DENVER, Nov. 13 /CNW/ -- Vista Gold Corp. (TSX: VGZ; Amex) is pleased to
announce results from a preliminary assessment at its Yellow Pine project in
Valley County, Idaho, that is expected to be completed in November 2006, by
Pincock Allen & Holt ("PAH") of Lakewood, Colorado, in accordance with
Canadian National Instrument 43-101 standards under the direction of Richard
Lambert, P.E. and Barton Stone, P.G., both independent qualified persons.
This preliminary assessment will be filed on SEDAR by the Corporation.
The Yellow Pine project is located in the Salmon River Mountains of
central Idaho in an area of historical gold, antimony and tungsten mining know
as the Stibnite or Yellow Pine Mining District. The district is located about
60 miles east of McCall, Idaho, and 10 miles southeast of the small settlement
of Yellow Pine, Idaho. Historically, the mine has produced about 700,000
ounces of gold from a combination of byproduct gold from tungsten and antimony
mining and more recent heap-leach production from oxide ore. The remaining
mineral resource consists of sulfide mineralization lying below and along
strike from the existing open pit.
PAH reviewed the mineral resources it had estimated in a report completed
on November 17, 2003, in compliance with NI 43-101 standards, the results of
which were previously reported by Vista in a press release dated November 19,
2003, and confirmed the estimates are still valid. At a cutoff grade of 0.025
ounces of gold per ton, the mineral resources are:
<<
Short Tons Grade Contained Gold
(000s) (ounces per ton) Ounces
Measured resources(1) 16,332 0.070 1,147,000
Indicated resources(1) 17,503 0.061 1,071,000
Measured and indicated
resources(1) 33,835 0.066 2,218,000
Inferred resources(2) 16,047 0.051 819,000
1) Cautionary Note to U.S. Investors concerning estimates of Measured and
Indicated Resources: This table uses the terms "measured resources" and
"indicated resources." We advise U.S. investors that while these terms
are recognized and required by Canadian regulations, the U.S.
Securities and Exchange Commission does not recognize them. U.S.
investors are cautioned not to assume that any part or all of mineral
deposits in these categories will ever be converted into reserves.
2) Cautionary Note to U.S. Investors concerning estimates of Inferred
Resources: This table uses the term "inferred resources." We advise
U.S. investors that while this term is recognized and required by
Canadian regulations, the U.S. Securities and Exchange Commission does
not recognize it. "Inferred resources" have a great amount of
uncertainty as to their existence, and great uncertainty as to their
economic and legal feasibility. It cannot be assumed that all or any
part of an inferred mineral resource will ever be upgraded to a higher
category. Under Canadian rules, estimates of inferred mineral
resources may not form the basis of a feasibility study or
prefeasibility studies, except in rare cases. U.S. investors are
cautioned not to assume that any part or all of an inferred resource
exists or is economically or legally minable.
>>
In undertaking the preliminary assessment, PAH considered the economic
and technical parameters associated with development of the mineral resources
by open-pit mining. The study, based on PAH's review of previous technical
studies and their own work, determined the best treatment approach would be an
on-site plant to produce a flotation concentrate that would be refined
off-site. The potential development would produce an estimated 1.9 million
ounces of gold over a 10-year life.
The total capital cost over the project life was estimated by PAH to be
US$170 million and preproduction capital was estimated by PAH to be US$150
million. According to the PAH study, at long-term gold prices over US$550 per
ounce, the project appears to be viable. PAH estimated that at a gold price
of US$630 per ounce, the Yellow Pine project demonstrates favorable economics,
with a net cash flow of US$266 million, a net present value of US$126 million
at a 5% discount rate and an internal rate of return of 19%. The preliminary
assessment is preliminary in nature and includes inferred mineral resources
(3% inferred and 97% measured and indicated) that are considered too
speculative geologically to have the economic considerations applied to them
that would enable them to be categorized as mineral reserves, and there is no
certainty that the preliminary assessment will be realized. Mineral resources
and that are not mineral reserves do not have demonstrated economic viability.
Mike Richings, President and CEO, commented, "Most investors are aware
that Vista plans to enter into a transaction that will result in the transfer
of our Nevada-based properties into our newly incorporated, wholly-owned
subsidiary, Allied Nevada Gold Corp. and the acquisition by Allied Nevada of
the Nevada-based mineral assets of Carl and Janet Pescio. As part of this
transaction, which is subject to receipt of shareholder, regulatory and other
required approvals, Vista would distribute most of its Allied Nevada common
stock to our shareholders, all pursuant to the terms of an Arrangement
Agreement among Vista, Allied Nevada and the Pescios as previously disclosed.
We believe that the current market price of our securities does not adequately
reflect the underlying value of our Nevada properties. By transferring these
Nevada assets to Allied Nevada and the acquisition of the Nevada-based assets
of the Pescio Group by Allied Nevada to create a single, Nevada-focused gold
company, we believe that our shareholders will be more likely to realize the
value of those underlying assets over time. The results of the PAH study on
Yellow Pine, together with the earlier released results on a more detailed
study at Paredones Amarillos as presented in the Corporation's press release
dated January 30, 2006, supports management's belief that substantial value
would remain in Vista following the transaction. We are planning to complete
a similar study on the Mt. Todd project before the end of the year and a
detailed feasibility study on the Awak Mas project in 2007."
Vista Gold Corp., based in Littleton, Colorado, evaluates and acquires
gold projects with defined gold resources. Additional exploration and
technical studies are undertaken to maximize the value of the projects for
eventual development. The Corporation's holdings include the Maverick
Springs, Mountain View, Hasbrouck, Three Hills, Wildcat projects, the F.W.
Lewis, Inc. properties and the Hycroft mine, all in Nevada, the Long Valley
project in California, the Yellow Pine project in Idaho, the Paredones
Amarillos and Guadalupe de Los Reyes projects in Mexico, the Amayapampa
project in Bolivia, the Awak Mas project in Indonesia, and the Mt. Todd
project in Australia.
This press release contains forward-looking statements within the meaning
of the U.S. Securities Act of 1933 and U.S. Securities Exchange Act of 1934.
All statements, other than statements of historical facts, included in this
press release that address activities, events or developments that Vista
expects or anticipates will or may occur in the future, including such things
as future business strategy, competitive strengths, goals, expansion and
growth of Vista's or Allied Nevada's businesses, operations, plans and other
such matters are forward-looking statements. When used in this press release,
the words "estimate," "plan," "anticipate," "expect," "intend," "believe" and
similar expressions are intended to identify forward-looking statements. The
statements made in this press release about reserve and resource estimates,
gold prices, production costs and estimated project economics, are forward-
looking statements. Other forward-looking statements include but are not
limited to those with respect to the anticipated impact the contemplated
transaction described herein may have on the operations of Vista or Allied
Nevada, as well as the benefits expected to result from the contemplated
transaction. These statements involve known and unknown risks, uncertainties
and other factors which may cause the actual results, performance or
achievements of Vista and Allied Nevada, including anticipated consequences of
the contemplated transaction described herein, to be materially different from
any future results, performance or achievements expressed or implied by such
forward-looking statements. Such factors include, among others, risks that
Vista's or Allied Nevada's acquisition, exploration and property advancement
efforts will not be successful; risks relating to fluctuations in the price of
gold; the inherently hazardous nature of mining-related activities;
uncertainties concerning reserve and resource estimates and related economic
analyses; potential effects on Vista's or Allied Nevada's operations of
environmental regulations in the countries in which they operate; risks due to
legal proceedings; uncertainty of being able to raise capital on favorable
terms or at all; and risks that may affect Vista's ability to complete the
proposed transaction including risks that Vista may be unable to obtain
required securityholder, court or third party approvals; as well as those
factors discussed in Vista's latest Annual Report on Form 10-K and Quarterly
Report on Form 10-Q and other documents filed with the U.S. Securities and
Exchange Commission. Although Vista has attempted to identify important
factors that could cause actual results to differ materially from those
described in forward-looking statements, there may be other factors that cause
results not to be as anticipated, estimated or intended. There can be no
assurance that such statements will prove to be accurate as actual results and
future events could differ materially from those anticipated in such
statements. Vista assumes no obligation to publicly update any forward-
looking statements, whether as a result of new information, future events or
otherwise.
For further information, please contact Greg Marlier at (720) 981-1185,
or visit the Vista Gold Corp. website at www.vistagold.com.
