Era Resources Inc.
TSX VENTURE : ERX

Era Resources Inc.

December 18, 2016 19:45 ET

Era Resources announces a substanially upgraded resource estimate for its Yandera Project

TORONTO, ONTARIO--(Marketwired - Dec. 19, 2016) -

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Era Resources Inc. ("Era" or the "Company") (TSX VENTURE:ERX) is pleased to announce an expanded and updated resource estimate for its Yandera Project, located in Madang Province, Papua New Guinea. This new resource estimate is the culmination of Era's 2016 strategy for Yandera-to demonstrate significant further resource growth that would underpin a feasibility study, improve understanding of the mineral potential at and along strike from the resource and to maximize project value through rigorous evaluation of development options.

The 2016 resource estimate is made pursuant to the requirements of National Instrument 43-101 - Standards of Disclosure for Mineral Projects ("NI 43-101") and the Canadian Institute of Mining, Metallurgy and Petroleum ("CIM").

Highlights of the new Yandera Resource Estimate

  • Measured and Indicated Resources total 728 million tonnes grading 0.33% copper, 0.01% molybdenum and 0.10 ppm gold; or 0.39% copper equivalent (full breakdown by category is shown below);
  • Inferred Resources total 230 million tonnes grading 0.29% copper, 0.00% molybdenum and 0.04 ppm gold; or 0.32% copper equivalent

In addition to the significant increase in Measured, Indicated and Inferred Resources, Pieter Britz, Era Resources President and CEO, added that, "the 2016 drill campaign was a remarkable success, achieving in all respects our overall targets of understanding the areas between the 2015 pit shells, and then stepping out beyond the 2015 perimeters of pits to expand the footprint of the resource. The 2016 resource estimate now provides a strong platform for a pre-feasibility study, which is scheduled to commence early in 2017."

Positive results from the 43-diamond-drill-hole campaign significantly strengthened the resource with a substantial increase in size, expansion of the 2015 footprint, linkages between previously separate pits and potential to further optimize pit design and reduce stripping ratios. (See Figure 1.)

The expansion of the Measured and Indicated resource in the 2016 estimate (see Table 1) is an important improvement over the 2015 resource estimate. Enhancements include:

  1. Delineation of mineralization between Gremi and Omora, Gremi and Imbruminda, and Dimbi and Gamagu, which increases resource size and reduces expected stripping ratios;
  2. Extension of mineralization in the South Dimbi, East Gremi, Omora and Benbenubu areas;
  3. Meaningful refinement of the constraining geologic framework, including detailed models of specific mineralization-related units and later units that cut mineralization;
  4. Refinement of grade shells to match geology and identified trends in the mineralization.

Table 1. Mineral Resource Statement at $US3.35/lb Cu, $US10.00/lb Mo and $US1,400.00/oz Au with 0.15% CuEq % cutoff. Assumptions noted below*.

Zone Classification Mass Metal Grades Contained Metal
(kt) CuEq (%) Cu (%) Mo (%) Au (ppm) CuEq (kt) Cu (kt) Mo (kt) Au (kg) Au (koz)
Total Resource Measured 196,496 0.46 0.38 0.01 0.10 895 742 26 18,883 607
Indicated 532,147 0.36 0.31 0.01 0.06 1,915 1,655 46 30,652 985
Measured & Indicated 728,643 0.39 0.33 0.01 0.10 2,809 2,397 72 49,535 1,593
Inferred 230,643 0.32 0.29 0.00 0.04 738 671 11 8,211 264
Oxide Resource Measured 19,530 0.42 0.37 0.01 0.12 82 72 1 2,320 75
Indicated 44,216 0.36 0.33 0.01 0.07 159 146 2 2,901 93
Measured & Indicated 63,746 0.38 0.34 0.01 0.12 242 219 4 5,221 168
Inferred 18,597 0.27 0.26 0.00 0.03 51 48 1 601 19
Non Oxide Resource Measured 176,967 0.46 0.38 0.01 0.09 812 669 25 16,564 533
Indicated 487,931 0.36 0.31 0.01 0.06 1,756 1,509 44 27,714 891
Measured & Indicated 664,898 0.39 0.33 0.01 0.10 2,568 2,178 69 44,279 1,424
Inferred 212,045 0.32 0.29 0.01 0.04 687 623 11 7,591 244

*Mineral Resources are not Mineral Reserves and do not have demonstrated economic viability. There is no certainty that any part of the Mineral Resources estimated will be converted into a Mineral Reserves estimate;

*Resources stated as contained within a potentially economically minable open pit; pit optimization was based on assumed copper, molybdenum, and gold prices of US$3.35/lb, US$10.00/lb, and US$1,400.00/oz, respectively; hypogene and transition recoveries of 90% for Cu, 85% for Mo, 65% for Au; oxide recoveries of 60% for Cu, 0% for Mo, 43.3% for Au; a mining cost of US$2.50/t, an ore processing and G&A cost of US$7.50/t, and a pit slope of 45 degrees;

*Resources are reported using a 0.15 % CoG on an Equivalent Copper value that included process recoveries for metal;

*The CuEq was calculated using the formula CuEq = Cu% + (Mo% * 2.82) + (Au ppm * 0.44); and,

* Numbers in the table have been rounded to reflect the accuracy of the estimate and may not sum due to rounding.

Yandera is an igneous-hosted, structurally controlled Cu-Mo-Au porphyry system comprised of a number of adjacent deposits along recognized structural trends. Mineralization is related to multiple pulses of intrusive bodies and hydrothermal alteration. Grade has spatial correlation with later porphyritic dacite intrusions and polymictic breccias with overprinting phyllic alteration. Broad tabular zones of mineralization extend from surface to depths of over 500 metres and have been drill defined to a strike length of over 5 kilometres. Very late sub-vertical northeasterly striking dikes of leucocratic quartz diorite cut zones of mineralization.

The resource block model was informed by 58,214 samples from 568 drill holes at an average hole spacing of less than 30 metres in the principle resource areas (Gremi, Imbruminda and Omora) and less than 100 metres in the other deposits within the model space.

To view Figure 1 : http://media3.marketwire.com/docs/EraFigure1.pdf

Mineral resources were estimated by Ordinary Kriging using MineSight® software in 25 by 25 by 10 metre blocks (XYZ), constrained by a copper grade shell based on a 0.15% Cu cutoff. Grade estimates within the grade shells were based on capped, five-metre composited assay data. Capping was conducted prior to compositing. The resource model was validated by visual inspection, statistical comparison to source data and swath plots. Resources were classified into Measured, Indicated and Inferred categories based on CIM definition standards sufficient for NI 43-101. A minimum of three drill holes were required for the assignment of Measured Mineral Resources within a search radius of 50 metres. Indicated Resources were classified with a minimum of two drill holes within a radius of 100 metres. The statistical classification scheme was rationalized to reflect geologic continuity.

The exploration work completed since the resource update in 2015, including surface mapping, sampling and drilling, expanded the resource significantly to the southeast in both the South Dimbi and Omora areas, both of which remain open further to the southeast. This exploration work also connected mineralization between the Gremi and Omora, Imbruminda and Gremi, and South Dimbi, Dimbi and Gamagu areas. The global average grade of the resource is remarkably similar to the 2015 resource estimate.

In order to establish a reasonable prospect of eventual economic extraction, the mineral resources presented above are reported within a potentially mineable pit configuration using the following economic inputs: a copper price of US$3.35/lb Cu, a molybdenum price of US$10/lb Mo, and a gold price of US$1400/oz Au; sulfide metallurgical recoveries of 90% Cu, 85% for Mo and 65% for Au; oxide metallurgical recovery of 60% for Cu, 0% for Mo, 43.3% for Au; mining cost of US$2.50/tonne of material mined; and process and G&A costs of US$7.50/tonne of material processed. Additional factors include a 2% royalty to the PNG government and a pit slope of 45 degrees.

The resources were reported within the pit configuration above a grade of 0.15% CuEq. The metal prices, recoveries and costs listed above were used to define copper equivalent-metal grades and quantities.

The metal ratios used for reporting copper equivalent are: CuEq = Cu% + (Mo% * 2.82) + (Au ppm * 0.44)

These metal ratios were developed using the metal prices and recovery assumptions listed above. Recoveries are based on metallurgical work carried out by the Company in 2011 and 2012.

The Mineral Resource Statement, with an effective date of December 15, 2016, is presented in Table 1. The resource has been reported as a total. Oxide and non-oxide material types will have different metallurgy and will have different recovery characteristics and costs.

Qualified Person and Technical Information

The mineral resources were estimated using current CIM standards, definitions and guidelines and applying NI 43-101. Mineral resources that are not mineral reserves do not have demonstrated economic viability. The estimate of mineral resources may be materially affected by environmental, permitting, legal, title, taxation, sociopolitical, marketing, or other relevant issues. The quantity and grade of reported Inferred resources in this estimation are uncertain in nature and there has been insufficient exploration to define these Inferred resources as Indicated or Measured mineral resource and it is uncertain if further exploration will result in upgrading them to an Indicated or Measured mineral resource category. The Company is arranging for the preparation of an independent technical report in respect of the resource estimate discussed in this new release and plans to file the technical report on SEDAR within 45 days of the date of this news release in accordance with the requirements of NI 43-101.

The Yandera Mineral Resource Statement was prepared by J.B. Pennington, MSc., C.P.G., and Justin Smith, BSc., P.E., SME-RM, both of SRK Consulting (U.S.), Inc., Reno, Nevada, and provides a classification of resources in accordance with CIM Standards on Mineral Resources and Mineral Reserves: Definitions and Guidelines, November 27, 2010. Mr. Pennington and Mr. Smith are Qualified Persons, and are independent of the Company for purposes of NI 43-101 and have approved the contents of this news release.

For further information on the Yandera Project, please refer to the technical report titled 'Updated Resource Estimate, Yandera Copper Project, Papua New Guinea', dated June 2015, available on the Company's website and on SEDAR. The Company is not aware of any environmental, permitting, legal, title, taxation, sociopolitical, marketing or other relevant risks other than those identified in the filed report and the most recent annual information form and management discussion and analysis of the Company filed on SEDAR.

Cautionary Statement Regarding Forward-Looking Information

This news release contains forward looking information, including but not limited to statements with respect to ongoing exploration at Yandera and Pomiea. Such forward-looking information is often, but not always, identified by the use of words such as "seek", "anticipate", "believe", "plan", "estimate", "expect" and "intend" and statements that an event or result "may", "will", "should", "could", or "might" occur or to be achieved and any other similar expressions.

In providing the forward-looking information in this news release, the Company has made numerous assumptions regarding: (i) the accuracy of exploration results received to date; (ii) anticipated costs and expenses; (iii) the accuracy of the Company's mineral resource estimate; (iv) the future price of copper and molybdenum; and (v) that the supply and demand for copper, molybdenum, and other metals develop as expected. Although management believes that the assumptions made and the expectations represented by such information are reasonable, there can be no assurance that the forward-looking information will prove to be accurate. Forward-looking information is subject to known and unknown risks, uncertainties and other factors that could cause actual results to differ materially from those contained in the forward-looking information, including actual results of exploration activities, changes in market conditions, risks relating to international operations, fluctuating metal prices and currency exchange rates, and other risks of the mining industry. Some of these risks, uncertainties and other factors are described under the heading "Risks Factors" in the Company's annual information form available on the Company's profile on SEDAR at www.sedar.com. Forward-looking information is based on estimates and opinions of management at the date the statements are made. Except as required by applicable securities laws, Era does not undertake any obligation to update forward-looking information even if circumstances or management's estimates or opinions should change. Readers should not place undue reliance on forward-looking information.

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