January 29th, 2008
Vancouver, BC, January 29, 2008 - Dynasty Metals & Mining Inc. (TSX: DMM, “Dynasty”) provides the following update to shareholders from its President, Robert Washer:
We made significant progress in 2007 towards achieving our two primary objectives, which are: to materially increase our resources estimates through continued exploration, and to become the largest gold producer in Ecuador, initially by bringing our Zaruma Gold and Jerusalem Projects into production.
Production Update - Zaruma Gold Project
In April 2007, we received the last of the necessary permits from the Ecuador Ministry of the Environment to construct and operate a mill capable of processing 500,000 tonnes of ore per annum at our Zaruma Gold Project.
We are rapidly progressing the development of our project, with production now expected to commence towards the end of the second quarter of this year. The project is on budget. Presently we:
- employ approximately 350 local residents, approximately 150 of which are working on underground exploration and the construction of the main decline;
- have completed approximately 50% of the pre-fabrication work on major plant components;
- have completed the footings and cement work for the ball mills, ore bins, crushers, conveyors, mixers and tanks;
- expect the ball mills to be delivered from Guayaquil and installed within six weeks;
- have stockpiled approximately 17,000 tonnes of high grade ore for the start up of the plant; and
- have completed one kilometre of underground exploration tunnels, from which we have defined the ore blocks from which we are going to mine initially from our main decline, which is only 120 metres from the first priority ore stopes.
Starting next month, we will regularly update our website at www.dynastymining.com with pictures as construction progresses.
Initially, we will process 300,000 tonnes of ore from our measured and indicated resources to produce approximately 100,000 ounces of gold annually at a total cash cost, inclusive of mining, of about US$200 per ounce. The installed capacity of the plant, except for the wet section, will be approximately 800,000 tonnes, allowing for significant expansion after we reach steady state production.*
Exploration Update - Dynasty Copper-Gold Belt
In November 2007, we announced a significant increase to our resources estimate at our Dynasty Goldfield Project. (See our press release dated November 19, 2007).
We continue to drill the Dynasty Goldfield. To date, we have only drilled within an area of approximately five square kilometres (km2) out of a total area of 30 km2 with high grade gold at surface, which was discovered through extensive trenching and assaying. At present, we are operating two diamond drill rigs and are expecting two more rigs to be delivered shortly to increase exploration at the Company’s projects.
Production Update - Jerusalem Project
We have received approval from the Ministry of Mines & Petroleum of the Terms of Reference to be included in the Environmental Impact Study (“EIS”) for Jerusalem. Prior to this approval, the Terms of Reference were presented to, and accepted by, the local community. The Company intends to comply with all of the requirements and technical procedures for the approval of the EIS from the Ministry of Mines & Petroleum, which, when fulfilled, will give us final approval to construct and operate the plant and mine.
The proposed plant for Jerusalem will initially be designed to produce approximately 100,000 ounces of gold annually and will be similar in size and include the same processing methodologies that will be employed at Zaruma. We have already purchased the ball mills, crushers, conveyor systems and the land on which the plant will be constructed.
Other Significant Events
In the past twelve months we achieved, among other results, the following:
- In January 2007, we hired Carlos Muirragui as our Business Development Manager in Ecuador. Mr. Muirragui is a former senior member of the Ecuadorian government, where he held a number of positions, including Vice Minister of Mines, Under Secretary of Hydrocarbons, and Under Secretary of Environmental Protection. On various occasions he was the acting Minister of Energy and Mines. He has extensive knowledge of operations within these ministries. Mr. Muirragui is a geologist and a civil engineer.
- In June 2007, we completed a $6 million non-brokered private placement at $6.00 per share.
- In August 2007, our shares were listed and called to trade on the Toronto Stock Exchange.
- In October 2007, we completed a $9.9 million brokered private placement at $8.25 per share.
- In December 2007, we exercised a previously negotiated option to buy back one-half of a 3% royalty payable on our Zaruma Gold Project for US$1 million. The Company has a further option to purchase the balance of the royalty for US$5 million at anytime before December 2008.
The President of Ecuador has made it clear on several occasions that he favours mining and expects it to be an engine for future economic growth. The mining industry in Ecuador is in its infancy. We will be the first modern mine to operate in Ecuador in approximately 50 years, and are constructing the largest plant in Ecuador’s history.
At present, mining in Ecuador is not subject to royalties or other forms of direct government participation, which is common in many other jurisdictions. It is generally understood that significant new taxes will deter foreign investment and slow industry growth. For these reasons, we believe that any future tax changes will be competitive with neighbouring nations and will not significantly impact our investment decisions.
Our present market capitalization of approximately $220 million, at $7.50 per share and 29.3 million shares outstanding, includes $16 million in cash and, as previously reported, significant estimated gold and silver resources. Our in ground estimated gold resources are presently valued by the market at approximately $35 per ounce at a time when we are in construction to commence large scale production. This excludes any value attributable to our many exploration prospects or the silver and other constituent metals associated with our gold resources.
I wish to thank our shareholders for their continued support.”
President & Chief Executive Officer
About Dynasty Metals & Mining Inc.
Dynasty Metals & Mining Inc. is a Canadian based mining company involved in the exploration and development of mineral properties in Ecuador. The Company has two advanced-stage projects, Zaruma, which is near production, and Jerusalem, and a highly prospective exploration project, the Dynasty Copper-Gold Belt, which includes the Dynasty Goldfield, the Copper Duke Project and the Marianna Joint Venture among other prospects.
Dynasty Metals & Mining Inc.
Robert Washer, President and CEO
For further information please visit the Company’s website at www.dynastymining.com, or please contact
|Dynasty Metals & Mining Inc.|
Tel: (604) 687-0888
|Brisco Capital Partners Corp.|
Tel: (403) 262-9888
*Based on an independent gold resources estimate of 1,568,000 tonnes in the measured category, with 0.45 ounces per tonne (“oz/t”), 13.93 grams per tonne (“g/t”), and 702,100 ounces gold; 915,000 tonnes in the indicated category, with 0.45 oz/t, 13.87 g/t and 408,100 ounces of gold; and 3,382,000 tonnes in the inferred category, with 0.41 ounces per tonne (“oz/t”), 12.72 grams per tonne (“g/t”), and 1,383,400 ounces gold. For further information, see the Company’s news release dated July 12, 2006 and An Independent Preliminary Assessment of the Zaruma Gold Project, which is dated August 21, 2006, both of which are available for viewing at www.sedar.com.
Julian McDermott, a member of AUSIMM (Australian Institute of Mining and Metallurgy) and a “Qualified Person” within the definition of that term in National Instrument 43-101 - Standards of Disclosure for Mineral Projects, is responsible for the technical information contained in this news release.
This news release includes “forward-looking information”, as such term is defined in applicable securities laws. The forward-looking information includes, without limitation, the estimation of mineral resources, the realization of mineral resources estimates, the success of exploration activities and other similar statements concerning anticipated future events, conditions or results that are not historical facts. These statements reflect management’s current estimates, beliefs, intentions and expectations; they are not guarantees of future performance. The Company cautions that all forward-looking information is inherently uncertain and that actual performance may be affected by a number of material factors, many of which are beyond the Company’s control. Such factors include, among others, risks and uncertainties relating to exploration and development; the ability of the Company to obtain additional financing; the Company’s limited operating history; the need to comply with environmental and governmental regulations; political and economic instability and general civil unrest in Ecuador; potential defects in title to the Company’s properties; fluctuations in currency exchange rates; fluctuating prices of commodities; operating hazards and risks; competition; and other risks and uncertainties, including those described in the Company’s Annual Information Form dated February 19, 2007 filed with the Canadian Securities Administrators and available at www.sedar.com. Accordingly, actual future events, conditions and results may differ materially from the estimates, beliefs, intentions and expectations expressed or implied in the forward-looking information. All statements are made as of the date of this news release and the Company is under no obligation to update or alter any forward-looking information.