Quadra Mining Ltd.

Quadra Mining Ltd.

October 30, 2006 09:00 ET

Quadra Mining Files Base Shelf Prospectus and a Technical Report for Carlota


Quadra Mining Ltd. (the "Company") (TSX:QUA) announces that it has filed a short form base shelf prospectus with the Securities Commissions in each of the provinces of Canada other than Quebec. When the final base shelf prospectus is filed, Quadra will be able, at its option, to undertake one or more offerings of debt securities, common shares, warrants and subscription receipts over a 25 month period following receipt of the final base shelf prospectus. The nature, size and timing of any such financings will be dependent upon Quadra's assessment of its requirements for funding and general market conditions. The net proceeds of such financings may be added to the general working capital of the Company or used to fund capital or other expenditures of the Company.

Quadra is also pleased to announce that is has filed a National Instrument 43-101 Technical Report for the Carlota Copper project in Arizona. The full NI 43-101 Technical Report will be available at www.quadramining.com and at www.sedar.com. The Technical Report provides a detailed and updated review of the Carlota project and has identified the following highlights for the project.

The project will comprise a run-of-mine ("ROM") heap leach project producing cathode copper by SX/EW over a nine year mine life plus two years of residual leach. The plant has been designed to produce up to 75 million pounds per year. The financial analysis gives a 21% internal rate of return ("IRR") based on the forward curve and a long term copper price of $1.20 per pound. Specific prices used in calculating the IRR were $2.80 in 2008, $2.55 in 2009, $2.30 in 2010, $1.80 in 2012, $1.50 in 2013 and $1.20 thereafter.

The total funding requirement through to positive cash flow is $218 million of which the capital component is $189 million and the working capital component is $29 million. Construction is budgeted over 18 months and targeted over 15 months. Operating costs are estimated at $0.99 per pound on a life of mine basis.

Paul Blythe, President of Quadra says, "the new Technical Report on Carlota provides us with the information necessary to decide when and how to move forward with the Carlota project. In preparing our financial model, we have seen the same capital and operating cost increases that have occurred globally. Nevertheless, we are very comfortable with the project economics, taking the view that the copper price must be sustainable at levels that will support such projects if the industry is to meet global demand. There has been one substantial change in scope, which has been to move to new equipment for mining as a better economic solution.

We see the biggest risk as further cost pressures and have already placed orders for long delivery and mobile mining equipment. We have on order a Hitachi EX5500 hydraulic shovel, seven Komatsu 830e haul trucks, four Komatsu 375 Dozers and the rectifier for the SX/EW plant.

Filing the Base Shelf Prospectus enables the Company to pursue various public market funding opportunities at times that the Company determines most advantageous including the public debt market."

This announcement is not an offer of securities for sale in the United States. No securities have been registered under the U.S. Securities Act to be offered for sale in the United States. Securities may not be offered or sold in the United States absent registration under the U.S. Securities Act 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.

Mr. Guy Le Bel of Quadra who is a qualified person has prepared the economic section of the Technical Report from which the technical information disclosed herein is excerpted, and has approved the content of this press release.

This press release contains "forward-looking information" that is based on Quadra's expectations, estimates and projections as of the dates as of which those statements were made. This forward-looking information includes, among other things, statements with respect to Quadra's business strategy, plans, outlook, long-term growth in cash flow, shareholder value, projections, targets and expectations as to reserves, resources, results of exploration (including targets) and related expenses, mine development, mine operations, mine production costs, drilling activity, sampling and other data, future recovery levels, future production levels, capital costs, costs savings, cash and total costs of production of copper, gold and other minerals, expenditures for environmental matters and technology, projected life of our mines, reclamation and other post closure obligations and estimated future expenditures for those matters, completion dates for the various development stages of mines, future copper, gold, molybdenum and other mineral prices (including the long-term estimated prices used in calculating mineral reserves), the percentage of production derived from mechanized mining, currency exchange rates, debt reductions and timing of expected sales. Generally, this forward-looking information can be identified by the use of forward-looking terminology such as "outlook", "anticipate", "project", "target", "believe", "estimate", "expect", "intend", "should", "scheduled", "will", "plan" and similar expressions. Forward-looking information is subject to known and unknown risks, uncertainties and other factors that may cause Quadra's actual results, level of activity, performance or achievements to be materially different from those expressed or implied by such forward-looking information, including but not limited to:

- Uncertainties related to the accuracy of our reserve and resource
estimates and our estimates of future production and future cash
and total costs of production and the geotechnical or
hydrogeological nature of ore deposits, diminishing quantities or
grades of reserves and variable metallurgical performance of these

- Uncertainties related to expected production rates, timing of
production and the cash and total costs of production and milling.

- Uncertainties relating to copper, gold, molybdenum and other
mineral prices, which are beyond the Company's control.

- Operating and technical difficulties in connection with mining
development or production activities.

- The Carlota copper project is not yet operating as a Mine and
Quadra may not be able to successfully complete all steps necessary
to being production.

- Uncertainties related to feasibility studies and other studies that
provide estimates of expected or anticipated costs, expenditures
and economic returns from a mining project.

- Uncertainties related to the ability to obtain and retain necessary
licenses, permits, electricity, surface rights and title for
development projects and project delays due to third party

- Uncertainties in obtaining additional financing required for the
development of the Carlota project that may result in delay or
postponement of the development of the project or even a
determination not to proceed at all.

- Uncertainties related to the future development or implementation
of new technologies, research and development and, in each case,
related initiatives and the effect of those on our operating

- Uncertainties related to judicial or regulatory proceedings.

- Changes in, and the effects of, the laws, regulations and
government policies affecting our mining operations, particularly
laws, regulations and policies relating to:

- mine expansions, environmental protection and associated
compliance costs arising from exploration, mine development, mine
operations, reclamation and mine closures;
- expected effective future tax rates in jurisdictions in which our
operations are located;
- the protection of the health and safety of mine workers; and
- mineral rights ownership in countries where our mineral deposits
are located.

- Changes in general economic conditions, the financial markets and
in the demand and market price for copper, gold, molybdenum and
other minerals and commodities, such as diesel fuel, petroleum,
steel, concrete, electricity and other forms of energy, and
fluctuations in exchange rates, particularly with respect to the
value of the U.S. dollar and Canadian dollar, concentrate and
transportation charges.

- Changes in the cost of supplies necessary for the construction and
operation of the project including the costs of construction,
mining equipment including tires and other parts, operating
supplies including acid and other commodities all of which are
experiencing world-wide shortages and resulting price inflation.

- Unusual or unexpected formations, seismic activity, cave-ins,
flooding, pressures, pit wall failures and other similar incidents
(and the risk of inadequate insurance or inability to obtain
insurance to cover these risks).

- Changes in accounting policies and methods we use to report our
financial condition, including uncertainties associated with
critical accounting assumptions and estimates.

- Environmental issues and liabilities associated with mining
including processing and stock piling ore.

- Geopolitical uncertainty and political and economic instability in
countries which we operate.

- Labour strikes, work stoppages, or other interruptions to, or
difficulties in, the employment of labour in markets in which we
operate mines, or extreme weather conditions, environmental
hazards, industrial accidents or other events or occurrences,
including third party interference that interrupt the production of
minerals in our mines.

- Quadra's reliance on a single producing property.

A discussion of these and other factors that may affect Quadra's actual results, performance, achievements or financial position is contained in the filings by Quadra with the Canadian provincial securities regulatory authorities, including Quadra's AIF and the preliminary base shelf prospectus. This list is not exhaustive of the factors that may affect our forward-looking information. These and other factors should be considered carefully and readers should not place undue reliance on such forward-looking information. Quadra disclaims any intent or obligations to update or revise publicly any forward-looking statements whether as a result of new information, estimates or options, future events or results or otherwise.

About Quadra Mining Ltd. (TSX:QUA)

Quadra is a British Columbia corporation based in Vancouver and is a copper producing company whose principal asset is the Robinson Mine in Nevada. The Company has a goal of becoming a mid-tier base metals development and operating company with interests in a number of advanced exploration, development and producing properties.

Contact Information

  • Quadra Mining Ltd.
    Sophie Taylor
    Manager, Investor Relations
    (604) 689-8550
    Quadra Mining Ltd.
    Paul Blythe
    Website: www.quadramining.com