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MAY 30, 2007 - 08:59 ET
High River Gold Reports Positive Economics for Recovering Zinc and Lead at Berezitovy
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TORONTO, ONTARIO--(CCNMatthews - May 30, 2007) - High River Gold Mines Ltd. ("High River" or the "Company")(TSX:HRG) is pleased to report positive results from an internal scoping study on the economics of installing flotation circuits (the "Flotation Circuit Project") to recover zinc and lead from the polymetallic orebody at its Berezitovy Gold mining project. High River was assisted by consultants Starkey Associates and SGS Lakefield.
High River is in the final stages of constructing a 1.5 million tonne per year processing facility to recover gold and silver from the Berezitovy open-pit mining project located in the Amur Oblast of the Russian Federation. The first gold pour is scheduled for August of this year.
Zinc and Lead at Berezitovy
The Berezitovy deposit is a polymetallic orebody which, in addition to gold and silver, contains a historical estimated resource (B and C1 categories) of 14.1 million tonnes averaging 0.93% zinc and 0.57% lead,(i) calculated according to the Russian Classification System. In November 2003, Roscoe Postle and Associates were engaged to perform an audit of the historical Russian classified resource and to calculate a NI 43-101 resource for gold and silver prior to a bankable feasibility study.
(i) These historical zinc and lead resource estimates have been calculated according to standard Russian industry practice and do not conform to the Canadian Institute of Mining, Metallurgy and Petroleum (CIM) standards and definitions for resource estimates, as set out in Canadian National Instrument 43-101 (NI 43-101). These estimates should not be relied upon until fully confirmed by a NI 43-101 compliant independently estimated resource calculation.
The Russian database was the result of extensive exploration in the late 1970's which included almost 40,000 metres of drilling and the development of three adits, totaling 7,914 metres, which were used to channel sample the mineralization and provide bulk samples. The zinc and lead content was not included in the audit of the database due to low base metal prices at the time. As part of their audit, Roscoe Postle and Associates requested that a 25 core-hole drilling programme be conducted to provide additional data to confirm the historical Russian database. The 25 additional core holes were also assayed for zinc and lead, and the results are included in the table below. Please see the press release dated June 23, 2003 for the sampling and assaying procedures used as well as the qualified persons.
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Gold Silver Zinc Lead
Drill Interval Grade(2) Grade Grade Grade
Hole From To (1)(m) (g/t) (g/t) (%) (%)
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North Zone 400 27.0 42.0 15.0 1.77 18.49 2.15 1.12
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401 104.0 134.0 30.0 1.88 17.49 1.26 0.31
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402 241.0 253.0 12.0 2.21 15.80 0.42 0.26
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403 183.0 190.0 7.0 1.96 24.55 1.40 0.16
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404 35.0 47.0 12.0 1.57 8.22 1.65 0.09
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405 28.0 45.0 17.0 3.66 11.23 1.03 0.03
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406 99.0 114.0 15.0 4.98 10.50 0.02 0.13
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407 9.1 21.9 12.8 4.47 13.09 0.90 0.01
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36.9 58.9 22.0 3.78 16.01 1.10 0.04
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408 42.0 48.0 6.0 3.08 10.12 0.40 0.37
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Central Zone 409 53.0 71.0 18.0 2.89 13.32 1.05 0.82
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410 151.5 160.0 8.5 5.91 6.68 0.14 0.25
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176.8 208.0 31.2 3.10 8.51 0.80 0.29
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411 18.0 31.0 13.0 3.82 9.18 0.80 0.67
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48.0 119.0 71.0 2.55 12.95 0.98 0.56
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412 43.2 157.0 113.8 4.02 18.47 1.08 0.90
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413 1.0 126.0 35.0 4.80 15.98 1.06 1.19
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166.0 197.4 31.4 6.27 17.01 1.20 0.24
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414 172.0 199.0 27.0 4.06 13.77 1.12 0.27
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415 144.0 199.0 55.0 3.70 13.57 1.24 0.32
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416 126.0 132.0 6.0 3.24 10.81 0.15 0.31
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181.0 229.0 48.0 3.48 19.15 0.94 0.54
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417 181.0 241.0 60.0 3.50 19.45 1.02 0.69
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418 6.7 134.6 127.9 3.49 15.86 1.01 0.88
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419 61.0 170.5 109.5 3.04 11.43 1.15 0.72
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South Zone 420 15.0 125.0 110.0 4.39 15.24 1.11 1.00
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421 38.0 62.0 24.0 3.24 18.68 0.38 0.22
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117.0 156.0 39.0 2.75 12.49 0.80 0.79
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422 81.0 162.0 81.0 4.15 13.42 0.84 0.86
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423 42.0 95.0 53.0 5.19 14.37 1.25 0.94
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424 65.0 71.0 6.0 2.20 10.80 0.80 0.74
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(1) 7 samples of gold grading in excess of 50 g/t (ranging in grade from
51 g/t to 1228 g/t) have been cut to 50g/t
(2) these assay results represent core lengths and do not necessarily
represent true widths
Recovery of Zinc and Lead, Increased Recovery of Gold and Silver
Based on the initial test work performed by SGS Lakefield, the Flotation Circuit Project could be expected to recover approximately 70% of the zinc and 67% of the lead in a zinc/gold concentrate and a lead/silver concentrate. As well it is expected to increase the overall recovery of gold from the currently planned 90% to approximately 92%, and of silver from 34% to approximately 77%.
Strong Flotation Circuit Project Economics
The Flotation Circuit Project economics are very strong, with an estimated internal rate of return as follows:
Metal Price Range Zinc Lead IRR
----------------- ---- ---- ---
Upper US $1.50/lb US $0.80/lb Approx. 90%
Lower US $0.75/lb US $0.40/lb Approx. 30%
Project economics benefit from close proximity to railhead and the burgeoning Asian markets. The capital cost of the Flotation Circuit Project is estimated at US $23 million.
Impact on Berezitovy Mine Economics
The impact of the Flotation Circuit Project on overall Berezitovy Mine economics is significant; by-product credits would reduce cash costs of producing gold (including the 6% royalty) by approximately 85% using the higher base metal price scenario, and 25% using the lower base metal price scenario.
Qualified Person
Daniel Vanin, P.Eng., is the qualified person, as defined in NI 43-101, and has read and approved the contents of this press release.
About High River
High River is currently constructing two open-pit gold mines which are scheduled to commence production this year, the Taparko-Bouroum Project in Burkina Faso (June) and the Berezitovy Project in Russia (August/September). Annual gold production from Taparko-Bouroum is planned at 100,000 ounces for the first 12 months increasing to over 140,000 ounces in the third year of operation, and annual production from Berezitovy is expected to exceed 100,000 ounces. Combined with gold production from High River's 85%-owned Russian subsidiary, OJSC Buryatzoloto, High River's attributable gold production is expected to exceed 200,000 ounces in 2007, and 300,000 ounces in 2008. In addition, the Company has two advanced exploration projects, the Bissa Gold Project in Burkina Faso and the world-class Prognoz Silver Project in Russia. These projects are expected to significantly add to the Company's production profile in the future.
Forward Looking Statements - This press release contains forward-looking statements based on current expectations. These forward-looking statements entail various risks and uncertainties that could cause actual results to differ materially from those reflected. Risk and uncertainties about the Company's business are more fully discussed in the Management's Discussion and Analysis published in the Company's Annual Report and in the Annual Information Form.
FOR FURTHER INFORMATION PLEASE CONTACT:
High River Gold Mines Ltd.
Dan Hrushewsky
Vice President Investor Relations
(416) 947-1440
(416) 360-0010 (FAX)
Email: info@hrg.ca
Website: www.hrg.ca
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