Anyone know of a more active board for CMIN, AZNG and or RiverRun?
Drilling will start soon so there should be more to talk about. I am excited about the prospects as indicated by the figures in the article below.
Good day,
I thought you might enjoy reading this article on Constitution Mining which was written by Ellsworth Dickson, the Editor in Chief of Resource World Magazine and will be featured in the journal's upcoming May issue. I have also attached the CMIN advertisement that will be on the back cover of the May issue. Resource World's May issue will be handed out to 8,000 mining investors who will be attending the World Resource Investment Conference in Vancouver on June 7 - 8, 2009. Resource World has a subscriber base of 30,000 readers and the magazine's website is www.ResourceWorld.com.
Constitution Mining Advancing Alluvial Gold Project
by Ellsworth Dickson
While most junior mining companies are exploring and developing hard rock lode gold deposits, Constitution Mining Corp. [CMIN-OTCBB] is focusing on the alluvial Gold Sands Project in the Amazon Delta, northeast Peru. Here, the company controls 38,200 hectares overlying gold-rich sands and gravels of the Marañón river system and has set up an operational base in the town of Saramiriza. While gold has been recovered from the Marañón river system since Inca times, the first recorded production of gold was in the 1940s. Since then, Canadian, Brazilian, Swiss, and Peruvian interests have operated with various degrees of success. While concentrations are modest -a Russian government consulting company, Sojuzkarta, reported a grade of 295 milligrams per cubic metre (mg/m3) over 500 hectares - quantities may be vast.
Constitution Mining (CMIN) has an 18-month development program to bring the Monica Discovery Area to a trial, or pilot mining, stage. This will require re-drilling the Discovery Area at closely-spaced centres to comply with NI 43-101 resource/reserve reporting standards. CMIN would also like to extend the resource though wider-spaced reconnaissance drilling. As well, more geotechnical and metallurgical studies are planned to complement existing data in order to prepare the optimum processing method. This will lead to the preparation of scoping, prefeasibility, and full feasibility studies leading to a bankable document.
Since acquiring the project in September 2008, CMIN has completed an initial social base line study, implemented a community relations program, submitted a DIA (Declaración de Impacto Ambiental), and received approval to start Category I operations from the Peruvian Ministry of Energy and Mines (MEM). The company has also acquired churn drilling equipment for further evaluation of resources and has commissioned and subsequently received a Preliminary Master Plan (scoping study).
To assist with project development, CMIN has engaged MTI Holland, AMEC Earth & Environmental, WorleyParsons, and the Stocker Group. The Company plans to drill some 500 drill holes with 200 holes planned at 100-metre centres to a depth of 50 metres in the Discovery Area with a view to developing a reserve to sustain pilot mining by a bucket wheel dredge connected to a floating processing plant. An additional 300 holes to 50 metres in depth are planned at one-kilometre spacings across the 20-kilometre wide alluvial field to extend mineralization and a resource potential to sustain a fleet of dredges. Drilling is expected to start in May and will total 25,000 metres using five rigs.
CMIN is in discussions with Scott Wilson Roscoe Postle Associates to provide guidance and technical auditing of sampling so a NI 43-101 compliant resource/reserve report can be prepared. In this regard, the company is working with WorleyParsons, which is providing sampling expertise. Johnson Drilling will operate the churn drilling equipment.
CMIN has also commissioned MTI Holland to draw up a Master Plan which will form the basis for a feasibility study.
According to current plans, the projected mining operation will start in 18 to 24 months with a wheel suction dredger and a floating plant that will be limited in size and dredging depth. The following year, the first full-scale dredger and floating plant will be commissioned with a capacity to dredge to 20 metres deep. A year later, a similar sized dredger and plant will be brought on with a dredging depth of 40 metres. Thereafter, the two-dredger system will be replicated twice, over a four-year period, until a production level of over 600,000 oz/year has been achieved with seven dredgers (and their floating plants).
Production is expected to start at 48,000 oz/year with one dredger and will grow to 630,000 oz./year with seven dredgers from resources grading between 250 - 350 mg/cubic metres. Preliminary cash flow analyses based on current information and assuming US $800/oz., 300 mg/m3, and a mine life of 16 years (although the deposit is expected to be mined over a much longer period) have returned the following numbers:
For the first single dredger scenario (pilot mining): NPV = US $80 million
IRR = 38%; Operating Costs = US $261/oz.
For the intermediate three-dredger scenario: NPV = US $309 million
IRR = 45%; Operating Costs = US $206/oz.
For the seven-dredger scenario: NPV = US $600 million; IRR = 46%
Operating Costs = US $183/oz.
Metallurgical work was done by previous operators, and MTI will also carry out recovery studies. While soil characteristics, grain size distribution, gold content, gold size and shape, gained from the drill samples will help define the dredgeability and processing parameters of the sands/gravels, bulk sampling will be done to confirm gold grades and distribution and to assess digability. Therefore, after the initial holes have been completed, a small-size grab dredger system with a small on-board processing plant will be used to gather data.
The dredges are fabricated by IHC in the Netherlands. Dredgers and floating plants will be loaded on semi-submersibles at the factory, shipped to Brazil and pushed upstream by tugs to the mine site.
The first dredger is expected to cost about US $6.5 million; however, total capital expenses of this dredging system is expected to be about US $46.7 million. For the larger dredgers and dredging systems, the Capex costs are expected to be about US $14.2 million and US $85.1 million, respectively.
CMIN has also completed field work for an EIAsd (Evaluación de Impacto Ambiental semidetallado) which will allow it to proceed with Category II activities. CMIN expects this to be granted within the next two months. The EIAsd also forms the basis for the full EIA which AMEC is working toward completing with a view for trial mining to start in 18 months. CMIN currently employs only two non-Peruvians on the project, the rest being nationals, most of who come from the project region.
Make it a great day,
Shawn Perger, Consultant
Alpine Communications AG
Toll-Free: 1-888-431-5685
Direct: 1-646-755-3262
AlpineCommunications.ch/Perger
