Mariana Resources Limited
TSX : MRY
AIM : MARL

July 06, 2011 09:00 ET

Mariana Results-First Stage Metallurigcal Testwork

Metallurgical testwork outlines potentially economic processing options for Calandria Sur and La Calandria-Las Calandrias Gold-Silver Project, Argentina

VANCOUVER, BRITISH COLUMBIA--(Marketwire - July 6, 2011) - Mariana Resources Ltd (TSX:MRY)(AIM:MARL)(PLUS:MARL) ('Mariana' or 'the Company'), the AIM and TSX quoted exploration and development company focused in Argentina and Chile, is pleased to announce results of the first stage of metallurgical testwork carried out on composite samples from the Calandria Sur discovery and LeachWell® assays from the La Calandria Vein at its 100% owned Las Calandrias Gold-Silver Project ('Las Calandrias') located in the prospective Deseado Massif gold-silver district in Southern Argentina. A maiden resource for Las Calandrias Project will be announced shortly and should be read in conjunction with this release.

Overview

This preliminary metallurgical testwork has outlined a number of potentially economic processing options, for both the Calandria Sur and La Calandria gold-silver deposits, subject to further testwork.

Calandria Sur

  • Logging of the degree of oxidation in conjunction with LeachWell® tests* on 9 drill holes showed that for metallurgical purposes the deposit should be sub-divided into oxide, transition and primary zones. (*LeachWell® tests are completed on assay pulps and provide a rapid indication of the percentage of gold recoverable by cyanidation)

  • A column heap leach test on the oxide zone composite gave recoveries of 79.5% for gold ("Au") and 54.5% for silver ("Ag").

  • A carbon-in-leach (CIL) test on the oxide zone composite gave recoveries of 94.6% for gold and 89.6% for silver.

  • Selective flotation on the primary zone composite produced a high value concentrate assaying 40.7g/t Au, 884g/t Ag and 40.2% S at gold and silver recoveries of 82.1 and 82.9%, respectively.

  • On the primary zone composite recoveries of 83.3% for gold and 75.2% for silver were obtained by bulk sulphide flotation followed by pressure oxidation and then cyanidation of the flotation concentrate.

  • Alternative processing options to be investigated in future testwork include:

    • Heap leaching and CIL processing of the combined oxide and upper transition zones, with heap leaching currently favoured because of its lower capital and operating costs.

    • Bulk sulphide flotation followed by oxidation and cyanidation of the concentrate and selective flotation of a saleable concentrate on the combined primary and lower transition zones, with the latter currently favoured because of its lower capital and operating costs.

  • LeachWell® tests on the mineralised sections of the remaining drill holes to better define the boundaries between the currently designated oxidation zones are awaited.

La Calandria Vein

  • LeachWell® tests on intercepts from six drill holes have indicated high average recoveries of 89.5% for the oxide zone, 94.5% for the transition zone and 86.0% for the primary zone.

  • Consequently, economic treatment of all the mineralisation at La Calandria by heap leaching or CIL may be feasible, subject to further LeachWell® tests on the remaining drill holes and testwork.

Mariana Chairman John Horsburgh commented today, "The comprehensive range of metallurgical testwork has outlined a number of potentially economic processing options, for both the Calandria Sur and La Calandria Vein gold-silver deposits at Las Calandrias. The next phase of testwork is already underway with extensive LeachWell assaying of drill intersections at Calandria Sur and La Calandria Vein to assist in mapping the metallurgical characteristics across each deposit. The excellent recoveries from the oxide, transition and primary mineralization at La Calandria Vein indicated by LeachWell® assays will stimulate on-going exploration drilling for high grade vein-breccias at Las Calandrias."

Summary of Preliminary Metallurgical Testwork

A comprehensive range of metallurgical testwork has been carried out on composite samples representing the oxide, transition and primary zones in Calandria Sur taken from a total of 72 drill intersections from 17 drill holes making up an aggregate of 197m and weighing 261kg. The metallurgical testwork was undertaken at Metcon Laboratories in Sydney, Australia, under the supervision of Consulting Metallurgist Peter Lewis, as outlined in the NI 43-101 technical report on Las Calandrias by Mine Development Associates ("MDA") 24 November 2010 (available on the company's website and filed on www.sedar.com). Testwork has included LeachWell® assaying, preparation of composites, comminution tests, gravity concentration, carbon-in-leach tests and heap leaching of the oxide mineralization. Tests on primary mineralisation have included fine grinding, flotation, oxidation and then cyanidation of the flotation concentrate, and selective flotation.

Calandria Sur

LeachWell® Tests

Before commencing any metallurgical testwork the relationship between the degree of oxidation and the amount of gold extractable by conventional cyanidation was determined by completing LeachWell® tests on 171 samples from continuous intersections in drill holes CSD13, 15, 18, 20, 23, 24, 25, 37 and 39, which are located in the centre of the deposit. The LeachWell® test results in rapid and complete dissolution of the extractable gold. Table 1 summarises the results.

Table 1. Summary of LeachWell test results
Oxidation
codes
Degree of
oxidation
Number of
intercepts
tested
From
number of
drill holes
Total
metres
tested
Average
head grade
(g/t Au)
% gold extraction
Average Range(c)
4 & 3 Complete to
Strong
13 3 24.5 2.72 95.7 87.6 to
96.0
2 Moderate 11 4 26.0 1.12 91.8 85.5 to
96.0
1(a) Weak 8 3 20.0 1.00 89.5 77.6 to
96.0
0 Unoxidized 131 8 269.0 2.52 40.3 3.4 to
96.0(d)
1(b) Weak 8 2 18.0 2.41 67.7 18.5 to
88.9
(a) weakly oxidized mineralization above the unoxidized zone (b) weakly oxidized mineralization below the unoxidized zone
(c) All reported extractions >96% were reduced to 96%. (d) Only 7 samples had extractions >70%.

Metallurgical Composites

The LeachWell® results showed that the amount of gold extracted decreased as the degree of oxidation decreased. Consequently, as shown in Table 2, three composite samples were made up for the metallurgical testwork using intercepts from the same drill holes used for the LeachWell® tests.

Table 2. Composite samples for metallurgical testwork
Composite Oxidation
codes
Number of
intercepts
Number of holes Total Metres Weight(kg)
Oxide zone 2, 3 & 4 22 4 56.5 76
Transition zone 1 16 5 38.0 52
Primary zone 0 34 8 102.2 133

Metallurgical Testwork

Comminution tests were completed on each composite. The results are shown in Table 3, and indicate that grinding costs will be close to the industry average.

Table 3. Comminution test results
Composite Rod Mill work index Ball Mill work index
Abrasion
Index
Product
P80 (um)
kWh/tonne Product
P80 (um)
kWh/tonne
Oxide 837 18.8 79 16.8 0.205
Transition 883 20.6 80 17.7 0.272
Primary 875 18.7 79 16.7 0.298

CIL tests over 24 hours at a grind size of P80 75µm and 0.1% cyanide concentration were completed on each composite with and without a preceding gravity concentration stage. Gold extractions by gravity were very low at 1.7%, 6.2% and 0% for the oxide, transition and primary zones, respectively. The results of the CIL tests without gravity concentration are summarized in Table 4.

Table 4. CIL test results
Composite Oxide Transition Primary
Gold
Calculated head (g/t) 1.50 2.21 1.58
Residue (g/t) 0.08 0.49 1.15
% extraction by CIL 94.6 77.9 27.1
% extraction predicted by LeachWell 94.5 74.0 27.6
Silver
Calculated head (g/t) 14.4 22.3 34.5
Residue (g/t) 1.5 4.5 20.2
% extraction by CIL 89.6 79.8 41.7
Consumptions (kg/t)
NaCN 0.24 0.33 0.41
Lime 0.51 0.65 0.69

The very close agreement between the actual CIL gold extractions and those predicted from the LeachWell® tests indicate that the latter is a reliable method of assessing potential gold extraction across the deposit.

A column heap leach test was also completed on the oxide composite at a crush size of minus 6.3mm. 79.5% of the gold and 54.5% of the silver were extracted from calculated head grades of 1.56g/t Au and 13.8g/t Ag. Cyanide consumption was 0.21kg/t. Although the test duration was 38 days, both gold and silver extractions were essentially complete after 29 days.

A diagnostic leach test on the residue from the CIL test on the primary zone composite showed that 98% of the unrecovered gold was locked in sulphide minerals, which consist mainly of pyrite.

Two processing options aimed at increasing gold extraction from the primary zone were examined.

  1. Bulk sulphide flotation followed by pressure oxidation of the flotation concentrate and then cyanidation of the oxidised product gave overall extractions of 83.3% for gold and 75.2% for silver.
  2. Selective flotation of a gold and silver rich pyrite concentrate for sale to a smelter produced a concentrate of 3.3% weight assaying 40.7g/t Au, 884g/t Ag and 40.2% S at gold and silver recoveries of 82.1 and 82.9%, respectively.

Processing Options

At this stage the following alternative processing options exist, which will be investigated in more definitive future testwork.

  • (i) Heap leaching and (ii) CIL processing for the combined oxide and upper transition (i.e. above the primary zone) zones, with heap leaching currently favoured because of its lower capital and operating costs.
  • (i) Bulk sulphide flotation/oxidation of the concentrate/cyanidation and (ii) Selective flotation of a saleable concentrate on the combined primary and lower (i.e. below the primary) transition zones, with the latter currently favoured, again because of its lower capital and operating costs.

LeachWell® tests are now being completed on the mineralised sections of the remaining drill holes to provide a more reliable indication of the boundaries between the currently designated oxidation zones.

La Calandria Vein

A limited number of intercepts from drill holes CND45, 46, 59, 61, 63 and 64 have been subjected to LeachWell® tests. The average results for each oxidation zone, defined in the same way as for Calandria Sur are given in Table 5.

Table 5. LeachWell results for La Calandria Vein
Oxidation
zone
Oxidation
codes
Number
of
intercepts
tested
From
number
of drill
holes
Total
metres
tested
Average
head
grade
(g/t Au)
% gold extraction
Average Range(a)
Oxide 3 & 2 3 1 3.75 1.01 89.5 85.1 to 90.9
Transition 1 3 2 2.95 11.43 94.5 82.1 t0 96.0
Primary 0 27 4 23.50 33.9 86.0 33.0 to 96.0
(a) All reported extractions >96% were reduced to 96%.

These limited results suggest that for all the gold mineralization in the oxide, transition and primary zones, treatment by heap leaching or CIL may be economically feasible.

However, more data are required to confirm this, and LeachWell® tests are currently being completed on the mineralised intercepts from the other drill holes. Testwork on La Calandria Vein will commence once the results of these have been received and assessed

Additional Information – Qualified Person(s)

Metallurgical information in this announcement has been supplied by Peter Lewis of Peter J. Lewis & Associates Pty. Ltd., Sydney, Australia. Mr. Lewis is an independent Consulting Metallurgist. He graduated in 1963 with an honours degree in Mineral Technology from the Royal School of Mines, Imperial College, London, U.K. He is a Fellow and Chartered Engineer of the Institute of Materials, Minerals and Mining, U.K., a Fellow and Chartered Practising Metallurgist of the Australasian Institute of Mining & Metallurgy, and a Member of The American Institute of Mining, Metallurgical and Petroleum Engineers. Mr. Lewis has extensive experience in the planning and evaluation of metallurgical testwork associated with the development of new mining projects, and, as such, is a qualified person within the meaning of national Instrument 43-101.

Exploration information in this announcement has been compiled by John Horsburgh who is a Fellow of the Australasian Institute of Mining and Metallurgy. Mr Horsburgh has sufficient experience relevant to the style of mineralization and types of gold deposit under consideration and to the activity that he is undertaking to qualify as a Competent Person and, as such, is a qualified person within the meaning of national Instrument 43-101.

For further information please visit website at www.marianaresources.com.

About Mariana Resources

Mariana Resources Ltd is an AIM and TSX quoted exploration and development company with an extensive portfolio of gold, silver and copper projects in Argentina and Chile. In southern Argentina, in addition to the Las Calandrias gold-silver discovery, the Company has the Sierra Blanca silver-gold prospect (70%); the Los Amigos joint venture (49%) with Hochschild Mining and a 160,000 Ha land package (100%) in the country. All of these projects are located in the Deseado Massif epithermal gold-silver district in mining-friendly Santa Cruz province of southern Argentina, which hosts four mines and several advanced projects.

In Chile, Mariana has a joint venture with US based international mining and natural resources company Cliffs Natural Resources Inc., to explore for iron oxide-copper-gold deposits ('IOCG') in a 92,000 km² area ("SCM Mariana Area") in north-central Chile along the highly prospective Atacama Fault Zone. The SCM Mariana Area includes the 44km² Buenaventura and 46km² Perro Chico IOCG projects. Mariana is also evaluating a number of gold-silver and copper-gold opportunities away from the Cliffs JV area, as part of a new initiative.

Safe Harbour

This press release presents "forward-looking statements" within the meaning of Canadian securities legislation that involve inherent risks and uncertainties. Forward-looking statements include, but are not limited to, statements with respect to the future price of gold and other minerals and metals, the estimation of mineral resources, the capital expenditures, costs and timing of the resources, the realization of mineral reserve estimates, the capital expenditures, costs and timing of the development of new deposits, success of exploration activities, permitting time lines, currency exchange rate fluctuations, requirements for additional capital, government regulation of mining operations, environmental risks, unanticipated reclamation expenses, title disputes or claims and limitations on insurance coverage. Generally, these forward-looking statements can be identified by the use of forward looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or state that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved". Forward-looking statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of Mariana to be materially different from those expressed or implied by such forward looking statements, including but not limited to: risks related to international operations, actual results of current exploration activities; actual results of current or future reclamation activities; conclusions of economic evaluations; changes in project parameters as plans continue to be refined; future prices of gold and other minerals and metals; possible variations in ore reserves, grade or recovery rates; failure of equipment or processes to operate as anticipated; accidents, labour disputes and other risks of the mining industry; and delays in obtaining governmental approvals or financing or in the completion of development or construction activities. Although the management of Mariana believes that the expectations reflected in such forward-looking statements are based upon reasonable assumptions and have attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. Mariana Resources does not undertake to update any forward-looking statements that are incorporated by reference herein, except in accordance with applicable securities laws.

Neither the TSX nor its Regulation Services Provider (as that term is defined in the policies of the TSX Exchange) accepts responsibility for the adequacy or accuracy of this news release.

Contact Information

  • Mariana Resources Ltd
    John Horsburgh
    Chairman
    +61 2 94374588

    Mariana Resources Ltd
    Glen Parsons
    CFO
    +612 94374588

    Mariana Resources Ltd (Vancouver Office)
    Kathryn Witter
    +1 604 669 9336

    RFC Corporate Finance Limited (Nomad)
    Rob Adamson
    +61 2 9250 0041

    RFC Corporate Finance Limited (Nomad)
    Will Souter
    +61 2 9250 0050

    FinnCap (Broker)
    Matthew Robinson
    +44 20 7600 1658

    St Brides Media and Finance Ltd (PR)
    Felicity Edwards
    +44 20 7236 1177

    St Brides Media and Finance Ltd (PR)
    Hugo de Salis
    +44 20 7236 1177