Liberty Mines Inc.
TSX : LBE

Liberty Mines Inc.

October 14, 2008 17:48 ET

Liberty Issues Clarifications

EDMONTON, ALBERTA--(Marketwire - Oct. 14, 2008) - As a result of reviews by the Alberta and British Columbia Securities Commissions, Liberty Mines Inc. (TSX:LBE) ("Liberty" or the "Company") is issuing the following news release to clarify its disclosure.

Drilling required for a mineral reserve estimate and an updated mineral resource estimate for the Redstone mine has been ongoing since the winter of 2006 until April 2008. As stated in press releases dated from September 7, 2006 to May 10, 2007, Liberty intended to have enough drilling completed by that time to produce a technical report stating a mineral reserve. All drill results were not available when the mineral resource technical report was being prepared in June 2007. Further drill results were reported in the October 10, 2007 and January 29, 2008 press releases and drilling continued until April 2008. Liberty has undertaken to have a NI 43-101 compliant technical report for the Redstone mine completed in approximately six months which will include a reserve estimate based on completed drilling and an updated resource estimate.

The Company has not yet attained the status of a producing issuer defined in NI 43-101 as an issuer which has gross revenues of at least $30 million from the most recently completed fiscal year, and at least $90 million gross revenue in the aggregate over the last three fiscal years, as disclosed in the annual audited financial statements. Independent Qualified Persons are therefore required to construct the Company's technical reports until that status is attained. Part of the McWatters feasibility study was written by a Qualified Person who was an employee of the Company. To remedy this situation, Liberty has undertaken to have an updated technical report for the McWatters mine reviewed by independent Qualified Persons completed in approximately six months.

The 2006 annual presentation contained a slide which stated a potential resource at the Redstone mine of 2 million tonnes or more grading 2.3% Ni based on additional mineralization that was suggested by the geophysics performed by Inco known as the "Inco anomaly". Drilling to date has verified that a significant part of the anomaly is nickel bearing. The technical report of January 30, 2006 by G.A. Harron for Starfire Minerals Inc. stated an historical inferred resource of 1,709,000 tonnes grading 2.44% Ni for the Redstone mine as declared in the Timmins Nickel 1991 annual report. From the dimensions of the Inco anomaly, the potential mineralized zone was extrapolated to a range of 1.7 million to 2 million tonnes or more. The key assumptions, parameters and methods used to estimate the historical mineral resource of 1.7 million tonnes are unknown. The Company has not yet completed the work necessary to verify the classification of the resource and is not treating the resource figure as an NI 43-101 defined resource verified by a Qualified Person at this time and therefore the resource figure should not be relied upon.

At the June 2008 annual meeting, an updated model was used which included the mineralized zone only in the basic Redstone channel with no additional allowance relative to the Inco anomaly and no allowance for a resource below the 508m level to the 700m level; drilling had not been completed at the time for that section of the mine and to date still remains to be done. Hence an estimate of 1 million tonnes was stated and the full qualifying language as above should have been reported.

The resource estimate for the Redstone mine was released in the August 23, 2007 technical report based on drilling to the 508m level which stated a measured resource of 274,000 tonnes grading 2.64% nickel and an indicated resource of 145,000 tonnes grading 1.70% nickel. Approximately 77,000 tonnes of the resource have been depleted by mining since August 23, 2007, mostly from the measured part of the resource.

The 2007 Annual Information Form ("AIF") contained an estimate of the mine life of the Redstone mine after a shaft is completed to the 1120m level. That statement was unsupported by a technical report containing a study of the mine reserves and production rate and should not have been included in the AIF.

In the February 23, 2007 news release an historical "reserve" was incorrectly disclosed. The historical resource was stated in the Qualifying Report for the Redstone mine by G.A. Harron on October 15, 2003 as an indicated resource of 49,400 tonnes grading 3.90% Ni (undiluted) over an average width of 1.4m above the 229m level, and inferred resources in the 229 to 335m interval were calculated to be 104,150 tonnes grading 4.19% Ni (undiluted). An economic study and a plan to mine the resource were not completed to reclassify the resource estimate as a reserve.

References to historical resources at the Groves, Sothman and Langmuir 2 projects have been mentioned in previous news releases and on the Liberty website. The disclosures did not meet all requirements under NI 43-101 disclosure for historical resources, and are restated as follows:

The Groves deposit contains an historical mineral resource of 500,000 tons (Canadian Mines Handbook, 1957) of 1.5% combined copper ("Cu") plus nickel ("Ni") above the 45.7m level in two separate zones. The Ni/Cu ratio was reported to be approximately 0.94 which gives an estimate of 0.77% Cu and 0.73% Ni in the resource. The resource category of the historical estimate was not identified and no comparison of the estimate can therefore be made to the accepted categories. The key assumptions, parameters and methods used to estimate the mineral resource are unknown. The Company has not yet completed the work necessary to verify the classification of the resource and is not treating the resource figure as an NI43-101 defined resource verified by a Qualified Person at this time and therefore the resource figure should not be relied upon;

The Sothman deposit contains an historical mineral resource of 350,000 tons grading 0.89% Ni (0.5% Ni cut-off) or 190,000 tons at 1.24% Ni (1% Ni cut-off) (Falconbridge Nickel 1971). The resource category of the historical estimate was not identified and no comparison of the estimate can therefore be made to the accepted categories. The key assumptions, parameters and methods used to estimate the mineral resource are unknown. The Company has not yet completed the work necessary to verify the classification of the resource and is not treating the resource figure as an NI43-101 defined resource verified by a Qualified Person at this time and therefore the resource figure should not be relied upon.

The Langmuir 2 main deposit contains an historical mineral inferred resource of 255,000 tons grading 1.20% Ni (G.A Harron qualifying report for Starfire Minerals Inc. January 30, 2006). The key assumptions, parameters and methods used to estimate the mineral resource are unknown. The Company has not yet completed the work necessary to verify the classification of the resource and is not treating the resource figure as an NI43-101 defined resource verified by a Qualified Person at this time and therefore the resource figure should not be relied upon.

This news release was prepared by Dr. Gary Nash PhD (Physics), the President, Chief Executive Officer and a Director of the Company, and Mr. William Randall MSc (Geology) Vice President of Exploration. Mr. Randall is acting as the Qualified Person as defined under NI 43-101.

About Liberty Mines Inc.

Liberty Mines Inc. is a producer of nickel and is focused on the exploration, development and production of nickel, copper, cobalt and platinum group metals from its properties in Ontario, Canada.

CAUTIONARY STATEMENT

No stock exchange, securities commission or other regulatory authority has approved or disapproved the information contained herein. This News Release includes certain "forward looking statements". All statements other than statements of historical fact in this release, including without limitation, statements regarding potential mineralization and reserves, exploration results, and future plans and objectives of Liberty, are forward looking statements that involve various risks and uncertainties. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. Important factors that could cause actual results to differ materially from Liberty's expectations are exploration risks, commodity prices, assumed startup and operating costs detailed herein and from time to time in the filings made by Liberty with securities regulators.

Contact Information

  • Liberty Mines Inc.
    Dr. Gary Nash, PhD (Physics)
    President & CEO
    (416) 238-9736
    (780) 437-7898 (FAX)
    Email: gnash@libertymines.com