Alhambra Increases Proven and Probable Reserves by 16% at its 100% Owned Uzboy Heap Leach Mine



    CALGARY, June 5 /CNW/ - Alhambra Resources Ltd. ("Alhambra" or the
"Corporation") announces that its updated National Instrument 43-101 ("NI
43-101") compliant report entitled "Resource and Reserve Estimation Study on
the Uzboy Gold Deposit, Akmola Oblast Kazakhstan" with an effective date of
December 31, 2007 (the "Report") prepared by its independent geological
consultants, A.C.A. Howe International Limited ("Howe") has been received and
filed on SEDAR at www.sedar.com.

    STUDY HIGHLIGHTS

    The highlights of the current Report for the estimated Proven and
Probable reserve categories in the oxide and transitional portions of the West
and East zones of the Uzboy gold deposit are as follows:

    
    -   Proven and Probable reserves increased by 16% over 2006 to 168,000
        ounces ("ozs")
    -   Proven and Probable recoverable reserves are estimated to be
        95,500 ozs at a 0.20 grams per tonne Cg/t") cut-off
    -   The net present value ("NPV") resulting from mining these reserves is
        estimated at approximately US$42 million using a discount rate of 10%
    -   The Proven and Probable mineral reserves in the oxide and
        transitional zones is unchanged at an average gold grade of 1.12 g/t
    

    "The two most important aspects of this updated study are that the
economics of the Uzboy gold deposit remain very robust and that we have been
able to replace the ounces produced in 2007, resulting in the addition of
another year onto the mine life for our Uzboy heap leach mine", said 
John J. Komarnicki, Alhambra's Chairman and CEO.
    As of December 31, 2007, the Proven and Probable recoverable reserves
combined with Work In Progress were estimated to be 118,500 ozs.

    DETAILED RESERVE INFORMATION

    The Uzboy gold deposit consists of an upper oxidized zone which is
underlain by a transitional zone. The transitional zone is that portion of the
deposit where the change over from oxidized to primary gold mineralization
occurs. The transitional zone comprises both oxidized and non-oxidized gold
mineralization.
    Pit optimizations were completed on the oxide and transitional resource
block models for the West and East zones of the Uzboy gold deposit using
Micromine Pit Optimization Module software. A total of 41 pit optimizations
were completed in order to generate the optimal pit to identify which blocks
should be mined and reserve reported.
    The following table summarizes the Proven and Probable reserves for the
optimal pit (No.41) (using a 0.20 g/t cut-off) estimated by Howe as at
December 31, 2007.

    
    -------------------------------------------------------------------------
               Reserve                                     Grade      Ounces
    Zone      Category     Mineralization    Tonnes        (g/t)       (gold)

    -------------------------------------------------------------------------
    West       Proven         oxide        1,749,000        1.17      65,800
              Probable        oxide          215,000        1.65      11,400
    -------------------------------------------------------------------------
    East       Proven         oxide        1,268,000        0.72      29,200
              Probable        oxide          501,000        0.77      12,400
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Total
     Oxide                                 3,733,000        0.99     118,800
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    West       Proven      transitional      574,000        1.45      26,700
              Probable     transitional      242,000        2.01      15,600
    -------------------------------------------------------------------------
    East       Proven      transitional       51,000        1.66       2,700
              Probable     transitional       93,000        1.41       4,200
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Total
     Transitional                            960,000        1.59      49,200
    -------------------------------------------------------------------------
    (*) Keeping with best practice principles, rounding errors may occur

    Proven and Probable reserves are included in the current Measured and
    Indicated resource categories as set out below.
    

    Recoverable gold after taking into account estimated percentage gold
recovery, mining losses and dilution are estimated to be 71,000 ozs for the
oxide zone and 24,500 ozs for the transitional zone for a total estimated
amount of 95,500 ozs. In 2006, the Transitional zone was included in the oxide
category.
    Optimization and reserve reporting methodology used the current Measured
and Indicated resource categories for the oxide and transitional portions of
the West and East zones of the Uzboy gold deposit. Howe used the following
parameters to estimate reserves:

    
    -------------------------------------------------------------------------
    Parameter                            Oxide                  Transitional
    -------------------------------------------------------------------------
    Mining Method                     Open Pit                      Open Pit
    Processing Method            Heap Leaching                 Heap Leaching
    Mining Cost/tonne                  US$1.95                       US$2.01
    Mining Losses (%)                      6.2                           6.2
    Mining Dilution (%)                    8.4                           8.4
    Processing Costs/tonne             US$3.85                       US$4.17
    Processing Recovery (%)                 70                            58
    Gold price/ounce(US$/oz)               850                           850
    Payment (%)                          99.05                         99.05
    Royalty (%)                            3.5                           3.5
    Pit Slope (degrees)                     45                            45
    -------------------------------------------------------------------------
    

    The Micromine Open Pit Optimiser is based on the Lerchs Grossman
algorithim and 3D graph theory and relies on the input of an ore body block
model file plus cut-off grades, metal prices and cost parameters to determine
the proportion of ore to waste in each block and the value of each block.
Based on the pit optimization study, optimal pit No.41 was selected for
reporting purposes resulting in the following: strip ratio of 1.26, waste:
5.90 million tonnes, ore: 4.60 million tonnes and average grade: 1.12 g/t
gold.
    After selecting the optimal pit, actual pit design for the West and East
zones of the Uzboy gold deposit was completed by Howe using the following
parameters: pit slope 45 degrees, bench height 5 metres ("m"), bench width
3.2 m, ramp width 15 m, and ramp slope 8 degrees. The pit design using the
above parameter inputs, optimum pit outlines and optimum pit shell wireframes
was completed in Micromine v. 11 Opencut Pit Design function.
    Reserves were estimated using the minimum mining (processing) grade
applied. Statistical analysis was run on oxide and transitional grades. The
minimum processing grades for oxide ore was found to be 0.22 g/t gold and for
transitional ore was 0.29 g/t gold. Measured and Indicated Blocks within
optimal pit No.41 which had a grade equal to or greater than the minimum
process grade for the respective material were considered for mineable reserve
estimation.
    The sensitivity study shows that the NPV for the pit of approximately
US$42 million, net of mining and processing costs, would result from mining
the oxide and transitional ore based upon optimal pit No.41 over a four year
period using a discount rate of 10%.
    The Uzboy heap leach mine is processing the Proven and Probable reserves
contained in the oxide portion of the West and East zones of the Uzboy gold
deposit. The Uzboy heap leach mine has been in commercial operations since
May 1, 2006. Prior to that date, all environmental, permitting, legal, title
and taxation aspects of the Uzboy heap leach mine were established with the
various department of the government of the Republic of Kazakhstan prior to
commencing commercial operations. Saga Creek Gold Company LLP ("Saga Creek"),
a 100% owned subsidiary of the Corporation, is responsible for the mining and
exploration activities conducted on the Uzboy gold project. Saga Creek employs
319 people in its mining, leaching, resin processing and exploration related
activities and contributes significantly to the local economy. Saga Creek
produces cathodic sediment as a product that is shipped to Europe for refining
and marketing. As such, the estimate of the mineral resources for the Uzboy
gold deposit and the mineral reserve for the oxide portion of the Uzboy gold
deposit are not expected to be affected by the above mentioned issues.

    RE

SOURCES The current Measured and Indicated mineral resources (previously reported) for the West and East zones of the Uzboy gold deposit estimated by Howe as at December 31, 2007 are set out below: ------------------------------------------------ Measured Resource Indicated Resource ------------------------------------------------------------------------- Cut-off Gold Gold Style of grade grade grade Mineralization (g/t) Tonnes (g/t) Ounces Tonnes (g/t) Ounces ------------------------------------------------------------------------- 0.20 3,733,300 0.86 103,500 1,784,300 0.71 40,600 Oxide 0.40 2,310,400 1.21 90,100 997,600 1.04 33,300 0.60 1,587,600 1.54 78,700 604,200 1.40 27,100 ------------------------------------------------------------------------- ------------------------------------------------------------------------- 0.20 1,102,200 1.15 40,700 1,415,200 0.98 44,600 Transitional 0.40 799,900 1.47 37,800 903,100 1.36 39,600 0.60 599,700 1.80 34,700 638,400 1.72 35,400 ------------------------------------------------------------------------- ------------------------------------------------------------------------- 0.20 15,626,900 1.22 614,200 7,270,000 0.96 223,600 Sulphide 0.40 11,206,900 1.59 572,100 5,108,800 1.23 202,600 0.60 8,186,400 2.00 526,100 3,599,400 1.55 179,600 ------------------------------------------------------------------------- ------------------------------------------------ Measured+Indicated Resource ------------------------------------------------------------------------- Cut-off Gold Style of grade grade Mineralization (g/t) Tonnes (g/t) Ounces ------------------------------------------------------------------------- 0.20 5,517,600 0.81 144,100 Oxide 0.40 3,308,000 1.16 123,400 0.60 2,191,800 1.50 105,800 ------------------------------------------------------------------------- ------------------------------------------------------------------------- 0.20 2,517,400 1.05 85,300 Transitional 0.40 1,703,000 1.41 77,400 0.60 1,238,100 1.76 70,100 ------------------------------------------------------------------------- ------------------------------------------------------------------------- 0.20 22,896,900 1.14 837,800 Sulphide 0.40 16,315,700 1.48 774,700 0.60 11,785,800 1.86 705,700 ------------------------------------------------------------------------- The Measured and Indicated resource categories for the oxide and transitional portions of the West and East zones of the Uzboy gold deposit were used to estimate the Proven and Probable Mineral Reserves and are not in addition to such Proven and Probable reserves. Inferred mineral resources in the oxide portion of the Uzboy gold deposit and the Measured, Indicated and Inferred resources for the sulphide portion of the Uzboy gold deposit do not have demonstrated economic viability. Howe used an Ordinary Kriging wireframe restricted linear block model to estimate the gold resources contained in the Uzboy gold deposit. Classification methodology used to assign a level of confidence to the mineral resources conforms to the Canadian Institute of Mining and Metallurgy ("CIM") mineral Resource definitions referred to in NI 43-101 - Standards of Disclosure for Mineral Deposits. QUALIFIED PERSONS The Report containing the updated reserve estimate was prepared by Mr. J.N. Hogg MSc, MAIG senior geologist with section contribution and study supervision from Mr. Neil Holloway, C. Eng., Howe's associate process engineer, Mr. Julian Bennett, C. Eng., Howe's associate mining engineer and Mr. Oleg Nesterov, Howe ' s contract mining engineer and are all Qualified Persons pursuant to NI 43 -101. Elmer B. Stewart, MSc. P. Geol., a director of Alhambra, is the Corporation's nominated Qualified Person. Mr. Stewart has reviewed and verified the technical information contained in this news release. ABOUT ALHAMBRA Alhambra is a Canadian based gold exploration and production corporation engaged in the exploration of and production from its 100% owned Uzboy Project. Alhambra is currently in its sixth year of operations in the Republic of Kazakhstan. Alhambra common shares trade on The TSX Venture Exchange under the symbol ALH and in Germany on the Frankfurt Open Market under the symbol A4Y. The Corporation's website can be accessed at www.alhambraresources.com. The TSX Venture Exchange Inc. has neither approved nor disapproved the information contained herein. Cautionary Note Concerning Reserve and Resource Estimates This news release by Alhambra uses the terms "resources", "measured resources", "indicated resources" and "inferred resources". United States investors are advised that, such terms are recognized and required by Canadian securities laws, the United States Securities and Exchange Commission (the "SEC") does not recognize them. Under United States standards, mineralization may not be classified as a "reserve" unless the determination has been made that the mineralization could be economically and legally produced or extracted at the time a reserve determination is made. Mineral resources that are not mineral reserves do not have demonstrated economic viability. United States investors are cautioned not to assume that all or any part of measured or indicated resources will ever be converted into reserves. Inferred resources are in addition to measured and indicated resources. Inferred resources have a great amount of uncertainty as to their existence and as to whether they can be mined legally or economically. It cannot be assumed that all or any part of an inferred resource will ever be upgraded to a higher category. United States investors are cautioned not to assume that all or any part of an inferred resource exist, or that it can be mined legally or economically. NI 43-101 is a rule developed by the Canadian Securities Administrators, which established standards for all public disclosure an issuer makes of scientific and technical information concerning mineral projects. The requirements of NI 43-101 are not the same as those of the SEC. This news release contains forward - looking information including but not limited to comments regarding the timing and content of upcoming work programs and geological interpretations and timing of mine life. Forward - looking information includes disclosure regarding possible future events, conditions or results of operations that is based on assumptions and courses of action, and therefore, involves inherent risks and uncertainties. For any forward looking information given, management has assumed that the analytical results it has received are reliable, and has applied geological interpretation methodologies which are consistent with industry standards. Although management has a reasonable basis for the conclusions drawn regarding the estimation of oxide and transitional ore reserves as accurate, actual results may differ materially from those currently anticipated in such statements. For such statements, we claim the safe harbor for future.

For further information:

For further information: Ihor P. Wasylkiw, Chief Information Officer,
(403) 508-4953; Jim Clarke, Investor Relations, 1-888-290-1335 (Toll Free)

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