MBAC Reports 28% Increase In Resources At The Itafós Arraias SSP Project
Jan 31, 2012
OTC Disclosure News Service
Toronto, ONT, Canada –
Toronto, Ontario, January 31,2012, MBAC Fertilizer Corp. (“MBAC” or the “Company”) (TSX:MBC andOTCQX:MBCFF) is pleased to report the results of an extensional and infill drilling campaign, aimed at testing the north-eastern portion of the Domingos target, located in close proximity to the beneficiation plant at the Itafós Arraias Project. The measured and indicated mineral resource estimate for the project now totals 75.8 million tonnes grading 5.0% P2O5 up from the previously reported NI 43-101 measured and indicated mineral resource estimate of 58.8 million tonnes grading 5.0% P2O5.
As stated in the April 27th, 2011 press release, systematic drilling of high-potential areas has led to the identification of additional, shallower and higher than average grade phosphate mineralization in the northern Domingos Block. The new drilling campaign totaled 4,551m of reverse circulation drilling and 768m of diamond drilling.
In addition, MBAC has refined the geological studies and subsequent block modelling for the Canabrava Block. This has led to an increase in the tonnage and grade of the resource at theCanabrava Block as summarized in Table 1 below. No additional drilling is expected to be done at the Canabrava Block during 2012, however the Company believes that further drilling in all directions at the Canabrava Block has the potential to increase the current mineral resource estimate.
2011 Exploration Results
The 2011 drilling campaign targeted the northern extension of the Domingos Block, and was aimed at converting indicated mineral resources into measured mineral resources in an area where the phosphate ore is relatively shallow and located close to the future beneficiation plant site. Infill drilling of the central parts of the Domingos Block has increased the geological confidence and resulted in the conversion of inferred resources into indicated mineral resources. The new drilling has confirmed the Domingos Block as a target along with the São Bento target to the north.
The updated mineral resource estimate has been classified, effective as of December 20, 2011, by Beau Nicholls (BSc (Geo) MAIG), principal consulting geologist for Amazon Geoservices Ltda, who is a qualified person in accordance with National Instrument 43-101. The measured and indicated mineral resource estimate comprises 75.8million tonnes grading 5.0% P2O5 (using a 1.5%cut-off for the Domingos target and a 2.8% cut-off for all other targets).
Appropriate rounding has been applied to the figures in Table 1 above
Drilling, sampling and QA/QC procedures were established at the beginning of the drilling campaign and conform to acceptable industry standards. QA/QC results have returned acceptable precision and accuracy.
Please refer to the technical report entitled “Arraias TocantinsDefinitive Feasibility Study Report” dated October 26, 2010, as amended February 10, 2011, available under the Company’s SEDAR profile at www.sedar.comfor further details on the QA/QC procedures.
All recent drilling has been analysed at ALS Chemex Ltd laboratory.
Itafós Arraias Project Update
TheItafós Arraias Project is progressing in accordance with the scheduled timeline. The detailed engineering for the project is almost complete. All equipment on the critical path to construction has been acquired. The earthworks for the project concluded last year and civil construction hascommenced at the site, beginning with the water dam. MBAC also has started hiring and training personnel for the day-to-day operation of the SSP plant.
The detailed engineering has shown that the project capital costs have increased inthe range of 8-9% due to inflation, but are still in line with the expected accuracy of the feasibility study. The expected capital expenditures for the project are currently fully funded through project finance debt facilities secured by the Company and funds raised through equity financings completed to date.The current average selling price for SSP is currently more than 40% higher than that used in the feasibility study. MBAC expects construction of the project to be complete in Q4 2012 and the commencement of SSP production in the same quarter.
Beau Nicholls, (MAIG) principal consulting geologist of Amazon Geoservices Ltda, is the qualified person who has approved the contents of this press release.
Steve Burleton, VicePresident, Corporate Development, at 416-367-2200, firstname.lastname@example.org or visit our website at: www.mbacfert.com
MBAC is focused onbecoming a significant integrated producer of phosphate and potash fertilizers in the Brazilian and Latin American markets. MBAC has an experienced team with over 150 years of combined experiencein the business of fertilizer operations, management, marketing and finance within Brazil. In October 2008, MBAC acquired ItafósMineração Ltda, which consisted of a phosphate mine, a mill and plant and related infrastructure, all located in central Brazil. MBAC’s exploration portfolio includes a number of additional phosphate and potash projects, whichare also located in Brazil. The Santana Phosphate project is a high grade phosphate deposit located in close proximity to the largest fertilizer market of Mato Gross Stateand animal feed market of Pará State.The Company continues to search for additional fertilizer opportunities in theBrazilian and Latin-American markets, where strong agricultural fundamentals and unique opportunities are expected to provide attractive growth opportunities in the near future.
Chief Executive Officer and Vice-Chairman
FORWARD LOOKING STATEMENTS
This press release contains”forward-looking statements” within the meaning of applicableCanadian and United Statessecurities legislation. Forward-looking statements include, but are not limitedto, statements related to activities, events or developments that the Companyexpects or anticipates will or may occur in the future, including, withoutlimitation, statements related to future drilling at the Canabrava Block, completion of detailed engineering at theItafós Arraias Project and the completion of construction of the project andthe commencement of SSP production in Q4 2012. Forward-looking statements areoften identified by the use of words such as “plans”,”planning”, “planned”, “expects” or “lookingforward”, “does not expect”, “continues”,”scheduled”, “estimates”, “forecasts”,”intends”, “potential”, “anticipates”, “doesnot anticipate”, or “belief”, or describes a “goal”,or a variation of such words and phrases, or state that certain actions, eventsor results “may”, “could”, “would”,”might” or “will” be taken, occur or be achieved.Forward-looking statements are based on a number of factors and assumptionsmade by management and considered reasonable at the time such statements aremade. Forward-looking statements involve known and unknown risks, uncertaintiesand other factors that may cause the actual results, performance orachievements to be materially different from those expressed or implied by theforward-looking statements,including among others, the Company continuing tosuccessfully drill the various targets at the Itafós Arraias Project, theconstruction and commencement of production at the project meeting the currenttimeline, the Company’s ability to hire and train qualified personnel forday-to-day operations at the SSP plant, the actual capital expenditures at the project beingfully-funded, fluctuations in capital costs based on inflation and otherfactors, fluctuations in the average selling price for SSP, as well as those factors disclosed in theCompany’s current Annual Information Form and Management’s Discussion andAnalysis, as well as other public disclosure documents, available on SEDAR atwww.sedar.com. Although MBAC has attempted to identify important factors thatcould cause actual actions, events or results to differ materially from thosedescribed in forward-looking statements, there may be other factors that causeactions, events or results not to be as anticipated, estimated or intended.There can be no assurance that forward-looking statements will prove to beaccurate. The forward-looking statements contained herein are presented for thepurposes of assisting investors in understanding the Company’s plan, objectivesand goals and may not be appropriate for other purposes. Accordingly, readersshould not place undue reliance on forward-looking statements.
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