beneficiation. The ROM pad is located some 1.5 km from the open pit and adjacent to the barge loading facility at an area known as Canico, on the River Cacheu.
  • ROM phosphate matrix is removed from the ROM pad and processed in the beneficiation plant to produce a phosphate rock concentrate product which is stockpiled at Canico in a 3,000 tonne stockpile which feeds a conveyor for barge loading. Recoveries of 78% by weight, have been determined from metallurgical test work and process design, which will result in the production of approximately 1 million tonnes per year of phosphate rock concentrate product.
  • Barges of up to 3,500 tonnes capacity will be moored and loaded at a pontoon warf near Canico. A set of four barges will be formed into a flotilla that will be maneuvered by a 'Pusher' tug to a barge marshalling area at Bolor in the River Cacheu estuary, some 175 kilometers from Canico.
  • The barges will then be maneuvered by tug to an offshore trans-shipment point in the Atlantic Ocean, where the phosphate rock concentrate will be loaded onto carriers (bulk carrier vessel of up to 28,000 tonnes capacity) utilizing ship's gear.
  • The battery limit for the BPRC Project is the phosphate rock concentrate product loaded into the hold of the bulk carriers.
  • Phosphate rock concentrate product will also be available for supply to the in-country market as a direct application fertilizer.

1 Million Tonnes Per Year BPRC Project - Economic Analysis Key Criteria and Highlights

A summary of the project parameters is provided in Table 1, below. A pre-tax cash flow projection has been generated for a 25 year mine life using the estimated capital and operating costs that are summarized in Table 2, further below.        

All amounts in US dollars

Table 1: Summary of Physical Parameters of the BPRC Project

Physical Parameter Value
Mine Life 25 Years
Construction Period 2 Years
Operation 304 days per year
Production Rate 1,300,000 ROM tonnes per year phosphate matrix
Total Life of Mine Product Production 25 million tonnes phosphate rock concentrate
Average Product Grade 33.1% P2O5 @ 1.6% Fe2O3 and 1.4 % Al2O3
Annual Product Sales 1,000,000 tonnes phosphate rock concentrate
Revenue Guidance Estimate $150 USD per tonne of phosphate rock concentrate FOB

Table 2: Summary of BPRC Project Costs

Operating Costs Life of Mine
Mining $ 46.01 per tonne phosphate rock concentrate
Marine $5.92 per tonne phosphate rock concentrate
Personnel $6.69 per tonne phosphate rock concentrate
Electricity $9.82 per tonne phosphate rock concentrate
Reagents $ 0.23 per tonne phosphate rock concentrate
Fuel $3.64 per tonne phosphate rock concentrate
Maintenance $ 2.83 per tonne phosphate rock concentrate
Total $ 75.15 USD per tonne phosphate rock concentrate
Capital costs (life of mine) Life of Mine
Pre-production stripping (incl. mobilisation) USD $ 10.93 million
Mine, Marine & Infrastructure (incl. contingency) USD $ 154.19 million
Total Mine Capital Cost US$ 165.12 million
Sustaining USD $ 134.71 million
Closure USD $ 3.04 million
Total Life of Mine Capital Cost (incl. contingency) USD $ 302.87 million
Contingencies 17.6%
Accuracy +/-15 %
Royalties 2%*

* Pending discussions with the Government of Guinea-Bissau.

Estimated mining costs include all costs related to land clearing, drainage and water control, pit dewatering, waste stripping, overburden transport and dump management, phosphate matrix mining and transport to beneficiation plant, beneficiated phosphate rock transport to stockpiles located at the barge loading facility, and reclamation.

The estimated processing costs include all costs related to the beneficiation of the phosphate matrix and subsequent dewatering for the production of a phosphate rock concentrate ready for sale.

The estimated product handling and transport costs include all handling and storage costs for the phosphate rock concentrate at Canico.  Also included is the barge loading and transport of the phosphate rock concentrate.

Table 3 (below) shows the capital cost estimate breakdown by project area.

Table 3: Project CAPEX Estimate (Area Breakdown)

Area # Area Name Fixed Capital
(M USD)
Contingency
(M USD)
Total Capital
(M USD)
Percent Total
000 Project General 31.88 4.20 36.08 22%
100 Mine 26.06 5.30 31.36 19%
200 Processing 35.86 7.75 43.62 26%
300 Product Handling and Transport 46.57 7.50 54.07 33%
  Total 140.37 24.75 165.12 100%

Capital estimates include mine facilities, beneficiation plant and infrastructure, mining equipment, dewatering wells, stockpile loader, dyke construction, stockpile area, ex-pit haul road construction and barges.

The Project's cash flow analysis is shown in Table 4, below.

Table 4: Cash Flow Analysis

Units 2013 2014 2015 2016 2017 2018 2019 2020-2039
Production:                
      ROM '000 tonne 0 0 1,300 1,300 1,300 1,300 1,300 26,000
      Sales  '000 tonne 0 0 1,000 1,000 1,000 1,000 1,000 20,000
      Price Phosphate product USD $/t 0 0 150 150 150 150 150 150
      Sales USD $ '000 0 0 150,000 150,000 150,000 150,000 150,000 3,000,000
Cost of Sales:                
 Operating cost USD $/t 0 0 68.36 68.23 70.63 70.66 72.28 76.42
   Total operating cost USD $ '000 0 0 68,362  68,225 70,634 70,655 72,280 1,528,403
   EBITDA USD $ '000 0 0 81,638 81,775 79,366 79,345 77,720 1,471,597
   CAPEX USD $ '000 57,504 107,616 12,403 3,236 5,712 3,236 10,441 102,723
Net cash flow before tax and royalties USD $ '000 (57,504) (107,616) 69,235 78,538 73,654 76,108 67,279 1,368,874

Considering the BPRC Project on a stand-alone basis, the undiscounted pre-tax cash flow totals US$ 1.569 billion over the 25 year mine life. Operating cash flow averages US$ 69.35 million per year and simple payback of total preproduction capital is achieved after approximately 2 years of operation.

EBITDA as disclosed in the table above is a non-GAAP financial measure and does not have a standardized meaning and is therefore unlikely to be comparable to similar measures presented by other issuers.

The Internal Rate of Return (IRR) is 39%. Pre-tax Net Present Value (NPV) at various discount rates is shown in Table 5, below.

Table 5: Pre-tax NPV Sensitivity to Discount Rate

Rate NPV
0 % (Undiscounted) USD $1,569 million
5 % USD $740 million
10 % USD $387 million
15 % USD $216 million
20 % USD $123 million
25 % USD $68 million
30 % USD $34 million

Mineral Resources Estimates

The resource estimate was subcontracted to Golder who modelled the Farim resource based on a two dimensional (2D) block model with 125 m by 125 m cells and 25 internal discretisation nodes covering the extents of the FPA layer. The extents of the FPA layer were estimated based on the presence or absence of the FPA layer in the drill holes.

Exploratory data analysis and variography were carried out and variables were estimated using a three pass strategy, whereby each successive pass had an increased search radius and less restrictive sample selection criteria. This approach ensures all blocks received a value for each variable. Values were assigned using a combination of Ordinary Kriging and Inverse Distance Weighted methods for the following variables:

  • P2O5s;
  • Al2O3s;
  • CaO;
  • Fe2O3s;
  • SiO2s;
  • FPA Thickness; and
  • Overburden Thickness.

The stripping ratio (SR) was derived from the estimated overburden and FPA thicknesses.

Classification was assigned to each block in the model based on a drilling spacing as follows:

  • Measured: Areas with drilling coverage of up to 500 m by 500 m and a P2O5 slope of regression greater than or equal to 0.65;
  • Indicated: Areas with drilling coverage of up to 1000 m by 1000 m and a P2O5 slope of regression greater than or equal to 0.4; and
  • Inferred: Areas within the extents of the FPA and not classified as Measured or Indicated.

A corridor following the river was excluded and set to "unclassified" due to the uncertainty related to the extraction of material in this area. In addition, the resource estimate was divided into blocks corresponding to the location relative to the river; "north" or "south".

After applying the above criteria and for the purpose of public reporting the resources were restricted to a minimum FPA thickness of 1.5 m and a stripping ratio no greater than 20:1. By applying these mining restrictions it is considered that the disclosed mineral resource estimates fulfill the requirement of "reasonable prospects for economic extraction". Due to the consistent grade continuity, with grades above 27% P2O5, a phosphate cut-off grade was not applied to report the Mineral Resource estimate.

Mineral Resource Statement

The reported open pit resources were restricted to a minimum FPA thickness of 1.5 m and stripping ratio no greater than 20:1. A constant density of 1.4 t/m3 was used to estimate tonnages. Golder considers the criteria used to define the mineral inventory to be adequate for the purpose of public reporting. The Mineral Resource estimate defines a combined Measured and Indicated Resource of 92.6 Mt at an average grade of 28.68 % P2O5 and an Inferred Resource of 18.3 Mt at an average grade of 28.66 % P2O5.

Tonnage figures have been rounded. No recoveries or dilution factors have been considered in this estimate and the estimate is strictly in situ, in accordance with NI 43-101 reporting guidelines for resources.

The mineral resources reported in this Technical Report were estimated using the Canadian Institute of Mining, Metallurgy and Petroleum (CIM) Standards on Mineral Resources and Reserves, Definitions and Guidelines prepared by the CIM Standing Committee on Reserve Definitions.

Mineralisation at Farim is still currently open to the west and poorly drilled to the south of the River. Golder recommends that additional QA/QC data should be gathered during the next drilling campaign, including blanks, to allow an analysis of the reliability of the GBMAG samples.

As the project moves into detailed design and production, it is recommended that a more thorough and systematic program of density determination be carried out and the resulting data be used to update the current estimates.

Table 6: Mineral Resource Statement, Farim Phosphate Deposit

Resource
Class
Block Tonnage
(Mt)
P₂O₅
(%)
FPA
(m)
Al2O3
(%)
CaO
(%)
Fe2O3
(%)
SiO2
(%)
Over
burden
(m)
S/R
Measured North of River 64.6 29.11 3.65 2.78 39.44 5.60 11.39 43.40 12.43
Indicated North of River 17.7 26.93 3.15 2.62 40.14 5.19 10.64 39.50 13.18
South of River 10.3 28.96 2.61 5.36 36.37 4.59 11.68 29.05 12.11
Sub total 28.1 27.68 2.95 3.63 38.75 4.97 11.02 35.65 12.79
Measured +
Indicated
North of River 82.3 28.64 3.54 2.75 39.59 5.51 11.23 42.56 12.59
South of River 10.3 28.96 2.61 5.36 36.37 4.59 11.68 29.05 12.11
Sub total 92.6 28.68 3.44 3.04 39.23 5.41 11.28 41.05 12.54
Inferred North of River 3.4 27.36 2.75 2.75 39.30 5.21 11.05 42.70 15.81
South of River 14.9 28.96 2.35 6.30 35.78 4.57 11.64 29.45 13.19
Sub total 18.3 28.66 2.42 5.64 36.43 4.69 11.53 31.90 13.67

Mineral Reserves Estimates

Estimated ROM phosphate matrix reserves and phosphate rock reserves for the proposed Beneficiation Option are listed in table below. The result of the Mineral Reserve Estimate is based on a minimum FPA thickness of 1.5 m, maximum in situ SR of 20:1 and a constant dry density of 1.4 t/m3. Golder considers the criteria used to define the 25 year mineral inventory to be reasonable for public reporting. This assumes the resource would be exploitable using open pit mining methods.

Table 7: Proven and Probable Reserves

    Phosphate Matrix Reserves
Category Unit Proven Probable Total/Average
ROM tonnes, dry Mt 29.5 3.5 33.0
ROM %P2O5, dry % 30.4 29.6 30.4
ROM %Al2O3, dry % 2.6 2.6 2.6
ROM %CaO, dry % 41.1 41.3 41.2
ROM %Fe2O3, dry % 4.5 4.6 4.5
ROM %SiO2, dry % 10.3 9.9 10.3
Product tonnes, dry Mt 22.5 2.7 25.1
Product %P2O5, dry % 33.1 32.2 33.0
Product %Al2O3, dry % 1.4 1.5 1.4
Product %CaO, dry % 46.0 46.2 46.0
Product %Fe2O3, dry % 1.6 1.7 1.6
Product %SiO2, dry % 11.1 10.7 11.1

The Measured and Indicated Resource estimates as stated in under "Mineral Resource Estimates" are inclusive of the resources comprising the Proven and Probable Reserve estimates described in Table 6.

For the Farim BPRC Option the total estimated Proven and Probable Reserves are 33.0 Mt (dry) with an average ROM P2O5 grade of 30.4%. Total rock (product) tonnes after beneficiation are estimated to be 25.1 Mt (dry) with an average product P2O5 grade of 33.1%. The overall ROM SR is estimated to be 9.08 bank cubic metres (bcm) per tonne of ROM phosphate matrix. The overall product strip ratio is estimated to be 14.47 bcm per tonne of phosphate rock, requiring the removal of approximately 299.5 million bcm of overburden over the life of the mine.

B. 1.3 Million Tonnes Per Year DSO Project Feasibility Study Overview

1.3 Million Tonnes Per Year DSO Project - Process Flow

The DSO Project Feasibility Study encompasses the following general process flow:

  • Annual production rate of 1.3 Mt per year of phosphate rock product.
  • Contractor mining.
  • Removal of overburden by a combination of excavators and trucks.
  • The overall ROM SR is estimated to be 9.08 bank cubic metres (bcm) per tonne of ROM phosphate matrix. The overall product strip ratio is estimated to be 14.47 bcm per tonne of phosphate rock, requiring the removal of approximately 299.5 million bcm of overburden over the life of the mine.
  • 1.3 million Tonnes per annum of Run of Mine (ROM) phosphate matrix is removed by excavator and truck to a 130,000 t ROM pad for storage and blending. The ROM pad is located some 1.5 km from the open pit and adjacent to the barge loading facility at Canico, on the Cacheu River. Phosphate rock is transferred from the ROM pad to the barge loading facility by front end loader.
  • Barges of up to 3,500 tonnes capacity will be moored and loaded at a pontoon wharf near Cancio.  A set of four barges will be formed into a flotilla that will be maneuvered by a 'Pusher' tug to a barge marshalling area at Bolor in the River Cacheu estuary, a distance of 175 kilometers.
  • The barges will then be maneuvered by tug to an offshore trans-shipment point in the Atlantic Ocean, where the phosphate rock product will be loaded onto carriers (bulk carrier vessel of 28,000 tonnes capacity) utilizing ship's gear.
  • The battery limit of this DSO option is phosphate rock product loaded into the hold of the bulk carriers.
  • ROM phosphate rock product will also be available for supply to the in-country market as a direct application fertilizer.

1.3 Million Tonne Per Year DSO Project - Economic Analysis Key Criteria and Highlights

A summary of key criteria is provided in Table 8, below. A pre-tax cash flow projection has been generated for a 25 year mine life using estimated capital and operating costs, which are summarized in Table 9, further below.

All amounts in US dollars

Table 8: Summary of Physical Parameters of the DSO Project

Physical Parameter Value
Mine Life 25 Years
Construction Period 2 Years
Operation 304 days per year
Production Rate 1,300,000 ROM tonnes per year phosphate product
Total Life of Mine Production 32.99 million tonnes phosphate product
Average Product Grade 30.4 % P2O5 @ 2.5% Al2O3; 4.4% Fe2O3
Annual Product Sales 1,300,000 tonnes phosphate product
Revenue Guidance Estimate $110 USD per tonne of phosphate FOB (Port Cacheu)

Table 9: Summary of DSO Project Costs

Operating Costs Life of Mine
Mining $ 35.02 per tonne of phosphate rock product
Marine $ 4.49 per tonne of phosphate rock product
Personnel $ 4.12 per tonne of phosphate rock product
Power and Electricity $ 0.57 per tonne of phosphate rock product
Fuel $ 3.01 per tonne of phosphate rock product
Maintenance $ 1.34 per tonne of phosphate rock product
Total $ 48.54 USD per tonne of phosphate rock product
Capital costs (life of mine) Life of Mine
Pre-production stripping (incl. mobilisation) USD $ 10.93 million
Mine, Marine & Infrastructure (incl. contingency) USD $ 99.91 million
Total Mine Capital Cost US$ 110.84 million
Sustaining USD $ 86.66 million
Closure USD $ 0.71 million
Total Life of Mine Capital Cost (incl. contingency) USD $ 198.21 million
Contingencies 17.46%
Accuracy +/-15%
Royalties 2%*

* Pending discussions with the Government of Guinea-Bissau.

Capital costs have been further estimated as follows:

Table 10: DSO Project CAPEX Estimate (Area Breakdown)

Area # Area Name Fixed  Capital
[M USD]
Contingency
[M USD]
Total Capital
[M USD]
Percent Total
[M USD]
000 Project General 22.17 3.73 25.90 23%
100 Mine 26.10 5.3 31.40 28%
300 Product Handling & Transport 46.34 7.20 53.54 48%
  Total 94.61 16.23 110.84 100%

Capital estimates include mine facilities and infrastructure, mining equipment, dewatering wells, stockpile loader, dyke construction, stockpile area, ex-pit haul road construction and barges.

Table 11: Cash Flow Analysis

Units 2013 2014 2015 2016 2017 2018 2019 2020-2039
Production:                
      ROM '000 tonne 0 0 1,300 1,300 1,300 1,300 1,300 26,000
Price Phosphate product USD $ / t 0 0 110 110 110 110 110 110
      Sales USD $ '000 0 0 143,000 143,000 143,000 143,000 143,000 2,860,000
Cost of Sales:                
  Operating cost USD $/t 0 0 43 43 45 45 46 50
   Total operating cost USD $ '000 - - 56,363 56,315 58,644 58,659 60,271 1,287,437
      EBITDA USD $ '000 - - 86,638 86,685 84,356 84,341 82,729 1,572,563
      CAPEX USD $ '000 39,685 71,159 11,971 2,804 5,280 2,804 4,619 59,890
Net cash flow before tax and royalties USD $ '000 (39,685) (71,159) 74,666 83,881 79,076 81,537 78,111 1,512,673

Considering the DSO Project on a stand-alone basis, the undiscounted pre-tax cash flow totals US$ 1.799 billion over the 25 year mine life. Operating cash flow averages US$ 76.40 million per year and simple payback of total preproduction capital is achieved after approximately 18 months of operation.

EBITDA as disclosed in the table above is a non-GAAP financial measure and does not have a standardized meaning and is therefore unlikely to be comparable to similar measures presented by other issuers.

The Internal Rate of Return (IRR) is 58.5%. Pre-tax Net Present Value (NPV) at various discount rates is shown in Table 12, below.

Table 12: Pre-tax NPV Sensitivity to Discount Rate

Rate NPV
0 % (Undiscounted) USD $1.799 million
5 % USD $879 million
10 % USD $484 million
15 % USD $291 million
20 % USD $185 million
25 % USD $122 million
30% USD $82 million

Mineral Resources and Reserves Estimates

Mineral Resources and Reserves estimates are the same in each of the BPRC and DSO Projects.

Mining

The same mining plan is used for the BPRC and DSO Projects.

The majority of the annual rainfall over the Project area is concentrated in the period from July through September, and the Project mine plan will carry out mining activities for 10 months out of the year to avoid the possible inefficiencies of mining during the higher rainfall months.  Installed mining equipment capacity has been designed to produce the annual plan phosphate requirements and associated waste stripping within the 10 drier months of the year.

Key design elements of the mining plan are water management and haul road maintenance.  All mining areas must be fully dewatered in advance of mining activities. The proximity of the mine to the River Cacheu will require the construction of a protection dyke to prevent in-pit flooding.

Contractor mining has been selected for the excavator/truck mining method for the mining plan based on flexibility, lower initial capital, lower investment risk, grade control, and the ability to blend quality for required product specifications. Contractor mining has been proposed to minimize capital investment and to shorten the period to production which could arise from the availability of mining capital equipment and the shortage of in country manpower skills.

The remote nature of the Project, with the lack of power supply, precludes the use of electric mining equipment and all mining equipment selected for the Project will use diesel mobile equipment.

The mining method uses excavators and trucks to handle 100% of the overburden and phosphate. Waste will be stripped and removed with 12 m3 bucket class front-end loaders matched with 97 tonne haul trucks.  The phosphate will be mined with 5m3 bucket class backhoes matched with 36 tonne trucks.

The BPRC operation will mine 1.3 Mt/a of phosphate matrix and will require a tailings management facility capable of holding 3.43 Mm³. The facility will be approximately 25 m high with a footprint of 1,100 m by 900 m. A site selection study of eight possible tailings storage locations has indicated a preferred location to the west of the open pit, 2 km northwest of the process plant.

Excavated overburden will be stored in two overburden storage facilities, the first of which will be up to 37 m high storing 35.4 Mm3 of material. After an initial period, the open pit will be backfilled as mining progresses and additional storage within the pit footprint above original ground level made. In later stages of production, a second ex-pit storage area will be created to the north of the pit to store 17.8 Mm3 of material. The preferred two ex-pit overburden storage facility areas are the result of a site selection study of six possible locations.

The DSO operation will mine 1.3 Mt/a of phosphate matrix and will require an overburden storage facility capable of holding 53.7 Mm³ of excavated overburden. This will be stored in two facilities, the first of which will be up to 37 m high storing 35.4 Mm3 of material. After an initial period, the open pit will be backfilled as mining progresses and additional storage within the pit footprint above original ground level made. In later stages of production, a second ex-pit storage area will be created to the north of the pit to store 17.8 Mm3 of material. The preferred two ex-pit overburden storage facility areas are the result of a site selection study of six possible locations.

C. Beneficiation

The BPRC Project has a four stage beneficiation process - screening, hydrocyclones, magnetic separators and dewatering, and will require a tailings management facility capable of holding 3.43 Mm³. A site selection study of eight possible tailings storage locations has indicated a preferred location to the west of the open pit, 2 km northwest of the beneficiation plant.

For the DSO Project, the ROM phosphate will be mined, blended if necessary, and will be directly shipped with limited treatment or processing (if any).

D. Project Infrastructure

The infrastructure requirements associated with the DSO and/or BPRC projects include the mine infrastructure, mine camp, offices, workshops, water treatment facilities, diesel or heavy oil power generation and water supply.

E. River Transport and Loading

The river transport and loading activities are common to the Feasibility Studies of both the BPRC Project and the DSO Project.

Transfer of the phosphate product, either DSO phosphate rock  from the ROM pad to the loading facility located on the Cacheu River at Canico, or the beneficiated phosphate rock concentrate product from the product stockpile into the barges and the transport down the river to a bulk carrier located offshore in the Atlantic Ocean, will be undertaken by the Company.

A barge loading facility will be constructed on the Cacheu River at Canico. The selected site is located adjacent to the mining operation/beneficiation site to minimise haulage. Phosphate product will be stockpiled and transferred to the barge loading facility by a front end loader.

The loading facility will receive the phosphate discharged from a front end loader into a feed hopper. The hopper will feed a conveyor system to load 3,000 to 3,500 tonne capacity barges. Sets of barges will then transport the products with the aid of a pusher tug down the River Cacheu to a barge marshalling site near Bolor. Individual barges will then be transported offshore to the transhipment site, approximately 20 km offshore in the Atlantic Ocean.

The barges will be unloaded utilizing the clam-shell cranes onboard the bulk carrier. A seagoing vessel of 28,000 tonne capacity has been assessed and concluded feasible for the unloading of phosphate at the trans-shipment point identified.

Recommendations

The results of the two Feasibility Studies show that both the BPRC and the DSO Projects are robust from a technical and economic standpoint at the selected long term phosphate prices, GBMMEC has recommended that the Company and GBMAG continue to advance either of the two projects to the engineering design and construction stages and to seek the necessary project financing and off-take agreements.

Qualified Persons

Dr. Marcelo Godoy, MAusIMM (CP) of Golder in Santiago, Chile, who is a Qualified Person as defined in NI 43-101, prepared and is responsible for the Mineral Resource Estimate as disclosed in this news release. Terry Kremmel, PE (MO and NC), SME (CP) of Golder, who is a Qualified Person as defined in NI 43-101, prepared and is responsible for the Mineral Reserve Estimate for the Project as disclosed in this news release.  In addition, the following Qualified Persons prepared (or supervised and approved the preparation thereof) and are responsible for other parts of the Feasibility Studies, which are referred to in this news release: Michael Short, FIMMM, CEng. of GBMMEC, Richard Elmer, C.Eng., MIMMM of Golder, Dr. Martin Preene, CEng FICE, CGeol FGS, CSci CEnv C.WEM FCIWEM (CP) of Golder, Dr. Marcelo Godoy, MAusIMM (CP) of Golder, Hendrik J.H. Otto, Pr Eng (SA) of Golder, Terry Kremmel, PE (MO and NC), SME (CP) of Golder, and Matthew Clark, PE CEng PMP (QP) of Baird. All of these Qualified Persons are independent from the Company.

About Plains Creek Phosphate Corporation

Plains Creek Phosphate Corporation is a Canadian mining and exploration company focused on advancing the Project in Guinea‐Bissau, West Africa through the company, GB Minerals AG. The Project currently comprises a phosphate deposit consisting of one continuous flat lying phosphate bed with a Mineral Resource estimate, disclosed in the Company's Feasibility Studies on the Project in accordance with National Instrument 43-101, which defines a Measured Resource of 64.6 MT at an average grade of 29.11% P2O5, an Indicated Resource of 28.1 Mt at an average grade of 27.68 % P2O5, and an Inferred Resource of 18.3 Mt at an average grade of 28.66 % P2O5 and states total proven and probable reserves of 33.0 Mt (dry) with an average ROM P2O5 grade of 30.4%.  The Measured and Indicated Resource estimates stated above are inclusive of the resources comprising the Proven and Probable Reserve estimates. The Feasibility Studies are authored by the Qualified Persons listed above, are filed on SEDAR and are publicly available under the Company's profile at www.sedar.com. A two-phased development is planned for the Project as an open pit mining operation. Phase One consists of a 1.3 Mt per year phosphate rock product direct shipping option project or a 1.0 Mt per year beneficiated phosphate rock concentrate project and Phase Two consists of the production of 2.0 Mt per year of phosphate rock concentrate and includes a beneficiation plant and associated infrastructure, pipeline and port.

The Company's shares are listed on the TSX Venture Exchange under the trading symbol "PCP". For additional information, please visit us at www.plainscreek.com.

ON BEHALF OF THE BOARD

(Signed) "Carson Phillips"
Carson Phillips
Vice‐President, Corporate Development and Director

Cautionary Statement

Statements in this release may be viewed as forward-looking statements. Such statements involve risks and uncertainties that could cause actual results to differ materially from those projected. There are no assurances the Company can fulfill such forward-statements and the Company undertakes no obligation to update statements. Such forward looking statements are only predictions; actual events or results may differ materially as a result of risks facing the Company, some of which are beyond the Company's control.

The reader should be cautioned that there are risks that could affect the potential development of the Project's mineral resources, which include: the political instability in Africa and Guinea-Bissau in particular, which is where the Project is located; and that additional financing will be required to ultimately develop the Project and the ability to obtain such financing on favorable terms will be affected by prevailing market conditions.  A more detailed discussion of such risks are outlined in the Company's Management's Discussion & Analysis, its DSO Project Feasibility Study and the BPRC Project Feasibility Study, all of which are filed under the Company's profile on SEDAR at www.sedar.com.

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.

SOURCE: Plains Creek Phosphate Corp.

For further information:

Carson Phillips
Vice‐President, Corporate Development and Director
Telephone: (604) 569‐0721   E‐mail: cphillips@plainscreek.com