Moly Mines Limited
TSX : MOL
ASX : MOL

Moly Mines Limited

July 02, 2008 10:28 ET

Moly Mines Announces 43% Increase in Spinifex Ridge Molybdenum Project Mineral Reserves

TORONTO, ONTARIO--(Marketwire - July 2, 2008) -

NOT FOR DISTRIBUTION TO US NEWSWIRE SERVICES OR DISSEMINATION IN THE UNITED STATES

Moly Mines Limited, (TSX:MOL)(ASX:MOL) is pleased to announce a 43% increase in the Spinifex Ridge Molybdenum/Copper Project's Proven and Probable Mineral Reserves to;

451 million tonnes @ 0.05% Mo and 0.08% Cu

This is sufficient to support the initial 23 years of the planned 20 million tonne per annum mine.

The Mineral Reserves are supported by a fully costed and optimized mine plan benefitting from the high level of certainty on operating cost inputs derived from the extensive contracting strategy the Company has executed since the completion of the Definitive Feasibility Study in September 2007.

The mine plan treats any Inferred Resource that falls within the pit plan as waste although previous resource studies have shown a very high conversion rate of this material to Measured or Indicated resources with more detailed drilling.

The resource base of Spinifex Ridge will host a mining operation well beyond the 23 years of Mineral Reserves and likely beyond 30 years at the current name-plate capacity. It is also likely to support an operational expansion to at least 30 million tonnes per annum. Further studies on the expansion of the Project continue.

The new Mineral Reserve estimate has been prepared by Moly Mines geological and mine planning staff in conjunction with independent resource and engineering group SRK Consulting with the Competent Persons statement compiled by Moly Mines Chief Executive Officer Dr Derek Fisher.

The new Mineral Reserve classified within the JORC and CIM Definition Standards on Mineral Resources and Mineral Reserves is estimated at:



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Mineral Tonnes Mo Cu Ag
Reserve (million t) (%) (%) (g/t)
Classification
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Proven 199.7 0.06 0.10 1.5
Probable 251.1 0.04 0.07 1.1
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Total 450.8 0.05 0.08 1.3
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The new Mineral Reserve is the portion of the Spinifex Ridge Measured and Indicated Resource, adjusted for mining dilution and ore losses, contained within the mine design and is based on the following Measured and Indicated Resource:



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Mineral Tonnes Mo Cu Ag
Reserve (million t) (%) (%) (g/t)
Classification
--------------------------------------------------------------------
Measured 206.8 0.06 0.10 1.5
Indicated 445.4 0.04 0.07 1.1
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Total 652.2 0.05 0.08 1.3
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There is an additional Inferred Resource of 399 million tonnes @ 0.04% Mo and 0.07% Cu. Appendix 1 provides further details. An updated technical report setting forth the full analysis of the Mineral Reserve will be provided in accordance with National Instrument 43-101 ("NI43-101") and filed on SEDAR.

These press materials do not constitute an offer of securities for sale in the United States. Securities may not be offered or sold in the United States absent registration or an exemption from registration. Any public offering of securities to be made in the United States will be made by means of a prospectus that will contain detailed information about the company and management, as well as financial statements.

THESE PRESS MATERIALS ARE NOT FOR RELEASE IN THE UNITED STATES.

This news release includes "forward-looking statements" as that term within the meaning of securities laws of applicable jurisdictions. Forward-looking statements involve known and unknown risks, uncertainties and other factors that are in some cases beyond Moly Mines' control. These forward-looking statements include, but are not limited to, all statements other than statements of historical facts contained in this news release, including, without limitation, those regarding Moly Mines' future expectations. Readers can identify forward-looking statements by terminology such as "aim," "anticipate," "assume," "believe," "continue," "could," "estimate," "expect," "forecast," "intend," "may," "plan," "potential," "predict," "project," "risk," "should," "will" or "would" and other similar expressions. Risks, uncertainties and other factors may cause Moly Mines' actual results, performance, production or achievements to differ materially from those expressed or implied by the forward-looking statements (and from past results, performance or achievements). These factors include the failure to complete and commission the mine facilities, processing plant and related infrastructure in the time frame and within estimated costs currently planned; variations in global demand and price for molybdenum and copper; fluctuations in exchange rates between the U.S. dollar and the Australian dollar; failure to recover the resource and reserve estimates of the Project; the failure of Moly Mines' suppliers and service providers to fulfill their obligations under construction, supply and tolling agreements; unforeseen geological, physical or meteorological conditions, natural disasters or cyclones; changes in the regulatory environment, industrial disputes, labor shortages, political and other factors; the inability to obtain additional financing, if required, on commercially suitable terms; and global and regional economic conditions. Readers are cautioned not to place undue reliance on forward-looking statements. We assume no obligation to update such information.

APPENDIX 1

MINERAL RESERVES

Table 1 below details Mineral Reserves.

These Mineral Reserves are based on Measured and Indicated Mineral Resources of 652.3 million tonnes at 0.05% molybdenum, 0.08% copper and 1.3g/t silver as presented in Table 2 below.



Table 1: Spinifex Ridge Molybdenum Project Mineral Reserves

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Mineral Tonnes Mo Contained Cu Contained Ag Contained
Reserve (million t) (%) Mo (%) Cu (g/t) Ag
Classification (tonnes) (tonnes) (million oz)
----------------------------------------------------------------------------
Proven 199.7 0.06 120,000 0.10 199,000 1.5 9.8
Probable 251.1 0.04 98,000 0.07 169,000 1.1 8.8
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Total 450.8 0.05 218,000 0.08 368,000 1.3 18.6
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Notes:

- Effective date of Mineral Reserves is 30June 2008.

- These Mineral Reserves are a subset of the Mineral Resource.

- The term "Mineral Reserve" of NI43-101 is equivalent to the term "Ore Reserve" of the JORC code.

- The contained molybdenum and contained copper quanta in this table are included for ease of reference, but is not intended to suggest that actual recoveries of minerals would be in such amounts.

- Contained metal is calculated on exact tonnes and grades.

- Ore loss and dilution factors were subjectively applied to blocks located on the outer margins of the mineralized envelope, however due to the large dimensions of the mineralized body, there is negligible reduction in total ore tonnes and grade.

- Pit optimization was completed using Whittle software and was based on various economic and revenue assumptions and unit life of mine costs including mining, processing, administration, selling, marketing and distribution costs. The source of economic, revenue and costing inputs include publically available estimates, contracted costs and independent experts reports.

- The mine design process takes inputs from the optimization process, the physical environment, metallurgical, and production requirements to create practical mine designs that address the anticipated production environment. Additionally, the design takes into account a requirement for accelerated access to high grade ore in the first 10 years of mine life.

- There are no additional environmental, permitting, legal, title, taxation, socio-political, marketing or other issues that will materially affect the estimates of Mineral Resources and Mineral Reserves.

COMPLIANCE STATEMENT

The information contained in the report to which this statement is attached relating Mineral Resources and Mineral / Ore Reserves is based on information compiled and verified under the supervision of Dr Derek Fisher who is a Fellow of The Australasian Institute of Mining and Metallurgy. Dr. Fisher is CEO of Moly Mines Limited and has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves' and as a Qualified Person for purposes of National Instrument 43-101 of the Canadian Securities Administrators.

Dr Fisher consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

MINERAL RESOURCES

Table 2 below details Mineral Resources.



Table 2: Spinifex Ridge Molybdenum Project Mineral Resources

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Mineral Tonnes Mo Contained Cu Contained Ag Contained
Reserve (million t) (%) Mo (%) Cu (g/t) Ag
Classification (tonnes) (tonnes) (million oz)
Measured 206.8 0.06 123,000 0.10 205,000 1.5 10.0
Indicated 445.4 0.04 171,000 0.07 315,000 1.1 16.2
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Total M&I 652.2 0.05 294,000 0.08 520,000 1.3 26.2
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Inferred 399.0 0.04 149,000 0.07 265,000 1.1 14.6
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Notes:

- Effective date Mineral Resources is 30th June 2008.

- The term "Mineral Resource" of the JORC code is equivalent to the term "Mineral Resource" of NI43-101.

- Mineral Resources are quoted inside a nominal 0.02% molybdenum wireframe: a minor amount of lower grade material was included for geological continuity.

- The contained molybdenum and contained copper quanta in this table are included for ease of reference, but is not intended to suggest that actual recoveries of minerals would be in such amounts.

- Contained metal is calculated on exact tonnes and grades.

- Mineral Resources that are not Mineral Reserves have not demonstrated economic viability.

COMPLIANCE STATEMENT

The Mineral Resource estimates was prepared under the supervision and based on information compiled by Mr Phil Jankowski, MAusIMM (CP), who is an employee of SRK Consulting and has been engaged by Moly Mines Limited in such capacity. Mr Jankowski has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 edition of the Australasian Code for Reporting Identified Mineral Resources and Ore Reserves (JORC Code) and as a Qualified Person for purposes of National Instrument 43-101 of the Canadian Securities Administrators. Mr Jankowski consents to the inclusion in this release of the matters based on his information in the form and context in which it appears. The grades were estimated by SRK into the block model by Ordinary Kriging. Geological data verification and QA/QC of the drill hole results were described in the report titled "Spinifex Ridge Mo-Cu Deposit, Western Australia, Updated NI 43-101 Technical Report" prepared by SRK and filed on SEDAR in May 2008.

Contact Information

  • Moly Mines Limited
    Derek Fisher
    Managing Director
    +61 8 94293300
    Website: www.molymines.com