LONDON, UNITED KINGDOM and TORONTO, ONTARIO -- (Marketwire) -- 02/13/13 -- Minera IRL Limited ("Minera IRL" or the "Company") (TSX: IRL)(AIM: MIRL)(BVLAC: MIRL), the Latin American gold mining company, is pleased to announce that the exploration drive at its Ollachea Project (the "Project"), Peru, has been completed beyond its 1,200 meter goal ahead of schedule and under budget.
-- Exploration drive has been successfully completed reaching 1,234 meters-- Best monthly advance of 216.5 meters achieved in January-- Completion more than one month ahead of schedule-- Project completion cost estimated at $13.8 million, approximately $1.1 million below budget-- Better than expected ground conditions within the slates that host the orebody-- Very little water inflow, contrary to hydrogeological model-- Exploration drilling of the eastern strike of the deposit from underground has commenced
"The production-size exploration drive at Ollachea has been an outstanding success," said Courtney Chamberlain, Executive Chairman of Minera IRL. "Our Peruvian mining contractor, JJC Contratistas Generales S.A. (JJC) has done an excellent job supported by our consultants TWP Sudamerica S. A. and our team of engineers. The speed and reduced cost associated with the completion of the drive as well as the practical experience gained indicates that assumptions used in the Definitive Feasibility Study (DFS), completed in November 2012, are conservative. This particularly relates to better ground conditions, a much higher advance rate and minimal water infiltration. The focus now turns to the exploration drilling from underground, which commenced early in January."
The exploration drive has a cross sectional size of 5 meters by 5 meters which will become the main haulage route when the mine is developed. The portal is at the future plant site location. Advance was completed on 31 January 2013, at 1,234 meters slightly more than the planned 1,200 meters. The final 200 meters of the tunnel is in the hanging wall parallel to the Minapampa orebody.
The development rate in the slate rock type, host to the mineralization, has been better than predicted with a record 216.5 meters achieved in January 2013. In penetrating the slates, except when developing through the Ollachea Fault Zone, the tunnel has been well supported by rock bolts and shotcrete.
The hydrogeological model predicted that a large amount of water would infiltrate into the exploration drive, indicating a wet mine. This has not occured and, based upon the experience thus far, the mine should be relatively dry. This is expected to reflect in reduced capital and operating costs for ponds and water treatment.
The budget approved in August 2011 for $14.9 million included mobilization, demobilization, access from the highway to the portal site, establishment of the portal, driving of the tunnel, other consultant and owner's costs and a contingency of 10%. The forecast completion cost is now $13.8 million, a significant reduction of $1.1 million compared to the budget.
Exploration drilling has begun probing the eastern strike extension of the Minapampa Zone from cuddies to the east of the nearest drilling from surface. Drilling of this zone from surface was not possible due to very steep terrain.