VANCOUVER, BRITISH COLUMBIA - April 2, 2015 - MGX Minerals Inc. (“MGX” or the “Company”) (CSE: XMG / FKT:1MG) is pleased to report that due to a low snow pack throughout the region, the Company has commenced early-season exploration and field reconnaissance activities.
Filed Reconnaissance completed at Koot Silica Prospect
The Company recently entered into an agreement with American Manganese Inc. to acquire the Kootenay Silica prospect (“Koot Claims”) (see press release dated March 5, 2015). Recent field reconnaissance has included mapping and geochemical sampling. Rock chip samples collected at the Koot Claims have been sent to ALS Minerals for whole rock analysis. Results are expected shortly and will assist in planning a phase one diamond drill program at Kootenay Silica.
Historic exploration on the Koot Claims by Cominco (now Teck-Cominco) outlined a mineralized zone spanning approximately 400 meters consisting of high-purity silicon dioxide (SiO2). Whole rock analysis of composite samples in six of seven diamond drill holes returned values ranging between 98.7% and 99.3% SiO2. The zone remains open along strike and at depth to the north, east and west. Cominco also completed decrepitation testing of rock fragments at 1,000° Celsius from three quartzite outcrops and noted no decrepitation.
MGX intends to use silica produced from Kootenay Silica as the primary ingredient for the production of ferro-silicon, a major industrial compound. The Company has completed ingredient composition and preliminary plant design for production of ferro-silicon and there appears to be sufficient silica (based on previous work) on the Koot Claims to support initial production.
Being regionally located near the Company’s flagship Driftwood Creek magnesium property (“Driftwood Magnesium”), Kootenay Silica may benefit from economies of scale through co-location of the magnesium oxide and ferro-silicon plants.
Driftwood Creek Update
MGX has conducted an internal scoping study to determine the final location for its magnesium oxide production plant. Negotiations are underway regarding MGX’s preferred locales.
Work is also underway at Driftwood Magnesium to construct a resource model that includes both the “Western” and “Eastern” mineralized zones (See Picture 1). Re-assaying of historic drill core from the “Western Zone” is proceeding on schedule. The historic drill core comprises over 620 meters of drilling across eight diamond drill holes and represents a mineralized zone spanning approximately 325 meters of strike length and up to 140 meters in true thickness (Klewchuk 2010).
Two historic resource estimates* (non 43-101 compliant) have been completed on the Property. Kaiser Resources Ltd. calculated a historic resource estimate totaling 22.5 million tonnes of magnesium oxide (MgO) using a specific gravity of 2.5 (Morris, 1978). Canadian Occidental Ltd. also prepared a resource estimate that totaled 29.4 million tonnes at a specific gravity of 3.0.
Picture 1. Historic drill hole map for “Western” and “Eastern” zones at Driftwood Creek.
MGX is also preparing an updated mine plan. The current mine plan suggests annual gross throughput totaling 220,000 tonnes of ore to produce approximately 100,000 tonnes of mid-grade (94-96%) dead-burned magnesia (DBM) for refractory use, along with substitution capacity to produce up to 100,000 tonnes of caustic calcined magnesia (CCM) for specialty fertilizer and animal feed supplement.
The Company is developing a long life quarry to support production of magnesium oxide (MgO) and continues to work with the Ministry of Energy and Mines to build a suitable mine plan that provides long-term economic benefits for the people of the East Kootenay Region.
*These are historical resource estimates that do not comply with the current CIM Definition Standards on Mineral Resources and Mineral Reserves as required by NI 43-101. A Qualified Person has not done sufficient work to upgrade or classify these historical resources estimates to current mineral resources prepared in accordance with NI 43-101. The issuer is not treating the historical estimate as current mineral resources and the historical estimate should not be relied on.
Andris Kikauka, Vice President of Exploration for MGX Minerals, and a non-independent Qualified Person as defined by N.I. 43-101, has reviewed the information contained in this news release and has verified the data.