Moly Mines Limited

Moly Mines Limited

October 11, 2007 09:07 ET

Moly Mines Moves Rapidly to Detailed Design and Construction Planning at Spinifex Ridge Following Completion of DFS

- Potential Financiers And JV Partners Conducting Due Diligence On Project - Personnel Recruitment Accelerating With Appointment Of Project Construction Manager - End-March 2008 Target For Financial Close: Production Start-Up In Mid-2009

TORONTO, ONTARIO--(Marketwire - Oct. 11, 2007) - Moly Mines Limited, (TSX:MOL)(ASX:MOL) reports that since completion last month of the Definitive Feasibility Study (DFS) on its Spinifex Ridge moly-copper project, the Company has rapidly moved to detailed design and planning for construction of the mine and processing facilities in the Pilbara district of Western Australia.

In particular, the Company has implemented a detailed execution plan aimed at having the necessary finance for Spinifex Ridge in place, all permitting completed and construction commenced by the end of March 2008 in order to meet its production start-up target of July 2009.

Copies of the detailed Information Memorandum on the project have been circulated to those major North America, European and Australian financial institutions that had previously expressed strong interest in assisting the company with financing Spinifex Ridge. Copies have also been distributed to potential joint venture partners.

An electronic data room has been opened, and the interested parties are now conducting due diligence on the project.

In addition, Moly Mines has progressed its personnel recruitment programme with the critical appointment of a project construction manager, Mr Terry Scott, who has over 30 years experience in managing the delivery of major mining, mineral processing, civil engineering, heavy construction and building projects. His most recent project was the A$760m Yabulu Extension at the QNI nickel refinery in Townsville, Queensland for BHP Billiton. He holds a Bachelor of Engineering (Civil) degree and is a Registered Mine Manager - Open Cut.

His early appointment will enable him to make a considerable contribution to the detailed design, execution planning and construction strategy for the Spinifex Ridge project.

Also joining Moly Mines, as senior metallurgist, is Mr Sam Thong who brings to the company some 15 years of extensive experience in crushing, grinding, and flotation circuits and in the application of new technology. He will report to metallurgical manager, Mr David Pass.

The Spinifex Ridge DFS was prepared and managed by WorleyParsons, Australia's largest resource engineering group. The company commenced detailed engineering and design activities for project implementation in August, and a significant number of their engineering team dedicated to the project will be accommodated in Moly Mines' West Perth offices.

Moly Mines already has over 40 full-time employees dedicated to Spinifex Ridge, and project implementation will be significantly enhanced by the integration of the WorleyParsons design engineers with the company's senior technical managers and staff.

Engineering and support services staffing numbers are expected to rise to around 100 in the next 6-8 weeks, and Moly Mines has completed sub lease arrangements for an additional 1,500m2 of floor space at a neighbouring premises to accommodate the expanding workforce.

The company's personnel manager, Ms Sue Germon, recently participated with a number of other companies in a two-day recruitment seminar in Johannesburg, organized by the Australian Government. Over 7,000 people attended, many seeking employment in the mining industry. Her attendance was in integral part of the company's forward planning and recruitment strategy.

The Spinifex Ridge orebody contains more than 600m lb of molybdenum and will be exploited by a conventional truck and shovel open pit mine at an annual rate of 20m tonnes. The processing plant will produce separate moly and copper concentrates. Using a long-term (post 2015) moly price forecast of less than half the current US$32/lb, the DFS shows revenues of US$4.94bn in the first 10 years of operation, with moly accounting for US$4.4bn of this total. With capital costs estimated at US$852m, payback would be achieved in three years.

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