Cambior Inc.
TSX : CBJ
AMEX : CBJ

Cambior Inc.

August 08, 2005 09:01 ET

Cambior Completes Camp Caiman Feasibility Study

LONGUEUIL, QUEBEC--(CCNMatthews - Aug. 8, 2005) - Cambior Inc. (TSX:CBJ)(AMEX:CBJ) - All amounts are expressed in US dollars, unless otherwise indicated.

Cambior Inc. (TSX:CBJ)(AMEX:CBJ) is pleased to announce the completion of a feasibility study for the Camp Caiman open pit gold project located in French Guiana, approximately 65 kilometres from Cayenne, the capital city. Highlights of the study include:

- Probable mineral reserves: 12.3 million tonnes grading 2.82 g Au/t

- Gold contained: 1.1 million ounces

- Average production rate: 124,000 ounces per annum

- Average mine operating cost: $268 per ounce

- Initial capital costs: $114.7 millions

- Construction period: 21 months

MINERAL RESERVES

Probable mineral reserves, based on a gold price of $425 and an exchange rate of US$1.2/1.0 euros presently stand at 12.3 million tonnes @ 2.82 g Au/t, representing 1.1 million ounces of gold contained.

Geology

The Camp Caiman orebody, located in a 30 km2 mining concession, has two open pits. The Scout pit, comprised primarily of saprolite, represents 35% of the project's probable reserves. Adjacently, to the east of the Scout pit, Pit 88 is composed of saprolite and fresh rock in equal proportions, and represents 65% of the project's probable reserves.



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Saprolite Transition Rock Total Oz
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Ore Grade Ore Grade Ore Grade Ore Grade
(000 t)(g Au/t)(000 t)(g Au/t)(000 t)(g Au/t)(000 t)(g Au/t)(000)
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88 4,077 2.65 382 3.47 3,573 4.04 8,033 3.31 854
Scout 4,205 1.90 39 2.56 9 2.48 4,252 1.90 260
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Total 8,282 2.27 421 3.39 3,582 4.03 12,285 2.82 1,114
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The mineral reserve and resource estimates were evaluated in accordance with definitions and guidelines adopted by the Canadian Institute of Mining, Metallurgy and Petroleum. An updated Technical Report will be filed with SEDAR within the next 30 days in accordance with National Instrument 43-101 for mining projects. Qualified persons responsible for the mineral reserve and resource estimates are Patrick Godin Eng., General Manager, Cambior Inc. and Yves Michaud, Technical Superintendent, Omai Gold Mines Ltd

The deposits identified are open at depth in the north extension of the 88 pit and the western extension of the Scout pit. Cambior also holds exploration permits on properties adjoining the mining concession where geochemical anomalies have been identified and will be the subject of future drilling programs. In addition, the Company has on-going exploration programs on prospective ground under option within trucking distance of the Camp Caiman project.

CAPITAL EXPENDITURES AND CONSTRUCTION

The feasibility study and capital cost estimates were prepared by Cambior with the support of independent engineering firms engaged to provide specific technical expertise, including the following:



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Processing plant Met-Chem Canada Inc.
Metallurgical tests Lafefield Research
Tailings disposal and water management Golder and Associates
Environmental Impact Study Saunier & Associés France
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The open pit mining operations will be performed with a fleet of 40-tonne articulated trucks and excavators to maintain the efficiency in rainy conditions. Processing will consist of a crushing and grinding circuit followed by a leach and carbon-in-pulp (CIP) circuit. Power is expected to be supplied from the national utility company. The initial capital costs are estimated at $114.7 million, detailed as follows:



Summary of Capital Expenditure
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(in thousands of $)

Description
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Infrastructure 12,367
Mining equipment and pre-production 22,732
Process plant 26,279
Tailings and water management 7,979
Support facilities 7,679
Indirects 31,172
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Sub-total 108,208
Contingency 6,500
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Total 114,708
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The construction schedule would cover a period of 21 months after the completion of financing arrangements and the obtaining of operating permits, which are scheduled for the second quarter of 2006.

PRODUCTION

The mining rate is expected to be an average of 27,000 tonnes of ore and waste per day. The mill is scheduled to process almost 12.3 million tonnes over 7 years. The processing rate is planned at 5,500 tonnes per day for the first five years as mostly soft ores will be treated. The sustaining capital expenditures over the mine life are estimated at $4.4 million.

The Camp Caiman production profile, based on the mineral reserves, is as follows:


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Year Tonnage milled Head grade Direct costs
(000 tonnes) (g Au/t) Ounces ($/oz)
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1 2,008 2.45 142,400 228
2 2,008 2.80 167,900 204
3 2,007 2.54 138,600 258
4 2,007 2.10 113,900 315
5 1,951 2.86 124,300 330
6 1,360 3.47 91,600 332
7 944 4.76 88,000 256
12,285 2.82 866,700 268
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During production the mine will employ approximately 350 individuals.

PROJECT ECONOMICS

The key assumptions for this study include an initial capital cost of $114.7 million, a gold price of $425 per ounce and diesel fuel price of $0.60/liter.



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Strip ratio 3.77
Probable mineral reserves
(millions of tonnes) 12.3
Head grade (g Au/t) 2.82
Gold Recovery (%)
Soft 93%
Transition 80%
Fresh rock 58%
AVERAGE 77.8%
Total gold contained (oz) 1,100,000
Milling rate (tonnes per day) 5,500
Mine life (years) 7
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Based on the results of the feasibility study, using the key assumptions, project parameters and a long-term gold price of $425/oz, the internal rate of return (IRR) of the Camp Caiman project is estimated at 10.4%.

Capital Costs

In preparing its feasibility study, the Company has assumed that it will be eligible to benefit from the Government of France's incentive measures to stimulate development in the Overseas Departments and Territories. The Company has assumed incentives of approximately 25% of the capital costs. These are subject to negotiations with the French authorities. The Company has initiated these talks and will file a formal request in early September.

Taxation

CBJ-CAIMAN S.A.S. benefits from a tax-holiday on the mining profits during the first 10 years of operations; however, gold production is subject to a royalty of approximately US $1.50/ounce to be paid to local government.

Permitting

The Camp Caiman Project requires two important operating permits (Installations classées pour la protection de l'environnement (ICPE) and Travaux miniers). The final documentation for these permits will be filed early in September with the French authorities. The two permits are subjected to a public consultation process which will be initiated during the last quarter of 2005 and completed at the end of February 2006. The authorizations will be granted by "Le Préfet du départment de la Guyane" and are forecasted for the end of June 2006.

BOARD APPROVAL

Louis P. Gignac, President and Chief Executive Officer of Cambior, stated: "The development of the Camp Caiman Project will allow Cambior to apply its expertise gained over the past 14 years at Omai and Rosebel. We look forward to working with the French authorities and the surrounding communities to bring this important economic development to French Guiana. During the remaining permitting phase, we intend to evaluate further initiatives to improve the returns of this project."

Cambior's Board of Directors has approved the Feasibility Study on the Camp Caiman Project and its subsequent development conditionally to:

- Obtaining all operating permits with realistic conditions and within a reasonable timetable;

- Satisfactory government grants under Loi Girardin;

- Relief from certain regional fuel tax and other regional levies and duties.

Cambior Inc. is an international gold producer with operations, development projects and exploration activities throughout the Americas. Cambior's shares trade on the Toronto (TSX) and American (AMEX) stock exchanges under the symbol "CBJ". Cambior's warrants "CBJ.WT.C" and "CBJ.WT.D" trade on the TSX.

Cautionary Note to U.S. Investors -- The United States Securities and Exchange Commission (the "SEC") permits mining companies, in their filings with the SEC, to disclose only those mineral deposits that a company can economically and legally extract or produce. We use certain terms in this press release, such as "mineral resources", that the SEC guidelines strictly prohibit us from including in our filings with the SEC. U.S. investors are urged to consider closely the disclosure in Cambior's Annual Report on Form 40-F. A copy of the 2004 Form 40-F is available to shareholders, free of charge, upon written request addressed to the Investor Relations Department.

Caution Concerning Forward-Looking Statements

This press release contains certain "forward-looking statements", including, but not limited to, the statements regarding the Company's strategic plans, evolution of mineral resources and reserves, work programs, development plans and exploration budgets. Forward-looking statements express, as at the date of this press release, the Company's plans, estimates, forecasts, projections, expectations or beliefs as to future events and results. Forward-looking statements involve a number of risks and uncertainties, and there can be no assurance that such statements will prove to be accurate. Therefore, actual results and future events could differ materially from those anticipated in such statements. Risks and uncertainties that could cause results or future events to differ materially from current expectations expressed or implied by the forward-looking statements include, but are not limited to, factors associated with fluctuations in the market price of precious metals, mining industry risks, risks associated with foreign operations, environmental risks and hazards, uncertainty as to calculation of mineral reserves and other risks referred to in Cambior's 2004 Annual Information Form filed with the Securities Commissions of all provinces in Canada, and with the United States Securities and Exchange Commission (under Form 40-F), as well as the Toronto Stock Exchange and the American Stock Exchange.

info@cambior.com / www.cambior.com

Contact Information

  • Cambior Inc.
    Bryan A. Coates
    Vice President Finance and Chief Financial Officer
    Direct line: (450) 677-2912
    (450) 677-0040 / 1-866-554-0554
    (450) 677-3382 (FAX)
    or
    Cambior Inc. CBJ - CAIMAN S.A.S.
    Camp Caiman Project
    Patrick Godin, General Manager
    Direct line: (450) 677-2390
    (450) 677-0040 / 1-866-554-0554
    (450) 677-2922 (FAX)