Greystar Resources Ltd.

Greystar Resources Ltd.

November 02, 2009 02:00 ET

Recognizing Higher Long Term Gold Outlook, Greystar Resources to Consider Alternative Processing Methods to Boost Economic Returns From Intermediate Sulphide Ore at Angostura

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Nov. 2, 2009) - Greystar Resources Ltd. (TSX:GSL)(AIM:GSL) (the "Company") announced that the Company will initiate a program of metallurgical testing aimed at investigating the application of agitation leach and/or pre-oxidation as processing methods for intermediate sulphide ore at its 100% owned Angostura gold-silver deposit. Initial testing from both processing methods have shown promising results and further testing is warranted. In the Preliminary Feasibility Study published in May 2009, the intermediate sulphide ore (representing approximately 17% of the recovered gold in the mine plan) was designed to be heap leached which resulted in low recoveries of precious metals. Recent column testing using the intermediate sulphide ore to simulate heap leach conditions have returned recoveries that question the economic viability of only using heap leaching on this ore type. It is important to point out that column testing to simulate heap leach conditions on oxide and transitional ores continue to show very positive results. In addition, flotation testing for treatment of the higher grade sulphide ore to produce a gold bearing concentrate also continues to show excellent results. Given the improvement in the long term outlook for gold, the Company believes that the intermediate sulphide ore may be able to support a more robust processing method which may lead to higher economic returns for this ore type. The agitation leach and pre-oxidation testing programs will take approximately six months to complete, as such the Bankable Feasibility Study is now expected to be completed in the second half of 2010. The Company will continue with the design of the heap leach facilities for treating oxide and transitional ore as well as the grinding and flotation circuit for the higher grade sulphide ore.

David Rovig, President & CEO commented, "Our Preliminary Feasibility Study was based upon $700 per ounce of gold during the first three years of operation and $650 per ounce of gold for the remaining twelve years. These gold prices limited our options for processing of the intermediate sulphide ore at Angostura which contains approximately 2 million ounces of gold. In the current gold environment, both agitated leach and pre - oxidation offer to increase recoveries and improve the economics of this ore type and the project as a whole. If either process is adopted, design modifications such as the inclusion of a tailings impoundment would need to be incorporated in the Bankable Feasibility Study. While this testing will delay the project, the Company will continue to move forward with all other aspects of the project including geotechnical evaluations, social and environmental studies, permitting, infrastructure construction and project finance."

About Greystar Resources Ltd.

Greystar Resources Ltd. is a precious metals exploration and development company that is currently completing a feasibility study on its wholly owned, multi-million ounce Angostura gold-silver deposit in northeastern Colombia. A positive prefeasibility study announced on March 25, 2009 envisions average annual production at Angostura of 511,000 ounces of gold and 2.3 million ounces of silver over a 15 year mine life.

Forward-Looking Statements

Certain statements in this press release are "forward-looking" within the meaning of Canadian securities legislation. They include statements regarding the anticipated effect of the new appointments, estimated annual production and estimated mineral resources. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable by the Company, are inherently subject to significant business, economic, competitive, political and social uncertainties and other contingencies. Many factors could cause the Company's actual results to differ materially from those expressed or implied in the forward-looking statements. These factors include, among others, conclusions or realization of mineral resources, the actual results of exploration activities, possible variations in ore grade or recovery rates, fluctuations in the price of gold and silver, risks relating to additional funding requirements, political and foreign risks, production risks, environmental regulation and liability, government regulation as well as other risk factors set out under the heading "Risk Factors" in the Company's final short form prospectus dated September 22, 2009 which is available on SEDAR at Investors are cautioned not to put undue reliance on forward-looking statements due to the inherent uncertainty therein.

Neither the Toronto Stock Exchange nor the AIM Market of the London Stock Exchange has reviewed and neither accepts responsibility for the adequacy or accuracy of this news release.

Contact Information