mt fitch scoping study

COMPASS RESOURCES NL
ABN 51 010 536 820
ASX Release 19 March 2007
�gPreliminary Scoping Study Indicates 2 million tpa
mine based on initial Mt. Fitch Uranium Resources
has attractive economics�h
A preliminary scoping study conducted by Westech International under the direction of
Compass and with significant input from Knox and Associates on geological issues and
MineConsult on mine engineering, indicates that development of the Mt. Fitch Uranium
resources is economically viable on a stand-alone basis in the current uranium demand
and price environment. This preliminary study is based on the uranium resource
announced on 14 July 2006 (announcement attached).
A program of additional drilling, sampling and process engineering test work will now
continue to refine and optimize concepts and collect more data for a Definitive Feasibility
Study. This program will also commence the necessary environmental engineering and
regulatory work required for mining and processing uranium.
Development of Mt. Fitch would provide the first step in the Compass plan for producing
uranium from a number of potential resources in its large tenement holding including the
Rum Jungle area (10 million pounds of uranium was mined in this area during the 1950�fs
and 60�fs).
The plan involves the mining of various potential resources as small independent mines
and processing the ore through a central mill and processing facility.
Continuing work at Mt. Fitch, preparatory to the initiation of a Detailed Feasibility Study
(DFS), will involve amongst other things:
�œ Environmental and Heritage Base line data collection;
�œ Design of all necessary air, water and other control and monitoring systems for the
project;
�œ Further drilling, geological modelling and mining engineering;
�œ Bulk sampling and additional process engineering test work to confirm the process
flow sheets; and
�œ Feasibility level engineering and cost estimating.
Both acid leach and alkali leach in conjunction with Resin in Pulp extraction have been
examined in the preliminary scoping study process flow sheet development. The
presence of significant quantities of carbonates in some of the resource types may favour
the alkali leach approach, which in turn may have significant environmental and hence
operating cost advantages.
Compass generated preliminary financial models based on inputs provided from Westech
and restricted the model to an approximate 10-year life based only on the currently
modelled Mt. Fitch resources. This starter project appears primarily sensitive to grade,
uranium price and process recovery. Using a range of uranium prices the following results
were calculated.
Uranium price NPV @ 10%
$USD 60 $73.8M
$USD 70 $141.3M
$USD 80 $208.8M
$USD 90 $276.3M
Although these are results of a preliminary study, they are entirely as expected and thus
the Board of Directors of Compass find them most encouraging and believe they confirm
the plan for developing the uranium resources of the Rum Jungle area.
About Compass
The Company has a 100% interest in the Browns and associated Copper-Cobalt-Nickel deposits, with
mining of the Oxide Project scheduled to commence in 2007. Projected production (with a mine life of 10
years) is 1.3 million tonnes per year (tpy), to produce 10,000tpy (22 million pounds) of Cu cathode and 2.2
million pounds (1,000tpy) of Co and 1.5 Mlbs (700tpy) of Ni as cobalt and nickel chemicals.
In addition to the Oxide deposit, Compass plans to mine the associated Lead-Copper-Cobalt-Nickel sulphide
deposit, which has a projected mine life of 20+ years.
Compass is also a successful uranium exploration company with a JORC defined resource of 14.5 million
lbs. Compass holds some of the most prospective uranium exploration ground in Australia. The Rum Jungle
mineral field was the site of the first uranium mines in Australia, mines which operated from the 1950s to
the 1970s.
Compass also has programs for gold and base metals exploration in New South Wales,
(Australia), and Peru.