Aura Minerals Provides Aranzazu Project Update
VANCOUVER, BRITISH COLUMBIA–(Marketwire – Aug. 12, 2008) – Aura Minerals Inc. (“Aura Minerals” or the “Company”) (TSX:ORA) is pleased to provide the following update on operations at its Aranzazu Project, located in the State of Zacatecas, Mexico.
The Company assumed operating control of the Aranzazu Project on June 5, 2008. Operations have continued on an intermittent basis as Aura Minerals is currently completing a detailed assessment of the mine, process plant and ancillary infrastructure. This assessment includes the installation of necessary standby equipment and upgrading standards in various areas, such as safety, equipment repair and general “housekeeping”.
The Company anticipates that this work will continue until the fourth quarter of 2008, at which time the Company expects to achieve a steady state throughput of 1,200 tonnes per day (“tpd”).
Since assuming control of the Aranzazu Project on June 5, 2008, the Company has processed low-grade ore stockpiled by the previous operator as the Company awaits formal transfer of the required explosives permit. This is expected by the end of the third quarter of 2008.
Process plant daily throughput (including down time for upgrades and repairs) from the time Aura Minerals acquired the Aranzazu Project on June 5, 2008 to June 30, 2008, being the end of the second quarter, averaged 654 tpd at a head grade of 0.61% Cu, 0.27 g/ t Au and 7.35 g/t Ag. Concentrate production during this period was approximately 284.5 tonnes, comprising an average of 27.7% Cu, 4.95 g/t Au and 232.1 g/t Ag. During this period, the Aranzazu Project generated revenues of $457,654 (US$405,453) on shipments of 221.6 tonnes of copper concentrate. The average price realized on these initial copper sales was US$3.93/lb. By-product credits amounted to US$0.42/lb and almost offset the treatment charges of US$0.50/lb. Total cash costs, excluding depletion, amortization and accretion, amounted to US$3.52/lb. As a result, during this period of intermittent operation, while processing low-grade stockpile material the operation generated a modest positive cash flow.
The Company is now in the detailed planning stages for a mine and process plant expansion. To date this work has included:
– A complete review of the historic 2007/08 drill program and ongoing development of a new underground block model.
– The selection of representative metallurgical samples which have been shipped to G & T Metallurgical Testwork Services Ltd. at its metallurgical testwork facility in Kelowna, British Columbia. Test work will be completed to determined amongst others:
— optimum grind size for metal recovery
— optimum reagent suite for copper recovery
— gravity testwork to optimize gold recovery
— floatation circuit design
— testwork for potential zinc recovery
This testwork has commenced and initial results are being received with final results expected early in the fourth quarter of 2008. The initial results are very positive with greater than 90% copper and gold recovery to a rougher concentrate. This initial work has prompted a detailed review of plant operation in terms of current gold recovery which is averaging 50%.
– The engagement of ISMS Servicios Mineros S.A. de C.V. (“ISMS”), a mine contracting firm out of Chihuahua, Mexico, to assist in mine planning and carry out a mine development program. This contract entails the detailed planning and implementation of a new mine development and production schedule to increase throughput to an initial 2,500 tpd expansion during 2009. As part of this work, the Company has purchased the first three major pieces of mine equipment, a single boom development jumbo, an eight-yard development scoop and a scissors lift. Additional equipment is being sourced and will be purchased on an ongoing basis.
The mine plan is being developed by the Company’s in-house engineers in conjunction with the team from ISMS. A new development ramp is being planned to access the deeper sections of the “Mexicana” zone, the “BW” zone to the west of Mexicana and the “Arroyos Azules” zones located beneath the existing open pit to the east of the Mexicana zone.
Drill results from the BW and Arroyos Azules zones are of considerably higher grade than the current grade from Mexicana. It is expected, therefore, that the mine head grade will increase significantly when mining advances to these zones in early 2009 (see News Release Nos. 2008-10 and 2008-20).
– The award of a surface diamond and reverse circulation (“RC”) drill program to Layne de Mexico S.A. de C.V. This program will initially focus on the high grade zones to the east of the Mexicana zone in order to provide more detailed information for stope planning & development. The RC rig will continue exploration drilling to the east to upgrade current resources and continue to provide data for ongoing mine expansion planning.
The Company also plans to mobilize an underground rig in early 2009 which will be used for definition drilling and to continue exploration beneath the known extent of mineralization.
– The purchase of a complete new assay laboratory facility from Inspectorate America Corporation of Houston, Texas. This laboratory is in final stages of construction in Richmond B.C. and it is planned to be shipped to site during the month of September. This will allow the mine to complete all copper, silver and gold assays for mine, process plant and concentrate on site. As part of this purchase, Inspectorate will provide detailed training and certification of on-site laboratory personnel.
– The engagement of Asistencia Industrial de la Laguna S.C., a Mexican engineering company, to complete ongoing plant design upgrades and infrastructure upgrades in preparation for steady state operations in the fourth quarter of 2008.
Commenting on the recent work at the Aranzazu Project, Mr. Patrick Downey, President & CEO, stated, “The Company has made significant progress in a very short period of time. We will continue to improve plant and mine operations over the next few months. This will increase production and reduce the fixed cost component of our per unit cash cost. Expansion plans are proceeding well and the recent drill results give us every confidence that we can significantly ramp-up mine throughput and increase the overall mill feed grade.”
Mr. Anthony P. George, B.Sc.(Hons), P.Eng., who is the Company’s Qualified Person as defined by National Instrument 43-101, has reviewed and approved the contents of this news release as applicable.
About Aura Minerals Inc.
Aura Minerals is a Canadian resource company focused on the acquisition, exploration, development and operation of mining properties in the Americas. In addition to the Company’s newly acquired Aranzazu Project, the Company owns the advanced stage Arapiraca Project in north-eastern Brazil, which was originally explored in the 1980′s and 1990′s for copper and gold. The project also contains magnetite (up to 50%) and nickel and the Company plans to evaluate the Arapiraca Project for all four metals which can be readily extracted. The nearby infrastructure is excellent with ready access to electricity, water and shipping ports.
This news release contains selected financial information that should be read in conjunction with the Interim Unaudited Consolidated Financial Statements and Management Discussion and Analysis for the three and six months ended June 30, 2008, which will be available on the Company’s website at www.auraminerals.com and on SEDAR at www.sedar.com. This news release also contains forward-looking statements that are not historical facts. Forward- looking statements involve risks, uncertainties and other factors that could cause actual results, performance, prospects and opportunities to differ materially from those expressed or implied by such forward-looking statements. Factors that could cause actual results to differ materially from these forward-looking statements include those risks set out in Aura Minerals’ public documents filed on SEDAR at www.sedar.com. Although Aura Minerals believes that the assumptions and factors used in preparing the forward-looking statements are reasonable, undue reliance should not be placed on these statements, which only apply as of the date of this news release, and no assurance can be given that such events will occur in the disclosed time frames or at all. Aura Minerals disclaims any intention or obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.
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