| | Tue Apr 21, 2009
Farallon Announces First Quarter Production Results and Conference Call
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| | April 21, 2009, Vancouver, BC -- Dick Whittington, President and CEO of Farallon Resources Ltd. ("Farallon" or the "Company") (TSX:FAN) is pleased to announce the production results for the first quarter of 2009 at the G-9 Mine in Guerrero State, Mexico. The mine produced zinc, copper and lead concentrates containing 16.9 million pounds of zinc, 1.2 million pounds of copper, 0.3 million pounds of lead, 229,500 ounces of silver and 3,300 ounces of gold. The Company will host a conference call tomorrow, Wednesday April 22nd, at 11:00 AM Eastern Time (8:00 AM Pacific Time) to discuss the First Quarter Production results. The call in details are provided below.
The Company remains on track to achieve its key production targets and goals for the balance of the year. Key highlights from operating results for the First Quarter of 2009 at the G-9 Mine are as follows:
- Commenced mining activity in the high-grade Southeast zone and ramped-up the mine and mill operations to design throughput rates of 1,500 tpd. As a result of access to the main mining area, a step-change improvement was made in mine and mill production during the month of March and commercial production was declared effective, April 1, 2009 (see news release dated April 6, 2009).
- Produced 14,800 tonnes of zinc concentrate, 3,000 tonnes of copper concentrate and 650 tonnes of lead concentrate. Concentrates are trucked to the Port of Manzanillo and the Company receives advance payments from Trafigura totaling 90% of the value on a regular basis.
- Completed concentrate shipments of approximately 10,800 tonnes of zinc concentrate, 2,100 tonnes of copper concentrate and 1,300 tonnes of lead concentrate. The Company received provisional payments for 100% of the value of the concentrates from these shipments which were made in vessels loaded at the Port of Manzanillo. The Company also initiated silver sales to Silver Wheaton, totaling approximately 57,000 ounces.
In addition to these production highlights, two further key highlights completed during and subsequent to the first quarter were as follows:
- Completed two equity placements totaling CDN $13.3 million at CDN $0.20/share with no associated warrant. The funds were used to repay the CDN $7.75 million in October promissory notes and for working capital.
- Resolved the outstanding litigation matters including successfully defending the mineral property interests at Campo Morado from a civil case launched by David Hermiston. These cases are now closed. As such, the Company received a refund of $375,000 from Silver Wheaton which was a portion of a waiver fee being held pending resolution of these matters.
President and CEO Dick Whittington stated "I am very pleased to start reporting production results at the G-9 Mine, as we are now a fully operational mining company. The major components of our operation are currently working well, however, we still have work to do to improve on some of the by-product recovery levels. With a plan in place and improving operational experience at the site we anticipate that we will meet our design targets in all areas of the mine and mill in the near future."
Mining Operations
During the period, the mine accessed and began mining mineralized material from the high-grade Southeast zone. As a result, mine grades improved consistently over the quarter and averaged 11.9% Zn, 1.7% Cu, 1.2% Pb and 190 g/t Ag during the month of March with 43,000 tonnes of mineralized material mined. Further development activity continues in the Southeast zone to open more mining faces for the second quarter. It is anticipated that mine grades will average 11.5% Zn, 1.7% Cu and 1.1% Pb during the second quarter of 2009 as production continues from the Southeast zone.
Mill Commissioning
Mill commissioning took place throughout the period with the mill ramping up to full commercial production on April 1, 2009. Mineralized material processed through the mill during the commissioning and ramp-up period is tabulated below.
G-9 Mill Material Processed |
Period |
Tonnes |
Grade
|
Zn% |
Cu% |
Pb% |
Ag g/t |
Au g/t |
July 1 to Sept 30, 2008 |
19,388 |
6.1 |
0.56 |
0.63 |
213 |
2.3 |
Sept 30 to Dec 31, 2008 |
86,536 |
8.8 |
1.13 |
1.31 |
216 |
2.8 |
Jan 1 to Mar 31, 2009 |
106,265 |
9.2 |
1.11 |
0.88 |
166 |
2.3 |
During the month of March, mineralized material throughput was approximately 43,000 tonnes or 92% of design throughput. Trucking of concentrates to the port of Manzanillo continued and all concentrate produced during the period will be sold under contract to Trafigura, Free On Board ("FOB") the port site. Concentrate produced during the commissioning and ramp-up period is tabulated below.
G-9 Zinc Concentrate Production |
Period |
Tonnes |
Grade |
Zn% |
Ag g/t |
Au g/t |
July 1 to Sept 30, 2008 |
1,693 |
46.5 |
183 |
1.72 |
Sept 30 to Dec 31, 2008 |
11,669 |
48.5 |
287 |
2.65 |
Jan 1 to Mar 31, 2009 |
14,829 |
51.7 |
252 |
2.40 |
G-9 Copper Concentrate Production |
Period |
Tonnes |
Grade |
Cu% |
Ag g/t |
Au g/t |
July 1 to Sept 30, 2008 |
0 |
-- |
-- |
-- |
Sept 30 to Dec 31, 2008 |
1,943 |
16.6 |
588 |
8.0 |
Jan 1 to Mar 31, 2009 |
3,015 |
17.8 |
694 |
10.4 |
G-9 Lead Concentrate Production |
|
Period |
Tonnes |
Grade |
|
Pb% |
Ag g/t |
Au g/t |
|
July 1 to Sept 30, 2008 |
326 |
16.8 |
562 |
11.5 |
|
Sept 30 to Dec 31, 2008 |
817 |
17.0 |
956 |
27.0 |
|
Jan 1 to Mar 31, 2009 |
650 |
22.9 |
2,005 |
56.5 |
|
Although the milling operations achieved design throughput rates, the metallurgical performance is still ramping up towards design. Now that the mine and mill are operating at 1,500 tpd the focus has shifted to improving overall metal recovery to concentrates. Average metal recovery achieved during the first quarter is tabulated below.
Jan 1 to Mar 31, 2009 |
Recovery (%) |
Zinc |
79 |
Copper |
45 |
Lead |
16 |
Silver |
40 |
Gold |
43 |
The Company will host a conference call tomorrow, Wednesday April 22nd, at 11:00 AM Eastern Time (8:00 AM Pacific Time) to discuss the First Quarter Production results and performance. The toll-free number for this conference call is 1-800-590-1508 or 1-416-644-3423. After the call the Company will post the audio of the conference call on our website at www.farallonresources.com. Financial statements for the First Quarter 2009 will be released on or about May 15, 2009.
Farallon advanced the G-9 polymetallic (zinc, copper, silver, gold, lead) project at its Campo Morado Property in Mexico through a 'Parallel Track' program in 2007 and 2008. Surface facilities were largely completed in mid 2008, followed by mill commissioning and underground stope development during the balance of 2008. As of April 1st, the mine is now in commercial production of 1500 tpd. Vessel shipments of concentrates commenced in February 2009 and are now occurring on a regular basis. Exploration is currently suspended however, there are numerous untested exploration targets available on the Company's 100% owned Campo Morado property. Exploration remains a key component of the Company's strategic plan going forward, and will be reinitiated as soon as economic conditions permit.
For further details on Farallon Resources Ltd., please visit the Company's website at www.farallonresources.com or contact Investor Services at (604) 638-2160 or within North America at 1-800-667-2114.
ON BEHALF OF THE BOARD OF DIRECTORS
J.R.H. (Dick) Whittington
President & CEO
No regulatory authority has approved or disapproved the information contained in this news release
Forward Looking Information
This release includes certain statements that may be deemed "forward-looking statements." All statements in this release, other than statements of historical facts, that address future production, reserve or resource potential, continuity of mineralization, exploration drilling, operational activities, production rates, costs to completion and events or developments that the Company expects are forward-looking statements. Although the Company believes that the expectations expressed in such forward looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in the forward looking statements and may require achievement of a number of operational, technical, economic and legal objectives. The likelihood of continued future mining at Campo Morado is subject to a large number of risks, including obtaining lower than expected grades and quantities of mineralization and resources, lower than expected mill recovery rates and mining rates, changes in and the effect of government policies with respect to mineral exploration and exploitation, the possibility of local disputes including blockades of the company's property, the possibility of adverse developments in the financial markets generally, fluctuations in the prices of zinc, gold, silver, copper and lead, obtaining additional mining and construction permits, preparation of all necessary engineering for ongoing underground and processing facilities as well as receipt of additional financing to fund mine construction, development and operation, if needed. Such funding may not be available to the Company on acceptable terms or on any terms at all. There is no known ore at Campo Morado and there is no assurance that the mineralization at Campo Morado will ever be classified as ore. For more information on the Company and the risk factors inherent in its business, investors should review the Company's Annual Information Form at www.sedar.com. |
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| | You can view the Next News Releases item: Thu May 7, 2009, Farallon & Credit Suisse Agree To Us$30 Million Term Loan Commitment
You can view the Previous News Releases item: Mon Apr 6, 2009, Farallon Announces Commercial Production At G-9 Mine
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