Teras Resources Inc. ("Teras" or the "Company") (TSX VENTURE:TRA) (OTCQX:TRARF)
is pleased to announce that Mine Development Associates ("MDA") has prepared a
Technical Report on the Cahuilla gold project in Imperial County, California at
the request of Teras Resources Inc. The purpose of this report is to provide the
first Mineral Resource estimate for the Cahuilla project that complies with NI
43-101 reporting standards. Steven Ristorcelli, C.P.G., Principal Geologist for
MDA, supervised preparation of the report and estimation of the Mineral
Resources. Mr. Ristorcelli is a qualified person under NI 43-101.
Using industry standard practices for resource modeling and the development of
supporting geologic models, Mr. Ristorcelli of MDA presented the following
resource estimate in the technical report:
-- An indicated resource of 1.017 million ounces of gold and 11.855 million
ounces of silver (70.148 million tons at an average grade of 0.015
ounces per ton ("opt") gold and 0.17 opt silver with a cutoff of 0.008
opt gold).
-- An additional inferred resource of 110,000 ounces of gold and 954,000
ounces of silver (9.733 million tons at an average grade of 0.011 opt
gold and 0.10 opt silver with a cutoff of 0.008 opt gold).
-- Converting silver to gold equivalent by dividing the silver ounces by 55
equals (i) an indicated resource of 1.233 million ounces gold equivalent
at the gold cutoff of 0.008 opt and silver cutoff of 0.17 opt; and (ii)
an inferred resource of 127,000 ounces gold equivalent at the same
cutoff totaling 1.360 million ounces gold equivalent combined.
At this phase of drilling and with the objectives of drilling, this resource
calculation is very positive and there is excellent potential to significantly
expand these resources. The following statements were taken directly from the NI
43-101 prepared by Mr. Steven Ristorcelli of Mine Development and Associates:
"The reporting cutoff of 0.008oz Au/ton is based on the most likely expectation
for development by an open-pit operation using heap-leach processing and gold
prices around or slightly higher than today's prices."
"The extensive in-fill drilling done by Teras has increased the size of the
resource as compared to the historic resource estimates and has verified the
resource. A significant outcome of Teras' work is development of a very good
geologic model that will guide future drilling."
TABLE 1. INDICATED AND INFERRED GOLD AND SILVER RESOURCES
All Indicated
----------------------------------------------------------------------------
Cutoff
oz Au/T Tons oz Au/T oz Ag/T oz Au oz Ag
0.005 108,733,000 0.012 0.14 1,250,000 15,331,000
0.007 83,125,000 0.013 0.16 1,106,000 13,217,000
0.008 70,148,000 0.015 0.17 1,017,000 11,855,000
0.009 58,689,000 0.016 0.18 921,000 10,564,000
0.010 49,184,000 0.017 0.19 836,000 9,394,000
0.011 41,383,000 0.018 0.20 757,000 8,318,000
0.012 34,874,000 0.020 0.21 687,000 7,393,000
0.013 29,342,000 0.021 0.22 619,000 6,543,000
0.015 20,939,000 0.024 0.25 507,000 5,172,000
0.020 10,080,000 0.033 0.31 328,000 3,084,000
0.025 5,797,000 0.040 0.35 234,000 2,052,000
0.030 3,732,000 0.048 0.39 179,000 1,459,000
0.050 1,118,000 0.074 0.49 83,000 547,000
----------------------------------------------------------------------------
All Inferred
----------------------------------------------------------------------------
Cutoff
oz Au/T Tons oz Au/T oz Ag/T oz Au oz Ag
0.005 21,685,000 0.008 0.08 180,000 1,691,000
0.007 13,147,000 0.010 0.09 134,000 1,183,000
0.008 9,733,000 0.011 0.10 110,000 954,000
0.009 6,753,000 0.013 0.10 86,000 689,000
0.010 4,975,000 0.014 0.10 71,000 512,000
0.011 3,848,000 0.015 0.10 59,000 400,000
0.012 2,914,000 0.017 0.11 49,000 306,000
0.013 2,374,000 0.018 0.10 42,000 235,000
0.015 1,562,000 0.021 0.09 32,000 137,000
0.020 606,000 0.026 0.08 16,000 48,000
0.025 230,000 0.035 0.08 8,000 18,000
0.030 118,000 0.042 0.09 5,000 11,000
0.050 15,000 0.067 0.13 1,000 2,000
----------------------------------------------------------------------------
Note that all grades are in Imperial units rather than metric or both as that is
the current format of report. Teras has also requested metric units in final
version.
The database contains a total of 368 holes with 192,927ft of drilling. Of this
total drilling, 347 drill holes are RC and 21 holes are core for 188,360ft and
4,567ft, respectively. The Cahuilla database has 38,077 gold assays and 36,012
silver assays in 38,737 samples.
Four estimates were completed: polygonal, nearest neighbor, inverse distance,
and kriged. These estimates were run several times in order to optimize the
results and determine sensitivity to estimation parameters. The inverse distance
estimate is the reported estimate. The block model is not rotated, and the
blocks are 25ft by 25ft by 20ft vertical. The dimensions were chosen to best
reflect possible block sizes for open-pit mining.
With this resource calculation, Teras is now well positioned to significantly
expand the gold-silver resource with further core and RC drilling with the goal
of collecting engineering data to develop a feasibility study for mine
development. Mr. Ristorcelli has presented the following conclusions and
recommendations for the next phase of exploration and development:
"The Cahuilla deposit is a very young, epithermal precious metal deposit
containing gold with silver. Based on the 2012 geologic model, the deposit is
relatively well understood, and exploration potential for encountering
additional precious metal mineralization is considered good. In addition to
having the potential to expand the resources, the Cahuilla project is now in a
position to undergo engineering and economic studies to determine its economic
viability.
The geological model completed in 2012 imparts much confidence in the resource
and in the understanding of the project. It has laid the groundwork for
effective exploration."
"Cahuilla is a project of merit that warrants both exploration and development
work, as well as advanced stage studies. The focus of the project should now be
on exploration outside of the deposit area. Advanced-stage work should include
metallurgy, economic studies, and permitting."
Phase I recommendations are given below:
Exploration
-- Initiate a detailed geological research program to better understand the
geology of Cahuilla with respect to precious metal mineralization.
Emphasis should be placed on a detailed mineralization study to
determine the relationship between lithology, alteration, and
mineralization and a structural study to better defined faulting and
structural controls of mineralization.
-- Geophysical surveys may help in guiding exploration to the east, west,
and south of the defined resource and may also help to define potential
new targets concealed beneath pediment and at depth. These surveys may
guide exploration around recent and historic drill holes that have
intersected mineralization but remain open ended. Historic magnetic data
should be reinterpreted in light of the new geologic understanding and
more sophisticated and modern magnetic processing tools now available.
IP, gravity, and audio-magneto telluric ("AMT") surveys should be done
to evaluate which would be most effective for exploration.
-- Permit new access roads and drill sites for planned drilling.
-- RC drill holes where the mineralization is open-ended to find the limits
of the deposit.
-- Drilling in areas where gold mineralization has been encountered in
historic drill holes but have little to no data in the vicinity.
Significant drill-hole intercepts have been encountered approx. 3,000ft
west-southwest in the hanging wall of the Modoc fault.
Development/Advanced-Stage Development
-- Initiate a diamond drilling program to a) obtain core in high-grade
areas to better define the stratigraphy and controls of mineralization,
b) obtain samples for metallurgy, and c) conduct geotechnical
investigations (density, rock mechanics).
-- Metallurgical test work should be done to better define extractions at
Cahuilla.
Economic Studies
A Preliminary Economic Assessment ("PEA") should be conducted soon. The results
would guide detailed planning of the previously described recommendations.
Teras is very pleased with the gold-silver resource calculated for this report
and the quality of the data evaluation and generation of geologic models to
assist in expanding resources. This confidence by Teras is based on the
following reasoning:
-- The presence of gold throughout the project in historic drilling and
sampling.
-- The resource area prepared by MDA covers only 143 acres of the 1650
acres currently in the project.
-- Historic drilling and RC drilling are less than 200 meters in vertical
depth and typically stopped with the transition from oxidized to
unoxidized rock.
-- Core drilling will be used to define the projected high grade feeder
veins into the hot spring gold system.
-- The deposit remains open along strike, at depth and below the Pediment
cover.
-- New drilling is showing that the transition zone between the quartz
monzonite fanglomerate and quartz monzonite below is very well
mineralized.
-- Thirty seven recent drill holes are not included in the current resource
estimate.
Currently, Teras is reviewing and planning the next phase of drilling using the
geologic models developed during the resource calculations. In addition:
-- An assessment by known experts in hot spring gold systems is being
reviewed.
-- A second resource estimate is being independently prepared that
incorporates the remaining 37 drill holes.
-- McClelland Laboratories of Reno, NV is currently conducting cyanide
soluble tests on a variety of pulps including various rock types and
oxidation states. This is phase 1 of the metallurgical test program;
phase 2 will consist of bottle roll testing. Further test work will be
done on core samples as new drilling progresses in 2013.
-- Additional ground geophysical surveys are planned in the first quarter
of 2013 with the focus on targeting the high grade feeder structures.
-- New drill site permitting has been initiated in the 4th quarter of 2012.
The exploration program completed by Teras has generated an excellent basis for
the expansion of the resource both within the project boundaries and at depth.
In comparison to known gold deposits, the current and historic drilling shows a
very well mineralized gold-silver system that requires further drilling and
continued geologic evaluation and understanding to continue to significantly
expand the known resource.
The approach by Teras to drilling, if successful, will allow rapid mine
development with a strong geologic understanding and density of drilling that
aids in potentially making a positive economic decision on future development.
Teras will file the final version of the Technical Report on Sedar as soon as it
is released by MDA, which is expected to be in the near future and will be
within the 45 day filing requirement of NI 43-101.
The scientific and technical information in this press release was prepared and
approved by Dennis J. LaPoint, a Registered Member of SME, who is a Qualified
Person under National Instrument 43-101 and a Director of Teras Resources Inc.
About Teras
The Company is focused on developing its Cahuilla project located in Imperial
County, California. The project encompasses an area of at least 3 km by 1.5 km
and demonstrates the potential for a large-scale, bulk mining operation
consisting of altered and mineralized sedimentary host rocks with numerous
sheeted high grade quartz veins. Grades of the Cahuilla gold/silver
mineralization are similar to grades of the host rocks at New Gold's Mesquite
Mine, also in Imperial County, California (0.56 g/t; Mineral Reserves and
Resources Summary as of December 31, 2011; New Gold website). Teras will
continue drilling at Cahuilla to expand its mineral resource and continue
developing the project with the goal of establishing a gold resource for future
extraction.
This press release may contain "forward-looking information" within the meaning
of applicable Canadian securities legislation. All statements, other than
statements of historical fact, included herein may be forward-looking
information. Generally, forward-looking information may be identified by the use
of forward-looking terminology such as "plans", " expects" or "does not expect",
"proposed", "is expected", "budgets", "scheduled", "estimates", "forecasts",
"intends", "anticipates" or "does not anticipate", or "believes", or variations
of such words and phrases, or by the use of words or phrases which state that
certain actions, events or results may, could, would, or might occur or be
achieved. In particular, this press release contains forward-looking information
regarding: the potential of the Cahuilla Project; the potential to expand the
resource; the possible techniques to mine the project and to process the
minerals mined from the project; the future prices for gold and silver; the
timing and results of future drilling; the potential requirements to develop a
feasibility study; the timing of and potential of drilling and exploration
programs, surveys, studies and developments; the potential for finding high
grade deposits; future metallurgical work; and the timing and success of
obtaining future permits.
This forward-looking information reflects the Company's current beliefs and is
based on information currently available to the Company and on assumptions the
Company believes are reasonable. These assumptions include, but are not limited
to: the actual results of exploration projects being equivalent to or better
than estimated results in technical reports or prior exploration results; future
costs and expenses being based on historical costs and expenses, adjusted for
inflation; continued success in drilling and exploration programs at the
Cahuilla project; successful studies in mining techniques and metallurgy;
commodity prices continuing at today's prices or rising; obtaining the necessary
funding to carry out recommended work programs, exploration and studies; and
continued success in obtaining permits. Additional assumptions can be found in
the Company's disclosure documents on the SEDAR website. Forward-looking
information is subject to known and unknown risks, uncertainties and other
factors that may cause the actual results, level of activity, performance or
achievements of the Company to be materially different from those expressed or
implied by such forward-looking information. Such risks and other factors may
include, but are not limited to: the early stage development of the Company and
its projects; general business, economic, competitive, political and social
uncertainties; commodity prices; the actual results of current exploration and
development or operational activities; competition; changes in project
parameters as plans continue to be refined; accidents and other risks inherent
in the mining industry; lack of insurance; delay or failure to receive board or
regulatory approvals; changes in legislation, including environmental
legislation, affecting the Company; timing and availability of external
financing on acceptable terms; conclusions of economic evaluations; and lack of
qualified, skilled labour or loss of key individuals. Although the Company has
attempted to identify important factors that could cause actual results to
differ materially from those contained in forward-looking information, there may
be other factors that cause results not to be as anticipated, estimated or
intended. Accordingly, readers should not place undue reliance on
forward-looking information. The Company does not undertake to update any
forward-looking information, except in accordance with applicable securities
laws.
FOR FURTHER INFORMATION PLEASE CONTACT:
Teras Resources Inc.
Peter Leger
President
(403) 262-8411 or (403) 852-0644
pleger@teras.ca
www.teras.ca
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