October 28, 2008
Pele Mountain Provides Eco Ridge Mine Project Update
Pele Mountain Resources Inc. (TSX VENTURE: GEM) ("Pele" or the "Company") today provided an update on its Eco Ridge Mine uranium project, recapping its progress and announcing measures in response to difficult market conditions.
"The Eco Ridge Mine contains an important strategic energy resource," said Pele President and CEO Al Shefsky. "However, factors affecting the entire industry, particularly a declining uranium price trend and the ongoing crises in the credit and equity markets, have necessitated an adjustment of project timelines, including the postponement of our pre-feasibility study and certain components of the permitting process. These measures will inevitably delay our recently-announced timetable for licensing, construction and commercial production."
In moving forward, the Company confirmed that several project elements are continuing according to plan, including the completion of its current in-fill drill program for detailed mine design purposes. Several technical studies already in-progress by SRK Consulting and SNC Lavalin will also be completed. Pele also announced it has commenced discussions with potential partners that could assist in funding the re-establishment of pre-feasibility and mine permitting schedules.
Mr. Shefsky added, "We will continue to advance development at Eco Ridge in a prudent fashion commensurate with the approximately $3.5-million in our treasury. We firmly believe that the long-term fundamentals for uranium are robust and that our project is well-positioned to provide a safe, secure, and reliable supply of uranium to the resurgent nuclear power industry."
With its excellent regional infrastructure, well-understood geology, and politically-stable and mining-friendly jurisdiction, Elliot Lake is an ideal location for the development of a long-term uranium supply. Pele's 100-percent owned Eco Ridge property contains a NI 43-101 compliant resource of 6.4 million pounds of "indicated" U3O8 (5.68 million tonnes grading 0.051 percent U3O8) and 36.1 million pounds of "inferred" U3O8 (37.26 tonnes grading 0.044 percent U3O8) with the potential for significant expansion. More than 300 million pounds of U3O8 were mined from similar deposits near Elliot Lake by Rio Algom and Denison Mines from 1956 to 1996.
Pele commenced the permitting process for the Eco Ridge Mine by filing a Project Description (see Pele website at www.pelemountain.net) with the Canadian Nuclear Safety Commission and the Federal Government's Major Project Management Office (see Pele press release dated September 8, 2008). The document details Pele's approach to the sustainable development of uranium operations at Eco Ridge. The mining, processing, and waste management plans make innovative use of proven technologies to build a modern, state-of-the-science facility, significantly more advanced and environmentally-friendly than historic operations in the Elliot Lake camp.
The Eco Ridge Mine uranium project has achieved several milestones during the past year, including:
- Submission of a Project Description to regulatory authorities.
- More than 15,000 metres of diamond drilling to upgrade U3O8 resources.
- Alternative tailings disposal studies, leading to an innovative closed circuit processing plan.
- Geotechnical and hydrogeological testing of proposed heap leach pad site and processing plant site.
- Preliminary leach pad design and plantsite design by SNC-Lavalin.
- Metallurgical testing on a 200-kilogram sample.
- Detailed variographic analysis of the Main Conglomerate Bed.
- A scoping level hydrogeology study of the proposed mining area.
- Aquatic and terrestrial environmental assessments.
- Continuing productive dialogue and communication with First Nations and the City of Elliot Lake.
This press release has been reviewed and approved by Fergus Kerr P. Eng., Vice President Uranium Operations for the Company and a Qualified Person under NI 43-101.
About Pele Mountain Resources
Pele Mountain Resources is committed to the sustainable development of the Eco Ridge Mine in the historic Elliot Lake mining camp. The company is developing a safe, secure, and reliable uranium mining operation in order to deliver lasting benefits to local communities and its shareholders. Pele also holds a diverse portfolio of gold, diamond, and base metal projects in Northern Ontario. Pele stock is listed on the TSX Venture Exchange under the symbol "GEM".
Some of the statements contained in this release are forward-looking statements, such as estimates and statements that describe Pele's future plans, objectives or goals, including words to the effect that Pele or management expects a stated condition or result to occur. Since forward-looking statements address future events and conditions, by their very nature, they involve inherent risks and uncertainties. Actual results in each case could differ materially from those currently anticipated in such statements. The economic viability of the 43-101 mineral resource at Pele's Elliot Lake Project has not yet been demonstrated by a pre feasibility study.
Common Shares Outstanding: 84,067,612
The TSX-V has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.
Contacts: Pele Mountain Resources Inc. Al Shefsky President 1-800-315-7353 Website: www.pelemountain.com
SOURCE: Pele Mountain Resources Inc.