ROCA - MAX Molybdenum Mine Production Update

TSX.V: ROK
#12-11

VANCOUVER, Sept. 26, 2011 /CNW/ - Roca Mines Inc. (TSX-V: ROK) ("Roca" or "the Company") has now received production reports, mill assays and sales results for the MAX Molybdenum Mine during the months of July and August, 2011.

The Company shipped 3 lots in August containing a total of 73,249 lbs of molybdenum and has since shipped an additional 3 lots containing 76,317 lbs molybdenum. The following table provides a summary of production data for July (since mill start-up on July 27th) and August:

MAX Mine Statistics Q4-2011
  July '11 August '11 TOTAL
Molybdenum Produced (lbs) 1 16,614 78,927 95,541
Average Head Grade (% Mo) 0.41 0.32  
Molybdenum Recovery (%) 94.5 96  
Mill Availability (%) 100 99  
Average Daily Throughput (tpd) 402 382  

Note 1: molybdenum contained in concentrate.

Since the underground operations restarted at the end of July 2011, crews have focused on new blasting designs and practices in an effort to demonstrate that previous experiences with wall sloughing, geotechnical stability, and head-grade dilution could be controlled. Based on current assessments, these efforts have succeeded in producing very good wall conditions and control. It is apparent that previous blasting practices caused unnecessary damage, ultimately leading to the stope operating problems described previously.

Throughput rates since start-up have been approximately 25% below targets due to the more conservative blasting practices, contractor scheduling difficulties during startup and equipment down-time. Issues with scheduling and equipment are expected to improve over time.

Having observed stope wall performance, it can now be assumed that the head grades processed since the beginning of August, (ranging from 0.20% to 0.41%) from the 725 mining level represent deliverable head grades in this section of the Main zone. This is roughly 0.2% Mo lower than initially targeted based on drilling and sampling on upper levels. Head grades observed for September to date have ranged from 0.21% to 0.38% Mo and have averaged 0.33% Mo. While the grades observed to date may appear high in context with other molybdenum mines globally, these grades are effectively at the current breakeven level for the operation at 500 tpd throughput, given current oxide prices in the US$14 range, and the historically high Canadian dollar, labour and energy costs.

The MAX mine was initially conceived as a high-grade mine that would expand production over time to lower unit costs and allow the processing of lower grade materials. While a significant amount of work has been completed towards a planned expansion to the permitted Phase II, 1,000 tpd operation, these throughput rates have not been achieved due to restricted cash flow.

Management is reviewing alternative plans including the option to accelerate the Phase II expansion of the operation. This would allow its sustained operation at current molybdenum price levels, and preserve the opportunity to benefit from any increase in molybdenum prices in the future.

Scott Broughton, P.Eng. is the 43-101 qualified person responsible for the preparation of this news release.

ROCA MINES INC.

"Scott Broughton"


Scott E. Broughton - President and CEO

Neither the 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 Roca Mines Inc.

For further information:

Investor Relations
Tel:    604-684-2900
Fax:  604-684-2902
Email:  info@rocamines.com
Web:   www.rocamines.com

 

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