Re: News Release - Tuesday, April 19, 2005
Title: *Chang Shan Hao 217 Gold Project Independent Preliminary Assessment and Technical Report Filed
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New Independent Estimate Doubles Measured and Indicated Resources to 2.2 Million Ounces of Gold and Increases Inferred Resources to 1.0 Million Ounces
VANCOUVER, CANADA - Jinshan Gold Mines is pleased to announce that is has filed an updated independent preliminary assessment and technical report ("Technical Report") in compliance with National Instrument 43-101 in connection with its new resource estimate on the Chang Shan Hao 217 ("CSH 217") Gold Project in Inner Mongolia, China. The updated Technical Report addresses the requested clarification of, and justification for, certain assumptions made in the company's technical report dated February 18, 2004 that formed the basis for an earlier resource estimate in respect of the CSH 217 Gold Project (see the company's January 14, 2005 news release). It also addresses all of the issues raised by the British Columbia Securities Commission in pre-filing discussions with respect to this updated Technical Report.
The Company's new, independent resource estimate on the CSH 217 Gold Project has more than doubled the project's measured and indicated gold resources to approximately 2.2 million ounces and also has increased the project's inferred gold resources to approximately 1.0 million ounces. The base case measured and indicated resources at the CSH 217 Gold Project (using a cut-off of 0.5 g/t gold and a gold price of US$400 per ounce) have been increased to 83 million tonnes grading 0.82 grams per tonne (g/t) gold, for contained gold content of approximately 2.2 million ounces. In addition, the project contains an estimated 37 million tonnes of inferred resources grading 0.89 g/t gold, for an additional contained gold content of approximately 1.0 million ounces.
Estimated Measured, Indicated and Inferred Resources for the CSH 217
Gold Project at various cut-off grades (base case highlighted)
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Meas-
ured Cont- Cont-
Meas- Indi- +Indi- ained Infe- ained
ured cated cated Gold rred Gold
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Mil- Mil- Mil- Mil- Mil- Mil-
Cut- lion Gold lion Gold lion Gold lion lion Gold lion
off Ton- Grade Ton- Grade Ton- Grade Ounces Ton- Grade Ounces
(g/t) nes (g/t) nes (g/t) nes (g/t) Gold nes (g/t) Gold
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0.3 22.4 0.75 82.3 0.74 104.7 0.73 2.46 52.4 0.74 1.25
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0.4 20.7 0.78 76.5 0.76 97.2 0.76 2.38 42.9 0.83 1.14
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0.5 17.6 0.84 65.0 0.81 82.7 0.82 2.18 36.5 0.89 1.04
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0.6 13.7 0.92 50.4 0.88 64.1 0.89 1.83 31.4 0.95 0.96
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0.7 10.3 1.01 37.3 0.97 47.7 0.98 1.50 24.6 1.03 0.81
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0.8 7.7 1.10 26.9 1.05 34.6 1.06 1.18 19.8 1.10 0.70
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0.9 5.7 1.19 18.6 1.14 24.3 1.16 0.91 14.7 1.19 0.56
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1.0 4.1 1.28 12.6 1.24 16.8 1.25 0.68 10.0 1.30 0.42
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The footnotes below apply to the resource table.
1) The Mineral Resources reported above have been calculated as of February, 2005 in accordance with the standards of the Canadian Institute of Mining, Metallurgy and Petroleum.
2) The contained gold represents estimated contained metal in the ground and has not been adjusted for mining or metallurgical recoveries. Readers are encouraged to review the Technical Report, which is filed on SEDAR (http://www.sedar.com), to understand all of the key assumptions, parameters and methods used to estimate the mineral resources.
3) Mineral resources that are not reserves do not have demonstrated economic viability. Measured and indicated mineral resources are that part of a mineral resource for which quantity and grade can be estimated with a level of confidence sufficient to allow the application of technical and economic parameters to support mine planning and evaluation of the economic viability of the deposit. An inferred mineral resource is that part of a mineral resource for which quantity and grade can be estimated on the basis of geological evidence and limited sampling and reasonably assumed, but not verified.
The new resource estimate was constrained using a mineralized envelope defined at 0.20 g/t gold, and interpreted on 50-metre sections. Gold grades were interpolated within the mineralized envelope using a combination of indicator and ordinary kriging methods (Indicator-modified Ordinary Kriging). The in-situ dry density values used were 2.65 tonnes per cubic metre (t/m3) for the oxide mineralization and 2.75 t/m3 for the sulphide mineralization. A grade capping of 5.0 g/t gold was applied, which removes about 3% of the in-situ contained gold in the database. The resources have been diluted to accommodate a bulk-mining production plan.
The resources have been classified using an index of drill-hole data configuration, which is based on multiple kriging passes. Measured resources are those within an ellipsoid 40x16x28 metres and a minimum of five composites and three octants informed; indicated resources are defined as estimated within 120x48x84 metres with a minimum of three composites and two octants informed; and inferred resources are defined as estimated within an ellipsoid 200x80x140 metres, and with two composites minimum informed. In all cases, the search ellipsoids were orientated along the strike of the mineralization.
The CSH 217 Gold Project deposits still remain open in some areas. Although the gold generally appears mostly as freely disseminated throughout the deposits, further upside to the project economics lies in determining a potential milling flow sheet to maximize recoveries of sulphidebearing material. Ongoing metallurgical studies indicate that the entire deposit should be amenable to heap leaching at a ¼-inch to ½-inch crush size. Optimization studies have commenced and will continue concurrently with proposed start-up of heap-leach mining operations. Bulk-tonnage and column-test metallurgical studies have commenced to provide a better understanding of run-of-mine (ROM) operating parameters.
Open-pit pilot mining was completed at the project in late 2004. The operation produced approximately 100,000 tonnes of oxidized mineralization for heap-leach/bulk-tonnage trials that are scheduled to commence during the second quarter of 2005. The pilot project was undertaken to advance scoping/feasibility studies and permitting toward full-scale mining. The pilot program was designed to test a targeted, commercial production rate of 100,000 ounces per year.
The new resource estimate was calculated by Mario E. Rossi, MSc., Min. Eng., of GeoSystems International Inc., Florida, USA, a qualified person as defined by National Instrument 43-101, based on the results from a drilling program that was undertaken in 2004. To date, 20,448 metres of drilling has been completed at the project.
Mr. Rossi supervised the preparation of the information in this release. Mr. Rossi has reviewed the available data, including drill logs, assay certificates and additional supporting sources, and believes that the resource calculation was conducted in a professional and competent manner. In addition, Mr. Rossi is unaware of any environmental, permitting, legal, taxation, socio-political, marketing, or other relevant issues that could materially affect such calculations.
About Jinshan
Jinshan Gold Mines is a Canadian company focused on the exploration and development of gold and copper projects in China. The company also is conducting exploration work on prospective properties in Xinjiang, Yunnan, Shandong, Liaoning, Guizhou and Inner Mongolia, in China.
Jinshan shares are listed on the TSX Venture Exchange under the symbol JIN.
Investors: Bill Trenaman/ Media: Bob Williamson: +1.604. 609.0598
Email: info@jinshanmines.com Website: http://www.jinshanmines.com
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