Selwyn Resources Ltd.

Selwyn Resources Ltd.

April 25, 2011 07:58 ET

Selwyn Chihong Receives B Water License: Project Update

VANCOUVER, BRITISH COLUMBIA--(Marketwire - April 25, 2011) - Selwyn Resources Ltd. (TSX VENTURE:SWN) ("Selwyn") is pleased to announce that Selwyn Chihong Mining Ltd. ("Selwyn Chihong") has received a type B Water License for the Selwyn Project. The license was issued by the Yukon Water Board and allows for the use and discharge of water related to the advanced exploration program proposed for the XY Central deposit. Selwyn Chihong is the joint venture company formed by Selwyn and Chihong Canada Mining Ltd.

Dr. Harlan Meade, President and CEO of Selwyn Chihong Mining Ltd. and Selwyn Resources Ltd., states: "The receipt of this license allows the proposed initial underground development activities at the XY Central deposit to proceed. The primary purpose of the underground program is to confirm the mining conditions that form the basis of the mining plan for the XY Central deposit."

The type B Water License, issued following an assessment of the underground program at the Selwyn Project by the Yukon Environmental and Socio-economic Assessment Board (YESAB), has a 10-year term. Together with the amendment to Selwyn Chihong's Land Use Permit (issued by the Ministry of Energy, Mines & Resources in July 2010 ), it allows for the immediate commencement of required portal, maintenance and waste storage facilities required for the planned underground program to access the XY Central deposit. The license establishes conditions for a rock stockpile storage facility, ponds and facilities for treatment of mine waters, new roads, expansion of camp facilities, additional fuel storage, and the use of explosives. In preparation for this advanced exploration program, Selwyn Chihong purchased and transported approximately $10 million of mining equipment and supplies to the XY Central deposit area in March 2011.

The underground development program consists of a decline to the lower end of the defined mineral resources included in the bankable feasibility study for the XY Central deposit, and lateral development to access the mineralization. The underground workings will also act as a platform for diamond drilling to provide detailed information for mine planning during the initial years of production. Removal of a bulk sample is planned for additional testing on grindability and other metallurgical parameters of the mineralization. The decline and lateral development will also form part of the infrastructure required for production.

Project Update

Definition drilling is now complete on the XY Central and Don deposits and new mineral resource estimates are currently being prepared. The bankable feasibility study will be based on the mining of approximately 8000 tonnes per day of ore from these two deposits and the subsequent processing in a central concentrator.

Since July, 2010, one drill has been operational on the XY West deposit. There are currently four drills on the XY West zone engaged in testing the extension of the high-grade mineralization, now identified over a strike length of 850 metres. A new mineral resource model will also be prepared for the XY West deposit. The XY West deposit provides a third mineral zone that is attractive for potential early development.

Engineering and evaluation work on the bankable feasibility study (being undertaken by Wardrop Engineering Inc. and other consultants) is advancing quickly, with the key activities nearing completion. A draft of the study is expected in late summer for audit and review. Completion of the bankable feasibility study will allow Selwyn and Chihong Canada to commence project financing discussions with the Chinese banks. ENFI, the Beijing-based Chinese engineering firm engaged by Selwyn Chihong, will prepare a Chinese Bankable Feasibility Study report for submission to Chinese authorities in order to obtain relevant approvals for future project financing. China ENFI Engineering Corporation will review the new mineral resource models for the XY Central and Don deposits along with other pertinent materials as they become available.

Upon completion of the advanced exploration program on the XY Central deposit, the initial bankable feasibility study will be updated with information obtained from the underground development and drilling activities and the ongoing optimization studies. The final bankable feasibility study will form the basis for securing the project debt and equity required for development. Completion of the final bankable feasibility study is expected in the second quarter of 2012.

Selwyn's focus is the exploration and development of its jointly-owned Selwyn Project in the eastern Yukon and Northwest Territories. The Selwyn Project represents one of the largest global undeveloped resources of zinc and lead and is unique in its location in the politically-attractive and stable jurisdiction of the Yukon. It is therefore a strategic asset with the potential to provide a long-term secure supply of zinc and lead to the Pacific Margin.

This news release contains forward-looking statements concerning the development of the Selwyn Project. These statements are based on assumptions and judgments of management regarding future events or results that may prove to be inaccurate as a result of failure to obtain necessary regulatory permits and approvals, the results of exploration activities, the failure to raise required funds for development of the Selwyn Project and other risk factors beyond Selwyn's control. There can be no assurance that such forward-looking 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 contained in this news release.

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

Contact Information

  • Selwyn Resources Ltd.
    Dr. Harlan Meade
    President and CEO
    (604) 801-7240 or Toll-free: 1-888-989-9188
    (604) 689-8355

    Selwyn Resources Ltd.
    Catalin Chiloflischi
    Manager of Investor Communications
    (604) 801-7240 or Toll-free: 1-888-989-9188
    (604) 689-8355