Intrepid Mines Limited Activities Report: Three Months to 30 June 2008

2008-07-25 03:32:00

BRISBANE, AUSTRALIA–(EMWNews – July 25, 2008) – Intrepid Mines Limited (TSX:IAU)(TSX:IXN)(ASX:IAU) –

All dollar values are United States Dollars unless otherwise stated.

This report on the quarter ended 30 June 2008 mining production, development and exploration activities is provided as required under ASX listing Rule 5.1.1.

HIGHLIGHTS

Operation

– Another solid quarter from Paulsens with gold production of 22,687 fine ounces (highest quarter on record), up 11 percent (prior quarter 20,369 ounces). The third consecutive quarter exceeding 20,000 fine ounces.

– Site cash costs decreased slightly to $429 per ounce (prior quarter $432 per ounce), primarily due to increased ounces produced. This is a terrific result considering a 4% strengthening of the Australian dollar against United States (US$19/oz) over the period. The team’s continued focus on cost control is reaping substantial returns to the company.

Finance

– The company continues to strengthen its treasury position evident through its strong gold production and revenue results during the quarter, including

– Gold revenue for the quarter was $20 million, an increase of 43 percent from the prior quarter of $14 million.

– Cash on hand at the end of the quarter was $34 million (excluding $12 million held on behalf of DRD Gold).

– The hedge position continues to reduce and will be fully abolished by the end of 2008. At the end of the quarter, the position was 22,448 ounces, a reduction of 10,682 ounces at $A627 per ounce over the last quarter. In addition, the Westpac finance facility was extinguished. The company is moving into a period of increased gold production and will be totally free of any hedging, which places it on a solid financial footing.

– Intrepid is well funded to meet all its operating, development and exploration activities well into the future and does not anticipate the need to raise capital until well into 2009 with the commencement of construction at Casposo.

Development

– Updated Casposo feasibility study was completed subsequent to the quarter end, with the company announcing a development timetable that will allow commencement of production in the third quarter of 2010.

Exploration

– An updated ore reserve and resource statement on Paulsens, dated 31 December 2007, announced on 15 May 2008, defined a measured and indicated resource of 272,700 ounces and reserve of 162,700 ounces. Exploration of the resource extension zones at Paulsens continues to show further encouragement.

– Exploration at Tujuh Bukit has been ongoing and subsequent to the quarter end, the company announced the drill results of hole GTD-08-035 which intersected 627.2 metres at 0.45 g/t gold and 0.44% copper from 222 metres, including 108 metres at 0.9g/t gold and 0.9% copper from 530 metres.

Brad Gordon, CEO

25 July 2008

Intrepid Mines Limited (TSX:IAU)(TSX:IXN)(ASX:IAU) (‘Intrepid’ or ‘Company’) is an international precious metals producer, developer and explorer operating in Argentina, Australia, Canada, El Salvador, Indonesia and Mexico. During the quarter ended 30 June 2008, the principal activities of Intrepid and its controlled subsidiaries (collectively referred to as ‘Intrepid’) were the operation of the Paulsens Gold Mine, feasibility evaluation of the Casposo project in Argentina, exploration of the Company’s international suite of exploration interests and the pursuit of precious metal projects and exploration assets. The Company is listed on the ASX and TSX.

This Activities Report is provided as required under ASX listing Rule 5.1.1. Intrepid’s presentation currency at 30 June 2008 is United States dollars, and all comparative information has been translated into United States dollars (US$). Values are translated from currencies used including Australian dollars (A$) and Canadian dollars (C$) into presentation currency. Assets and liabilities are translated at the rate of exchange in effect at the quarter end. At 30 June 2008 the rate applied in this report was A$ to US$ 0.9600, and C$ to US$ 0.9912. Income, expenditure and cash flow items are translated at the exchange rates prevailing on the day of the transaction or where administratively efficient at the average exchange rates prevailing during the quarter. The following average rates were applied in the report below:



12 months to 3 months to 3 months to
31 December 2007 31 March 2008 30 June 2008
--------------------------------------------------------------
A$ to US$ 0.8898 0.9040 0.9415
C$ to US$ 1.0201 0.9963 0.9876
--------------------------------------------------------------

 

Additional information including press releases has been filed electronically through the System for Electronic Document Analysis and Retrieval (‘SEDAR’) and on the Australian Stock Exchange online lodgment system. These releases are available online at www.sedar.com and www.asx.com.au respectively.

A copy of the complete Intrepid Mines Activities Report in PDF format is available at the following web link: EMWNews.com/docs/iau0725.pdf”>http://media3.EMWNews.com/docs/iau0725.pdf.

Gold equivalent reporting

The assumptions used by the Company in reporting on gold equivalent targets are as follows:



---------------------------------------------------------
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A Gold Price $ 733
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B Silver Price $ 12
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C Gold Recovery avg 93%
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D Silver Recovery avg 80%
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Equiv Calc equals (733/12) X (0.93/0.80)
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Equiv Calc 71
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---------------------------------------------------------

 

Resources and gold equivalence

Cost and price factors used in the calculation of gold equivalence are based on information from recent Casposo mineral resource and reserve estimates. These include metal prices of US$ 733 per ounce gold and US$ 12 per ounce silver. Gold and silver recoveries used in the estimate, obtained from metallurgical testing were determined to be 93% and 80% respectively from which a silver:gold ratio of 71:1 is derived. See IAU release to ASX dated 17 July 2008.

Qualified Person

The information in this announcement that relates to Resource estimates on Casposo is based on information compiled by or under the supervision of Rodrigo A Marinho, who is a full-time employee of AMEC International. Mr Marinho has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves” and is a Qualified Person as defined in the Canadian National Instrument 43-101 (standards of Disclosure for Mineral Projects). Mr Marinho consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

The information in this announcement that relates to Reserve estimates on Casposo is based on information compiled by or under the supervision of Ralph H Penner, who is a full-time employee of AMEC International. Mr Penner has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves” and is a Qualified Person as defined in the Canadian National Instrument 43-101 (standards of Disclosure for Mineral Projects). Mr Penner consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

Exploration and Development information relating to the Casposo, Taviche and El Salvador projects in this announcement is based on information compiled by or under the supervision of William McGuinty, P. Geo., V.P. Exploration, Intrepid Mines Limited. Bill McGuinty is a full-time employee of Intrepid Mines Limited and has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the JORC ‘AustralasianCode for Reporting of Exploration Results, Mineral Resources and Ore Reserves’ and is a Qualified Person as defined in the Canadian National Instrument 43-101 (standards of Disclosure for Mineral Projects). Mr. McGuinty consents to the inclusion in this announcement of the matters based on his information in the form and context in which it appears.

The information in this report that relates to Exploration Results in Indonesia is based on information compiled by or under the supervision of Malcolm Norris, who is a member of The Australasian Institute of Mining and Metallurgy. Malcolm Norris is a full-time employee of Intrepid Mines Limited and has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the “Australasian Code for Reporting of Exploration Results), Mineral Resources and Ore Reserves”. and is a Qualified Person as defined in the Canadian National Instrument 43-101 (standards of Disclosure for Mineral Projects). Malcolm Norris consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

Quality Control

A Quality Control sampling program of blanks and duplicates has been in operation at the Casposo Project since 2002 to monitor the integrity of all assay results. All core samples are split at the Company’s Calingasta core facility and core samples with inserted control samples are currently shipped to Alex Stewart Assayers Argentina S.A. in Mendoza Argentina, where they are dried, crushed, split and 50 gram pulp samples are prepared for analysis. Gold values are determined by fire assay with an atomic absorption (AA) finish and Silver values are obtained using gravimetric methods for mineralized veins. These samples and those from other areas are also analyzed using an ICP multi-element scan.

At the Taviche project samples are prepared and sent by to the SGS Minerales facility in Durango, Mexico, the drill core samples are dried, crushed to 75% passing 2mm mesh and a 250-gram split is pulverized to 85% passing 75 micrometre mesh. Prepared pulps were analyzed for gold and silver by fire assay with a gravimetric finish (SGS method FAG323) in Durango. Pulps are shipped to SGS Minerals Services in Toronto, Canada for multi-element analysis using an ICP40 element package. For both the surface and drilling programs, blanks and certified reference standards were inserted into the sample stream to control the quality of sample preparation and analysis.

Intrepid exercises a strict chain of sample custody in its drilling program at Tujuh Bukit, Indonesia. Joint Venture personnel remove core from the drill rig and deliver it to a project geologist who logs the core and marks the core into two metre sample intervals. Intrepid and Joint Venture personnel supervise the immediate splitting, sawing and bagging of samples, and packaging of groups of samples for dispatch to the laboratory. The remainder of the split core remains on site.

Samples are securely packaged, batched, and then transported under supervision to Intertek’s laboratory facility in Jakarta. At the laboratory, the samples are prepared by crushing and pulverizing and a 30 gram charge is assayed for gold by conventional fire assay and/or atomic absorption methods. Multi-element ICP analysis is carried out using a multi-acid digestion process. All samples that contain silver and/or copper, lead, and zinc values that exceed the upper detection limits for ICP are re-analysed by conventional atomic absorption methods to determine the absolute values of these metals.

Statements relating to gold resource estimates are expressions of judgment, based on knowledge and experience and may require revision based on actual production experience. Such estimates are necessarily imprecise and depend to some extent on statistical inferences and other assumptions, such as gold prices, cut-off grades and operating costs, which may prove to be inaccurate. The drill programmes at Tujuh Bukit, Taviche and El Salvador are insufficiently advanced to define a resource estimate and it is uncertain if further drilling will result in the determination of a resource statement at these projects.

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION

This release contains certain forward-looking statements, relating to, but not limited to Intrepid’s expectations, intentions, plans and beliefs. Forward-looking information can often be identified by forward-looking words ‘estimate’, ‘may’ and ‘will’ or similar words suggesting future outcomes, or other expectations, beliefs, plans, objectives, assumptions, intentions or statements about future outcomes, or statements about future events or performance. Forward-looking information may include reserve and resource estimates, estimates of future production, unit costs, costs of capital projects, and timing of commencement of operations and is based on current expectations that involve a number of business risks and uncertainties. Factors that could cause actual results to differ materially from any forward-looking statement include, but are not limited to, failure to establish estimated resources and reserves, the grade and recovery of ore which is mined varying from estimates, capital and operating costs varying significantly from estimates, delays in obtaining or failures to obtain required governmental, environmental or other project approvals, inflation, changes in exchange rates, fluctuations in commodity prices, delays in the development of projects and other factors. Forward-looking statements are subject to a variety of known and unknown risks, uncertainties and other factors that could cause actual events or results to differ materially from those expressed or implied.

Shareholders and potential investors are cautioned not to place undue reliance on forward-looking information. By its nature, forward-looking information involves numerous assumptions, inherent risks and uncertainties, both general and specific, that contribute to the possibility that the predictions, forecasts, projections and various future events will not occur. Intrepid undertakes no obligation to update publicly or otherwise revise any forward-looking information whether as a result of new information, future events or other such factors which affect this information, except as required by law.

Statements relating to gold reserve and resource estimates are expressions of judgment, based on knowledge and experience and may require revision based on actual production experience. Such estimates are necessarily imprecise and depend to some extent on statistical inferences and other assumptions, such as gold prices, cut-off grades and operating costs, which may prove to be inaccurate. Information provided relating to projected costs, capital expenditure, production profiles and timelines are expressions of judgment only and no assurances can be given that actual costs, production profiles or timelines will not differ materially from the estimates contained in this announcement.



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CORPORATE INFORMATION (at June 30, 2008)
----------------------------------------------------

Directors and Executive Management
C. G. Jackson Chairman
B. Gordon Managing Director, CEO
L. Curtis Non-Executive Director
K. Dundo Non-Executive Director
R. McDonald Non-Executive Director
I. Mc Master Non-Executive Director
V. Chidrawi Company Secretary
S. Smith Chief Financial Officer
D. Russell GM of Paulsens
M. Norris Executive GM, Exploration &
New Business
B. McGuinty VP, Exploration
F. Bourchier VP Opts. & Bus. Dev., Americas

Issued Capital
The issued capital is 427,902,350 shares comprising
413,417,997 ordinary shares of Intrepid Mines
Limited and 14,484,353 exchangeable shares of
Intrepid NuStar Exchange Company.

Major Shareholders
National Nominees 8.9%

Stock Exchange Listings
Australian and Toronto Stock Exchanges
ASX Ticker Symbol: IAU
TSX Ticker Symbols: IAU & IXN

Shareholder Enquiries
Advanced Share Registry Services
110 Stirling Highway
Nedlands WA 6009
Telephone +61 8 9389 8033
Facsimile +61 8 9389 7871

Equity Transfer & Trust Company
120 Adelaide St W, Suite 420
Toronto, Ontario M5H 4C3
Canada
Telephone: +1 416 361 0930 ext 274
Facsimile: +1 416 361 0470

Corporate and Registered Office
Level 1, 490 Upper Edward Street
Brisbane QLD 4004
Telephone +61 7 3007 8000
Facsimile +61 7 3007 8080

Capital Markets Office
155 University Avenue, Suite 1710
Toronto, Ontario
Canada M5H 3B7
Telephone +1 416 368 4525
Facsimile +1 416 368 3859

Website
www.intrepidmines.com

 

ABN: 11 060 156 452

For more information, please contact

Intrepid Mines Limited
Brad Gordon
Chief Executive Officer
+61 7 3007 8011
Email: bgordon@intrepidmines.com.au
Website: www.intrepidmines.com

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