Vista Gold Corp. Announces Results From a Preliminary Assessment of Its Yellow Pine Gold Project, Idaho
13 November 2006 - 6:01AM
PR Newswire (US)
DENVER, Nov. 13 /PRNewswire-FirstCall/ -- Vista Gold Corp. (TSX:
VGZ; Amex) is pleased to announce results from a preliminary
assessment at its Yellow Pine project in Valley County, Idaho, that
is expected to be completed in November 2006, by Pincock Allen
& Holt ("PAH") of Lakewood, Colorado, in accordance with
Canadian National Instrument 43-101 standards under the direction
of Richard Lambert, P.E. and Barton Stone, P.G., both independent
qualified persons. This preliminary assessment will be filed on
SEDAR by the Corporation. The Yellow Pine project is located in the
Salmon River Mountains of central Idaho in an area of historical
gold, antimony and tungsten mining know as the Stibnite or Yellow
Pine Mining District. The district is located about 60 miles east
of McCall, Idaho, and 10 miles southeast of the small settlement of
Yellow Pine, Idaho. Historically, the mine has produced about
700,000 ounces of gold from a combination of byproduct gold from
tungsten and antimony mining and more recent heap-leach production
from oxide ore. The remaining mineral resource consists of sulfide
mineralization lying below and along strike from the existing open
pit. PAH reviewed the mineral resources it had estimated in a
report completed on November 17, 2003, in compliance with NI 43-101
standards, the results of which were previously reported by Vista
in a press release dated November 19, 2003, and confirmed the
estimates are still valid. At a cutoff grade of 0.025 ounces of
gold per ton, the mineral resources are: Short Tons Grade Contained
Gold (000s) (ounces per ton) Ounces Measured resources(1) 16,332
0.070 1,147,000 Indicated resources(1) 17,503 0.061 1,071,000
Measured and indicated resources(1) 33,835 0.066 2,218,000 Inferred
resources(2) 16,047 0.051 819,000 1) Cautionary Note to U.S.
Investors concerning estimates of Measured and Indicated Resources:
This table uses the terms "measured resources" and "indicated
resources." We advise U.S. investors that while these terms are
recognized and required by Canadian regulations, the U.S.
Securities and Exchange Commission does not recognize them. U.S.
investors are cautioned not to assume that any part or all of
mineral deposits in these categories will ever be converted into
reserves. 2) Cautionary Note to U.S. Investors concerning estimates
of Inferred Resources: This table uses the term "inferred
resources." We advise U.S. investors that while this term is
recognized and required by Canadian regulations, the U.S.
Securities and Exchange Commission does not recognize it. "Inferred
resources" have a great amount of uncertainty as to their
existence, and great uncertainty as to their economic and legal
feasibility. It cannot be assumed that all or any part of an
inferred mineral resource will ever be upgraded to a higher
category. Under Canadian rules, estimates of inferred mineral
resources may not form the basis of a feasibility study or
prefeasibility studies, except in rare cases. U.S. investors are
cautioned not to assume that any part or all of an inferred
resource exists or is economically or legally minable. In
undertaking the preliminary assessment, PAH considered the economic
and technical parameters associated with development of the mineral
resources by open-pit mining. The study, based on PAH's review of
previous technical studies and their own work, determined the best
treatment approach would be an on-site plant to produce a flotation
concentrate that would be refined off-site. The potential
development would produce an estimated 1.9 million ounces of gold
over a 10-year life. The total capital cost over the project life
was estimated by PAH to be US$170 million and preproduction capital
was estimated by PAH to be US$150 million. According to the PAH
study, at long-term gold prices over US$550 per ounce, the project
appears to be viable. PAH estimated that at a gold price of US$630
per ounce, the Yellow Pine project demonstrates favorable
economics, with a net cash flow of US$266 million, a net present
value of US$126 million at a 5% discount rate and an internal rate
of return of 19%. The preliminary assessment is preliminary in
nature and includes inferred mineral resources (3% inferred and 97%
measured and indicated) that are considered too speculative
geologically to have the economic considerations applied to them
that would enable them to be categorized as mineral reserves, and
there is no certainty that the preliminary assessment will be
realized. Mineral resources and that are not mineral reserves do
not have demonstrated economic viability. Mike Richings, President
and CEO, commented, "Most investors are aware that Vista plans to
enter into a transaction that will result in the transfer of our
Nevada-based properties into our newly incorporated, wholly-owned
subsidiary, Allied Nevada Gold Corp. and the acquisition by Allied
Nevada of the Nevada-based mineral assets of Carl and Janet Pescio.
As part of this transaction, which is subject to receipt of
shareholder, regulatory and other required approvals, Vista would
distribute most of its Allied Nevada common stock to our
shareholders, all pursuant to the terms of an Arrangement Agreement
among Vista, Allied Nevada and the Pescios as previously disclosed.
We believe that the current market price of our securities does not
adequately reflect the underlying value of our Nevada properties.
By transferring these Nevada assets to Allied Nevada and the
acquisition of the Nevada-based assets of the Pescio Group by
Allied Nevada to create a single, Nevada-focused gold company, we
believe that our shareholders will be more likely to realize the
value of those underlying assets over time. The results of the PAH
study on Yellow Pine, together with the earlier released results on
a more detailed study at Paredones Amarillos as presented in the
Corporation's press release dated January 30, 2006, supports
management's belief that substantial value would remain in Vista
following the transaction. We are planning to complete a similar
study on the Mt. Todd project before the end of the year and a
detailed feasibility study on the Awak Mas project in 2007." Vista
Gold Corp., based in Littleton, Colorado, evaluates and acquires
gold projects with defined gold resources. Additional exploration
and technical studies are undertaken to maximize the value of the
projects for eventual development. The Corporation's holdings
include the Maverick Springs, Mountain View, Hasbrouck, Three
Hills, Wildcat projects, the F.W. Lewis, Inc. properties and the
Hycroft mine, all in Nevada, the Long Valley project in California,
the Yellow Pine project in Idaho, the Paredones Amarillos and
Guadalupe de Los Reyes projects in Mexico, the Amayapampa project
in Bolivia, the Awak Mas project in Indonesia, and the Mt. Todd
project in Australia. This press release contains forward-looking
statements within the meaning of the U.S. Securities Act of 1933
and U.S. Securities Exchange Act of 1934. All statements, other
than statements of historical facts, included in this press release
that address activities, events or developments that Vista expects
or anticipates will or may occur in the future, including such
things as future business strategy, competitive strengths, goals,
expansion and growth of Vista's or Allied Nevada's businesses,
operations, plans and other such matters are forward-looking
statements. When used in this press release, the words "estimate,"
"plan," "anticipate," "expect," "intend," "believe" and similar
expressions are intended to identify forward-looking statements.
The statements made in this press release about reserve and
resource estimates, gold prices, production costs and estimated
project economics, are forward- looking statements. Other
forward-looking statements include but are not limited to those
with respect to the anticipated impact the contemplated transaction
described herein may have on the operations of Vista or Allied
Nevada, as well as the benefits expected to result from the
contemplated transaction. These statements involve known and
unknown risks, uncertainties and other factors which may cause the
actual results, performance or achievements of Vista and Allied
Nevada, including anticipated consequences of the contemplated
transaction described herein, to be materially different from any
future results, performance or achievements expressed or implied by
such forward-looking statements. Such factors include, among
others, risks that Vista's or Allied Nevada's acquisition,
exploration and property advancement efforts will not be
successful; risks relating to fluctuations in the price of gold;
the inherently hazardous nature of mining-related activities;
uncertainties concerning reserve and resource estimates and related
economic analyses; potential effects on Vista's or Allied Nevada's
operations of environmental regulations in the countries in which
they operate; risks due to legal proceedings; uncertainty of being
able to raise capital on favorable terms or at all; and risks that
may affect Vista's ability to complete the proposed transaction
including risks that Vista may be unable to obtain required
securityholder, court or third party approvals; as well as those
factors discussed in Vista's latest Annual Report on Form 10-K and
Quarterly Report on Form 10-Q and other documents filed with the
U.S. Securities and Exchange Commission. Although Vista has
attempted to identify important factors that could cause actual
results to differ materially from those described in
forward-looking statements, there may be other factors that cause
results not to be as anticipated, estimated or intended. There can
be no assurance that such statements will prove to be accurate as
actual results and future events could differ materially from those
anticipated in such statements. Vista assumes no obligation to
publicly update any forward- looking statements, whether as a
result of new information, future events or otherwise. For further
information, please contact Greg Marlier at (720) 981-1185, or
visit the Vista Gold Corp. website at http://www.vistagold.com/.
DATASOURCE: Vista Gold Corp. CONTACT: Greg Marlier of Vista Gold
Corp., +1-720-981-1185 Web site: http://www.vistagold.com/
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