SOURCE: La Mancha Resources

June 17, 2011 08:50 ET

La Mancha Resources: Clarification on CIL Feasibility Study

PARIS--(Marketwire - Jun 17, 2011) - La Mancha Resources Inc. (TSX: LMA), hereinafter "La Mancha" or the "Company"). As a result of a review by the British Columbia Securities Commission ("BCSC"), La Mancha is issuing the following news release to clarify its disclosure concerning its positive Definitive Feasibility Study press release, published on May 16, 2011, for the proposed upgrade of its present heap leach plant to Carbon-In-Leach technology at its Hassaï gold mine in North-Eastern Sudan.

The Definitive Feasibility Study highlights, as compiled by Sedgman Ltd. with the collaboration of CSA Global Pty Ltd., Golder Associates, Arethuse Geology and Wardell Armstrong, remain unchanged as confirmed in the table below.

Definitive Feasibility Study Highlights
Economic assumptions*
Gold price2013: $1,200/oz
2014: $1,100/oz
≥ 2015: $1,000/oz
Gold royalty fee5%
Corporate tax rate10%
Production:
Commissioning 2013
Yearly mill run rate, Mtpa 3.0
Gold recovered, '000 oz 698
Metallurgical recovery 72%
Yearly production**, oz161,647
Mine life, years4.7
Financials:
Initial capital cost $187.0 M
Total sustaining capital $4.2 M
Average cash costs per year*** $571/oz
Internal rate of return 36%
NPV @ 0% discount $148.8 M
NPV @ 5% discount $116.3 M
Payback**** , years1.8

*Applicable corporate tax rate and gold royalty fee are currently 15% and 7% respectively; **Excludes low production projected in last year of operation; ***CIL cash cost excludes capitalized mining costs associated to acidic ore stockpiles; ****Calculated from the commencement of production

However, following BCSC's review, La Mancha is retracting the supplemental information which had been provided in the May 16th 2011 press release concerning Sedgman's economic analysis of the extra 1.2Mt of heap leach residue grading 2.06 g/t Au (for 79,475 oz of gold contained) which remained in the inferred category as of March 31, 2011. La Mancha acknowledges that an inferred resource cannot be used to suggest an economic value in the content of a feasibility study, even when discussing upside potential, as is the case on page 3 of its May 16, 2011 press release.

ABOUT LA MANCHA RESOURCES INC:
La Mancha Resources Inc. is an international gold producer with operations, development projects and exploration activities in Africa, Australia and Argentina. La Mancha's shares trade on the Toronto Stock Exchange (TSX) under the symbol "LMA". For more information on the Company, visit its website at http://www.lamancha.ca/.

CAUTION CONCERNING FORWARD-LOOKING STATEMENTS
This press release contains certain "forward-looking statements", including, but not limited to, statements regarding the Company's strategic plans, future commercial production, sales and financial results, development, construction and production targets and timetables, mining costs; statements regarding capital expenditures, development plans, and exploration programs, objectives and budgets; statements regarding the Company's expectations; statements regarding the capital costs associated to the development of the CIL project of the Hassaï property, and its economic viability and profitability. Forward-looking statements express, as at the date of this press release, the Company's plans, estimates, forecasts, projections, expectations or beliefs as to future events and results. Forward-looking statements involve a number of risks and uncertainties, and there can be no assurance that such statements will prove to be accurate. Therefore, actual results and future events could differ materially from those anticipated in such statements. Risks and uncertainties that could cause results or future events to differ materially from current expectations expressed or implied by the forward-looking statements include, but are not limited to, factors associated with fluctuations in the market price of precious metals, mining industry risks, exploration risks, risks associated with foreign operations, environmental risks and hazards, uncertainty as to calculation of mineral reserves, requirement of additional financing or additional permits, authorizations or licences, risks of delays in construction and production and other risks referred to in La Mancha's 2010 Annual Information Form filed with the Securities Commissions, as well as the Toronto Stock Exchange.

Contact Information

  • For additional information, please contact:
    La Mancha Resources Inc.
    Martin Amyot
    Vice President Corporate Development
    Tel: (514) 987-5115 ext 25

    Nicole Blanchard
    Investor Relations
    Tel: (514) 987-5115 ext 26
    Email: Email Contact