Katanga Mining Limited
TSX VENTURE : KAT

Katanga Mining Limited

May 19, 2006 16:47 ET

Katanga Technical Update

TORONTO, ONTARIO--(CCNMatthews - May 19, 2006) - Katanga Mining Limited (TSX VENTURE:KAT) ("Katanga" "Company") announced today that following the release of the Feasibility Study dated April 03, 2006 and the Technical Report dated April 06, 2006, a continuing review of the data has resulted in a decision to make minor adjustments to the resource and reserve estimates and the operating plan. Please refer back to our press release dated April 11, 2006 filed on www.sedar.com. The results are summarized in a revised Feasibility Study and Technical Report issued 16 May 2006.

Katanga is of the view that the items identified by the review are within the parameters of the Feasibility Study and the review process has served to improve the quality of the study as the Company begins detailed engineering on its Kamoto project.

Changes to the Feasibility Study and Technical Report include the following:

-Recovery of remnant stope pillars in the Kamoto Mine was reduced from 90% to 60%.

-The cobalt content from hanging wall dilution in the Kamoto mine was decreased

-The Kamoto Mine Resource tonnage was reduced because some of it may not be
minable.

-Certain mine development costs were increased resulting in a slightly higher mine operating costs.

-Cobalt recovery in the metallurgical plant was increased based on capital being spent for modernization of the entire process and control system.

After the review, minor revisions were made to the Kamoto underground and open pit mining sequence and a revised financial analysis was completed.

The changes to the Reserve and Resource estimate and the operating costs over the analysis period are as follows:

Kamoto Mineral Reserve Estimate, May 16, 2006



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Ore Copper Copper Cobalt Cobalt
Classification Tonnes Grade % Tonnes Grade % Tonnes
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Kamoto Proven and
Probable Mineral
Reserves 45,002 3.12% 1,403 0.36% 164
Open Pit Proven and
Probable Mineral
Reserves 47,598 3.20% 1,521 0.26% 124
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Proven + Probable
Reserves 92,600 3.16% 2,924 0.31% 288
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Notes: Mineral reserves are separate from mineral resources.


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Ore Copper Copper Cobalt Cobalt
Classification Tonnes Grade % Tonnes Grade % Tonnes
---------------------------------------------------------------------
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Kamoto Proven and
Probable Mineral
Reserves -1% +1% 0% -7% -9%
Open Pit Proven and
Probable Mineral
Reserves 0% 0% 0% 0% 0%
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Proven + Probable less less
Reserves than 1% than 1% 0% -4% -5%
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Percentage change from April 6, 2006 Reserve estimate

Kamoto Mineral Resource Estimate, May 16, 2006

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Ore Copper Cu Cobalt Co
Tonnes Grade Tonnes Grade Tonnes
Classification (000's) % (000's) % (000's)
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Kamoto Measured
and Indicated
Mineral Resources 21,227 4.12% 875 0.46% 97

Open Pit Measured
and Indicated
Mineral Resources 47,676 3.17% 1,512 0.36% 173
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Measured +
Indicated
Resources 68,902 3.47% 2,388 0.39% 270
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Inferred Mineral
Resources
-Kamoto 11,826 5.28% 624 0.15% 18
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Inferred Mineral
Resources - Open
Pits 17,493 3.41% 596 0.32% 56
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Total Inferred
Mineral Resources 29,319 4.16% 1,220 0.25% 74
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Notes: Mineral resources are exclusive to mineral reserves.

Percentage change from April 6, 2006 Resource estimate

---------------------------------------------------------------------
Ore Copper Cu Cobalt Co
Tonnes Grade Tonnes Grade Tonnes
Classification (000's) % (000's) % (000's)
---------------------------------------------------------------------
---------------------------------------------------------------------
Kamoto Measured
and Indicated
Mineral Resources -19% +4% -15% -4% -22%

Open Pit Measured
and Indicated
Mineral Resources +3% +1% +4% -2% +1%
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Measured +
Indicated
Resources -5% +1% -4% -4% -9%
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Inferred Mineral
Resources
-Kamoto -20% +7% -15% -4% -24%
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Inferred Mineral
Resources - Open
Pits 0% 0% 0% 0% 0%
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Total Inferred
Mineral Resources -9% +1% -8% +2% -7%
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Over the analyzed 20-year period, total revised production
costs are as follows:


------------------------------------------------
Total
('000s USD) USD/t ore USD/lb. Cu USD/t Cu
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Underground Mining 869,689 9.74 0.18 401
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Open Pit Mining 1,013,017 11.34 0.21 467
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Kamoto DIMA
Concentrator 473,393 5.30 0.10 218
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Luilu Plant 955,432 10.70 0.20 441
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General &
Administration 259,934 2.91 0.05 120
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Site Operating
Cost Sub Total 3,571,465 39.99 0.75 1,648
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Cobalt Credit (2,505,037) (0.52) (1,156)
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Site Operating
Cost Total
After Cobalt Credit 0.22 492
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Transport and
Marketing Expenses 772,006 0.16 356
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Royalty and Lease
Obligations 255,251 0.05 118
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Capital Costs 658,049 0.14 304
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Total Production
Costs 2,751,734 0.58 1,270
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Percentage change from April 6, 2006 Technical Report

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Total
('000s USD) USD/t ore USD/lb. Cu USD/t Cu
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Underground Mining 3.8% 4.1% 0.0% 3.4%
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Open Pit Mining 0.6% 0.9% 0.0% 0.0%
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Kamoto DIMA
Concentrator 0.6% 0.8% 0.0% 0.0%
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Luilu Plant 1.5% 1.8% 0.0% 1.1%
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General &
Administration 1.9% 2.1% 0.0% 1.7%
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Site Operating Cost
Sub Total 1.7% 2.0% 1.4% 1.3%
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Cobalt Credit 0.3% -1.9% -0.2%
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Site Operating
Cost Total
After Cobalt Credit
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Transport and
Marketing Expenses 0.4% 0.0% 0.0%
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Royalty and Lease
Obligations 2.0% 0.0% 1.7%
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Capital Costs 0.0% 0.0% -0.3%
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Total Production
Costs 2.3% 1.8% 1.8%
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To reflect the changes identified by the review a revised feasibility study has been prepared and an amended technical report dated May 16, 2006 has been prepared. Katanga intends to file an amended National Instrument 43-101 Independent Technical Report regarding the feasibility study shortly.

The feasibility study comprises several components prepared by HATCH (metallurgical and plant engineering studies including mechanical and electrical engineering, surface infrastructure and financial modeling studies), McIntosh RSV LLC ("RSV"), in association with Caracle Creek International Consulting Inc. ("CCIC") (mineral reserves and resources and mine planning), and SRK Consulting Engineers and Scientists (environmental, tailings, geotechnical and groundwater studies).

Dr. Scott Jobin Bevans, P.Geo. of CCIC and Mr. Malcolm Paul Lotriet, Pr.Eng, FSASIMM, of RSV are the independent "Qualified Persons", within the meaning of National Instrument 43101, who prepared the mineral reserve and resource estimate. Mr. Christian Heili, Pr.Eng and FSAIMM of HATCH, an independent "Qualified Person", within the meaning of National Instrument 43-101, was responsible for metallurgical and plant engineering as well as financial modelling and the economic evaluation Mr. Adrian Meinties, Pr. Eng. of SRK, an independent qualified person within the meaning of National Instrument 43-101, was responsible for the environmental aspects of the report including tailings site selection and design.

Mr. Alan Naismith, FSIMM of SRK, an independent "Qualified Person" with the meaning of National Instrument 43-101, was responsible for the geotechnical aspects of the evaluation.

Richard Dye, the Senior Vice President, Technical Services of Katanga Mining and a Qualified Person under National Instrument 43-101, has reviewed and approved the contents of this press release.

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.

Contact Information

  • Katanga Mining Limited
    Arthur H. Ditto
    President & Chief Executive Officer
    Office: (416) 369-4340
    Mobile: (416) 456-3308
    or
    Katanga Mining Limited
    Anu Dhir
    VP Corp. Development
    Office: (416) 369-4340
    Mobile: (416) 843-0401