News release
| Wallbr | idge announ | ces positive | results from | Pre-Feasibi | lity Study of | Broken Ha | mmer Projec | t in |
| Sudbury |
| Toronto, | Ontario – | October 16, | 2012 - Wall | bridge Mini | ng Compan | y Limited ( | TSX: WM, | FWB: |
| WC7) (" | Wallbridge" | ) today ann | ounced posit | ive results fr | om a prefea | sibility study | completed | on its |
| Broken H | ammer copp | er and platin | um group m | etal project i | n Sudbury, O | ntario. The | prefeasibility | study |
| was prep | ared by Geni | var Inc. and | demonstrates | the viability | of the projec | t as an open | pit mine, wi | th the |
| ore treate | d at a custom | mill facility. |
Prefeasib bility study highlights
| E | stimated Ear | nings Before | Interest, Ta | xes, Depreci | ation, and A | mortization ( | EBITDA) o | f $8.4 |
|---|---|---|---|---|---|---|---|---|
| m | illion or $42 | .60 per tonne | of ore | |||||
| E | stimated tota | l capital cost | s (CAPEX) f | or the project | of $1.9M | |||
| E | stimated pre | -tax Net Pr | esent Value | (NPV) of $ | 6.03M usin | g an 8% di | scount facto | r and |
| $ | 3.50USD per | pound of Co | pper and $1, | 600USD per | ounce of Plat | inum and CA | D/USD of 1. | 00 |
| E | stimated ore | production r | ate of 750 to | nnes of Cu-N | i-PGE ore p | er day simila | r to the 2011 | bulk |
| s | ample produc | tion rate | ||||||
| E | stimated Min | e life of 12 m | onths | |||||
| E | stimated Ope | rating Costs | (OPEX) of $ | 131.99/per to | nne of ore |
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| All dollar | amounts are | in Canadian | currency. A | final versio | n of the pref | easibility stu | dy will be fil | ed on |
| SEDAR | within 45 day | s as required. |
| “We are | very encoura | ged by the p | ositive result | s of the pref | easibility stu | dy” said Ma | rz Kord, Pre | sident |
| and CEO | of Wallbrid | ge Mining. “ | The prefeasi | bility sugges | ts that the B | roken Hamm | er project h | as the |
| potential | to become e | conomically | viable and g | enerate posit | ive cash flo | w. What’s m | ore encourag | ing is |
| that the d | eposit remain | s open for ex | pansion to th | e west and to | depth”. |
| Mr. Kord | added, “The | footwall-sty | le Broken H | ammer proje | ct is in a larg | e land packa | ge on the no | rthern |
| rim of the | Sudbury ba | sin within a 9 | -kilometer st | rike length o | f very similar | geology wit | h extremely | strong |
| prospects | .” |
Broken H Hammer Proj ject Descript tion
| The Bro | ken Hammer | project is | planned to | be an open | pit operatio | n used for | the extracti | on of |
|---|---|---|---|---|---|---|---|---|
| approxim | ately 196,00 | 0 tonnes of i | n-pit Cu-Ni- | PGE minera | l resources u | tilizing the s | ervices of s | urface |
| mining co | ntractors. Th | e ore is plan | ned to be sam | pled for met | al accounting | through a sa | mple tower o | n-site |
| prior to | being transpo | rted to an o | ff-site facilit | y for proces | sing. The p | refeasibility | study assum | es the |
| productio | n will comm | ence in earl | y to mid-20 | 13 and will | be complete | d within 12 | months of m | ining |
| operation | at an averag | e daily rate of | approximate | ly 750 tonne | s of ore durin | g the 12-mo | nths of operat | ion. |
Summary of the Broken Hammer Updated Mineral Resource Estimate
An updated resource estimate prepared by Roscoe Postle Associates Inc. (“RPA”) according to NI43-101 standards was filed as a technical report on the property on August 1, 2012.
Table 1: Updated mineral resource estimate, with an effective date of July 27, 2012
| BROKEN HAMMER MINERAL RESOURCE | ||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Category | Tonnes | Cu (%) | Ni (%) | Pt (g/t) | Pd (g/t) | Au (g/t) | Ag (g/t) | |||||||
| Indicated | 231,100 | 0.92 | 0.10 | 2.01 | 1.90 | 0.71 | 6.35 |
As part of the prefeasibility study, RPA prepared an in-pit mineral reserve estimate based on a global mining recovery of 95% and 5% dilution (at zero grade). Table 2 below summarizes the in-pit reserve.
Table 2: Mineral Reserve estimate
| BROKEN HAMMER MINERAL RESERVES | |||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Category | Tonnes | Cu (%) | Ni (%) | Pt (g/t) | Pd (g/t) | Au (g/t) | Ag (g/t) | ||||||
| Probable | 196,600 | 0.92 | 0.10 | 1.92 | 1.82 | 0.64 | 6.02 | ||||||
| Waste Rock | 1,710,770 tonnes | ||||||||||||
| Stripping Ratio | 8.7 |
Summary of Capital Cost Estimates (CAPEX)
The total capital cost to build the Broken Hammer open pit is estimated to be $1.9M. Specific details are as follows:
| Category | Capital Cost ($K) | |
|---|---|---|
| Contractor Capital | 538 | |
| Wallbridge Capital | 1,130 | |
| Contingency @ 15% | 250 | |
| Total CAPEX | 1,918 |
Summary of Mine Operating Cost Estimates (OPEX)
| The total mine operating cost including G & A and start-up development, all processing facility charges | |
| and penalties and 1.5% royalty are estimated to be $25.95 million, which represents $131.99 per tonne of | |
| ore. Specific details are as follows | : |
| Mine Operating Costs | $/Tonne | $/Tonne | |||
|---|---|---|---|---|---|
| Mined | Milled | ||||
| Drilling/ Blasting / Loading & Hauling | $8,334,000 | $4.37 | $42.39 | ||
| SUB-TOTAL MINING (DIRECT) | $4.37 | $42.39 | |||
| Add: | |||||
| General & Administrative | $1,263,000 | $0.66 | $6.42 | ||
| Crushing & Sampling | $2,162,000 | $1.13 | $11.00 | ||
| Haulage to custom mill | $1,965,000 | $1.03 | $10.00 | ||
| SUB-TOTAL (INDIRECT) | $2.82 | $27.42 | |||
| TOTAL MINING & TRANSPORTATION COSTS | $7.19 | $69.80 | |||
| Milling, Smelting, Refining Costs & Charges | $12,227,000 | $6.41 | $62.00 | ||
| TOTAL PROCESSING COSTS | $6.41 | $62.19 | |||
| TOTAL OPERATING COSTS | $13.60 | $131.99 |
Economic Analysis & Sensitivity
The parameters used for the prefeasibility study are as follows:
| Metal | Price ($) | Mill Recovery | |
|---|---|---|---|
| (%) | |||
| Copper | 3.50/lb | 94.0 | |
| Nickel | 9.00/lb | 58.0 | |
| Palladium | 650/oz | 85.0 | |
| Platinum | 1,600/oz | 71.0 | |
| Gold | 1,700/oz | 81.0 | |
| Silver | 35.00/oz | 63.0 | |
| CAD/USD | 1.00 |
The 12-month project generates an EBITDA of $8.4M and a pre-tax Net Present Value (NPV) of $6.03 M discounted at 8%. The payback period would be 8.0 months. Below are the details of the economic analysis:
| FINANCIAL ANALYSIS | |||
|---|---|---|---|
| REVENUE | $C | $/Tonne milled | |
| Copper $ | 11,562,600 | 58.81 | |
| Nickel | 1,932,500 | 9.83 | |
| Palladium | 10,969,100 | 55.79 | |
| Platinum | 5,214,300 | 26.52 | |
| Gold | 4,454,300 | 22.66 | |
| Silver | 500,200 | 2.54 | |
| TOTAL REVENUE $ | 34,633,000 | $176.15 | |
| COSTS: | |||
| Mining | $9,791,000 | $49.80 | |
| Crushing & Hauling | 3,933,000 | 20.00 | |
| Milling, Smelting, Refining & other charges | 12,227,000 | 62.19 | |
| TOTAL COSTS $ | 25,951,000 | $131.99 | |
| PROFIT BEFORE ROYALTY | $8,682,000 | $44.16 | |
| Royalty @ 1.5% | 307,000 | 1.56 | |
| EBITDA | $8,375,000 | $42.60 |
The sensitivity analysis on the base case pricing scenario uses variations of +/- 15% from the base case in revenues for copper, platinum, and other factors that could have a significant effect on the project. Below is the sensitivity analysis chart for the Broken Hammer project based on the variations in those significant parameters:
Wallbridge Mining Co. Ltd. - Broken Hammer Mine Pre Tax NPV @ 8%
$12,000
$10,000
$8,000
$6,000
$4,000
$2,000
$0 -15% -10% -5% Base 5% 10% 15% US/C$ Pt Price Opex Capex Cu price Pd price
The project is most sensitive to US/C$ exchange rate as well as project operating costs.
Cautionary Notes regarding the prefeasibility study
The Broken Hammer pre-feasibility study was prepared to broadly quantify the Broken Hammer deposit's capital and operating cost parameters, and to further the development of this footwall-style Cu-Ni-PGE project. It was not prepared for use as a valuation of the Broken Hammer deposit, nor should it be considered to be a final feasibility study. The information contained in the Broken Hammer pre-feasibility study reflects various technical and economic conditions at the time of writing and is based on the successful results of the 2011 bulk sample. These conditions can change significantly over relatively short periods of time. The achievability of life of mine plans, budgets and forecasts are inherently uncertain. There can be no assurance that the potential results contained in the Broken Hammer pre-feasibility study will be realized. Readers are cautioned that the assumptions used in the preparation of the Broken Hammer pre-feasibility study, although considered reasonable at the time of preparation, may prove to be imprecise and, as such, undue reliance should not be placed on them.
Qualified Persons
Qualified person for the Broken Hammer updated resource estimate is Mr. Bruce Churchill, P. Geo., who prepared the 2012 updated resource estimate contained in the prefeasibility study for Broken Hammer Project filed August 2, 2012 referenced herein. Mr. Churchill is a Qualified Person under NI43-101 and is independent of Wallbridge. Qualified Person for the Broken Hammer prefeasibility study, the main subject of this disclosure, is Mr. Rod Doran, P. Eng. of GENIVAR.
In addition to the Qualified Persons responsible for the preparation of the above referenced technical report, Mr. Alar Soever, P. Geo., Executive Chairman for Wallbridge Mining, has acted as Qualified Person, as defined by NI43-101, concerning the exploration portion of this disclosure and Mr. Marz Kord, P. Eng., President & CEO for Wallbridge Mining, has acted as Qualified Person regarding the engineering and economic portions of this disclosure. Both Mr. Soever and Mr. Kord are employees of Wallbridge Mining, thus are not independent.
About GENIVAR
GENIVAR, through its combination with WSP, is one of the world’s leading professional services firms, working with governments, businesses, architects and planners and providing integrated solutions across many disciplines. The firm provides services to transform the built environment and restore the natural environment, and its expertise ranges from environmental remediation to urban planning, from engineering iconic buildings to designing sustainable transport networks, and from developing the energy sources of the future to enabling new ways of extracting essential resources. It has 14,500 employees, mainly engineers, technicians, scientists and architects, as well as various environmental experts, based in more than 300 offices, across 35 countries, on every continent.
About RPA
RPA is a group of technical professionals who have provided advice to the mining industry for nearly 30 years. During this time, RPA has grown into a highly respected organization regarded as the specialty firm of choice for resource and reserve work. Their portfolio of customers includes clients in banking, government, major mining companies, exploration and development firms, law firms, individual investors, and private equity ventures.
About Wallbridge Mining
Wallbridge Mining Company Limited (WM:TSX) is an established metals company working to build sustainable growth for investors through discovery and development of mineral resources.
Wallbridge specializes in nickel, copper, platinum, palladium and gold projects in mining friendly jurisdictions of North America, with a particular focus on Sudbury, Ontario. Wallbridge's position in Sudbury offers unique large-scale discovery upside in Canada's premier mining district.
Wallbridge has a record of generating high potential projects and financing exploration through joint ventures or spin-out companies. Wallbridge has 48 exploration to pre-feasibility stage mineral projects. These include 12 joint ventures with partners Impala Platinum Holdings Limited, Lonmin Plc, Xstrata Nickel and a number of junior mining companies.
Wallbridge also holds significant equity interests in spin-out companies Duluth Metals Limited (DM:TSX) and Miocene Metals Limited (MII:TSV).
For Further Information
Please visit the Company's website at www.wallbridgemining.com, or contact:
Wallbridge Mining Company Limited
Joshua Bailey, M.Sc., P.Geo Vice President, Exploration Tel: (705) 682-9297 ext. 240 Email: [email protected] Linda Zubal Director of Corporate Communications Tel: (705) 682-9297 ext. 263 Email: [email protected]
This document may contain forward-looking statements relating to operations of Wallbridge or its subsidiaries or to the environment in which they operate. Such statements are based on operations, estimates, forecasts and projections. They are not guarantees of future performance and involve risks and uncertainties that are difficult to predict and may be beyond Wallbridge's control. A number of important factors could cause actual outcomes and results to differ materially from those expressed in forward-looking statements, including those set forth in other public filings. In addition, such statements relate to the date on which they are made. Consequently, undue reliance should not be placed on such forward-looking statements. Wallbridge disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, save and except as may be required by applicable securities laws.