Starfield Resources Provides Update on Hydrometallurgical Process



    
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    Successful Results Announced from Continuous Hydrolysis Circuit
    

    TORONTO, Oct. 30 /CNW/ - Starfield Resources Inc. (TSX: SRU / OTCBB:
SRFDF) today released successful results from the refinement of the hydrolysis
circuit in its hydrometallurgical process intended to treat massive sulphide
ore from the Company's Ferguson Lake property in Nunavut.
    "We are having a banner year with our Ferguson Lake project and I
couldn't be more pleased with our progress," said André J. Douchane, President
and CEO. "Dr. Harris and his team have created the basis for a new era in
metal recovery wherein efficiency is key and the environment is better
protected than ever before."

    Update on Iron Hydrolysis Testing

    Testing of the continuous circuit for iron hydrolysis, precipitation and
hydrochloric acid recovery has been ongoing in Montreal for the past two
months. Initial results are encouraging, and further testing is planned to
continue for the remainder of 2008.

    
    Preliminary results show:
    -   The procedure can be effectively and efficiently translated from the
        initial batch mode of testing to continuous operation (a key
        achievement in any hydrometallurgical process).
    -   Hydrochloric acid, ranging from 30% to 35% in strength, has been
        continuously, and more importantly, steadily and consistently
        produced over extended periods of several hours.
    -   The process generates a highly crystalline black hematite, with a
        coarse texture that filters very well, and an iron content of 68% to
        71%, with no detectable base metals or chloride content.
    

    "After over two years of extensive laboratory development work, Starfield
has achieved a real breakthrough in hydrometallurgical research," said Michael
Moran, Starfield's Director of Engineering. "With this process we can now take
a difficult massive sulphide ore and produce pure nickel, copper and cobalt
products in a cost-effective, environmentally friendly and energy-efficient
manner."
    The hydromet processing plant is designed to extract pure, LME-grade
nickel, copper and cobalt metals from massive sulphides at competitive
production costs. The process will allow for economical operations at
Starfield's proposed mine and hydrometallurgical plant sites, and produce
by-product electricity to power both the plant and the mine, with some excess
electricity remaining for potential sale to local communities.
    Dr. Bryn Harris, B.Sc., Ph.D., FCIM, FIMMM, C.Eng, is the Qualified
Person for the hydrometallurgical process and has reviewed this news release
in accordance with NI 43-101.
    In March of this year, Starfield released a summary of the preliminary
economic study (scoping study) which, using a base case model, estimated a
pre-tax IRR of 13.4% with approximately CDN$266 million of pre-tax cash flow
per year. In the same release, the Company also estimated a pre-tax IRR of 27%
with about CDN$536 million of pre-tax cash flow per year by using then current
prices for nickel and copper. Since March, nickel and copper prices have
declined to levels below those used in the March 20, 2008 press release;
however, other products considered in the cash flow analysis either remained
the same or increased in value. Revisiting the scoping study model used in the
March 20, 2008 release, with current commodity prices and exchange rates,
shows a pre-tax IRR at 34.3% with approximately CDN$697 million of pre-tax
cash flow per year.
    A comparison of the effects of commodity price changes to the base case
model is outlined in the table below.

    
    -------------------------------------------------------------------------
                                        Scoping
                                      Study Base
    Commodity                         Case Model    March 2008  October 2008
    -------------------------------------------------------------------------
    Metals - US$ per pound
    -------------------------------------------------------------------------
      Nickel                                8.00         14.25          4.50
    -------------------------------------------------------------------------
      Copper                                2.00          3.75          1.80
    -------------------------------------------------------------------------
      Cobalt                               25.00         25.00         30.00
    -------------------------------------------------------------------------
    Sulphuric Acid - US$ per ton           80.00         80.00        320.00
    -------------------------------------------------------------------------
    Exchange Rate - USD/CAD                 1.11          1.11          1.29
    -------------------------------------------------------------------------
    Pre-tax IRR                             13.4%         27.0%         34.3%
    -------------------------------------------------------------------------
    Pre-tax Cash Flow - CDN$        $266 million  $536 million  $697 million
    -------------------------------------------------------------------------
    Table 1 - Commodity prices and exchange rates used in various pre-tax IRR
    calculations
    

    The pre-tax NPV at a 10% discount rate would increase from
CDN$1.94 billion using the March numbers to CDN$2.99 billion using current
prices. The pre-tax NPV at a 15% discount rate, using current prices, is
CDN$1.7 billion.
    "These numbers clearly demonstrate the value of the hydrometallurgical
process we intend to use at Ferguson Lake," added Mr. Douchane. "This process,
with its economically diverse commodities, clearly helps to stabilize the
project's positive economics. While the copper and nickel prices are
considerably lower than even those contemplated in the base case, the project
economics remain positive because of the rise in the price of sulphuric acid,
and the decline of the Canadian dollar against the U.S. dollar."

    About Starfield

    Starfield Resources Inc. is an advanced exploration and development stage
company focused on its Ferguson Lake nickel-copper-cobalt-platinum-palladium
property in Nunavut, Canada. The property is emerging as Nunavut's largest
ongoing base and precious metal project. Starfield has funded the development
of a novel, environmentally friendly and energy-efficient hydrometallurgical
flow sheet to recover metals from its Ferguson Lake massive sulphides.
    The Company will be filing an amendment to its scoping study to reflect
the project's sensitivity to more volatile commodity prices.

    Forward Looking Statements

    This news release may contain certain information that constitutes
forward-looking statements. Forward-looking statements are frequently
characterized by words such as "plan," "expect," "project," "intend,"
"believe," "anticipate" and other similar words, or statements that certain
events or conditions "may" or "will" occur. Forward-looking statements are
based on the opinions and estimates of management at the date the statements
are made, and are subject to a variety of risks and uncertainties and other
factors that could cause actual events or results to differ materially from
those projected in the forward-looking statements. These factors include the
inherent risks involved in the exploration and development of mineral
properties, the uncertainties involved in interpreting drilling results and
other geological data, fluctuating metal prices and other factors described
above and in the Company's most recent annual information form under the
heading "Risk Factors" which has been filed electronically by means of the
Canadian Securities Administrators' website located at www.sedar.com. The
Company disclaims any obligation to update or revise any forward-looking
statements if circumstances or management's estimates or opinions should
change. The reader is cautioned not to place undue reliance on forward-looking
statements.
    Starfield Resources Inc. investors may also participate in the Company's
online community at http://www.agoracom.com/ir/Starfield.

    
                             www.starfieldres.com
    





For further information:

For further information: André J. Douchane, President and CEO, (416)
860-0400 ext. 222, adouchane@starfieldres.com; Greg Van Staveren, Chief
Financial Officer, (416) 860-0400 ext. 223, gvanstaveren@starfieldres.com;
Connie Anderson, Investor Relations, (416) 860-0400 ext. 228,
canderson@starfieldres.com

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