/NOT FOR DISTRIBUTION IN THE UNITED STATES OR DISSEMINATION THROUGH A
U.S. NEWSWIRE SERVICE/PERTH, Western Australia, July 20 /CNW/ - DIORO EXPLORATION NL ABN 31 009
271 532 (ASX/TSX: DIO)HIGHLIGHTS:
- Frog's Leg Proved and Probable Ore Reserves grow 45% to 789,504
ounces of gold (386,857 attributable to Dioro)
- New upgraded mine plan shows 86% conversion of Measured and Indicated
Resources to Ore Reserves
- Average annual gold output planned to increase 29% to 113,388 oz
(55,560 oz attributable to Dioro) from 2010 onwards.Dioro Exploration NL ("Dioro" or the "Company") is pleased to announce
the completion of a new mine plan and Definitive Feasibility Study at the
Frog's Leg Mine. The Frog's Leg Mine Proved and Probable Ore Reserves as at
April 1st 2009 have now been estimated at 789,504 ounces of gold (386,857 oz
attributable to Dioro), up 45% from the previous equivalent mine depleted Ore
Reserve as at April 1st 2009 of 545,781 ounces of gold (267,433 oz
attributable to Dioro).
The Frog's Leg Mine forms part of the Mungari East Joint Venture whose
participants are Dioro Exploration 49% and La Mancha Resources 51%.
With the upgraded mine plan, gold output for the mine is planned to
average 113,388 ounces of gold per annum (55,560 ounces attributable to Dioro)
from 2010 onwards, representing a 29% increase over the December 2007
feasibility study average annual gold production estimate, and the mine life
is extended by 1.2 years. The following table highlights the changes in the
mine's operational and economic profile from April 1st 2009 onward:Table 1
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FROG'S LEG MINE Remaining
FEASIBILITY Ore Reserve at Ore Reserve at Ore Reserve at
STUDIES: 1 April 2009 as 1 April 2009 1 April 2009
per previous as per new as per new
ORE RESERVE COMPARISON mine plan mine plan mine plan
(100% basis)(*) (100% basis) (Dioro 49% only)
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Mined tonnes 3,185,333 4,892,214 2,397,185
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Mined grade 5.33 5.02 5.02
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Mined ounces 545,781 789,504 386,857
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Increase in total LOM
reserve 45%
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Mine life (months) 71 85 85
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Mine life (years) 5.9 7.1 7.1
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Average annual ounces
from 2010 88,236 113,388 55,560
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Increase in annual
gold production 29%
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Processing recovery 94.9% 94.0% 94.0%
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Recovered ounces 517,946 742,134 363,646
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Recovered ounces per
year 87,540 104,772 51,338
-------------------------------------------------------------------------(*)The figures in this column are derived from the results of the
previous mine plan and feasibility study completed in 2007, adjusted
for depletion by mining of the Frog's Leg reserve between November
2007 and March 31 2009
The joint venture partners are completing the final financial analysis of
the Ore Reserve which is anticipated to be available by Friday 24th July.
ORE RESERVE AND MINERAL RESOURCE
Based on the new mine design, the Frog's Leg Ore Reserves and Mineral
Resources are as follows:Table 2
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(as at 1 April 2009) Ounces
Resources are ---------------------------
inclusive of Grade Attributable
reserves Tonnes (g/t Au) Total to Dioro
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Proved reserves 594,816 5.49 104,899 51,400
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Probable reserves 4,297,399 4.96 684,605 335,457
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Total P&P reserves 4,892,215 5.02 789,504 386,857
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Measured resources 996,000 7.1 230,000 112,700
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Indicated resources 3,553,000 6.7 760,000 372,400
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Total M&I resources 4,549,000 6.8 990,000 485,100
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Inferred Resources 934,000 5.9 176,000 86,240
-------------------------------------------------------------------------The mineral reserves were estimated in accordance with definitions and
guidelines adopted by the Canadian Institute of Mining, Metallurgy and
Petroleum and the Australasian Joint Ore Reserve Committee ("JORC") Code. They
were calculated using a mining cut-off grade of 3.0 g/t, standard dilution
parameters applied to the resource based upon empirical knowledge of the
Frog's Leg rock conditions and industry standards, mining methods, pillar and
panel recoveries, standard assumptions on mine design made to suit operating
equipment parameters and AMC Consultants Pty Ltd benchmarks.
As shown in the table below, this Proved and Probable Ore Reserve
represents an 86% conversion from the Measured and Indicated resource reported
in May 2008.Table 3
Conversion of Mineral Resource to Ore Reserve
Mining activity to 31/03/2009 61,771 mined ounces
Mineral reserves at 01/04/2009 789,504 mined ounces
Total project (current reserves + previous 851,275 mined ounces
production)
Total Measured and Indicated Resource 990,000 ounces
Conversion of Resources to Reserves 86%ABOUT THE FROG'S LEG MINE
The Frog's Leg mining project is a joint venture between Dioro
Exploration NL (49%) and La Mancha Resources Australia (51%). The project is
situated 25km west of Kalgoorlie-Boulder in the Eastern Goldfields of Western
Australia. The Frog's Leg deposit was discovered in late 1999, put into
production by the previous operator in April 2004 via open pit mining, and
shut down in 2005. The property remained on case and maintenance until 2006,
when the Joint Venture began a significant diamond drilling program aimed at
outlining sufficient resources for an underground mining operation. Following
successful drilling programs and resource increases, a positive feasibility
study was issued in December 2007. Frog's Leg was successfully converted into
an underground mine, with the first gold pour occurring on May 13, 2008, less
than 12 months after construction began. Since then, the mine has steadily
increased its performance, and was considered to have met commercial
production criteria on January 1, 2009.
The mine is currently producing ore from development drives and stopes.
The following table outlines certain key parameters relating to activities at
the mine since underground development began in 2007:Table 4
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2007 2008 2009 TOTAL
Jan-Mar
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Decline and lateral development (m) 1,361 3,792 848 6,001
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Ore drive development (m) 152 2,532 846 3,530
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Total waste (t) 127,101 357,863 58,460 543,424
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Total ore (t) 24,392 298,807 142,834 457,033
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Mine estimated average grade 3.52 4.25 4.22 4.20
(development plus stoping ore) (g/t)
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Gold mined (oz) 2,763 39,605 19,403 61,771
-------------------------------------------------------------------------(*)As previously announced, for the period 1 March to 31 May 2009, the
reconciled grade for 77 623 tonnes of Frog's Leg ore treated at the
Jubilee mill increased to 5.3 g/t (this parcel of ore represented Dioro's
49% share of the ore despatched from the Frog's Leg mine during that
period)
QUALIFIED PERSONS AND DATA VERIFICATIONS
The Independent Qualified Persons involved in preparing the new mining
plan and related reserves calculations are:
Denis Grubic (MAusIMM) as a qualified Mining Engineer and an employee of
AMC Consultants Pty Ltd has conducted a review of the Ore Reserve for the
Frog's Leg Gold Mine.
La Mancha Qualified Persons are:
Trevor Eddie Bsc. (Geol) MAusIMM, Chief Geologist of La Mancha Resources
Australia, supervised the drilling program and was responsible for quality
control and verification of the drill hole data used by La Mancha Resources
Australia in calculating the Mineral Resource. Trevor Eddie Bsc. (Geol)
MAusIMM, Chief Geologist, La Mancha Resources Australia, conducted the Mineral
Resource estimation and supervised the geostatistical analysis of the drill
data.
Joe McDiarmid, BSC, BEng (Mining), AusIMM, Frog's Leg Underground Mine
Manager, La Mancha Resources Australia, conducted supervised the study and all
of the information contained in this release.
Frog's Leg Ore Reserve and Mineral Resource were evaluated in accordance
with definitions and guidelines adopted by the Canadian Institute of Mining,
Metallurgy and Petroleum and Australasian Joint Ore Reserve Committee Code.
They were calculated using a mining reserve cut-off grade of 3.0 g/t, standard
dilution parameters applied to the resource based upon empirical knowledge of
the existing Frog's Leg Underground mine conditions and industry standards,
mining methods, standard assumptions on pit design made to suit operating
parameters and consulting benchmarks.
There are numerous uncertainties inherent in estimating mineral reserves,
including many factors beyond the control of the Joint Venture. Ore Reserve
and Mineral Resource estimations are a subjective process, and the accuracy of
any resource estimate is a function of the quality of available data and
engineering and geological interpretation and judgment. Results from drilling,
testing and production, as well as material changes in metal prices subsequent
to the date of an estimate, may justify revision of such estimates. To the
best of joint ventures knowledge, at the time of estimation there were no
known environmental, permitting, legal, title, taxation, socio-economic,
marketing, political or other relevant issues that would materially impact on
the eventual extraction of the Ore Reserves.
The effective date of the Ore Reserve is April 1, 2009.
The updated resource review and estimation conforms to the requirements
of NI43-101 and the CIM Best Practices for Estimation of Mineral Resources.
Mr Joe McDiarmid, Mr Trevor Eddie & Mr Denis Grubic have read National
Instrument 43-101 of the Canadian Securities Administrators ("NI 43-101"). By
reason of their education, affiliation with a professional association (as
defined in NI 43-101) and past relevant work experience, they are "qualified
persons" for the purposes of NI 43-101. Mr Joe McDiarmid, Mr Trevor Eddie and
Mr Denis Grubic to the inclusion in the report of the matters based on their
information in the form and context in which it appears.
FORWARD LOOKING STATEMENTS
Caution Regarding Forward-Looking Statements: The forward-looking
statements made in this release are based on assumptions and judgments of
management regarding future events and results. Such forward looking
statements, including but not limited to those with respect to the operations
at the company's South Kal operations and the Frog's Leg joint venture and the
company's capital expenditures and expected future production involve known
and unknown risks and uncertainties which may cause the actual results,
performance or achievements of the company to be materially different from any
anticipated future results, performance or achievements expressed or implied
by such forward-looking statements. Such factors include, among other things,
the actual market prices of gold, the actual results of current exploration,
the actual results of future mining, processing and development activities,
changes in project parameters as plans continue to be evaluated, as well as
those factors disclosed in the company's public documents
For further information: David McArthur, Company Secretary, Dioro
Exploration NL - Dioro Exploration NL, Registered Office: Level 2, 45 Stirling
Highway, Nedlands, Western Australia 6009, Telephone (08) 9243 3228, Facsimile
(08) 9389 8327, Website: www.dioro.com.au, Postal Address: PO Box 985,
Nedlands, Western Australia 5909
