CVG approves Las Cristinas feasibility

Toronto-based Crystallex International (KRY-T) has moved a step closer to development of Las Cristinas, a large, low-grade gold project in Venezuela’s Bolivar state.

The company’s local partner, Corporacion Venezolana de Guayana (CVG), recently approved a final feasibility for development of the project. General Rangel Gomez says CVG looks forward to the start of gold production in early 2006 and that associated benefits will flow to the local community, Bolivar state and the Republic “through the jobs created, social benefits, and royalties and taxes paid.”

In September 2002, CVG granted Crystallex the exclusive right to develop and exploit the gold reserves and resources at Las Cristinas. A year later, Crystallex submitted a final feasibility for the project to CVG. Since then, the company has worked with CVG to confirm the economic and technical viability of the project so that construction can proceed.

With the feasibility study approval now in hand, Crystallex expects that a formal engineering and construction contract will soon be granted.

The full feasibility study was prepared by SNC-Lavalin, (SNC-T) using reserve and resource calculations carried out by Mine Development Associates (MDA). Proven and probable reserves are estimated at 246 million tonnes at 1.29 grams gold per tonne, or about 10.2 million contained ounces.

Measured and indicated resources stand at 439 million tonnes grading 1.09 grams gold (inclusive of reserves), while inferred resources are pegged at 208 million tonnes averaging 0.91 gram gold.

The combined reserves and resources make Las Cristinas one of the largest undeveloped gold deposits in South America. The deposit is open at depth, and there are additional zones that have not yet been drill-tested.

An open-pit mine is planned. The feasibility study estimates the stripping ratio will be 1.34-to-1 and less than 1-to-1 in the first five years. Metallurgical recoveries are expected to be 89%.

Before construction can begin, Crystallex must secure final approval for its environmental impact study. In conjunction with CVG, it must also secure land-use and environmental permits. In the interim, the company will carry out an internal study to investigate the potential for higher mining rates and expansion so as to boost production above the 20,000 tonnes per day envisioned in the feasibility.

Crystallex’s other mining assets in Bolivar state include the Tomi and La Victoria gold mines and the Revemin mill.