Luna Gold Corp. (fka LGCUF)

[b4atf]

Not very much new content on this board. Luna has geat potential for a buyout in my opinion. Nice proven preserves and Brazil is the first of the BRICS.

News Releases September 03, 2010
Luna Gold Releases Updated NI 43-101 Technical Report for Aurizona Gold Project

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Vancouver, September 3, 2010 -- Luna Gold Corp. (TSXV-LGC) ("Luna" or the "Company") is pleased to announce the results of the updated NI 43-101 compliant technical report, entitled "NI 43-101 Technical Report Mineracao Aurizona S.A, Aurizona Project, Maranhão, Brazil, dated September 1, 2010" (the "Report") for its 100% owned Aurizona Gold Project ("Aurizona") located in the state of Maranhão, northeastern Brazil between the cities of São Luis and Belém. The Report was completed by SRK Consulting (U.S.) Inc. ("SRK"), using a base case Measured and Indicated Mineral Resource of approximately 0.9 million ounces of gold (21.1 million tonnes grading 1.3 g/t gold at a cut-off grade of 0.3 g/t which relates to the economic cut-off in the Report) based on January 15, 2009 estimates. Using a base case gold price of $1,000 per ounce, the Report shows that Aurizona has a net pre-tax cash flow (undiscounted) of $153 million with an after tax Net Present Value (NPV) of $81 million using a 8% discount rate. The mine would recover approximately 670,000 ounces of gold at a waste to ore strip ratio of 3.4 to 1 over a 12-year mine life.

Mineral Resources as at January 15, 2009

kt
Au g/t
Au Ounces

Measured
1,500
1.44
69,000

Indicated
19,621
1.29
835,300

Measured and Indicated
21,121
1.33
904,300


The Inferred Mineral Resource is 0.4 million ounces of gold (10.9 million tonnes grading 1.14 g/t gold at the same cut-off grade).

The Report is based on and supports the resource estimate previously disclosed in January 2009 and demonstrates strong financial returns in the current economic climate and will be the foundation for further growth as Aurizona continues with the commissioning of its process plant and exploration programs.

"This report continues to demonstrate the robust economics of Aurizona. Management sees this as a good start to build upon in the coming years", commented Jim Bahan, Luna's President & CEO. "We are now focused on ramping up production in the coming months and launching our aggressive exploration program to expand the company's total gold resources."

All dollar amounts presented in this press release are expressed in US dollars. An exchange rate of 1.80 Brazilian Reais to US dollars was used where costs were based on Brazilian expenditures.

The report will be filed and made available on SEDAR.

Summary Highlights
Estimated Contained Gold
729,000
oz

Estimated Net Recoverable Gold (based on 92% recovery)
670,000
oz

Mill throughput rate



Daily
4,100
Tonnes

Annual (million)
1.5
Tonnes

Life of Mine
12
Years

Overall Strip Ratio
3.4


Capital Expenditure



Initial
$65.2
M

Sustaining
$17.7
M

Total
$82.9
M

Total Operating Cost per ounce (1)
$516




Years 1 to 3
Life of Mine

Gold Production (oz per year)
51
56

Average feed grade to mill (grams per tonne)
1.25
1.32

Operating cost per ounce
$481
$516


Sensitivity Analysis
Economic results for the Base Case plant throughput of 1.5Mtpa and 1.8Mtpa are as follows:


Base Case
Base Case + 20%


(1.5 Mtpa)
(1.8 Mtpa)

Net Present Value (NPV) at 8% Discount Rate
$81M
$100M

Net Cash flow (NPV at 0% Discount Rate)
$153M
$170M

Internal Rate of Return (IRR)
44%
58%


The basis of this assumption is that the Company's operations can increase production from 1.5Mtpa to 1.8Mtpa without any significant capital investment. It should be noted that the 1.8Mtpa sensitivity merely accelerates the 1.5Mtpa production schedule and does not account for seasonality of mining rate assumed in the 1.5Mtpa base case.
1.Total operating costs per ounce is a non-GAAP measure. It does not have a standardized meaning prescribed by GAAP and may not be comparable to similar measures presented by other mining companies.

About Luna Gold Corp
Luna is a gold mining and exploration company engaged in the exploration and development of gold deposits and advanced stage gold exploration projects in Brazil. The Company is currently commissioning its Aurizona gold mine in Maranhão, Brazil.