Fort a la Corne Joint Venture: Orion South NI 43-101 Mineral Resource - Indicated: 84 million tonnes and 12 million carats - Inferred: 98 million tonnes and 13 million carats



    Stock Symbol: SGF: TSX

    SASKATOON, Sept. 10 /CNW/ - George H. Read, P. Geo., Senior Vice
President Exploration and Development, is pleased to announce the NI 43-101
compliant Mineral Resource estimate for the explored portion of the Orion
South Kimberlite ("OS"), which is located at the southern end of the Orion
Kimberlite Cluster within the Fort a la Corne Joint Venture ("FALC-JV": 60
percent Shore Gold Inc. ("Shore") and 40 percent Newmont Mining Corporation of
Canada Limited ("Newmont")). This resource estimate has been prepared by an
independent Qualified Person ("QP") from P&E Mining Consultants Inc. ("P&E").
The Mineral Resource estimate includes Indicated Resources of 84 million
tonnes at a grade of 13.83 carats per hundred tonnes ("cpht") and Inferred
Resources of 98 million tonnes at a grade of 12.83 cpht. Table 1 summarizes
the details of the NI 43-101 Mineral Resource as prepared by P&E. The lower
proportion of Indicated Resources of overall tonnes reported at OS, when
compared to the Star Kimberlite, is due to a significantly smaller underground
bulk sample when compared to the Star Kimberlite (23,468 tonnes from OS versus
75,436 tonnes from Star) and a smaller large diameter drilling (LDD) program
at OS (62 holes on OS versus 96 holes on Star).


    
    Table 1. Mineral Resource Estimate for the Orion South Kimberlite.
    Reported Kimberlite Units: Cantuar, Pense, Early Joli Fou (EJF), Mid Joli
    Fou (MJF), Viking, Late Joli Fou (LJF) and a Mixed Sediment and
    Kimberlite unit at the interface of the Pense and EJF

    -----------------------------------------------------------------------
    Resource
    Category   Kimberlite Unit   Tonnes x 1000   Grade cpht  Carats x 1000
    -----------------------------------------------------------------------
    Indicated          Cantuar               0         0.00              0
    -----------------------------------------------------------------------
    Indicated        EJF Inner          43,912        18.29          8,033
    -----------------------------------------------------------------------
    Indicated        EJF Outer          12,872        11.03          1,419
    -----------------------------------------------------------------------
    Indicated      Pense Inner          27,026         7.92          2,140
    -----------------------------------------------------------------------
    Indicated      Pense Outer               0         0.00              0
    -----------------------------------------------------------------------
               Mixed Sediments
    Indicated     & Kimberlite               0         0.00              0
    -----------------------------------------------------------------------
    Indicated           Viking               0         0.00              0
    -----------------------------------------------------------------------
    Indicated              LJF               0         0.00              0
    -----------------------------------------------------------------------
    Indicated            TOTAL          83,810        13.83         11,592
    -----------------------------------------------------------------------
    Inferred           Cantuar              51         4.85              2
    -----------------------------------------------------------------------
    Inferred         EJF Inner          32,731        19.46          6,368
    -----------------------------------------------------------------------
    Inferred         EJF Outer          43,075        10.13          4,362
    -----------------------------------------------------------------------
    Inferred       Pense Inner          15,458         8.77          1,356
    -----------------------------------------------------------------------
    Inferred       Pense Outer           1,034         6.39             66
    -----------------------------------------------------------------------
                Mixed Sediment
    Inferred      & Kimberlite              83         7.35              6
    -----------------------------------------------------------------------
    Inferred            Viking             231         9.87             23
    -----------------------------------------------------------------------
    Inferred               LJF           5,371         7.40            398
    -----------------------------------------------------------------------
    Inferred             TOTAL          98,035        12.83         12,582
    -----------------------------------------------------------------------

    Table Notes

    (1) Mineral resources are accumulated within an optimized floating-cone
        pit shell.
    (2) Mineral resources which are not mineral reserves do not have
        demonstrated economic viability. The estimate of mineral resources
        may be materially affected by environmental, permitting, legal,
        title, taxation, socio-political, marketing or other relevant issues.
    (3) The quantity and grade of reported inferred resources in this
        estimate is conceptual in nature. There is no guarantee that all or
        any part of the mineral resource will be converted into a mineral
        reserve.
    (4) 1 millimetre bottom diamond size cut-off assumed.
    (5) Resources are reported at a C$4.94 cut-off.
    

    The OS Kimberlite is one of the largest diamond bearing kimberlites in
the world, with a surface area totalling some 403 hectares, situated within
the FALC-JV claims. The Mineral Resource estimate prepared by P&E includes
kimberlite volume, density and tonnage data collected during the surface
drilling programs comprising 149 core holes (15,517 metres of kimberlite), and
62 LDD holes (7,920 metres of kimberlite), diamond and tonnage data from
underground bulk sampling (23,468 dry tonnes, 2,346 carats and 15,248 stones)
and diamond and tonnage data from the mini-bulk samples recovered from the LDD
program on Orion South (62 holes, 9,580 processed tonnes, 1,039.67 carats and
10,356 stones). This resource estimate uses a 1.0 millimetre bottom diamond
size cut-off and considers all kimberlite above 20 metres above sea level or
to a depth of approximately 430 metres below surface.
    The Inner (vent proximal) and Outer (vent distal) Kimberlite Units of the
EJF and Pense are based on detailed kimberlite geology recorded from core
logging of the pattern drill program. Core logging information is combined
with whole rock geochemistry data, geophysical and density measurements to
identify the constituent kimberlite lithologies within OS and their
volcanological features that form the OS Kimberlite crater. The EJF and Pense
Inner Kimberlite Units represent coarser grained EJF and Pense Kimberlite that
occurs within the volcanic cinder cone and the EJF and Pense Outer Kimberlite
Unit include finer grained EJF and Pense Kimberlite that lies on and outside
the cinder cone. Underground bulk sampling and LDD have shown that higher
grades and larger diamonds are found within the EJF and Pense Inner Kimberlite
Units. The underground bulk sampling of the EJF is deemed representative of
the EJF Inner Kimberlite Unit.
    An essential component of the Mineral Resource estimate relies on the
reconciliation of the diamond grades from the underground samples with those
calculated for the LDD samples. The LDD sampling method underestimates the
true diamond grade and price due to limited sample size, diamond breakage,
diamond loss and dilution of LDD grade by overburden falling down LDD holes.
Detailed analysis of diamond results from LDD and underground bulk sampling
has been undertaken, and reconciled with kimberlite geology, defined by core
drilling, in order to define rigorously constrained factors that are applied
to diamond grade results from LDD.
    CIM standards and securities commission disclosure regulations require
that a resource can only be declared on a mineral deposit which has
"reasonable prospects of economic extraction". The reported mineral resource
for OS is constrained using an optimized floating-cone pit shell. The Mineral
Resources reported in Table 1 comprise the kimberlite that is constrained
within the floating-cone pit shell and exceeds the economic cut-off as
determined by the parameters in Table 2.


    
    Table 2. Economic Parameters

    ---------------------------------------------------
    Exchange Rate                C$1.00 equals US$0.85
    ---------------------------------------------------
    Stripping Cost                        C$1.00/tonne
    ---------------------------------------------------
    Mining Cost                      C$1.60/rock tonne
    ---------------------------------------------------
    Processing Cost                   C$3.29/ore tonne
    ---------------------------------------------------
    General & Administration          C$1.65/ore tonne
    ---------------------------------------------------
    Overall Pit Slope Angle                 25 degrees
    ---------------------------------------------------
    Internal Cut-off                  C$4.94/ore tonne
    ---------------------------------------------------
    

    Diamond prices used in this resource statement are based on a valuation
by WWW International Diamond Consultants Ltd. ("WWW") using their March 2008
price book. The High scenario modeled prices determined by WWW are used in the
Resource estimate and are detailed in Table 3. High scenario modeled prices
for the Star deposit were also used in the February 2009 resource estimate and
the August 2009 reserve estimate for the Star Kimberlite and the use of the
High scenario modeled prices in this OS resource estimate facilitates
comparison.
    WWW estimates that diamond prices are presently approximately 10 to 15
percent lower than March 2008 levels. P&E have utilized the WWW diamond
valuations based on March 2008 prices and, although diamond prices have since
dropped by 10 to 15 percent, changes in the Canadian $/US $ exchange rate of
some 15 percent in favour of project economics have occurred since March 2008,
thereby supporting the use of the March 2008 High diamond price valuation.


    
    Table 3. Diamond Prices

    -------------------------------------------------------------------------
    Kimberlite          Parcel Price  Model Price  Minimum Price  High Price
    Lithology   Carats   (US$/carat)   (US$/carat)  (US$/carat)   (US$/carat)
    -------------------------------------------------------------------------
    EJF       1,400.38       $98           $121         $100          $166
    -------------------------------------------------------------------------
    Pense       581.93       $57           $109          $91          $123
    -------------------------------------------------------------------------

    As a test of the sensitivity of the OS resource to market fluctuations,
the resource model was also run within the pit shell using the WWW Minimum and
Model price scenarios. The results suggest that the OS resource is relatively
insensitive to moderate diamond price fluctuations. The variations in tonnes,
grade and carats for the three WWW diamond price scenarios are listed in Table
4.


    Table 4. Diamond Price Sensitivity at a C$4.94 cut-off

    --------------------------------------------------------
                            Million      Grade      Million
    Scenario      Class      Tonnes      (cpht)      Carats
    --------------------------------------------------------
    Minimum   Indicated        76.8       14.7         11.3
            ------------------------------------------------
               Inferred        86.3       14.0         12.1
    --------------------------------------------------------
    Model     Indicated        80.9       14.2         11.5
            ------------------------------------------------
               Inferred        93.5       13.2         12.4
    --------------------------------------------------------
    High      Indicated        83.8       13.8         11.6
            ------------------------------------------------
               Inferred        98.0       12.8         12.6
    --------------------------------------------------------
    

    In addition to the Mineral Resource estimate determined by P&E, a further
90 to 100 million tonnes of the OS Kimberlite is designated a 'potential
mineral deposit' by Shore, as detailed core logging, whole rock geochemistry,
geophysical and density measurements confirm the geological continuity of
kimberlite material from the Inferred Resource into this part of the
kimberlite, which is contained within the 333 million tonnes originally
defined in the geological model for the OS Kimberlite (Shore News Release
October 21, 2008). The 90 to 100 million tonne potential mineral deposit is
conceptual in nature and is not a resource estimate. It is uncertain if
additional exploration work will lead to the kimberlite presently included in
the potential mineral deposit being upgraded to a resource category.
    Senior Vice President Exploration and Development, George Read, states:
"This NI 43-101 Mineral Resource estimate for the OS Kimberlite proves the
potential of the FALC-JV to contain diamondiferous kimberlites of substantial
value. Shore has recently shown that an economic diamond mine with the world's
largest diamond processing plant (40,000 tonnes per day) is feasible at the
Star Kimberlite (Shore News Release August 27, 2009) and any additional
resources estimated within the FALC-JV will significantly augment the
economics of a diamond mine."
    Shore commissioned the NI 43-101 Mineral Resource estimate and related
Technical Report for the Orion South property and, as such, the Technical
Report is the sole responsibility of Shore. Newmont did not participate in the
preparation, supervision or review of the work associated with this exercise
and takes no responsibility for the content or information included in the
Technical Report or this press release.
    Shore anticipates publication of the Technical Report as soon as it is
available, within the regulated 45 day period after this news release. Shore
is the operator of the FALC-JV, which is held by the Fort a La Corne Joint
Venture between Shore as the operator and 60 percent owner and Newmont as the
owner of a 40 percent interest.
    Mr. Fred Brown CPG, PrSciNat, of P&E is the independent Qualified Person
who was responsible for the Orion South Kimberlite Resource estimate. Mr.
Brown, a Certified Professional Geologist (No.11015) with the American
Institute of Professional Geologists and a registered Professional Natural
Scientist with the South African Council for Natural Scientific Professions
(No.400008/04), has over 21 years of worldwide experience in mining resource
and reserve assessments and related work and has worked on diamond mines in
southern Africa for De Beers. His specialties include resource estimation, ore
deposit modeling, due diligence reviews, project evaluation, mining geology,
geostatistical studies and preparation of NI 43-101 reports. He is regarded as
one of the leading authorities in diamond resource evaluation and diamond
geostatistics. P&E Mining Consultants Inc. is an established and
internationally recognized geological and mine engineering consulting firm
specializing in resource estimates, scoping, pre-feasibility studies and
participation with other consulting firms on feasibility studies, with over 70
projects undertaken in the last 5 years. P&E has Certificates of Authorization
from the Association of Professional Geoscientists of Ontario and Professional
Engineers Ontario and the Association of Professional Engineers and
Geoscientists of Saskatchewan. Mr. Eugene Puritch, P.Eng. (Haileybury School
of Mines, Queen's University), a principal of P&E Mining Consultants Inc., who
supervised the preparation of the Mineral Resource estimate for the Orion
South Kimberlite, has more than 30 years experience in mine evaluation and
resource estimating for some of Canada's largest mining companies. He has
undertaken more than 120 resource estimates and mine designs in his career,
many of which formed the basis for feasibility studies and subsequent
production decisions. Prior to co-founding P&E, Mr. Puritch was regularly
under contract to provide his services to Micon International Ltd., Aker
Solutions Canada Inc., A.C.A. Howe International Ltd. and Strathcona Mineral
Services. Dr. Wayne Ewert, P.Geo. (PhD, Geology, Carleton University, Ottawa,
Canada and B.Sc. University of Waterloo, Canada) a principal of P&E, has over
40 years of worldwide experience in diversified exploration, project
evaluation and resource based geological modeling. He has over 18 years of
international consulting experience in support of project acquisitions and
related financing activities. His experience includes involvement with the
evaluation and assessment of diamond projects in Lesotho and South Africa on
behalf of A.C.A. Howe International. P&E consents to the statement of mineral
resources contained herein.
    Senior Vice President Exploration and Development, George Read,
Professional Geoscientist in the Provinces of Saskatchewan and British
Columbia, is Shore's Qualified Person responsible for the verification and
quality assurance of analytical results. Shore is a Canadian based corporation
engaged in the acquisition, exploration and development of mineral properties.
Shares of the Company trade on the TSX Exchange under the trading symbol
"SGF".

    Caution Regarding Forward-Looking Statements

    This news release contains forward-looking statements as defined by
certain securities laws, including the "safe harbour" provisions of the
Ontario Securities Act and the United States Private Securities Litigation
Reform Act of 1995. The words "may," "could," "should," "would," "suspect,"
"outlook," "believe," "plan," "anticipate," "estimate," "expect," "intend,"
and words and expressions of similar import are intended to identify
forward-looking statements, and, in particular, statements regarding Shore's
future operations, future exploration and development activities or other
development plans containing forward-looking statements.
    These forward-looking statements are based on Shore's current beliefs as
well as assumptions made by and information currently available to Shore and
involve inherent risks and uncertainties, both general and specific,
concerning anticipated financial performance, business prospects, strategies,
regulatory developments, development plans, exploration, development and
mining activities and commitments. Although management considers these
assumptions to be reasonable based on information currently available to it,
they may prove to be incorrect.
    Risks exist that predictions, forecasts, projections and other
forward-looking statements will not be achieved due to a number of factors
including, but not limited to, developments in world diamond markets, changes
in diamond valuations, risks relating to fluctuations in the Canadian dollar
and other currencies relative to the US dollar, changes in exploration,
development or mining plans due to exploration results and changing budget
priorities of Shore or its joint venture partners, the effects of competition
in the markets in which Shore operates, the impact of changes in the laws and
regulations regulating mining exploration and development, judicial or
regulatory judgments and legal proceedings, operational and infrastructure
risks and the additional risks described in Shore's most recently filed Annual
Information Form, annual and interim MD&A and short form prospectus. Shore's
anticipation of and success in managing the foregoing risks could cause actual
results to differ materially from what is anticipated in such forward-looking
statements.
    Although management considers the assumptions contained in
forward-looking statements to be reasonable based on information currently
available to it, those assumptions may prove to be incorrect. When making
decisions with respect to Shore, investors and others should not place undue
reliance on these statements and should carefully consider the foregoing
factors and other uncertainties and potential events. Unless required by
applicable securities law, Shore does not undertake to update any
forward-looking statement that may be made.





For further information:

For further information: Joseph Dickson, Investor Relations Manager at
(306) 667-3505 and www.shoregold.com


Custom Packages

Browse our custom packages or build your own to meet your unique communications needs.

Start today.

CNW Membership

Fill out a CNW membership form or contact us at 1 (877) 269-7890

Learn about CNW services

Request more information about CNW products and services or call us at 1 (877) 269-7890