Jacobina moves to feasibility (May 01, 2003)

Vancouver The rising price of bullion has prompted Desert Sun Mining (DSM-V) to complete a feasibility study on its Jacobina gold project in northeastern Brazil.

Through the expansion of its on going prefeasibility study, the junior aims to have a full blown feasibility study in hand by August. Engineering firm SNC-Lavalin will complete the study and in the process develop a detailed time line to put existing mine back into production. SNC-Lavalin will also investigate the open pit potential of the mineralization surrounding the higher-grade mine.

"The completion of a bankable feasibility will give DSM the framework within which to reactivate the Jacobina mine," says company President, Stan Bharti. "Construction and re-development could begin as early as 2004."

The past producing Jacobina mine cranked out some 700,000 oz. of gold from 1983 to 1998 and has a 1 million tonne per year processing plant on site. Lying in the southern part of the Bahia gold belt, the project currently hosts a measured and indicated resource of 15 million tonnes grading 2.87 grams gold per tonne, plus an inferred resource of 23 million tonnes averaging 3.1 grams gold.

A preliminary scoping study indicated that at US$300-per-oz. gold, the mine could produce 73,000 oz. gold per year at a cash cost of US$188 per oz. Startup capital expenditures are pegged at US$16 million.

Desert Sun recently completed a first round of drilling on the project. The drill results, combined with the previous data shows a continuous zone of low grade, potentially open-pittable material up to 10 km long.

The junior recently launched a second bout of drilling and currently has three rigs turning.