Greystar Resources Ltd.
TSX : GSL
AIM : GSL

Greystar Resources Ltd.

July 15, 2010 02:00 ET

Greystar Resources Announces Updated Metallurgical Recovery Model for the Angostura Gold-Silver Deposit, Colombia

VANCOUVER, BRITISH COLUMBIA--(Marketwire - July 15, 2010) - Greystar Resources Ltd. (the "Company") (TSX:GSL)(AIM:GSL) is pleased to announce an updated metallurgical recovery model (FS Recovery Model) and process flow for the Company's 100% owned Angostura gold-silver deposit located in Colombia's California mining district. The updated model, which will be incorporated into the Feasibility study (FS) scheduled for publication in the second half of 2010, replaces the metallurgical model used in the May, 2009 Preliminary Feasibility study (PFS Recovery Model). 

The results of the metallurgical testing have the following average gold recoveries by ore type.

Process Ore Type Average Metallurgical Test Results -PFS1) Average Metallurgical Test Results – FS6)
19 mm2) 38 mm3)
Heap Leach Oxide 90 % 91 % 91 %
Transitional 73 % 74 % 70 %
Low Grade Sulphide 39 % 33 % 30 %
Flotation/ BIOX/CIP/Heap Leach Flotation Tails High Grade Sulphide 94 % 86 %
1) Heap Leach average metallurgical results in the PFS based on 18 Column Leach Test (CLT) at 19 mm.
2) Heap Leach average metallurgical results in the FS based on 77 CLT at 19 mm (includes all the samples tested at 38 mm).
3) Heap Leach average metallurgical results in the FS based on 11 CLT at 38 mm.
4) High grade ore circuit average metallurgical results in the PFS based on 90% flotation gold recovery, 98.5% Smelter Recovery, 54% heap leaching recovery of flotation tails agglomerates.
5) High grade ore circuit average metallurgical results in the FS based on 91% flotation gold recovery, 90% BIOX® /CIP recovery, and 50% heap leaching recovery of flotation tails agglomerates.
6) Heap leach feed size sensitivity (38mm vs. 19mm) employed for the FS recovery model was determined considering only samples tested at both feed sizes, rather than average results as presented in the table shown above.

Updates to the recovery model include:

  • A coarsening of the planned heap leach feed size to 38mm.

  • A new geo-metallurgical model to project heap leach recoveries.

  • A revision to the high grade recovery circuit to include stirred tank bio-oxidation and carbon-in-pulp (CIP) cyanidation of the flotation concentrate.

The PFS Recovery Model included heap leaching at a 19mm feed size, a simpler empirical interpretation of heap leach recoveries based on analyzed sulphur content and shipping of flotation concentrate to a smelter, rather than on-site processing. 

The FS Recovery Model is based on a new geo-metallurgical model that uses a re-interpreted oxidation profile of the Angostura deposit to project heap-leach recoveries. Partial or complete oxidation has enhanced the ability of cyanide to dissolve the fine-grained Angostura gold mineralization. The geology team of Greystar, assisted and guided by Strathcona Mineral Services in Toronto, developed the updated oxidation profile based on the characterization of approximately 290,000 meter of drill core. A core interval was characterized as fresh rock in the total absence of iron oxides affecting the ubiquitous sulphide minerals. A core interval was characterized as oxide rock where pervasive oxidation has reduced the total sulphur content to less than one percent (typically less than 0.5%), and the log indicated at most a trace of sulphides being present. Transition rocks are those with a presence of both limonite and sulphides, and as a result have sulphur values above 1% sulphur. The oxidation code assigned to the core intervals was used to model in three dimensions the lower limit of oxidation that separate the sulphide or fresh rocks from oxide and transition rocks above. This lower limit of oxidation is irregular and its position depends on the permeability of the rock mass as a result of alteration and fracturing. The lower limit of oxidation can be found locally just a few metres below surface where modern creeks have provided erosion but reaches to depths of more than 250 metres elsewhere; in general, oxidation extends to an average depth of 95 metres.

The oxidation profile at Angostura is immature and has resulted in a complex arrangement of oxide, transition and remnant fresh rock above the lower limit of oxidation. This was modelled in three dimensions using indicator kriging which estimates the probability of a block to belong to one or more of the three different oxidation rock types based on the surrounding drill-hole information. As a result, each block in the block model now has an estimate of the proportion of oxide, transition and fresh rock. An oxide block contains more than 60% oxide rock, less than 10% fresh rock and has a total sulphur content of 1% or less. A fresh block contains 45% or more of fresh rock and 8% or less of oxide rock. Any block not identified as oxide or fresh is designated as transition. The choice of these parameters was derived from the gold recovery characterization of groups of samples used for the heap-leach test work. This classification reflects the often "mixed" nature (with respect to oxidation composition) of the Angostura ores above the lower limit of oxidation. This geo-metallurgical model was adopted in resource modeling and mine planning by NCL Ingeniería y Construcción of Santiago, Chile.

The FS metallurgical processing routes for the Angostura ore will be driven by the FS Recovery Model with;

  • Oxide, transitional and low-grade sulphide ore processed by conventional cyanide heap leach and agglomerated flotation tailings heap leach.

  • High grade sulphide mineralization will be treated via milling, flotation, stirred tank bio-oxidation, carbon in pulp cyanidation of bio-oxidized residue and pulp agglomeration heap leaching of flotation tailings.

Heap Leach FS Recovery Model

Testing was carried out by Metcon Research and McClelland Laboratories (MLI). The Heap Leach Recovery model was developed by McClelland Laboratories (MLI) after extensive testing of the oxide, transitional and low-grade sulphide materials at both MLI and Metcon Research. A full copy of the MLI report will soon be posted on Greystar's website at www.greystarresources.com.

Response of the Angostura ore to simulated heap leach cyanidation treatment was determined by standard column percolation leach tests conducted on 77 metallurgical samples, at an 80%-19mm feed size. Results from those tests were extensively analyzed with consideration of ore zone, extent of oxidation, lithology, alteration composition, depth and results from detailed head analyses. Results from this data analysis were used to develop a model for estimating commercial heap leach response of the Angostura ore at a tertiary crush (19mm) feed size.

The 19mm heap leach estimates were then factored, based on actual results from comparative column leach tests on a smaller number of samples (11) conducted at a 38mm feed size. These factored estimates were used for estimating commercial heap leach response of the Angostura ore at a secondary crush (38mm) feed size. Recovery model results for heap leaching of secondary crush (38mm) Angostura ore are shown below.

Heap Leach Recovery Model, 38mm Feed Size
Ore Types Oxidation Composition4) Total S Content,
% S
Au Rec., % Ag Rec., % Reagent Consumption
kgNaCN/
mt ore
kgCaO/
mt ore
Oxides1) All All Au Rec. = 0.246 * [% Oxides] + 67.297 48 0.3 1.3
Transitionals2) >20% Oxides All Au Rec. = 0.246 * [% Oxides] + 62.297 56 0.5 1.4
Transitionals2) <20% Oxides <1.0% Au Rec. = 0.246 * [% Oxides] + 62.297 56 0.5 1.4
Transitionals2) <20% Oxides >1.0% 56 56 0.5 1.4
 
Sulfides3) All All Au Rec. = -3.600 *[STotal (%)] + 37.469 34 0.8 for Cu <0.03%
1.6 for Cu 0.03% - 0.10%
2.4 for Cu >0.10%
1.6
1) Oxides ore type is defined as all ore containing > 60% oxides, <10% sulfides and <1% Total S.
2) Transitionals ore type is defined as all ore not classified Oxides or Sulfides ore types.
3) Sulfides ore type is defined as all ore containing >45% sulfides and <8% oxides.
4) Oxidation composition, on a gold weighted basis.

High Grade Sulphide (Flotation/BIOX®/CIL/Heap Leach Flotation Tails) FS Recovery Model

The high grade processing circuit considers whole ore milling (106µm grind), conventional sulphide flotation treatment of the milled ore, BIOX®/CIP processing of the flotation concentrate, and agglomeration heap leaching of the flotation tailings. The Flotation/BIOX®/CIL/Heap Leach Flotation Tails Recovery model was developed by MLI. A full copy of the MLI report will soon be posted on Greystar's website at www.greystarresources.com.

Extensive milling/flotation testing was conducted on multiple drill core composites from the Angostura Project over the last 4 years. Early testing was conducted at Metcon Research, SGS (South Africa) and G&T Metallurgical. More recent testing was conducted at MLI, SGS (Santiago) and SGS (South Africa).

Recovery model flotation recovery estimates are based on results from flotation variability testing, conducted on 36 ore variability drill core composites, 13 ore zone master composites and three overall master composites, as well as locked-cycle flotation tests conducted on the same ore zone and overall master composites.

Preliminary flotation concentrate stirred tank bio-oxidation testing, with agitated cyanidation of the resulting bio-oxidized concentrate has been performed at MLI. Recovery model concentrate BIOX®/CIP recovery estimates are based on results from that testing, and on Goldfields operational experience (discussed below) with other commercial concentrate BIOX® processing circuits. BIOX® bulk batch testing is ongoing at Goldfields that supports these recovery estimates.

Agitated cyanidation tests have been conducted on flotation tailings from the locked cycle flotation testing described above. The recovery model estimate of recoveries from heap leach cyanidation of the flotation tailings are based on results from these short terms (3-4 day) cyanidation tests. These tailings recovery estimates are supported by results from a "pulp agglomeration" column leach test conducted on a crushed (38mm feed size) oxide/transitional ore composite agglomerated using flotation rougher tailings (106µm feed size) produced from a high grade sulphide master composite.

A summary of the recovery model recovery estimates is shown below.

Recovery Model, Angostura HG Sulfide Circuit, Whole Ore Flotation,
with Stirred Tank Biooxidation of Flotation Concentrate, and Heap Leach
("Pulp Agglomeration") Cyanidation of Flotation Tailings, 80%-106µm Feed Size
Ore   Flotation Conc. Bioox./CN Tailings Cyanidation Combined
Zone   Au
Rec.,
%
Ag
Rec.,
%
Au
Rec.,
%
Ag
Rec.,
%
Au
Rec.,
%
Ag
Rec.,
%
Au
Rec.,
%
Ag
Rec.,
%
Central   90 72 90 75 46 47 86 67
Los Laches   85 78 90 75 50 56 84 71
Peresoza   90 90 90 75 39 64 85 74
El Silencio   90 87 90 75 50 50 86 72
Veta de Barro   86 84 90 75 65 62 87 73

Sulphide Concentrate FS Treatment

Stirred-tank bio-oxidation of the Angostura flotation concentrate followed by cyanidation of the oxidized residue was found to be more solid and economically attractive than direct shipment of the flotation concentrate to a smelter (May 2009 PFS), roasting of the flotation concentrate with agitated cyanidation of the roasted calcine, or pressure oxidation (POX) treatment with agitated cyanidation of the POX residue. The comparative process routes were analyzed in GRD Minproc/AMEC/NCL/Greystar trade-off studies. Ultra-fine grinding and leaching of flotation concentrate was also evaluated during metallurgical testing at G&T Metallurgical, but the resulting gold and silver recoveries were too low for consideration in the trade-off study. A preliminary stirred-tank test at McClelland Laboratories, confirmed the amenability of the Angostura flotation concentrate to bio-oxidation with subsequent carbon-in-leach cyanidation of the bio-oxidation residue. Based on these positive results Greystar Resources contracted Gold Fields Limited, the world leader in tank bio-oxidation processing, for a continuous BIOX® mini-pilot plant run using bulk flotation concentrate from the Angostura deposit. Flotation concentrate preparation and testing associated with the BIOX® pilot plant is being done at SGS Lakefield Research Africa in Johannesburg under the direction of Gold Fields Technical Division, BIOX® Department. This test program, to be completed by October 2010, will provide the necessary data for designing the commercial bio-oxidation treatment plant, establishing optimum conditions for gold recovery, recycling of toxin-free solution from the BIOX® plant and generating an environmentally stable solid waste product.

Gold Fields BIOX® process has been commercially available for over 20 years. Eleven BIOX® plants have been commissioned since 1986; eight of these are in operation today. The largest BIOX® plant to date is the 1,069 tonne per day flotation concentrate facility commissioned in mid-2008 at Kolpatas, Uzbekistan. Phase 2 development of this BIOX® plant is now under way and will increase capacity to 2,137 tonne per day of flotation concentrate. This is possible because of the modular design of BIOX® plants.

The BIOX® process uses naturally-occurring microorganisms, which break-down the sulphide mineral matrix that encapsulate precious metals. This exposes the precious metals for subsequent cyanidation, substantially increasing recoveries. The BIOX® process involves the continuous feeding of flotation concentrate into a series of aerated, stirred reactors. Certain constituents, such as iron and sulphur, are dissolved during the process; the precious metals remain associated with the solids. After bio-oxidation, which requires 4 to 6 days, the solids are separated from the liquids. The BIOX® product is washed in a counter-current decantation circuit and then treated in a conventional carbon in pulp cyanide plant to extract the precious metals. Gold recoveries are typically 90% or higher. The solution is treated and recycled.

The BIOX® process has many advantages over other refractory processes such as roasting, pressure oxidation and nitric acid leaching. These include:

  • High precious metal recovery

  • Significantly lower capital and operating costs

  • Robust technology suitable for use in remote areas

  • Lower level of skills required for operation

  • Environmentally non-polluting yielding products that meet the US EPA standards and allow recycling

  • Ongoing process development and improvement

About Greystar Resources Ltd.

Greystar Resources Ltd. is a precious metals exploration and development company that is currently completing a feasibility study on its wholly owned, multi-million ounce Angostura gold-silver deposit in northeastern Colombia. A positive prefeasibility study announced on March 25, 2009 envisions average annual production at Angostura of 511,000 ounces of gold and 2.3 million ounces of silver over a 15 year mine life.

Forward-Looking Statements

Certain statements in this news release are "forward-looking" within the meaning of Canadian securities legislation. They include statements about future management and the Company's anticipated transition from a gold exploration company to a gold production company.. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable by the Company, are inherently subject to significant business, economic, competitive, political and social uncertainties and other contingencies. Many factors could cause the Company's actual results to differ materially from those expressed or implied in the forward-looking statements. These factors include, among others, conclusions or realization of mineral resources, the actual results of exploration activities, possible variations in ore grade or recovery rates, fluctuations in the price of gold and silver, risks relating to additional funding requirements, political and foreign risks, production risks, environmental regulation and liability, government regulation as well as other risk factors set out under the heading "Risk Factors" in the Annual Information Form dated March 26, 2010 which is available on SEDAR at www.sedar.com. Investors are cautioned not to put undue reliance on forward-looking statements due to the inherent uncertainty therein.

Neither the Toronto Stock Exchange nor the AIM Market of the London Stock Exchange has reviewed and neither accepts responsibility for the adequacy or accuracy of this news release.

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