/NOT FOR DISTRIBUTION TO UNITED STATES WIRE SERVICES OR DISSEMINATION IN THE UNITED STATES/
TORONTO, Jan. 6, 2012 /CNW/ - Looking back at 2011 provides a chance to reflect on the transformation that has taken place at Polar Star. At the beginning of last year, we were focused on developing our flagship property Montezuma.
Now one year later, the Company has:
- completed a diamond drill program at Montezuma;
- refurbished and restarted the Chépica mine; and
- commenced the farm-out of non-core properties.
Montezuma: New Target Discovered
At Polar Star's flagship property Montezuma, a 20.000 meter diamond drill campaign was completed in April. In July, additional geophysics was performed at Zone B to test the previously intercepted enriched sulphide zone. Since then, the program has focused on gaining a better insight into the structure and dynamics of the faulting and thrusting encountered. The program confirmed that the mineralized porphyry fragments caught up in the thrust zones is derived from a source to the west of the completed drilling. The revised structural interpretation, based on a review of the drill core, surface mapping and geophysics, has outlined a new large area of alteration that has previously not been drilled. This exciting new target zone will be the focus of the 2012 drill program.
Chépica in Production
The Company has also advanced the Chépica mine, which was originally announced at our Annual Shareholders' Meeting in May. Our timing could not have been better. With the capital markets in turmoil and gold prices climbing to new all-time highs, the Chépica mine, a source of cash flow and low capex, will allow the Company to minimize the risk of dilutive financings while still allowing us to advance our future growth plans. In November we conducted a detailed review of our options for concentrate sales and selected Empresa Nacional de Minería ("Enami") as they offered Polar Star the best available terms. Enami is a Chilean state owned enterprise that manages various mining interests, and refines and smelts copper and gold from Chile's small- and medium-scale miners. Its main role is to promote Chile's small and midsize mining sector by carrying out toll milling and processing, and granting credit at favourable rates to companies. The gold/copper concentrate Chépica produced was shipped to the Ventanas smelter in December and initial cash receipts were received later in the month. With startup expenses now behind us, Polar Star will focus on operational efficiencies and increasing sales at the Chépica mine.
Joint Venturing Non-Core Properties
With our focus committed to Montezuma and Chépica, the Company has entered into joint ventures with three new partners. Most notable was the announcement of an exclusive option agreement on 172,600 hectares of our property portfolio with BHP Billiton, one of the world's largest mining companies. The Company also entered into joint ventures with RedQuest Capital Corporation and Kairos Capital Corporation on our Los Azules, Fortuna and Nancagua properties, respectively. These three transactions account for approximately half of Polar Star's property inventory and re-affirm the quality and attractiveness of our portfolio. We believe our joint efforts will benefit all shareholders.
Outlook for 2012
During 2012, we will build upon the milestones achieved last year. At Montezuma we have a new drill campaign planned. Our Chépica mine will see increased operation efficiency and sales, and we look forward to working together with our new joint venture partners to develop Polar Star's world class property portfolio.
On behalf of Polar Star's management and the Board of Directors, I would like to thank all shareholders for your continued support. We look forward to sharing a successful 2012 with you.
President and CEO
This news release may contain forward-looking statements based on assumptions, uncertainties and management's best estimates of future events. Actual events or results could differ materially from the Company's expectations and projections. Investors are cautioned that forward-looking statements involve risks and uncertainties. Accordingly, readers should not place undue reliance on forward-looking statements. When used herein, words such as "anticipate", "will", "intend" and similar expressions are intended to identify forward-looking statements. For a more detailed discussion of such risks and other factors that could cause actual results to differ materially from those expressed or implied by such forward-looking statements, refer to Polar Star's filings with Canadian securities regulators available on www.sedar.com or the Company's website at www.polarstarmining.com.
About Polar Star
Polar Star Mining Corporation (TSX: PSR) is an emerging exploration company with a focus on building value in Chile through discovery and development. Its flagship property, Montezuma, covers 40 kilometres of the West Fault and the cross-cutting Esperanza Fault system and is located between Codelco's Radomiro Tomic - Chuquicamata - Ministro Hales (formerly known as Mansa Mina) group of copper-molybdenum porphyry deposits, and Antofagasta PLC's El Tesoro - Esperanza - Polo Sur group of copper-gold porphyry deposits.
For further information:
Adam Rochacewich, CFO
Tel: (416) 368-3496
Email: [email protected]