Alexis Minerals Corporation

Alexis Minerals Corporation

November 15, 2007 07:37 ET

Alexis to Advance Underground Exploration Towards a Production Decision at Lac Pelletier Gold Project, Rouyn-Noranda, Quebec


TORONTO, ONTARIO--(Marketwire - Nov. 15, 2007) - Alexis Minerals Corporation (TSX:AMC) is pleased to announce that the Certificate of Authorization has been received for an underground exploration and bulk sampling program at the Lac Pelletier Gold Project, Rouyn-Noranda, Quebec from the Ministere du Developpement durable, de l'Environment et des Parcs, Quebec. Current gold prices support improved project economics with potential returns increasing to pre-tax cash flows of C$20.2M and increasing IRR to 154%. Lower mine cut-off grades also offer potential to significantly increase mine life for additional further improvements.

Upon the receipt of the permit, site clearance can now commence in preparation for construction of surface facilities and settling ponds to allow dewatering of a ramp and underground workings previously excavated in 1992. Repairs to the Hydro-Quebec electrical supply line to the site are almost completed and construction of office trailers, dry and other facilities will commence shortly. Dewatering of the ramp is now scheduled to start in January 2008 and will be followed by the development of a ventilation raise to surface. An underground program of exploration will then be conducted, including lateral drifting, additional ramp extension and underground drilling. The program will conclude with a 40,000 tonne bulk sample which will lead the project to a production decision in 2008.

"The Certificate of Authorization allows Alexis to proceed with its' strategic objective of bringing a second gold project to a production decision," stated David M. Rigg, President and CEO of Alexis Minerals. "Alexis is aggressively pursuing a short- to medium-term strategy which will see Alexis develop as a medium-sized gold producing company in 2008 through the development of Lac Herbin and Lac Pelletier gold projects. Leverage to gold price is very attractive and has substantial upside impact on the economics of both deposits. Alexis Minerals is currently well funded to advance both gold projects through to production."

Lac Pelletier Gold Project

The Lac Pelletier Gold Project is located 4 km from Rouyn-Noranda, Quebec. Alexis currently has an option to earn 100% of the project from Thundermin Resources with the sole remaining obligation to vesting being to make a production commitment prior to September 2008. The production commitment can be delayed one year upon cash payment to Thundermin of $75,000. Upon production, the project is subject to an historical 1% NSR royalty to Falconbridge (Xstrata) and a 2.5% NSR to Thundermin.

Falconbridge and Thundermin previously completed an underground exploration program in 1992. Historical work on the deposit area of the property includes 42,656 m of surface and underground diamond drilling; 1050 m of ramp development and 292 m of lateral drifting with two levels developed in ore. A bulk sample of 11,634 tonnes was previously treated in 1992 at a custom milling facility, the Camflo Mill, in Malartic, Quebec. The historic producing Stadacona mine (Production of 2,742,000 tonnes grading 5.49 g/t Au from 1928 to 1958) is located on, and at the eastern limit of, the Lac Pelletier property. Alexis acquired the 722.6 Ha Lac Pelletier property in 2005.

Lac Pelletier Resources

Alexis Minerals completed an independent calculation of Resources on the project, in August 2006 with results of this work summarized in Table 1.

Table 1. Lac Pelletier Resources
Resource Category
Cut- ---------------------------------------------------------------------
off Measured (M) Indicated (I) Inferred Total
Grade --------------------------------- Total -------------------------
(g/t tonnes Grade tonnes Grade M + I tonnes Grade Inferred
Au) --------------------------------- (Ounces) -------------------------
(t) (g/t (t) (g/t (t) (g/t Au) (Ounces)
Au) Au)

2.00 61,000 6.19 1,546,188 5.21 271,134 801,539 4.12 106,173
3.00 61,000 6.19 1,179,834 6.05 241,632 491,140 5.17 81,637
4.00 61,000 6.19 827,942 7.14 202,199 317,182 6.12 62,410
5.00 61,000 6.19 557,514 8.43 163,243 175,242 7.45 41,974

Mineral Resources were prepared by Mr. Carl Pelletier, P.Geo., Independent QP., Innovexplo Inc..(See Press Release: August 31st, 2006; 43-101 Report dated: October 2006 is available through

Lac Pelletier Scoping Study and upside potential

Alexis Minerals has also undertaken a scoping study on the deposit through independent consulting firm, Golder Associates Ltd.. The financial analysis of the study was based on the October 2006 resource estimate (Table 1), provided as a block model from Teck2mine Inc and modeled within Datamine planning software; using production rates, appropriate mining methods and dilutions, development quantities and costs calculated by Golder . Potential "mineable" tonnes were estimated using the gold resource inventory (Table 1) beneath a recommended 30-meter crown pillar. Golder assessed the deposit using 'stepped room and pillar' (90%) and 'blasthole' (10%) mining methods, with a mining recovery factor of 90%; and employing a cut-off grade of 4.42 g/t Au. A Golder block model resource calculation of 600,732 tonnes grading 5.8 g Au/t for 112,000 contained oz.Au was used in their preliminary mining schedule for the study (See Press Release: April 19, 2006; 43-101 Report dated : May 2007 is available at

The significant increase in gold price subsequent to the report and evaluation are very beneficial to the project. The original base case study employed a gold price of US$550/oz.Au (C$ 605/oz.Au) and a resulting economic cut-off grade of 4.42 g/t Au. The Golder study provided gold price sensitivities shown in Table 2.

Table 2: Gold Price Sensitivities, Lac Pelletier project,
Rouyn-Noranda Quebec
(from Scoping Study by Golder Associates, May 2007)
Note: The table incorporates the C$ gold price used in the
original Scoping Study.
Gold Gold Pre-tax Life of
Price Price Cash Flow IRR Mine
US$/oz.Au C$/oz.Au (C$) % (Years)
550 605 2.8 39 3.0
575 632.5 5.5 72 3.0
600 660 8.2 103 3.0
700 770 20.2 154 4.0
800 880 34.4 211 4.5

Investors should be cautioned that mineral resources that are not mineral
reserves do not have demonstrated economic viability and that the
preliminary assessment (the scoping study) 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, and there is no certainty that the
preliminary assessment will be realized.

Potential for Improved Economics and Mined Resources

Current gold prices strongly support the potential of the deposit and the economics of a production decision. On the basis of the original Golder Scoping study, the C$ gold price has increased to above C$770/oz.Au with consequent improvement of projected pre-tax cash flow to C$20.2M and IRR to 154%, see table 2 above.

In addition to the recognized improved economics with increasing gold price, Alexis is also encouraged by the potential to increase mined resources from the deposit. The Golder Study models recovery of approximately 35% of Resources calculated using a 3.0 g/t Au cut-off, Table 1, due to the higher mining cut-off grade of 4.42 gAu/t.

"The increased gold price at this time would allow Alexis to use a lower 4.0 g/t Au mining cut-off grade," stated Keith Boyle, P.Eng and Chief Operating Officer for Alexis Minerals. "Lowering this cut-off will result in potential for delineation of significantly more tonnes within the known Deposit. At current gold prices the mineable tonnage of the deposit could be expected to almost double within our known Resources (see Resources at 4.0 g/t Au cut-off, Table 1), with subsequent increased mine life and even higher IRR and pre-tax cash flows."

Results from the underground exploration program will complement ongoing internal feasibility and engineering studies and assist with project optimization. The Scoping study provides for Lac Pelletier ores to be shipped to Val d'Or, with the strategic objective of developing a satellite deposit to complement ore feed from the advanced Lac Herbin Gold Project in Val d'Or, Quebec. Alexis also owns the fully-permitted, 1400 tpd, Aurbel gold mill in Val d'Or which remains under care and maintenance.

Additional Results from Surface Drilling in 2007 - Lac Pelletier Gold Program, Rouyn-Noranda, Quebec

Two surface drilling programs have been completed during the summer months in 2007 at the Lac Pelletier property in association with project optimization studies. Results from the drilling programs are summarized in press releases of August 13 and October 2nd, 2007. Assays from last nine previously unreported, barge-based drill holes have now been received from the laboratory (Table 3) and include:

- 6.30 g/t Au over 2.5 m (Hole 17475-65),

- 5.80 g/t Au over 2.1 m (Hole 17475-66),

- 12.86 g/t Au over 3.5 m (Hole 17475-67),

- 5.89 g/t Au over 2.0 m (Hole 17475-68), and,

- 3.60 g/t Au over 6.0 m (Hole 17475-69).

The surface programs have been successful in outlining several large-volume ore shoots that can potentially be mined using low-cost, bulk mining methods during the early production stages of a Lac Pelletier operation. Engineering studies on the feasibility of mining these areas is currently underway. Exploration drilling outside of the known resource areas, including these recent results, continues to intersect significant gold mineralization and ore zone extensions.

Quality Control

The Lac Pelletier program is supervised by Robert Inglis, P.Eng and Claude Perrault, P.Ing. for mining and engineering; and Jean Girard, P.Eng., Exploration Manager, for geology; Qualified Persons as defined under NI 43-101 guidelines. Assay samples are taken from drill core, sawed in half with one half sent to a commercial laboratory and other half retained for future reference. A strict QA/QC program is followed which includes mineralized standards and blank for each batch of samples. Analyses were performed by Techni-lab, Abitibi (Quebec).

Jean Gigard, P.Eng., Qualified Person under 43-101 guidelines, has reviewed the contents of this press release.

About Alexis Minerals

Alexis Minerals Corporation is a Canadian exploration and development company listed on the Toronto Stock Exchange. Alexis holds an outstanding portfolio of properties covering the Val-d'Or and Rouyn-Noranda Mining Camps in Quebec. Alexis has a clear route to 100% ownership of all interests of Aur Resources on approximately 212 square kilometres of the Val-d'Or Mining Camp. Alexis owns the 1400 tonne per day Aurbel gold mill and holds a 100%-interest in the Aurbel property. Alexis is following strategic exploration approaches across these properties for both gold and base metals, with a focus on the potential for gold production from the 100%-owned Lac Herbin and Lac Pelletier deposits during 2007 - 2008. Alexis has the right to earn-in into a 100% interest in the Lac Pelletier property. The Company is also currently advancing towards a 50% interest in 825 square kilometres of the Rouyn-Noranda Mining Camp in JV with Xstrata Copper Canada (formerly Falconbridge Ltd.). Three (3) underground drills and two (2) surface drills are currently active in Val-d'Or and two surface drills are expected to recommence drilling on Rouyn-Noranda properties very shortly.

Forward-looking information. This document may contain or refer to forward looking information based on current expectations, including, but not limited to, mineralization projections, estimates regarding the timing and costs of production, mineral prices, feasibility of projects, and future mining plans. Forward-looking statements are subject to significant risks and uncertainties, and other factors that could cause actual results to differ materially from expected results. These forward-looking statements are made as of the date hereof and we assume no responsibility to update or revise them to reflect new events or circumstances.

Table 3. Barge-based Exploration Drilling Results
Lac Pelletier Project, Quebec
Core Uncut Cut Grade
Hole # Section From To length Grade 30 g Au/t
(m) (m) (m) (g Au/t) (g Au/t)
118.5 121.5 3.0 1.43 1.43
17475-60 38N, 31-33W ------------------------------------------
133.7 141.0 7.3 1.97 1.97
17475-62 37-48N, 44-45W NSV NSV
94.0 96.0 2.0 3.19 3.19
17475-63 35N, 10-22W ------------------------------------------
211.0 213.3 2.3 3.17 3.17
17475-64 34-38N, 2-20W NSV NSV
17475-65 39-42N, 0-18W 282.3 284.8 2.5 6.30 6.30
288.0 291.0 3.0 0.91 0.91
17475-66 46-47N, 0-7W ------------------------------------------
308.9 311.0 2.1 5.80 5.80
254.0 256.5 2.5 4.30 4.30
17475-67 29-32N, 4-23W ------------------------------------------
275.1 278.6 3.5 12.86 12.86
17475-68 41N, 8-24W 223.8 225.8 2.0 5.89 5.89
17475-69 38-39N, 12-22W 198.8 204.8 6.0 3.60 3.60

Note: Results from all other drill holes completed on Lac Pelletier during
2007 are reported in previous press releases dated: August 13th 2007 and
October 2nd, 2007. A complete table of results from both summer drilling
programs is presented as Appendix 2 to the Q3-2007 MD&A Quarterly report
released November 14th, 2007.

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