Brazauro Announces Increased Mineral Resource and Positive Results from Preliminary Economic Assessment of Tocantinzinho Gold Project, Brazil

    HOUSTON, September 26 /CNW/ - Brazauro Resources Corporation (TSX
VENTURE:BZO) is pleased to report that a Preliminary Economic Assessment on
its Tocantinzinho Gold Project, in northern Brazil, has been completed by NCL
Brasil Ltda.

    Highlights include:

    --  Average annual gold production of 82,000 ounces of gold over a mine
life of 20 years, based on a mining rate of 2 million tons per year

    --  Operating cash cost of US$ 360 per ounce

    --  Net present value (NPV) of US$ 34.5 million, using a 5% discount rate
and gold price of US$ 550 per ounce

    --  Project Internal Rate of Return (IRR) of 8.3%

    --  Economic valuation based on an Updated Mineral resources estimate,
with total ounces approximately 30% greater than the previous published

    --  Significant potential for mining rate increase, improving the key
economic parameters

    NCL, a Brazilian/Chilean consultancy, has prepared this Preliminary
Economic Assessment with input from a number of independent parties, including
SGS Lakefield and Hazen Research Inc. (metallurgical tests), L.Bernal
(Processing), Gadelha (Infrastructure). NCL undertook the Mineral resource
estimate, mine planning, preliminary economic valuation and report

    Mineral Resources Update

    The Mineral Resource estimate was prepared in accordance with National
Instrument 43-101 based on information compiled by NCL's principal, Rodrigo
Mello, who is a "qualified person" as defined in National Instrument 43-101.

                        Tocantinzinho Mineral Resource

                         Indicated                     Inferred
                Tonnes              Ounces    Tonnes              Ounces
                (x 000)  Au (g/t)   (x 000)   (x 000)  Au (g/t)   (x 000)
    Oxide            183      1.12         7     2,120      1.03        70
    Fresh rock    24,413      1.33     1,047    25,585      1.19       978
    Total         24,597      1.33     1,053    27,704      1.18     1,048
    Notes: Resources above cut-off of 0.2 g/t. Totals may not add due to

    Cautionary Statement: The Preliminary Economic Assessment is preliminary
in nature and includes Inferred Mineral Resources that are considered too
speculative geologically to have the economic considerations applied to them
that would enable them to be categorized as Mineral Reserves. There is no
certainty that the conclusions reached in the Preliminary Economic Assessment
will be realized. Mineral Resources that are not Mineral Reserves do not have
demonstrated economic viability.


    Based on four different metallurgical tests, a flow sheet was proposed
with a flotation circuit followed by cyanidation of the concentrate. The
process recovery rate is projected to be 91%.

    Mine Plan

    NCL undertook a mine plan based on the Indicated and Inferred Updated
Mineral Resources delineated to date. Pit optimization was performed using a
gold price of US$ 550/oz. Only fresh rock resources were used in the mine
plan. The resources contained in the economic pit shell are the following:

                                                         Gold Content
                  Ore (tones x 000)   Grade Au g/t      (ounces x 000)
    INDICATED          20,717             1.48                948
    INFERRED           17,833             1.34                768
    Note: Resources above cut-off of 0.55 g/t.

    Capital Costs

    Total capital expenditure is estimated to be US$ 105 million. The main
components are the process plant (US$ 43.4 million) and infrastructure (US$ 32
million). Costs for a 200 km power line at 138 kV are included, as supplied by
the state's energy agency (Celpa), who stated that after September 2008 enough
hydroelectric energy will be available for the project. Mining expenditures
(US$ 20 million) contemplate pre-production and equipment, based on an owner
operated mining fleet.

    Operational Costs

    The following operating costs were estimated:

              Open Pit Total Operating Costs
                                     Ore Tonne
    Mining                                        4.43
    Processing                                    7.46
    G & A                                         2.00
    Environment                                   0.60
    Total                                        14.49

    The mining cost per ton moved is US$ 1.20, and the total cash cost per
ounce produced is US$ 360.

    Sensitivity Analysis

    The project is more sensitive to process recovery, gold grade and price
and less to operational and capital expenses. At a spot price of US$ 730, the
NPV, discounted at 5%, is US$ 175 million, utilizing the same pit optimization
as at US$ 550 /oz.

    Project Upsides

    The main upsides of the Tocantinzinho Project are:

    --  Optimizing the engineering solutions adopted will enhance the
economics. For example, a quick estimate of the potential of increasing
production by 50% would increase the NPV by over 50%.

    --  No oxide ore or tailings are considered in this study, which, if
included, could enhance the gold production.

    --  The exploration potential of the area has not yet been tapped, with
several interesting targets over the 43,840 hectares of Brazauro's mining
rights in the prospective Tapajos gold area.

    --  High grade intercepts present throughout the mineralized zone may
continue at depth providing potential for future underground mining.

    Rodrigo Mello, who is a "qualified person" as defined in National
Instrument 43-101, has read and approved the contents of this release.

    Mark E. Jones III

    Chairman, CEO Brazauro Resources Corporation

    The TSX Venture Exchange does not accept responsibility for the adequacy
or accuracy of this release. No stock exchange, securities commission or other
regulatory authority has approved or disapproved the information contained
herein. The news release includes certain "forward-looking statements." All
statements other than statements of historical fact included in this release,
including, without limitation, statements regarding potential mineralization,
exploration results and future plans and objectives of Brazauro Resources are
forward-looking statements that involve various risks and uncertainties. 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 Brazauro's expectations are exploration risks detailed herein
and from time to time in the filings made by the Company with securities

For further information:

For further information: Brazauro Resources Corporation Mark Jones,
Chairman, 281-579-3400

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