Twin Metals Minnesota LLC, is the joint venture company between Duluth Metals Limited (60% ownership interest) and Antofagasta plc (40% ownership interest). In 2011, Twin Metals Minnesota LLC acquired Franconia Minerals Corporation. Franconia`s principal assets are a 70% interest in the Birch Lake, "old Maturi" (not including former Nokomis property) and Spruce Road deposits through the Birch Lake Joint Venture, with Beaver Bay Resources owning the remaining 30%. Franconia announced in November, 2010 its intention to increase its ownership at the Birch Lake Joint Venture to 82% upon commencement of production. All of the forgoing Indicated and Inferred Mineral Resources are expressed as a 100% ownership position. Exploration Target tonnages reflect TMM's current 70% interest in a portion of these properties, which will increase to 82% upon production.
This new Mineral Resource Estimate incorporates assay data from 266 holes totalling 871,000 feet drilled on the Maturi deposit between 2006 and 2011, in addition to information from 99 legacy holes also in the geologic data base. The Birch Lake deposit resource estimate incorporates assay data from 65 holes totalling 155,000 feet drilled between 2000 and 2010, and information from an additional 14 legacy holes. The Spruce Road deposit resource estimate incorporates assay data from 210 legacy holes. The effective date of the mineral resource estimate is April 23, 2012.
This new Mineral Resource Estimate reports an increase in tonnage and metal that is approximately double the estimate used in Duluth Metal's Preliminary Economic Assessment (PEA) of January 8, 2009. The current Prefeasibility Study underway will review the scale, timing, and development the Twin Metals Minnesota Project appropriately for the latest estimate. The January 8, 2009 PEA report should be considered no longer relevant to the Twin Metals Minnesota Project.
A map showing the Indicated and Inferred boundaries and the Exploration Target Areas can be found as part of this press release on the Company website at http://www.duluthmetals.com.These June 2012 Resource Estimates for the Maturi, Birch Lake and Spruce are based on a 0.3% copper cut-off grade to define the resource model. Based on AMEC`s review of metal prices, process recoveries, refining costs and underground mine operating costs likely to apply at the Twin Metals site, the 0.3% copper cut-off grade (highlighted) is considered the base case for the statement of Indicated and Inferred Mineral Resources at this time. The estimates at the cut-off grades higher and lower than the base case are to show sensitivity of the estimate to cut-off grade. The figures for resources presented herein, including the anticipated tonnages and grades that may be achieved or the indicated level of recovery that may be realized, are estimates and no assurances can be given as to their accuracy. Such estimates are, in large part, based on interpretations of geological data obtained from drill holes and other sampling techniques. Actual mineralization or favorable host rock units may be different from those predicted. It may also take many years from the initial phase of drilling before production is possible, and during that time the economic feasibility of exploiting a deposit may change.