VANCOUVER, BRITISH COLUMBIA--(Marketwire - July 12, 2012) - Formation Metals Inc. (FCO.TO) (the "Company") is providing an update on the progress of construction on its 100% owned Idaho Cobalt Project ("ICP"), which is managed by JDS Energy & Mining. The ICP is comprised of the development of a mine and construction of a concentrator at a primary cobalt deposit in Lemhi County near the town of Salmon, Idaho, and the construction of an electrowinning cobalt production facility in Shoshone County, near Kellogg, Idaho, U.S.A.
Mine & Concentrator Site Construction Progress Summary
Construction activities at the minesite are concentrated on the construction of a new access and haul road recently approved by the agencies overseeing the mine plan of operations. The importance of this new road is that it provides an additional access between the mine portal and mill apart from the proposed tram line and eliminates two miles of haul road dedicated to mine traffic between the portal bench and mill which is expected to have a positive impact on the cost per ton to process the ICP ore.
Major re-alignment work on a section of the access road known as "Buddy's Grade" has also been completed at the minesite. This work was designed to reduce the degree of its grade and curve to accommodate the safe and efficient passage of the concentrate haul trucks travelling to the Company's hydrometallurgical refining complex outside of Kellogg, Idaho. Concurrently, the construction of an emergency safety on-site helipad and the clearing of approximately 7.2 acres of land for new road access are underway. This summer's work to date has involved the movement of approximately 14,000 cubic yards of earthworks and the placement of approximately 1,740 cubic yards of new gravel on Buddy's Grade, the heli-pad and berms along access roads. In addition, road improvements along Meadow Creek required grading and the placement of a further 1,570 cubic yards of gravel.
Cobalt Production Facility Construction Progress Summary
Engineering, construction and procurement continued on the ICP concentrate refining circuits. This included the engineering and procurement of a dedicated continuous process hydrometallurgical circuit to process cobalt concentrate, the preparation for re-starting of the copper electrowinning circuits to process copper and the preparation of the gold circuits design. Plans to re-start the copper electro-winning circuits are in place using all cells with the ability to expand to the design capacity of 8 million pounds of copper annually.
As discussed in the Company's news release dated May 2, 2012, the decision to utilize a new continuous process hydrometallurgical circuit to process ICP cobalt concentrate has allowed the three existing batch process autoclaves to be available for processing third party silver, copper and gold concentrates. These existing autoclaves have recently been x-rayed, pressure tested and certified for commercial use. Commissioning of these existing autoclaves is in process and is proceeding as anticipated.
Third party concentrate is now being delivered to the refinery on a daily basis with the leach section expected to soon be operational. Management at the refinery is evaluating cost estimates for the required sections for this new concentrate processing business and is working toward commissioning the refining complex up to its design capacity of 30 tons per day of concentrate material.
As a result of the expanding business at the refinery, the Company recently hired Mr. Donnie Murrell, M.B.A., as the Sunshine Precious Metals Refinery Manager. He has significant experience in sales, commercial real estate and has experience in multiple management positions, including contract management and operations management. Mr. Murrell's key responsibilities include developing goals, objectives, policies and procedures related to activities, developing and administering budgets, and conducting short and long range planning. Mr. Murrell will also work in expanding the customer base while meeting existing customer contract deadlines.
"Construction activities continue at both the minesite and the refining complex utilizing cash on hand to keep critical construction activities moving forward while we continue to concentrate on closing the final stage of mine financing," stated Mari-Ann Green, Chairman and CEO of the Company. She continued, "Once we have secured the funds required to complete the construction of the ICP we will commence Phase III Construction. Phase III is expected to take between 9 and 14 months from the commencement of underground operations to access the ore and commence commercial production of high purity cobalt and byproduct copper and gold."
Formation Metals Inc. is a well-established, mineral exploration, development and refining company that is dedicated to the principles of environmentally sound mining and refining practices, and believes that environmental stewardship and mining can co-exist. Formation trades on the Toronto Stock Exchange under the symbol FCO.
Formation Metals Inc.
Mari-Ann Green, C.E.O.
This press release contains "forward-looking statements" within the meaning of applicable Canadian securities legislation. Generally, forward-looking statements can be identified by the use of forward- looking terminology. Forward-looking statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of the Company to be materially different from those expressed or implied by such forward-looking statements. Although the Company has attempted to identify important factors that could cause actual results to differ materially from those contained 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. Accordingly, readers should not place undue reliance on forward-looking statements. The Company does not undertake to update any forward-looking statements that are contained herein, except in accordance with applicable securities laws. Further information on the Company is available at www.sedar.com.
The statements contained in this news release in regard to Formation Metals Inc. that are not purely historical are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including Formation Metals Inc.'s beliefs, expectations, hopes or intentions regarding the future. All forward-looking statements are made as of the date hereof and are based on information available to the parties as of such date. It is important to note that actual outcome and the actual results could differ from those in such forward-looking statements. Factors that could cause actual results to differ materially include risks and uncertainties such as technological, legislative, corporate, commodity price and marketplace changes.