Mexican gold project — Manhattan’s Moris ready for

Encouraged by the findings of an independent feasibility report, Manhattan Minerals (VSE) has set about arranging financing to bring a Mexican gold project into production.

The Moris project, in the northern state of Chihuahua, is one of several being explored and developed by the junior in Mexico.

Capital costs (plus contingencies) for the proposed heap-leach operation are estimated to total US$11.4 million, with an additional US$1.4 million required for startup working capital. Annual production is expected to be 27,780 oz. gold, with production costs averaging US$182 per oz. The bankable feasibility report, prepared by Reno, Nev.-based Cassiday & Associates, is based on proven and probable minable reserves of 4.8 million tons grading 0.062 oz. gold and 0.3 oz. silver per ton, using an 0.02-oz. cutoff. This minable reserve is contained within a larger geologic reserve of 6.6 million tons grading 0.058 oz. gold and 0.3 oz. silver outlined in three deposits: El Creston, San Luis and Eureka.

The mine plan calls for the use of open-pit, truck-loader hauling to a 3-stage crushing system. The life-of-mine strip ratio is 1.3-to-1, with most of the waste to be removed in the later years of production. After agglomeration, the ore would be stacked in three 8-metre lifts on a 180,000-sq.-metre leach pad. A carbon absorption process plant is expected to recover 60% of the gold and half of the silver over a 60-day leach period. The current minable reserve is believed sufficient for an 8-year mine life, with production amounting to 222,300 oz. gold and 706,700 oz. silver during this period.

The company describes the property’s exploration potential as “excellent” and expects additional resources will be developed as the mine is prepared for production. Construction and development are expected to take nine months once financing has been secured. Capital cost payback is expected to take 1.5 years. A 32.5% internal rate of return on investment is projected, using gold and silver prices of US$385 per oz. and US$5 per oz., respectively. Elsewhere, Manhattan Minerals plans to acquire an interest in a massive sulphide project in Peru, a country reputed to have excellent exploration potential.

The company’s letter of intent with BRGM of France allows it to earn a 52.5% interest in the Tambo Grande deposit in the northwestern department of Piura by funding a US$5-million work program leading to a bankable feasibility study.

Tambo Grande is a typical Kuroko-type massive sulphide deposit, occurring at surface to a depth of 650 ft. Based on drilling to date, it is estimated to contain 42 million tonnes grading 2.06% copper, 1.47% zinc and 0.025 oz. silver.

Although gold content was not systematically analyzed, a sample spot-check of core returned results ranging from 0.0015 oz. to 0.151 oz. gold. The deposit is within a large concession covering three additional anomalies that have yet to be drill-tested.

Manhattan is completing its due diligence of the project. Once a production decision is made, Manhattan will make a US$1-million cash payment to BRGM.