NEWS RELEASE
ECUADORIAN MINERALS CORPORATION
January 14, 1997
Trading: TSE.EMC
EMC UPDATE ON GABY PREFEASIBILITY STUDY
To date, process design criteria have been completed and a mineable reserve and capital cost estimate will be finalized by the end of January. Mine planning and economic analyses will be finished by the end of February and the final report issued in March. EMC's intention would be to proceed to a full feasibility study by May of this year and this would be completed in approximately 12 months.
The main Gaby deposit shows all the classic characteristics of a major Andean gold/copper porphyry system with extensive, mineralized stockworks and breccias contained within an intrusive/volcanic complex. A total of approximately 34,000 meters of drilling have been carried out on the property since 1990, with EMC's programs totaling over 28,000 meters of core and reverse circulation drilling. Drill spacing between holes is about 70 - 100 meters and the deepest holes reach 300 vertical meters. Gold mineralization in excess of 0.5 g/t gold (0.015 oz/t) covers an area of about 1.8 km long by up to 300 meters wide and has been intersected over a vertical distance (allowing for topography) in excess of 500 meters. There are indications from recent drilling of deeper mineralized zones which may have acted as "feeders" for the known mineralization; this hypothesis will be tested with deep drilling as part of a final feasibility study.
The presence of 3 near-surface, higher grade gold centers with low waste-to-ore ("strip") ratios which are amenable to mining in the first 2 years of production will have a significant positive impact on project economics by accelerating capital cost payback. In addition a high-grade, gold-bearing shear zone, located some 400 meters to the east of the main Gaby deposit - the Tama Zone - contains gold values up to 24.0 g/t over 2 meter drill intercepts in 3 holes over a 600 meter strike length, with mineralization still open to the north and south and at depth. Further drilling is planned to commence in February on the Tama Zone together with follow-up drilling in the western portion of the main Gaby deposit where access was not previously possible and where one drill hole (CAL-3) reported an encouraging intercept of 174 meters at 0.74 g/t gold.
Metallurgically, the main Gaby deposit would utilize conventional cyanidation gold recovery technology in a large-scale milling operation followed by a carbon-in-leach recovery process. Based on work by McClelland Labs of Sparks, Nevada, recoveries are expected to be on the order of 87% for the sulfide ore (which represents 95% of the deposit) and 90% for the oxide ore.
To date EMC has earned a controlling 55% interest in the northern portion of the main Gaby deposit, which represents the majority of the known deposit. The remaining 45% interest (for a total 100% interest) in this northern portion can be earned by EMC by making further option payments over the next 3 years. The southern portion of the main Gaby deposit is governed by a joint venture agreement with Zappa Resources Ltd with EMC being the operator and having an option to acquire a 51% interest.
EMC has granted an aggregate of 102,500 Incentive Share Options to employees pursuant to its Stock Option Plan at an exercise price of Cdn$ 0.86 per share until January 2007. The granting of these options is subject to regulatory approval.
EMC is a Toronto Stock Exchange listed exploration and development company with a focus on bulk mineable gold and copper porphyry deposits in the northern Andes of South America, principally Ecuador and Peru. The Company has 31.4 million shares issued and 34.8 million fully diluted.
Stephen J. Kay, President and CEO
The Toronto Stock Exchange neither approves nor disapproves the information contained in this News Release.
For additional information, contact Linda North at Tel: (602) 483-9932 or Fax: (602) 483-9926.