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Rainy River Resources Completes Feasibility Study: Establishes Intermediate Production Profile With 4.0 Million Ounces Of Gold In Proven And Probable Reserves

TORONTO, April 11, 2013 /PRNewswire/ --

-- RR.TSX

 

Rainy River Resources Ltd. (" Rainy River" or the "Company" (RR.TSX)) is pleased to announce receipt of a positive Feasibility Study ("FS") for its 100% owned Rainy River Gold Project ("RRGP") in northwestern Ontario, Canada. The information presented below summarizes the results of the FS for a mine and processing scenario based on the October 10, 2012 National Instrument 43-101 ("NI 43-101") mineral resource estimate, which includes assay data up to June 10, 2012. All currency amounts herein are expressed in Canadian dollars ($) unless otherwise noted. This feasibility study was prepared and compiled by BBA Inc. ("BBA") for Rainy River in cooperation with a number of specialized consultants.

                           FEASIBILITY STUDY HIGHLIGHTS
                           ----------------------------
     - Proven and Probable Mineral Reserves of 4.0 million ounces of gold and
                          10.3 million ounces of silver.

     - First- and second-quartile average cash costs of US$413 and US$468 per
    ounce gold (including royalties and net of silver credits) over the first
                          5 and 10 years, respectively.

       - Industry leading "all-in" costs of US$771 per ounce gold, first 10
                                      years.

     - Average mill head grade of 1.46 grams per tonne ("g/t") of gold, first
                                    10 years.

          - Average underground grade of 5.07 g/t of gold, life-of-mine.

      - Average annual production of 326,000 gold ounces and 494,000 silver
                             ounces, first 10 years.

                                   KEY METRICS
                                   -----------
    - Life-of-mine after-tax net present value ("NPV", at a 5% discount rate)
    of $931 million, internal rate of return ("IRR") of 23.7% and a payback of
     3.2 years based on metal prices of US$1,400 per ounce gold and US$25 per
                            ounce silver (base case).

             - Initial pre-production capital costs of $713 million.

       - Total open pit sustaining capital costs of $322 million (tailings
              facilities, overburden, waste removal, and equipment).

      - Underground development capital costs of $68 million, commencing in
                      2016, funded by operating cash flows.

       - Underground sustaining capital costs of $95 million (development,
                          infrastructure and equipment).
                                  SUMMARY OF PROJECT ECONOMICS
                                  ----------------------------
    Gold Price Silver Price Exchange
      (US$ /    (US$ /     Rate   NPV at 5% discount         IRR         Payback Period
      ounce)    ounce)   (US$:C$)  rate (C$ million)         (%)             (years)
                                   Pre-tax  After-tax Pre-tax After-tax Pre-tax After-tax
      $1250      $25       0.91     $1002     $721     23.5     19.9      3.4      3.5
      $1400      $25       0.93     $1296     $931     27.8     23.7      3.1      3.2
      $1600      $30       0.97     $1674     $1191    32.8     27.9      2.7      2.8
      $1800      $35       1.00     $2059     $1469    37.6     32.1      2.4      2.5

Raymond Threlkeld, Rainy River's President and CEO, stated: "With the release of the Rainy River Gold Project Feasibility Study, we are transitioning to the mine development stage of Canada's newest gold district. The Feasibility Study outlines an outstanding project, located in one of the best mining jurisdictions in the world, conveniently surrounded by infrastructure, and with tremendous exploration potential.

"By continuing to focus on our strategy of delivering a project with the lowest risk to our shareholders and the strongest internal rate of return, we have developed a plan with high production rates, low cash and "all-in" costs and strong margins.

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