Norwest Corporation completes feasibility study on the Soledad Mountain Project



    TSX - GQM

    VANCOUVER, Dec. 14 /CNW/ - Norwest Corporation of Vancouver, British
Columbia has completed a feasibility study and Technical Report in the form
prescribed under National Instrument 43-101 for the Soledad Mountain Project. 
The Technical Report will be filed with applicable Canadian securities
commissions within the prescribed 45 days via SEDAR.

    Base Case Cash Flow Projection

    The following are the parameters used in the base case cash flow
projection:
    
    -  Gold and silver prices of $600.00/oz and $12.00/oz respectively
    -  An analysis on an all-equity basis with lease financing of the primary
       mining equipment and
    -  A 10 % contingency on capital and operating costs.
    

    The Project has a projected internal rate of return (IRR) on capital
employed of 19% before taxes with a payback of approximately 4 years. The net
present value (NPV) is $66.5million with discount rate of 5.0% and the
undiscounted, cumulative net cash flow is $120million. The contribution of
gold and silver to gross revenues is projected to be 84% and 16% respectively
with an average cash operating cost per ounce of gold produced, net of silver
credits, of $420/oz. To provide a comparison, the same mining scenario without
the 10% contingency on operating costs has an IRR of 23% before taxes, a NPV
of $93.3million with a discount rate of 5% and an undiscounted, cumulative net
cash flow of $158million.
    The projected IRR is 38% before taxes, the NPV is $187million and the
undiscounted, cumulative net cash flow is $290million with closing gold and
silver prices on November 30 of $783.50/oz and $13.98/oz respectively.
    The projected IRR is 14% before taxes, the NPV is $40million and the
undiscounted, cumulative net cash flow is $83million with rolling 36-month
average gold and silver prices of $571.74/oz and $10.56/oz respectively to the
end of November 2007 and these are typical prices used by lenders to assess
gold and silver projects.
    The US dollar is used and quantities are reported in Metric units with
Imperial units in brackets.

    Overview

    The Company is proposing to develop a gold-silver, open pit, heap leach
operation on its Soledad Mountain property, located just outside the town of
Mojave in Kern County in southern California. Every element of the Project has
been rethought and re-engineered in the past three years in an effort to find
sound technical and cost-effective solutions for a robust Project.
    The local infrastructure and the ready access to site at all times of the
year will have a significant impact on both the cash required to the start of
production and the operating cost.

    Mineral Resource Estimates

    The Soledad Mountain deposit is hosted in a volcanic sequence of rhyolite
porphyries, quartz latites and bedded pyroclastics that occur on a large
dome-shaped feature, called Soledad Mountain, along the margins of a collapsed
caldera. High-grade precious metal mineralization is associated with steeply
dipping epithermal fissure veins occupying faults and fracture zones that
cross cut the rock units. The veins are contained within siliceous envelopes
of lower grade material that forms the bulk of the mineral resource.
    Gold is present in ore as native gold and electrum with particles ranging
in size from less than 10 micron to greater than 150 micron with the silver
content of the electrum as high as 25%. Silver is also present as the mineral
acanthite (Ag(2)S) with some native silver, pyrargyrite (3Ag(2)S.Sb(2)S(3))
and polybasite (9Ag(2)S.Sb(2)S(3)). Pyrite (FeS(2)), galena (PbS) and
chalcopyrite (CuFeS(2)) are present in minor amounts with no indicated
acid-generating potential.
    The geological database contains 71,325 samples, generated from over
113,593 m (372,649 ft) of drilling and sampling of underground crosscuts. Ore
zones were shaped manually by company geologists to define continuity with a
low-grade cutoff grade of 0.274 g/t AuEq (0.008 oz/ton AuEq).
    The Company engaged SRK Consulting (U.S.), Inc. in 2005 to prepare a
National Instrument 43-101 compliant Technical Report to validate and confirm
mineral resource estimates. The Technical Report was released on March 6,
2006. The mineral resource estimates are set out in the table below:

    
           Mineral Resource Estimates at a 0.008oz/ton AuEq Cutoff

                                                -----------------------------
                                                           Grades
                                                -----------------------------
                                                     Gold          Silver
    -------------------------------------------------------------------------
    Resource
     Category             t           ton        g/t   oz/ton    g/t  oz/ton
    -------------------------------------------------------------------------
      Measured        39,720,000   43,692,000   0.926   0.027   14.86   0.43
      Indicated       50,774,000   55,851,000   0.603   0.018   11.47   0.33
    -------------------------------------------------------------------------
    Total & Average   90,494,000   99,543,000   0.744   0.022   12.96   0.38
    -------------------------------------------------------------------------
      Inferred        32,073,000   35,280,000   0.497   0.014   10.84   0.32
    -------------------------------------------------------------------------

                       -----------------------
                           Contained Metal
                       -----------------------
                            Gold      Silver
    ------------------------------------------
    Resource
     Category               oz          oz
    ------------------------------------------
      Measured         1,181,100   18,941,100
      Indicated          981,100   18,686,400
    ------------------------------------------
    Total & Average    2,162,200   37,627,500
    ------------------------------------------
      Inferred           510,700   11,154,000
    ------------------------------------------
    

    The Technical Report is available on the Company's web site as
www.goldenqueen.com.

    Mineral Reserve Estimates

    The company engaged Norwest Corporation of Vancouver in January 2007 to
prepare a NI 43-101 compliant Technical Report to assess mineral reserves for
the Project as part of an independent feasibility study based upon technical
work and engineering designs completed to the end of 2006.
    The open pit design done by Norwest Corporation is considered to be both
detailed and complete. The mineral reserve estimates are set out in the table
below:

    
                Proven and Probable Mineral Reserve Estimates

                                                -----------------------------
                                                        Diluted Grades
                                                -----------------------------
                                                    Gold            Silver
    -------------------------------------------------------------------------
    Reserve
     Category             t           ton        g/t   oz/ton    g/t  oz/ton
    -------------------------------------------------------------------------
      Proven          27,705,500   30,476,000   0.819  0.0239   13.82  0.403
      Probable        18,861,800   20,748,000   0.535  0.0156   11.69  0.341
    -------------------------------------------------------------------------
    Total & Average   46,567,300   51,224,000   0.703  0.0205   12.96  0.378
    -------------------------------------------------------------------------

                     -------------------------
                            Contained Metal
                     -------------------------
                           Gold      Silver
    ------------------------------------------
    Reserve
     Category               oz         oz
    ------------------------------------------
      Proven             728,600   12,282,800
      Probable           323,800    7,075,800
    ------------------------------------------
    Total & Average    1,052,400   19,358,600
    ------------------------------------------
    

    Allowance has been made for ore loss and dilution in determining the
detailed mining schedule. Dilution has been assigned a zero grade for
calculation of reserves. The planned ore mining rate is 4,500,000 tonnes per
year (5,000,000 tons per year) once in full production with an average
stripping ratio of 2.12:1 and this includes the waste rock mined during the
pre-production period.
    Only approximately 50% of the mineral resource estimates have been
included in the current 12-year mine plan.

    Ore Transport Option

    Although the current mine plan relies on trucks for all ore haulage to
the crushing-screening plant, it is the company's intent to replace the trucks
with a pipe conveyor with a possible significant reduction in both capital and
operating costs for the Project. Pipe conveyor technology is well proven in
practice with upwards of 200 installations in Europe.

    Gold And Silver Recoveries

    Extensive process development done on Soledad Mountain ores from 1988 to
1999 shows that these ores are readily amenable to heap leaching if the ore is
crushed to relatively small sizes. The test work is well documented and test
results have been used in a number of historical feasibility studies for the
Project. Parameters such as agglomerate strength and binder addition rates,
percolation rates, cyanide consumption and reagents required for pH control
were also determined in standard tests.
    A flow sheet that uses a high-pressure grinding roll or HPGR for
preparing ores for heap leaching has been developed for the Project. Extensive
bottle roll and column leach test work on quartz latite and rhyolite samples
crushed in the HPGR was done from mid-2003 to mid-2007 to determine operating
parameters for the heap leach operation and gold and silver recoveries.
    The primary rock types to be mined are rhyolite porphyry and flow-banded
rhyolite, pyroclastics, quartz latite porphyry and siliceous vein material.
The rock types will be encountered in different areas and at various stages of
the life of the mine.
    The following recoveries are now projected for the commercial operation
based upon an analysis of tails obtained in the column leach test work:

    
           -------------------------------------------------------
            Primary Rock Types   Proportion     Gold      Silver
                                 ---------------------------------
                                     %           %          %
           -------------------------------------------------------
            Pyroclastics            10.5        85.4       52.5
            Quartz Latite           21.3        89.9       52.5
            Rhyolite                68.1        83.4       52.5
            Undefined                0.1      Average     Average
           -------------------------------------------------------
            Total & Average        100.0        85.0       52.5
           -------------------------------------------------------
    

    Extended leach times are available in commercial operations and the
company expects ultimate silver recoveries to be higher than indicated in the
table above.
    Annual gold and silver production is projected to average 75,000 oz and
950,000 oz respectively at full production levels.

    The HPGR In Hard-rock Mining Applications

    The design of the crushing-screening plant with the HPGR as the key
comminution device has been completed by AMEC Americas Limited.
    The HPGR consists basically of two counter-rotating rolls - one a fixed
roll and the other a "floating" roll. The "floating" roll is mounted on and
can move freely on two slides. The grinding forces are applied to the floating
roll by four hydraulic rams. Ore is choke-fed to the gap between the rolls and
comminution takes place without impact and by inter-particle crushing in the
bed of particles. The gap between the rolls is determined by the nip-in
characteristics of the feed and the total grinding force applied, which in
turn depends upon the pressures in the hydraulic system. Each roll is driven
by an electric motor via a planetary gear reducer.
    The company and its consulting engineers believes that test results and a
technical assessment of the HPGR show that this will be a viable and
cost-effective approach to preparing ores for heap leaching with the following
indicated benefits:

    
      -  Higher recoveries in the heap leach operation due to micro-cracks in
         the ore particles;
      -  Faster gold and silver extraction rates;
      -  Substantially lower capital costs than a conventional crushing and
         screening plant;
      -  Manageable dust control with fewer transfer points;
      -  Lower energy consumption and thus lower operating costs and
      -  Exceptional circuit flexibility that will readily permit future
         upgrades such as a finer HPGR feed size or the recycle of edge
         product.
    

    The HPGR has made a breakthrough in hard-rock mining applications as
evidenced by 12 HPGRs installed in large, hard-rock mining operations in Peru,
Indonesia, South Africa and Australia in the last three years.
    The overall availability for the crushing-screening plant allowed for in
the feasibility study is only 81.7%. The company expects that this could
readily be achieved and even exceeded with standard maintenance practices.

    Capital And Operating Costs And Economic Impact

    The cash required to the start of production is estimated to be
$57.7million and this includes a 10% contingency. It is estimated that a
further $2.1million will be required as working capital and cash flow is
expected to turn positive approximately nine months after the start of
production. The sustaining capital is estimated to be a further $15.5million.
The bulk of the sustaining capital will be required for the equipment
leases/additions and for construction of the second and third stages of the
heap leach pad.
    The average cash operating cost is projected at $9.90/t ($9.00/ton) of
ore mined for the life of the mine.
    It is expected that the company will be a significant employer in the
area with an indicated 195 fulltime jobs and this will have a positive impact
on the Mojave economy. It is further projected that the mine will generate
sales taxes in excess of $10million, property taxes of $7.7million, California
State gold and silver fees of $5.4million and royalties payable to landholders
of $12.7million over the initial Project life of 15 years.

    Permitting Update

    All key submissions required for an amended set of approvals and permits
for the Project have now been submitted to the responsible regulatory
authorities.

    
      -  Land Use - Conditional Use Permits

         The environmental setting of the Project was documented in a number
         of baseline studies completed from 1990 onwards and in the certified
         Environmental Impact Report (the "EIR") and Environmental Impact
         Statement completed in 1997. The Kern County Board of Supervisors
         unanimously approved two Conditional Use Permits (CUPs) for the
         Project in September 1997 (i.e. CUP Case No. 41, Map No. 213 and CUP
         Case No. 22, Map No. 214). The Bureau of Land Management
         subsequently issued its Record of Decision approving the Plan of
         Operations under NEPA in November 1997. The company completed a
         number of studies and did significant work on site in 2005 and 2006
         to document that the environmental setting for the Project has not
         changed since 1997.

         The State of California introduced backfilling requirements for
         certain types of open pit, metal mines in December 2002. The company
         contended that these regulations did not apply to the Project under
         a grandfathering provision included in the regulation. The
         company therefore pursued both a favorable interpretation under the
         regulation and subsequently an amendment of the regulation with the
         State Mining and Geology Board (the Board) in 2006. These efforts
         were supported by Kern County officials. Both approaches were
         rejected by the Board and the decision was duly recorded by the
         Board in January 2007. As of the date of this press release, the
         company has not as yet received approval from the regulatory
         authorities for the proposed mine plan but this is being actively
         pursued as described below.

         Norwest Corporation prepared a life-of-mine waste rock management
         plan and this plan incorporates sequential & partial backfilling of
         mined-out phases of the open pit with no double-handling of waste
         rock at the end of the mine life. This plan was included in an
         Application for a revised Surface Mining Reclamation Plan, which was
         submitted to the Kern County Planning Department (the "Planning
         Department") on April 9, 2007.

         The Planning Department completed its review of the Application and
         deemed the Application complete as set out in a letter dated
         July 24, 2007. The Planning Department noted that changes proposed
         for the Project constitute new information that requires evaluation
         of potential impacts and mitigation in a supplemental EIR. The
         Planning Department issued a Request for Proposal to prepare the
         supplemental EIR to a total of 17 qualified consultants and these
         proposals were due to be submitted to the Planning Department by the
         close of business on November 12, 2007. It is now expected that work
         on the supplemental EIR will begin in January 2008.

         It is important to note that the Bureau of Land Management has
         confirmed that its Record of Decision approving the Plan of
         Operations under NEPA in November 1997 remains valid and that no
         additional reviews or approvals are required before the Company can
         proceed with the Project.

      -  Water Quality - Report of Waste Discharge and Waste Discharge
         Requirements

         The Lahontan Regional Water Quality Control Board (the Regional
         Board) is responsible for ensuring compliance with the federal Clean
         Water Act and California's Porter-Cologne Water Quality Act.

         The company submitted a Report of Waste Discharge (ROWD), prepared
         by WZI Inc., Bakersfield, to the Regional Board in June 1997. The
         Regional Board adopted Board Order No. 6-98-9 on March 5, 1998 at a
         meeting held in Lancaster and this set the Waste Discharge
         Requirements for the Project.

         The company and its consulting engineers prepared and submitted a
         revised ROWD to the Regional Board on March 8, 2007.  The revised
         ROWD was prepared at the request of the Regional Board to document
         changes in the layout and design of the heap leach facility plus
         other changes proposed for the Project.

         The Regional Board has completed its assessment of the revised ROWD
         and has prepared draft Waste Discharge Requirements for the Project.
         The Regional Board will wait for confirmation from the Kern County
         Planning Department that a certified supplemental EIR is available
         before adopting a revised Board Order and setting Waste Discharge
         Requirements for the Project.

      -  Air Quality - Authority to Construct and Permit to Operate

         The Company had obtained seven Authority to Construct permits dated
         March 16, 2002. These permits expired on March 16, 2004 and were not
         renewed due to changes anticipated in the Project.

         WZI Inc. of Bakersfield was asked to assess air quality for the
         Project in February 2006 and was commissioned to obtain Authority to
         Construct permits in April 2006. Emissions modeling was done by WZI
         Inc. and submitted to the Kern County Air Pollution Control District
         (KCAPCD) in September 2006. The KCAPCD has completed its review of
         the submissions. The company submitted Applications for Authority to
         Construct permits on June 8, 2007 and these are currently being
         processed.

         The Authority to Construct permits are converted to a Permit to
         Operate after construction has been completed and subject to
         inspection by the Kern County Air Pollution Control District.
    

    Aggregate

    It is expected that an aggregate business can be developed on the
property once the heap leach operation is in full production and based on the
location in southern California with close proximity to major highways and
railway lines. No allowance has been made for a contribution to cash flows
from the production and sale of aggregate.

    Outlook

    The company believes that financing for the Project can be obtained if
gold and silver prices remain firmly above $600/oz and $12.00/oz respectively.
Management will evaluate financing options early in 2008 with a view to making
a production decision as soon as permits have been secured.

    Qualified Person

    Sean Ennis, P.Eng., of Norwest Corporation is a Qualified Person as
described in NI 43-101 and has approved the technical content of this press
release.

    Caution To US Investors

    We advise US investors that while the terms "measured resources",
"indicated resources" and "inferred resources" and "proven reserves" and
"probable reserves" are recognized and required by Canadian regulations as
defined under the CIM Definition Standards, the US Securities and Exchange
Commission does not recognize these definitions which may differ in various
respects from the corresponding definitions published by the U.S. Securities
and Exchange Commission in Industry Guide 7. US investors are cautioned not to
assume that any part or all of the material in the "measured resource",
indicated resource" and "inferred resource" categories will ever be converted
into reserves.

    Caution With Respect To Forward-looking Statements

    This press release contains forward-looking statements, including
statements which relate to the intent, belief and current expectations of the
company and its management. Investors are cautioned that any such
forward-looking statements do not guarantee future performance as mineral
exploration and development involves risks and uncertainties, including
economic risks, regulatory risks and other risks including those disclosed in
the company's public filings. Actual results could therefore differ materially
from those indicated by such forward-looking statements. In particular, plans
to proceed to production are subject to numerous risks, including obtaining
the necessary approvals and permits and production financing. Information and
estimates on reserves and economics are subject to numerous assumptions and
risks that may cause actual results to differ significantly from such
information and estimates.

    Additional Information

    Further information on Golden Queen Mining Co. Ltd. is available on the
SEDAR web site at www.sedar.com and on the company's website at
www.goldenqueen.com or contact us as follows:

    H. Lutz Klingmann, President
    Telephone: (604) 921-7570
    email: mintoexpl@telus.net

    The feasibility study will also be available on the company's website
within 45 days.

    The current number of shares issued and outstanding is 78,440,880.

    The Toronto Stock Exchange has not reviewed and does not accept
    responsibility for the adequacy or accuracy of the contents of this press
    release.





For further information:

For further information: H. Lutz Klingmann, President, Telephone: (604)
921-7570, email: mintoexpl@telus.net


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