Verena Minerals Corporation
TSX VENTURE : VML

Verena Minerals Corporation

September 29, 2009 08:30 ET

Verena Minerals Corporation Reports Preliminary Assessment Results for Volta Grande Gold Project

TORONTO, ONTARIO--(Marketwire - Sept. 29, 2009) - Verena Minerals Corporation (TSX VENTURE:VML) (the "Company" or "Verena") is pleased to announce the completion of the Preliminary Assessment ("PA" or "Scoping Study") for the Volta Grande Gold Project located in Para State, Brazil.

The study was undertaken by Scott Wilson Roscoe Postle Associates Inc. ("Scott Wilson RPA") of Toronto in order to determine the viability and economic parameters for a large scale gold mining operation at the North Block of the Volta Grande Project.

Highlights of the PA are as follows, based on a US $900 / oz gold price:

  • Annual production of an average of 200,000 ounces per year at full capacity
  • Initial 10-year mine life based on current Mineral Resources
  • Updated mineral resource estimation at a 0.3 g/t Au cutoff grade
      • 845,000 ounces gold, Indicated Resource of 30,045,000 tonnes at a grade of 0.87 g/t Au
      • 1,818,000 ounces gold, Inferred Resource of 79,945,000 tonnes at a grade of 0.71 g/t Au
  • Internal Rate of Return ("IRR") of 22%
  • Strip ratio, Life of Mine ("LOM") 3.2:1
  • Annual throughput ~ 7 million tonnes / year
  • Production rate ~ 20,000 tonnes / day
  • Ore head grade ~ 1 g/t Au
  • Capital costs of US $295 million
    • including US $57 million new mining equipment
    • including 15% contingency or US $ 38 million
  • Cash costs US $481 / ounce Au
  • Undiscounted Pre-Tax Cash Flow of US $371 million over the current mine life
  • Simple pre-tax payback after approximately 4.7 years
  • Net Present Value ("NPV"), on pre-tax basis,of US $151 million at a 7.5% discount rate

Optimization

During the Pre-feasibility phase, various options will be analyzed that could reduce capital requirements, including: purchase and fabrication of all mining and milling equipment in Brazil, as well as contract mining.

The current PA is based on the Mineral Resources outlined to date with drilling to 150 meters below surface. As Verena progresses to a Bankable Feasibility Study, an additional 20,000 meters will be drilled to upgrade Inferred Resources to Measured and Indicated Resources. This next phase of drilling will test the extensions of the mineralized zone along strike and down dip to at least the 300 meter level, which may be amenable to open pit and / or high grade underground operations.

It is important to note that the Brazilian government has recently given approval for the construction of the "Belo Monte Power Plant" 20 kilometers upstream from Volta Grande. This power project will be an 11,000 Megawatt capacity plant and the second largest hydro project in Brazil. This development will have a significant impact on the Volta Grande project by opening the region with new infrastructure, power, labour, machinery, and other services important in developing a new mining project. The city of Altamira is situated 65 kilometers from Volta Grande and has a population of approximately 70,000 people.

Exploration Upside

An extensive drill program will be undertaken on the "South Block," a large parallel shear zone, where initial drilling has indicated gold mineralization similar to the "North Block" (e.g., Hole #VVD – 168, 23 meters at 1.80 g/t Au).

"We believe the Scott Wilson RPA study has definitely shown the intrinsic value of the Volta Grande Gold Project to Verena shareholders with high gold production rates and favourable economics," said Stephen G. Roman, President and CEO. "We expect to improve on the project parameters, including additional resource potential by completing the next phase of drilling and a Final Feasibility Study."

Qualified Persons

The Volta Grande Gold Property PA was completed by Messrs. Hrayr Agnerian, P. Geo., and Holger Krutzelmann, P. Eng., of Scott Wilson RPA, Qualified Persons within the definition of National Instrument 43-101, under the direction of Mr. George Flach, P.Geo., of Verena, also a Qualified Person. Messrs. Agnerian, Krutzelmann, and Flach have reviewed the contents of this release.

About Verena

Verena Minerals Corporation is a Canadian-based mineral exploration company with a portfolio of properties including gold, diamonds and gemstones in Brazil. Verena's prime focus is on advancing and expanding its 100% owned Volta Grande Project, located in Para State. Verena trades on the TSX Venture Exchange and has approximately 99.7 million common shares issued and outstanding.

Cautionary Statement on Forward Looking Information

This press release may include forward looking statements within the meaning of securities laws. Forward looking statements involve certain risks and uncertainties that could cause actual results to differ materially from what is currently expected. Accordingly, readers should not place undue reliance on forward looking statements. For a more detailed discussion of such risks and other factors, refer to Verena's filings with the Canadian securities regulators available on www.sedar.com or the Company's website at www.verena.com. Cautionary Statement as per 43-101, Sec. 3.4 (e): "A statement that mineral resources that are not mineral reserves do not have demonstrated economic viability, if the results of an economic analysis of mineral resources are included in the disclosure."

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Contact Information

  • Verena Minerals Corporation
    Stephen G. Roman
    Chairman, President and CEO
    (416) 368 2998
    www.verena.com