MONTREAL, QUEBEC--(Marketwire -04/17/12)- To continue to meet growing demand for its strategic metal, Malaga Inc. (TSX: MLG.TO - News)(OTCQX: MLGAF.PK - News) is pleased to announce today that it will undertake the construction of a pilot plant to validate the proof of concept studies for recovering and reprocessing tungsten from its existing tailings pond. In March 2012 the company's NI 43-101 reported that the pond contains 450,000 tonnes @ 0.14% WO3 of inferred resources.
Financed by an advance on sales from Malaga's current customer, Global Tungsten & Powders Corp ("GTP"), construction will begin immediately with first delivery expected in Q3-2012. Assuming a 50% recovery rate, Malaga would produce an additional 31,500 metric tonne units (MTU's) over the next few years from the current tailings pond, which is the equivalent value of $10M USD in revenues at current market prices.
"We are pleased to valorize the tungsten content from our current tailings pond, and look forward to using the cash flow generated from this project to invest in development of the Pasto Bueno mine," said Pierre Monet, President and CEO of Malaga Inc. "We are also pleased to benefit from GTP's on-going support and their position as a leading player in the tungsten sector."
To help increase the current plant recovery rate, the intent is to add screens that will capture the very fine particles which the current production line is unable to process. The project consists of pumping the tailings from the current pond to the pilot plant; sorting the material through a series of different screens, and then processing it through magnets to obtain a final concentrate. It's expected that the pilot plant will have a capacity of 300 tonnes per day. Upon success of the recovery project, Malaga will install additional recovery capacity and add new screens to the current production line in an effort to continue to improve the recovery rate as well as reduce future closure costs.
ANNUAL GENERAL MEETING
The annual general meeting will be held on June 6, 2012 at 10am at 1 Place Ville-Marie, 40th floor.
Malaga Inc. owns and operates the Pasto Bueno mine in Peru, and is one of the few publicly- traded producers of tungsten outside of China. Malaga is a low cost producer due to its gravimetric ore concentration process and the availability of hydroelectric power generated on its property. While Malaga's production capacity represents about 10% of the tungsten available for sale outside of China, the Company plans to increase production and is currently exploring the property to develop its reserves and resources.
Certain statements in the foregoing may constitute forward-looking statements which involve known and unknown risks, uncertainties and other factors that may cause Malaga's actual results, performance or achievements or industry results to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. The information provided reflects management's current expectations regarding future events and performance as of the date of this news release.