Mason Graphite Reports 31% Increase in Measured and Indicated Mineral Resources to 65.7 Million Tonnes at 17.2% Cg Using 5% COG(1)
December 15, 2014
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High grade zone (greater than 25% Cg) increases from 6.7 to 9.7 million tonnes at 31.2% Cg
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Mason Graphite Inc. ("Mason Graphite" or the "Company") (TSX VENTURE:LLG)(OTCQX:MGPHF) is pleased to announce the completion of an updated mineral resource estimate for its 100%-owned Lac Gueret graphite project in northeastern Quebec.
Highlights of the updated mineral resource estimate include:
Measured and Indicated ("M&I") mineral resources increased 31% from 50 million tonnes ("Mt") to 65.7 Mt; grade also increased from 15.6% Cg to 17.2% Cg at 5% COG;
Mineral resources in the Measured category increased 323% from 4.5 Mt to 19.1 Mt; with grade also increasing from 15.5% Cg to 17.9% Cg at 5% COG; and
The high grade mineral resources in the M&I category (see unit "U3" in Table 1) increased 45% from 6.7 Mt to 9.7 Mt, with an average grade of 31.2% Cg using a COG of 25%.
Table 1 - December 2014 Mineral Resource Estimate
Categories Unit Tonnes Grade (Cg) Graphite in-situ (t) Measured (M) U1/U2 (5 to 25% Cg) 15,730,000 15.16% 2,385,000 U3 (> 25% Cg) 3,375,000 30.58% 1,032,000
All units 19,105,000 17.88% 3,417,000 Indicated (I) U1/U2 (5 to 25% Cg) 40,257,000 14.59% 5,873,000 U3 (> 25% Cg) 6,332,000 31.58% 2,000,000
All units 46,589,000 16.90% 7,873,000 M + I U1/U2 (5 to 25% Cg) 55,987,000 14.75% 8,258,000 U3 (> 25% Cg) 9,707,000 31.23% 3,032,000
All units 65,694,000 17.19% 11,290,000 Inferred U1/U2 (5 to 25% Cg) 15,201,000 14.90% 2,265,000 U3 (> 25% Cg) 2,450,000 31.75% 778,000
All units 17,651,000 17.24% 3,043,000 (1) COG: Cut-Off Grade.
The updated mineral resource estimate was carried out by Goldminds Geoservices and Roche Ltd. using 25,956 carbon graphite (Cg) assays obtained from 283 diamond drill holes (43,324 metres) and 4 trenches (987 metres).
Benoit Gascon , President and CEO of Mason Graphite, commented "We are very pleased with the results of the updated resource. The update has further increased our knowledge and confidence in the Lac Gueret mineral deposit, which will be very helpful in identifying further optimization opportunities as we develop the Feasibility Study for the project. Furthermore, since only the Measured and Indicated categories are considered in the calculation of mineral reserves, the increases in the size and grade of these categories could result in a larger mineral reserve than what could have been expected with the previous mineral resource estimate. We expect to update the technical report in respect to the Lac Gueret project in conjunction with the Feasibility Study completion in 2015."
Mineral Resource Estimation Methodology
The updated mineral resource estimate is based on geological observations and geochemical data modeling: Unit 1 is defined by a content of 5-10% Cg; Unit 2 by 10-25% Cg; and Unit 3 by 25% Cg or more. Waste has less than 5% Cg.
Drill holes, cross sections, and plan views were interpreted to construct three-dimensional wireframe models using the geochemical analyses and geological descriptive logs with a nominal cut-off of 5% Cg under Genesis software. No capping value was applied to the assays. Assay intervals were composited to 3 meter lengths from the raw Cg assay values and grades were estimated using the inverse distance method. For the grade estimation, variable direction search ellipsoids following the structural folding trends were used. Anisotropy was interpreted in semi variogram and set to 60 meters along the x axis, 40 meters along the y and 15 meters along the z axis. The block model was defined by un-rotated blocks of 3 meters long by 3 meters wide by 3 meters thick sited in 401 columns, 468 rows and 134 levels and covers a strike length of roughly 1,800 meters to a maximal depth of 356 meters below the highest surface point. A fixed density of 2.9 g/cm3 was applied to calculation.
Mineral resources were classified as Measured, Indicated or Inferred based on information spacing and the confidence of the geological continuity of the mineralization in accordance with the CIM guidelines and established with the use of a maximum of ten composites per block and a maximum of two composites per drill hole. The Measured resources required a minimum of eight composites per block within an ellipsoid of 40 m x 40 m x 15 m. The Indicated resources required a minimum of four composites per block within an ellipsoid of 60 m x 60 m x 15 m. The Inferred resources required a minimum of two composites per block within a sphere of 120 m radius.
Only material located within a pit shell generated from an optimized mining scenario run under Whittle software is included in this mineral resources estimate. This scenario is assuming an overall pit slope of 45 degrees, a mining cost of CA$ 6 per tonne and a processing cost of CA$ 63 per tonne milled, a 100% mining recovery, no mining dilution, a mill recovery of 96.6% and an average selling price of US$ 1,285 per tonne (CA$ 1,371 per tonne) of concentrate at 93.7% Cg.
Interest Payment on Convertible Debentures
Mason Graphite also announces that it intends to issue an aggregate of 197,619 common shares of the Company (the "Common Shares") at a deemed price per share of $ 0.63 in payment of $ 124,500 in interest due and payable under the Company's 12% convertible debentures due June 11, 2019 (the "Debentures"). Under the terms of the Debentures, the Company has the option to pay 50% of the semi-annual interest due on the Debentures in Common Shares. The balance of the interest owing under the Debentures, being $ 124,500, has been paid in cash.
The issuance of the Common Shares in payment of interest on the Debentures is subject to the approval of the TSX Venture Exchange and the Common Shares will be subject to a four month hold period.
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Mason Graphite - Mason Graphite Reports 31% Increase in Measured and Indicated Mineral Resources to 65.7 Million Tonnes at 17.2% Cg Using 5% COG(1)
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