CGA Mining Limited - Announcement to the Australian Securities Exchange and Toronto Stock Exchange



    
    /NOT FOR DISSEMINATION IN THE UNITED STATES OR FOR RELEASE TO US NEWS
    WIRE SERVICES/

    53% INCREASE IN GOLD RESERVE TO IN EXCESS OF 3M OUNCES FOR THE MASBATE
    GOLD PROJECT
    

    PERTH, Western Australia, Oct. 22 /CNW/ - CGA Mining Limited ("CGA", the
"Company") (ASX:CGX, TSX:CGA) and Filminera Resources Corporation
("Filminera") are pleased to report that an updated independent mineral
reserve estimate has been prepared for the Masbate Gold Project by Lower
Quartile Solutions Pty Ltd ("LQS"), resulting in a significant increase in
reserves.
    As at 20 October 2008, total probable reserves are now estimated to
contain 92.2Mt @ 1.0g/t resulting in 3.03 million ounces of gold. This
represents an increase in reserves of 53% from the figure reported in the
Technical Report dated 30 April 2006 prepared by IMC Consultants Pty Ltd.
    Table 1 below summarises the results of the upgrade of probable reserves.

    
    TABLE 1 - 2008 Updated Masbate Probable Reserve Estimate
    -------------------------------------------------------------------------
    Area                      Ore Tonnes             Grade            Ounces
    -------------------------------------------------------------------------
    Holy Moses Basalt         57,242,000               1.0         1,888,000
    -------------------------------------------------------------------------
    Main Vein                 22,967,000               1.0           736,000
    -------------------------------------------------------------------------
    Colorado                  11,398,000               1.0           374,000
    -------------------------------------------------------------------------
    Montana                      629,000               1.7            34,000
    -------------------------------------------------------------------------
    Total                     92,236,000               1.0         3,032,000
    -------------------------------------------------------------------------
    

    The probable reserve is based on a gold price of US$750 and also includes
an additional mining recovery allowance of 95% (which is more conservative
than the May 2006 mineral reserve estimation). The reserves will be sourced
from 3 major independent pits and a number of smaller surrounding pits, with
the average strip ratio (W:O) now materially reduced to 1.05:1 (the original
average strip ratio was 3.43:1). As part of the study LQS has optimised the
mining schedule for the initial two years of production, during which time it
is planned to mine approximately 8Mt of ore at an average grade of 2.0 g/t.
    The detailed review of the geological model and subsequent analysis of
current price and mining cost projections allowed for expansion of the
previously defined pits. Estimation of the mineral reserve was completed in
accordance with the Canadian Securities NI 43-101 by LQS. An economic cut-off
grade of 0.4 g/t, updated mining, processing and administration costs and the
application of the results from recent metallurgical recovery test work were
applied to the mineral resource.
    A computer based open pit optimisation routine was used to determine the
appropriate mining limits (area and depth), taking account of all
environmental requirements in connection with open pit mining and waste
disposal.
    We currently have 4 rigs on site focussed on exploration activities and
these updated reserves do not include results from recently completed drilling
in the Panique area (8,005m), nor do they include drilling in the Main Vein /
Boston area (3,986m). Drilling results from both these areas have been
returned and geological interpretation and block modelling will be completed
by the end of the December quarter. Further increases in resources and
subsequently reserves are expected, including additional higher grade reserves
which we would expect to extend the high grade period of mining beyond the
current 2 year plan.
    In light of the significant increase in reserves and scale of the
project, a higher throughput option is under review, focussed on maximising
grade and throughput over the first 10 years of the project. The preliminary
assessments indicate that a significant increase in throughput may be
achievable with only nominal additional capital. The existing plant layout
would not require modification as it has been designed to allow for and
accommodate additional tankage and crushing capacity if desired.

    ABOUT CGA MINING LIMITED

    CGA is listed on the Toronto Stock Exchange and Australian Securities
Exchange. The Masbate Gold Project in the Philippines is currently under
construction and first gold production is due in the first quarter of 2009.
The project has a total indicated resource base of 4.55M ounces, total
inferred resource base of 3.22M ounces and a probable reserve of 3.03M ounces
of gold. It is currently forecast to produce over 200,000 ounces per annum.
The 4Mt pa plant is under construction by Leighton Contractors Asia Limited
("Leighton"). CGA is completing a scoping study for the expansion of the plant
throughput at Masbate. The mining contract for the Masbate Gold Project has
been awarded to Leighton, the largest mining contractor in the world. A
30,000m drilling program (22,000m of which has now been completed) is
currently underway at Masbate. CGA is completing a Feasibility Study into the
Mkushi Copper Project in Zambia, which is due for completion in December 2008.
The Company is also currently undertaking a 10,000m drilling program at
Segilola, regarded as Nigeria's most advanced gold property. CGA has a
disciplined acquisition program focused on acquiring new gold projects with a
substantial initial resource with the capacity to grow materially and where
the development and operational experience of CGA can be applied to enhance
shareholder value.

    NATIONAL INSTRUMENT 43-101 AND JORC COMPLIANCE

    Mr Geoff.G.Jones, F.Aus.I.M.M.CP Mng, CGA's Consulting Engineer, is
acting as the Qualified Person in compliance with NI 43-101 and JORC reporting
requirements with respect to this announcement. He has prepared and or
supervised the preparation of the scientific or technical information in this
announcement and confirms compliance with NI43-101 and JORC requirements.
    Further information relating to the Masbate Project is included in the
technical report entitled Technical Report on the Mineral Resources of the
Masbate Deposit, Masbate Province, Republic of the Philippines for CGA Mining
Limited prepared by Mining Associates Pty Ltd and available on SEDAR at
www.sedar.com, lodged 8 July 2008.
    Andrew James Vigar of Mining Associates Pty Ltd, a qualified person, has
verified the resource statement for the Masbate Project as disclosed in this
announcement, including sampling, analytical and test data underlying the
estimate. Verification of the data included numerous site visits, database
validation of historical drill results and review of sampling and assaying
protocols. The qualified person was satisfied with the verification process.
    A new NI 43-101 compliant report will be lodged shortly on www.sedar.com
verifying and supporting the new reserve statement made for the Masbate
Project. Mr Daniel Tuffin of Lower Quartile Solution Pty Ltd, a qualified
person, has verified the reserve statement for the Masbate Project as
disclosed in this announcement, including sampling, analytical and test data
underlying the estimate. Verification of the data included database validation
of historical drill results and review of sampling and assaying protocols. The
qualified person was satisfied with the verification process.

    CAUTIONARY NOTE REGARDING FORWARD LOOKING STATEMENTS

    This announcement includes certain "forward-looking statements" within
the meaning of Canadian securities legislation. All statements, other than
statements of historical fact, included herein including, without limitation,
statements regarding anticipated dates for construction and production, and
other milestones related to the Masbate Gold Project and other projects;
estimates of capital and operating costs, recovery rates, production estimates
and estimated economic return; and CGA's future operating or financial
performance, are forward-looking statements. Information concerning mineral
reserve and resource estimates including statements regarding the conversion
of inferred resources to reserves also may be deemed to be forward-looking
statements in that it reflects a prediction of the mineralization that would
be encountered if a mineral deposit were developed and mined. Forward-looking
statements involve various risks and uncertainties and are based on certain
factors and assumptions. There can be no assurance that such statements will
prove to be accurate, and actual results and future events could differ
materially from those anticipated in such statements. Important factors that
could cause actual results to differ materially from CGA's expectations
include uncertainties related to fluctuations in gold and other commodity
prices and currency exchange rates; uncertainties relating to interpretation
of drill results and the geology, continuity and grade of mineral deposits;
uncertainty of estimates of capital and operating costs, recovery rates,
production estimates and estimated economic return; the need for cooperation
of government agencies in the development of the Masbate Gold Project; the
need to obtain additional financing to develop the Masbate Gold Project; the
possibility of delay in development programs or in construction projects and
uncertainty of meeting anticipated program milestones for the Masbate Gold
Project; and other risks and uncertainties disclosed under the heading "Risk
Factors" in CGA's Annual Information Form for the year ended 30 June 2008
filed with the Canadian securities regulatory authorities on the SEDAR website
at www.sedar.com.





For further information:

For further information: Australian Contact: President & CEO - Michael
Carrick, Tel: +61 8 9263 4000, Fax:  +61 8 9263 4020, Email:
mcarrick@cgamining.com; US Contact: Chairman - Mark Savage, Tel: (505)
344-2822, Fax: (505) 344-2922, Email: marksavage@comcast.net

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