Chieftain Metals Inc.
TSX : CFB

Chieftain Metals Inc.

June 29, 2012 16:10 ET

Chieftain Metals Updates Progress on Tulsequah Chief Project

TORONTO, ONTARIO--(Marketwire - June 29, 2012) - Chieftain Metals Inc. ("Chieftain" or the "Company") (TSX:CFB) is pleased to give an update on the progress made at its Tulsequah Chief mine project in British Columbia.

Project Substantially De-risked

Chieftain has advanced the Tulsequah feasibility study with Tetra Tech Mining and Minerals, and has succeeded in substantially de-risking the project. The Company has also identified a number of project improvements, which should optimize capital and operational elements of the project.

Key technical areas of progress resulting from the feasibility work that de-risk the project include a strong understanding of appropriate mining methods including cost efficient long hole mining, improved metallurgical flow sheet, detailed road design including efficient staging, and a fully integrated site water balance to meet environmental requirements.

The Company believes that these areas of optimization could not be completed in time for the current feasibility study schedule and that additional time is required to assess their contributions. Components being targeted for further optimization include:

  • Metallurgy, specifically to further improve the copper concentrate quality
  • Power generation, specifically alternate fuel sources replacing diesel
  • Materials handling opportunities in the mine and mill ore feed design revealed during the feasibility study
  • Capex optimization including road, development, engineering and layout

The Company is also advancing discussions with a number of prospective strategic parties to partner project development as the Tulsequah operational capabilities now allow for these talks to accelerate.

Interim Water Treatment Plant

The Interim Water Treatment Plant (IWTP) was acquired out of receivership from Redfern Resources Ltd. It was transported to site and constructed by Chieftain to address the historic environmental concerns of acid mine drainage arising from previous owners operations. The IWTP has been operating since December 2011, and treatment of the mine-impacted water thus far has shown significant improvement in discharge water quality, with test results showing a reduction of greater than 98% of the metals load compared with un-treated mine waters. Although the effluent has been meeting guidelines, the plant has been operating below designed levels of efficiency, with higher than budgeted operating costs. The Company has advised authorities of its plan to suspend operations at the plant while the Company implements mitigation measures and reviews plans for operational efficiencies. The Company anticipates a period of limited operations while plant testing and optimisation activities are underway, with an increase to a higher operating level when project financing is secured and the Tulsequah project gets underway as always contemplated in the project plan.

To learn more about the Interim Water Treatment Plant, click the link below to view a short video and to access the full Chieftain Metals Water Treatment Plant brochure. http://www.chieftainmetals.com/tulsequah-chief-acid-water-remediation.php.

Road Permit Amendment

Chieftain submitted the Amendment Application document for the alternative road route in late April. The application is undergoing a technical review by provincial and federal agencies and the Taku River Tlingit First Nation (TRTFN). The scope of the review is comprised of the re-alignment section from kilometer 57 of the approved access road north from the mine site to the end of the Warm Bay Road south of the town of Atlin, BC. Chieftain considers the re-alignment to offer significant reductions in potential environmental and cultural impacts compared to the previously approved route, as it will allow a 35 km reduction in new road construction and reduce the number of stream crossings by 24, avoid sensitive caribou habitat, and eliminate any crossing of the TRTFN Heritage Trail. We currently anticipate completion of the review process and receipt of a decision later this summer.

About Chieftain Metals Inc.:

Chieftain Metals Inc.'s principal business is the acquisition, exploration and development of mineral properties. Since incorporation, the Company's business has focused entirely on the acquisition, and thereafter the development, of the Tulsequah Chief Polymetallic Project, in north-western British Columbia, Canada. The Tulsequah Project consists of 38 mineral claims and Crown-grants covering approximately 14,220 hectares and covers two previously producing mines. For more information on the Tulsequah Project, please refer to the Company's NI 43-101 compliant technical reports, "Tulsequah Chief Deposit, Tulsequah Chief Property, Northern British Columbia" and "Big Bull Project, Tulsequah Chief Property, Technical Report, Northern British Columbia", each dated as of November 8, 2010 and available under the Company's profile on SEDAR (www.sedar.com).

Forward-Looking Information:

This press release includes certain "forward-looking statements" within the meaning of the Ontario Securities Act or other laws or regulations. All statements, other than statements of historical fact, included herein, including without limitation, statements regarding potential mineralization, mineral resources or reserves, exploration results, future plans and objectives of Chieftain Metals Inc. are forward-looking statements that involve risks and uncertainties. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements.

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