Forsys Announces Third Quarter 2011 Operational Results and Outlook
TORONTO, ONTARIO -- (Marketwire) -- 11/14/11 -- Forsys Metals Corp. ('Forsys' or the 'Company') (TSX: FSY)(FRANKFURT: F2T)(NSX: FSY) announced today the release of its unaudited consolidated financial and operating results for the three months and nine months ended September 30, 2011, together with its Management's Discussion and Analysis ('MD&A') for the corresponding period. These documents are posted on the Company's profile on SEDAR at www.sedar.com and on the Company's website at www.forsysmetals.com.
Marcel Hilmer, Chief Executive Officer, commented, 'Our third quarter was among our most active for the group with an emphasis on developing our Namibplaas Uranium Project in Namibia. During the third quarter, we released the initial Namibplaas National Instrument 43-101 ('NI 43-101') technical report summarizing the results of the phase one drilling program and have now commenced a $2.5 million phase two drilling program. We also entered into an agreement to acquire the remaining 30% of Namibplaas. This acquisition is a significant step towards the consolidation of production from Namibplaas with production from our 100% owned fully licensed Valencia uranium deposit in Namibia. The announcement of an additional financing of up to $10 million will enable us to focus on advancing our Namibian uranium assets and complete a new feasibility study before the end of 2012'.
As at September 30, 2011, the Company had working capital of $4,979,588.
Highlights from the MD&A include:
-- On September 15, 2011 the Company reported the results of its initial NI
43-101 Resource Statement for its 70% owned Namibplaas Uranium Project
('Namibplaas'). An inferred ore resource of 88 million tonnes containing
25 million pounds of U3O8 at a 100 ppm cut-off grade was reported. The
Company confirmed that the mineralization type is similar to that found
at the Valencia Uranium Project ('Valencia') and that there were a
number of significant high-grade zones.
-- Forsys announced that it was acquiring the remaining 30% interest in
Namibplaas on October 24, 2011. With this acquisition the Company will
be able to benefit fully from the advanced exploration program at
Namibplaas and have full control over the assessment of the
consolidation with the already 100% owned Valencia. Consideration for
this acquisition is 13,000,000 new common shares and 2,000,000 common
share purchase warrants of the Company, exercisable for two years at
$1.10.
-- In October 2011, the Phase two drilling program at Namibplaas commenced,
consisting of an additional 40,000 metres of percussion drilling in
approximately 200 holes. The objective of this in-fill drilling program
is to bring the drill spacing to 40 by 40 metres and allow for
completion of an updated NI 43-101 Resource Statement by the third
quarter of 2012.
-- On October 5 the Company announced that it had entered into a
subscription agreement with Leo Fund Managers Limited ('Leo') whereby
Leo will invest $8,000,000, on a private placement basis for additional
shares of the Company. Completion of the transaction is subject to
approval of the Company's shareholders at a Special Meeting of
Shareholders which has been scheduled for November 18, 2011. The share
subscription will form part of a larger private placement of new shares
by the Company for gross proceeds of up to a maximum amount of
C$10,000,000.
-- Following on from the August 2011 Mintek report on heap leach testing of
Valencia ore, the Company has now commenced the phase two optimization
testing. Ore samples have been shipped to Mintek in South Africa and the
Company remains confident of achieving improved recoveries in the
optimization phase studies that are focusing on larger samples and
improved processes. Simulus, a leading Perth based engineering group,
continue to manage this process.
-- The internal study on potential plant design efficiencies, improved
recoveries and reduced capital and operating costs continues. This
review also includes the economics of consolidating the Valencia and
Namibplaas ore bodies and increasing the plant size and throughput.
Company Outlook
The Phase two drilling program at Namibplaas commenced in October 2011 with the objective of completing an additional 40,000 metres of percussion drilling and bringing the drill hole spacing to 40 by 40 metres to allow for preparation of an updated NI 43-101 technical report in the third quarter of 2012. Forsys expects to complete the acquisition of the remaining 30% interest in Namibplaas in Q4, 2011.
The optimization phase of the heap leach testing on the Valencia ore body continues. The Company is also focused on advancing the design of a consolidated Valencia and Namibplaas uranium projects with an annual plant capacity of approximately 6.0 Mlbs of U3O8 from the two deposits. Preliminary pit designs and mining schedules are expected to confirm the potential of a consolidated operation.
The Company is targeting to complete an updated feasibility report before the end of 2012.
Uranium Price Outlook
The long-term contract price for uranium is reported on a monthly basis by Ux Consulting. It was US$62.00/lb at December 31, 2010 and had moved up to US$73.00/lb at the end of January 2011. At the end of October 2011, the monthly quote for the long-term contract price for uranium was US$63.00/lb.
About Forsys Metals Corp.
Forsys Metals Corp. is an emerging uranium producer with 100% ownership in the fully permitted Valencia Uranium Project and currently 70% ownership in the Namibplaas Uranium Project in Namibia, Africa a politically stable and mining friendly jurisdiction. Current NI 43-101 compliant resource and reserves at Valencia and Namibplaas Uranium Project's are available on our Website.
On behalf of the Board of Directors of Forsys Metals Corp.
Marcel Hilmer, Chief Executive Officer
Sedar Profile #00008536 (11-12)
Forward-Looking Information
This news release contains projections and forward-looking information that involve various risks and uncertainties regarding future events. Such forward-looking information can include without limitation statements based on current expectations involving a number of risks and uncertainties and are not guarantees of future performance of the Company. The following are important factors that could cause Forsys actual results to differ materially from those expressed or implied by such forward looking statements: fluctuations in uranium prices and currency exchange rates; uncertainties relating to interpretation of drill results and the geology; continuity and grade of mineral deposits; uncertainty of estimates of capital and operating costs; recovery rates, production estimates and estimated economic return; general market conditions; the uncertainty of future profitability; and the uncertainty of access to additional capital. Full description of these risks can be found in Forsys Annual Information Form, dated March 29, 2011, available on the Company's profile on the SEDAR website at www.sedar.com. These risks and uncertainties could cause actual results and the Company's plans and objectives to differ materially from those expressed in the forward looking information. Actual results and future events could differ materially from anticipated in such information. These and all subsequent written and oral forward looking information are based on estimates and opinions of management on the dates they are made and expressed qualified in their entirety by this notice. The Company assumes no obligation to update forward looking information should circumstances or management's estimates or opinions change.
Shares Outstanding: 80,130,231
The Toronto Stock Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.
Contacts:
Forsys Metals Corp.
Marcel Hilmer
Chief Executive Officer
61 417 177 942
mhilmer@forsysmetals.com
www.forsysmetals.com
TMX Equicom
Nisha Hasan
1 416-815-0700 ext. 258-258-9721
nhasan@equicomgroup.com
