News release via Canada NewsWire, Toronto 416-863-9350
Attention Business Editors:
Western Goldfields Commences Major Drilling Program - Excellent
Potential to Increase Resources
<<
- Mesquite Mine is a rare permitted multi-million ounce U.S. gold
reserve, one of only a handful of such opportunities in the United
States
- Proven and Probable reserves of 2.36 million ounces of gold and
Measured and Indicated resources of 1.25 million ounces(1)
- Average annual production of 165,000 ounces of gold planned
commencing April 2008
- Company recently listed on the Toronto Stock Exchange
>>
TORONTO, Sept. 21 /CNW/ - Western Goldfields, Inc. (TSX:WGI, OTC
BB:WGDF.OB) today announced the commencement of a major 70,000-foot reverse
circulation drilling program, designed to expand the non-oxide mineral
resource base at its Mesquite Mine in Imperial County, California. The
drilling program is consistent with Western Goldfields' decision to proceed
quickly with bringing this exceptional gold mining opportunity into production
by April 2008. The Company is estimating average annual production of
165,000 ounces of gold from the mine, with an initial project life of 9-1/2
years.
Initial test work from the Mesquite Vista pit non-oxides conducted by
Newmont Metallurgical Services indicated a recovery of gold in concentrate of
more than 80 percent, suggesting excellent potential for enhanced gold
recovery from a gravity and flotation circuit program. Samples from the
drilling program also will be used for further metallurgical test work to
optimize gold recovery going forward. The Layne Christensen Company of
Chandler, Arizona, is conducting the reverse circulation drilling program.
"After reviewing the geologic database supporting the reserve estimate
described in the recent Feasibility Study, it is apparent that many of the
drill holes in the mine area stopped in mineralized non-oxide material," said
Mr. Raymond W. Threlkeld, President and Chief Executive Officer. "The
Feasibility Study indicated proven and probable reserves of 2.36 million
ounces of gold and measured and indicated resources of 1.25 million ounces(1).
The potential to increase resources appears excellent. Mesquite is already
permitted for development which will make it possible to expand our production
in a remarkably short time."
Western Goldfields announced the findings of the Feasibility Study in a
news release on August 9, 2006, and the results can be found on Western
Goldfields' website. The resource and reserve estimates are summarized in the
Appendix to this news release.
"The Mesquite Mine is a unique gold mining opportunity, in that it is a
fully permitted, multi-million ounce reserve in a politically safe location -
one of only a handful of major deposits owned by an independent company in the
United States," said Mr. Randall Oliphant, Chairman, Western Goldfields. "The
Mesquite Mine should form a very solid and profitable foundation on which we
can create increasing value for the shareholders of Western Goldfields. We
also intend to pursue additional precious metals opportunities that are
emerging in our industry, particularly in North America," added Mr. Oliphant.
Western Goldfields, Inc.
Under a new, highly experienced, and dynamic management team, Western
Goldfields is a gold producer focused on completing the expansion of its
Mesquite Mine, located in Imperial County, California, and returning the mine
to full production. Western Goldfields acquired the Mesquite property in 2003
from Newmont Mining Corporation. Newmont originally operated the mine until
2001 when it ceased production, as the low gold prices at that time did not
support expansion plans. However, Newmont continued the permitting process for
expansion, and the permits were approved in 2002. Western Goldfields has
continued producing gold from ore placed on heaps by the previous owners, and
expects gold production in 2006 to be about 14,000 ounces.
Western Goldfields, Inc. recently began trading on the Toronto Stock
Exchange under the symbol WGI. The Company currently has 69,187,051 common
shares issued and outstanding and 111,369,230 shares of common stock on a
fully diluted basis.
(1) Resource estimates are exclusive of Mineral Reserves. Cautionary note
to U.S. investors concerning Measured, Indicated, and Inferred mineral
resources: These terms are required by the CIM's "Standards on Mineral
Resources and Reserves, Definition and Guidelines". U.S. investors are
cautioned not to assume that all or any part of the stated mineral
resources will be converted into reserves. Reference is made to the
Company's news release issued on August 9, 2006 for additional
information regarding the Feasibility Study and mineral resource and
reserve estimates regarding the Mesquite Mine.
Forward-Looking Information
Certain statements contained in this news release and subsequent oral
statements made by and on behalf of the Company may contain forward-looking
information within the meaning of the United States Private Securities
Litigation Reform Act of 1995 and equivalent Canadian legislation. Such
forward-looking statements are identified by words such as "intends",
"anticipates", "believes", "expects", and "hopes" and include, without
limitation, statements regarding the Company's plan of business operations,
drilling program, potential contractual arrangements, receipt of working
capital, anticipated revenues, and related expenditures. There can be no
assurance that such statements will prove to be accurate; actual results and
future events could differ materially from such statements. Factors that could
cause actual results to differ materially include, among others, those set
forth in the Company's Annual Report on Form 10-KSB for the year ended
December 31, 2005 filed with the U.S. Securities and Exchange Commission,
under the caption, "Risk Factors". Most of these factors are outside the
control of the Company. Investors are cautioned not to put undue reliance on
forward-looking statements. Except as otherwise required by applicable
securities statutes or regulation, the Company disclaims any intent or
obligation to update publicly these forward-looking statements, whether as a
result of new information, future events or otherwise.
<<
APPENDIX
MESQUITE MINE
Mineral Resources and Reserves
August 1, 2006
-------------------------------------------------------------------------
Mineral Resources Inclusive of Reserves
-------------------------------------------------------------------------
Classification Category Tons Grade Contained
(x 1,000) (Au oz/T) (Au ozs)
-------------------------------------------------------------------------
Measured Oxide 73,355 0.016 1,188,000
Non-oxide 19,591 0.024 470,000
-------------------------------------------------------------------------
Measured Subtotal 92,946 0.018 1,658,000
-------------------------------------------------------------------------
Indicated Oxide 82,611 0.016 1,338,000
Non-oxide 26,338 0.022 566,000
-------------------------------------------------------------------------
Indicated Subtotal 108,949 0.017 1,904,000
-------------------------------------------------------------------------
M&I TOTAL 201,895 0.018 3,562,000
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Mineral Reserves
-------------------------------------------------------------------------
Classification Category Tons Grade Contained
(x 1,000) (Au oz/T) (Au ozs)
-------------------------------------------------------------------------
Proven Oxide 55,923 0.017 923,000
Non-oxide 12,749 0.024 306,000
-------------------------------------------------------------------------
Proven Subtotal 68,672 0.018 1,229,000
-------------------------------------------------------------------------
Probable Oxide 52,589 0.017 910,000
Non-oxide 9,647 0.023 222,000
-------------------------------------------------------------------------
Probable Subtotal 62,236 0.018 1,132,000
-------------------------------------------------------------------------
P&P TOTAL 130,908 0.018 2,361,000
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Mineral Resources Exclusive of Reserves
-------------------------------------------------------------------------
Classification Category Tons Grade Contained
(x 1,000) (Au oz/T) (Au ozs)
-------------------------------------------------------------------------
Measured Oxide 18,767 0.015 274,000
Non-oxide 7,484 0.023 174,000
-------------------------------------------------------------------------
Measured Subtotal 26,251 0.017 448,000
-------------------------------------------------------------------------
Indicated Oxide 31,019 0.015 453,000
Non-oxide 17,101 0.021 351,000
-------------------------------------------------------------------------
Indicated Subtotal 48,120 0.017 804,000
-------------------------------------------------------------------------
M&I TOTAL 74,371 0.017 1,252,000
-------------------------------------------------------------------------
1. The Company's mineral reserves are estimated using appropriate
cut-off grades at an assumed gold price of US$450 per ounce and
projected process recoveries, operating costs and life of mine plans
which include allowances for dilution and mining recovery.
2. The Company's mineral reserves are consistent with the definitions
established by Industry Guide 7, administered by the U.S. Securities
and Exchange Commission.
3. The Company's mineral resources are estimated using appropriate
cut-off grades at an assumed gold price of US$500 per ounce,
projected process recoveries, operating costs and mine plans which
include allowances for dilution and mining recovery.
4. The Company's mineral resources and mineral reserves are classified
in accordance with the Canadian Institute of Mining, Metallurgy and
Petroleum's (CIM) "Standards on Mineral Resources and Reserves,
Definitions and Guidelines".
5. Cautionary note to U.S. investors concerning Measured, Indicated and
Inferred mineral resources: These terms are required by the CIM's
"Standards on Mineral Resources and Reserves, Definitions and
Guidelines". Mineral resources that are not mineral reserves do not
have demonstrated economic viability. U.S. Investors are cautioned
not to assume that all or any part of the stated mineral resources
will be converted into reserves.
6. The Company's mineral resource and reserve estimates were prepared
under the supervision of Mr. M. Hester, FAusIMM, Vice President,
Independent Mining Consultants Inc., Tucson Arizona, who qualifies as
an independent Qualified Person under Canadian Securities
legislation.
>>
%SEDAR: 00021587 %CIK: 0001208038
/For further information: please visit www.westerngoldfields.com, or
contact: Raymond W. Threlkeld, President and Chief Executive Officer, (416)
324-6005, rthrelkeld(at)westerngoldfields.com; Brian Penny, Chief Financial
Officer, (416) 324-6002, bpenny(at)westerngoldfields.com; Richard Wertheim,
Investor and Media Relations, Wertheim + Company Inc., (416) 594-1600,
wertheim(at)wertheim.ca/
(WGDF)
CO: Western Goldfields, Inc.
CNW 18:20e 21-SEP-06
