Farallon Resources Ltd.

Farallon Resources Ltd.

September 12, 2005 09:30 ET

Farallon Announces Successful Results from $2.1 Million Metallurgical Program

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Sept. 12, 2005) - Farallon Resources Ltd. (TSX:FAN) -

Pilot Plant Program Results Indicate Recoveries of 97% for Zinc and 80-85% for Copper

Company Trademarks Proprietary "PARTOX" Hydrometallurgical Process

Dick Whittington, President and CEO of Farallon Resources Ltd., is pleased to announce the results of an extensive metallurgical test work program recently carried out on Farallon's Campo Morado, polymetallic, zinc-gold-copper-silver-lead project in Guerrero State, Mexico. This $2.1 million program was initiated to specifically address the metallurgical challenges that the project faced due to the finely disseminated nature of the mineralization of the various deposits that make up the Campo Morado Project. In addition, a "Proof of Principle" Pilot Plant program was conducted to validate - in continuous operating conditions - the selected hydrometallurgical flowsheet for the Pre-Feasibility Study for the project. The Company is targeting completion of the Pre-feasibility Study in mid February 2006.

The results have been very encouraging, and indicate that a partial oxidation, solvent extraction/electrowinning ("SX/EW") process for the selective removal of copper and zinc, followed by a standard cyanidation extraction process for gold and silver works extremely well on Campo Morado type mineralization. As a result, the Company has applied for, and been granted, a Trademark for the process and will be marketing it to other companies in need of similar hydrometallurgical treatment. The process has been registered under the "PARTOX" Trademark and will be referred to as such in all future Company announcements surrounding the metallurgical process to be used at Campo Morado.


Metallurgical programs, performed in 1997 and 1998 on samples of mineralization from the Reforma and Naranjo deposits, were designed to produce marketable selective flotation concentrates. Although these programs achieved some success, it was apparent that project economics would be adversely affected by the low base metal recoveries as well as the costs of concentrate transportation and smelter treatment charges in effect at the time. Accordingly, preliminary bench-scale hydrometallurgical tests were performed with a view to extracting metallic copper, zinc, silver and gold from bulk concentrates through the application of commercially-proven, unit hydrometallurgical processes. The results demonstrated the potential technical viability of such an approach. As with other project related activities, all metallurgical studies were terminated in 1998, when work on the project was suspended due to low metal prices.

In 2004, as part of the Pre-Feasibility Study currently underway, Bateman Engineering Pty Ltd (Bateman) was contracted to be responsible for the hydrometallurgical process design and associated engineering. Bateman was also requested to be the "Overall Project Review Engineers" for the Pre-feasibility Study. Bateman has extensive experience in the field of hydrometallurgy; for example, the firm designed and successfully commissioned the plant for Anglo American's Skorpion Zinc Leach - Solvent Extraction and Electrowinning Project in Namibia.

Pilot Plant Program and Flowsheet Development

A three-phase metallurgical "Proof of Principle" test program commenced in October 2004 and was designed, almost exclusively, to confirm the technical viability of the hydrometallurgical flowsheet to be used at Campo Morado. Under the flowsheet, flotation bulk rougher concentrates are subjected to conventional medium-temperature/pressure oxidation in an autoclave. This process, which is designed to oxidize approximately 20 percent of the sulphides, selectively extracts zinc and copper into solution and partially oxidizes precious metal-bearing sulphides, leaving most of the barren pyrite in the concentrate un-oxidized. Copper and zinc metal cathodes of commercial purity are then recovered from solution by normal SX/EW processes. The washed solids residue from pressure oxidation is subjected to conventional cyanidation to recover silver and gold. A schematic diagram of the hydrometallurgical flowsheet is available on the Company's website.

Bulk Sampling Program

A comprehensive metallurgical bulk sample drilling program commenced in late 2004 and continued into early 2005. A total of 14 holes, totalling 4,200 metres, were drilled at Reforma (10 holes), Naranjo (3 holes) and El Largo (1 hole). For El Largo, samples from this program were combined with rejects from core samples obtained from the 2004 exploration drilling program. The samples were sent to G&T Metallurgical Services Ltd. ("G&T") in Kamloops, British Columbia, Canada for preparation of the necessary bulk flotation samples for the pilot plant program.

Phases 1 and 2 Testwork and Results

Phase 1 and Phase 2 flotation programs were initiated at G&T to produce bulk rougher concentrates for subsequent bench-scale scoping-level pressure oxidation tests at SGS Lakefield ("SGS"). G&T performed flotation tests on samples of Reforma, Naranjo and El Largo mineralization at various levels of primary grind, to assess the impact of grind size on bulk circuit response. Results from pressure oxidation tests, performed on these bulk concentrate samples by SGS at their laboratories in Lakefield, Ontario, demonstrated the amenability of the mineralization to low temperature/pressure oxidation. Phase 2 pressure oxidation test results were applied to design the Phase 3 continuous pilot plant circuit.

Phase 3 Pilot Plant Testwork and Results

The success of the Phase 1 and Phase 2 programs resulted in the implementation of a dedicated pilot plant program - Phase 3 - in which a pilot plant, specifically designed and built to process Campo Morado mineralization, was constructed at SGS. The pilot plant, which incorporates all of the elements indicated in the flowsheet, was commissioned in May 2005.

This Phase 3 work was designed to examine the entire integrated hydrometallurgical flowsheet, under continuous operations, from bulk concentrate feed, through to the production of electrowon metallic copper and zinc, while treating separate bulk rougher concentrates from Reforma, Naranjo and El Largo respectively. The gold and silver would be recovered by cyanidation in a program of batch tests. Approximately 3 tonnes of bulk rougher concentrates, produced by G&T and Pacific Pilot Plant in Kamloops, British Columbia, were shipped to SGS for the Phase 3 pilot plant work.

All unit processes incorporated in the hydrometallurgical circuit were successfully tested in continuous mode. Pilot plant results indicate that, on average, 80%-85% of the copper and up to 97% of the zinc are extracted during the selective pressure oxidation process and, subsequently, are recovered as high purity metal through two separate solvent extraction and electrowinning circuits. Cyanidation tests performed on partially oxidized solids residues yielded average gold recoveries of 57% for Naranjo, 66% for Reforma and 62% for El Largo, and average silver recoveries were 82% for Naranjo, 76% for Reforma and 88% for El Largo. A comprehensive precious metal recovery program is currently underway to examine the means by which precious metal recoveries may be enhanced and reagent consumption optimized. The flowsheet has been registered in Canada and Mexico under the Trademark "PARTOX", ie partial oxidation process. A Summary of SGS Lakefield's Pilot Plant Report is available on the Company's website. The summary and flowsheet can be also obtained in hard copy by contacting Investor Relations at the numbers below. The full report will be filed on SEDAR within 30 days, and will also be available on the website.


The Phase 3 pilot plant was a success in every respect. The results provide important data to be used by Bateman in the development of process design criteria, flowsheet development and equipment selection for a PARTOX facility to be located at Campo Morado. Capital and operating cost projections will be developed for inclusion in the Pre-Feasibility Study, based on technically viable extractive metallurgical processes.

Dick Whittington said: "I am delighted with the results of this program. It indicates that the PARTOX flowsheet design for processing material from the Campo Morado deposits is not only viable technically, but that the nature of the mineralization lends itself very well to this technique. The results are excellent and vindicate the effort and initiative of those involved in the planning, design and operation of the program. We are breaking new ground with this process, and hence have chosen to Trademark it. The extent of the program, its cost, and the dedicated nature of the pilot plant itself, removes a major element of risk from the overall Campo Morado mine development project. I congratulate those involved but in particular, Dr. David Dreisinger, who has spearheaded this campaign from the conceptual stage through to the completion of this pilot plant program. These very key results will form the basis of the Pre-Feasibility Study, slated for completion in February 2006."

The in-house qualified person for the drilling program and selection of samples for metallurgical testwork at Campo Morado is Daniel Kilby, P.Eng. ALS Chemex is the analytical laboratory for the project; sample preparation is done in Guadalajara, Mexico and analysis is done in Vancouver, BC. All samples are assayed for gold by fire assay fusion with a gravimetric or Atomic Absorption (AA) finish. Silver, copper, lead, zinc and 27 to 30 additional elements are determined for all samples by acid digestion, followed by an AA or ICP finish. Duplicates are analyzed by Acme Analytical Laboratories in Vancouver.

The metallurgical program is supervised by independent consultants. David Dreisinger, P.Eng., is responsible for the hydrometallurgical program and Peter Taggart, P.Eng., is responsible for the flotation testwork and ensuring that bulk concentrates are developed for use in the pilot plant. Both are independent qualified persons as defined by National Instrument 43-101.

Farallon has a strong cash position of C$14.3 million. Based on the success of the Company's 2004-2005 exploration and engineering programs, Farallon's Board of Directors recently approved a new budget of $10.4 million that will enable the Company to complete its current drilling program and conclude a Pre-Feasibility Study by early 2006.

Forward-Looking Information

This release includes certain statements that may be deemed "forward-looking statements". All statements in this release, other than statements of historical facts, that address future production, reserve potential, exploration drilling, exploitation activities and events or developments that the Company expects are forward-looking statements. The likelihood of future mining at Campo Morado is subject to a large number of risks and will require achievement of a number of technical, economic and legal objectives, including obtaining necessary mining and construction permits, completion of pre-feasibility and final feasibility studies, preparation of all necessary engineering for pits and processing facilities as well as receipt of significant additional financing to fund these objectives as well as funding mine construction. Such funding may not be available to the Company on acceptable terms or on any terms at all. There is no known ore at Campo Morado and there is no assurance that the mineralization at Campo Morado will ever be classified as ore. For more information on the Company and the risk factors inherent in its business, investors should review the Company's Annual Information Form at www.sedar.com.

No regulatory authority has approved or disapproved the information contained in this news release.

Contact Information

  • Farallon Resources Ltd.
    Melanee G. Henderson
    Investor Relations
    (604) 684-6365 or Toll Free: 1-800-667-2114 (North America)
    (604) 684-8092