Nov 17 2010
CHAMPION MINERALS INC. (TSX:CHM)(FRANKFURT:P02) has announced new assay results from the extension of diamond drill hole FL10-21 on the Fire Lake North Claim Block from the Company's Fermont Iron Property in northeastern Quebec.
Champion announced on October 18, 2010, that drill hole FL10-21 increased the core length of Iron mineralization to 361.5m from the original 171.0m of 36.3% Total Iron that was drilled during Champion's winter 2010 drill program as reported May 18, 2010. The expanded interval assay results equates to 336.9m of 35.4% Total Iron, including 292.5m grading 37.0% Total Iron and 178.1m of 40.5% Total Iron.
The Fire Lake North Project and Claim Block
Champion announced on November 3, 2010, positive results from a Preliminary Economic Assessment ("PEA") study on the Fire Lake North Project performed by BBA Inc. (of Montreal, Quebec). The PEA study shows a Net Present Value (NPV) of US$ 1.637 billion at a cash flow discount rate of 5% based on an Iron concentrate production rate of 7 million tonnes per year at a grade of 65% Iron over a 14 year mine life. The internal rate of return ("IRR") for the project is 24.8%.
Based on these positive results a Feasibility Study is being planned for 2011. Fire Lake North is considered to be a viable project with the current Mineral Resource estimate of 388 million tonnes grading 29% Total Iron with drilling underway. The ongoing 15,000m Fire Lake North drilling program has the potential to enhance the project's economics if it increases the NI 43-101 compliant Mineral Resources and production profile that could result in higher Net Present Value and extend the mine life. This extension in drill hole FL10-21 could potentially help in this regard. The drilling is progressing on schedule with 3 drill rigs on site with a fourth drill to be added shortly to accelerate the program. The objective of this drill program is to increase tonnage in the two outlined open pit areas and increase the inferred resources on several exploration targets in the area.
Work is also being planned on several additional claim blocks surrounding Fire Lake North and will include diamond drilling at: (1) Bellechasse; (2) O'Keefe-Purdy where several kilometric-sized folded iron formations are known to occur; and (3) Harvey-Tuttle where Champion has just completed the second tranche of 47 holes for 10,140m from the Phase 1 drill program.
Champion's Fire Lake North Claim Block is located 8km to the north of the operating Fire Lake Mine owned by ArcelorMittal and is 60km to the south of Consolidated Thompson Iron Mines Ltd.'s Bloom Lake Mine. Fire Lake North is situated within the Labrador Trough of northeastern Quebec and western Labrador, widely recognized as a world class Iron ore mining camp, the Fermont-Wabush-Labrador City Iron Ore District (the "District"). The four producers in the vicinity comprise Canada's Iron ore production estimated at more than 40 million tonnes of Iron ore concentrate per year including the recently commissioned Consolidated Thompson Bloom Lake mine. Indications are that the District will be producing more than 60 million tonnes of concentrate per year in the future based on disclosed expansion plans. Fire Lake North, Bellechasse and fourteen other claim blocks are 82.5% owned by Champion, with its joint venture partner Fancamp Exploration Ltd. (TSX-V: FNC) owning the remaining 17.5% interest.
Quality Assurance and Quality Control
All drill core logging and sample preparation was conducted by qualified Company personnel under National Instrument ("NI") NI 43-101 standards at the Company's core logging facilities at the Bellchasse Camp (Quebec). The NQ-sized drill core was split in half. One-half of the drill core was kept in the core tray for reference purposes and the other half core was individually bagged, tagged, sealed and packed in large nylon bags which were then securely closed and sent by commercial ground transportation for analysis to COREM laboratories in Quebec City (Quebec). Quality Assurance samples including standards of certified reference material, field duplicates, pulp duplicates and blank samples were inserted every 5 samples. COREM also inserted blank samples, standards and duplicates for Quality Control purposes.
The technical information in this news release was prepared, revised and approved by Jeff Hussey P. Geo., VP Exploration of the Company and Jean Lafleur, P. Geo., Director and Technical Advisor to the President and CEO of Champion. Both individuals are Qualified Persons under NI 43-101 standards.
Source: CHAMPION MINERALS INC.