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Copper Fox updates resources at Schaft Creek, higher copper grades

Copper Fox Metals  (CVE:CUU) announced Monday that its Schaft Creek deposit in northwest British Columbia now contains an estimated 6.1 billion pounds of measured and indicated copper, with significantly higher grades from an earlier resource report in 2008. 

The updated resource estimate, prepared by AMEC Americas, indicated that at a base case 0.20% copper equivalent cut-off, the deposit hosts 1.01 billion tonnes, grading 0.27% copper, 0.017% molybdenum and 0.18 grams per tonne (g/t) of gold, for a total of 6.1 billion pounds of contained copper, 383 million pounds of molybdenum, and 5.8 million ounces of gold. 

The measured grade of copper now stands at 0.36%, compared to 0.30% in the pre-feasibility study nearly three years ago. 

Copper Fox said that in adopting a more conservative approach to optimize the project’s economics, the company selected a higher cut-off grade to increase the average copper grade per tonne, while reducing tonnage. 

The Schaft Creek deposit is one of the largest undeveloped copper, gold, and molybdenum deposits in North America. In 2008, the project was estimated to have a before tax net present value of $2.8 billion over a 23-year mine life, at an 8% discount rate.

Inferred resources, at the same base case cut-off as above, were estimated at 283.6 million tonnes at a copper equivalent grade of 0.39%, containing a further 1.5 billion pounds of copper, 69 million pounds of molybdenum, and 1.3 million ounces of gold. 

"The completion of the resource estimate is a great milestone for Copper Fox. Our primary objective now is to complete the feasibility study for the Schaft Creek project as soon as possible,” said president and CEO Elmer B. Stewart. 

“The strategy for the resource estimate was to eliminate areas of very low grade mineralization and therefore reduce grade smoothing. 

“The updated resource estimate shows that the average metal grades for the deposit remain relatively constant up to a 0.25% copper equivalent cut-off, above which the tonnes decrease significantly with a corresponding increase in the average metal grades.”

Indeed, the 2011 drilling program at the site is focused on the higher-grade mineralization intersected in the Paramount Zone last year, with the aim of defining a higher grade “starter pit”, and increasing the tonnage and average grade of the metals in this zone. 

The company expects to complete an updated resource estimate for this area after it finishes the 2011 drilling campaign, with a feasibility study anticipated by the end of the third quarter. 

Copper Fox said that though Schaft Creek also hosts silver at an estimated grade range of between 1 and 2 g/t, silver content was not included in the latest estimate due to some historical data issues. 

Mineral resources were estimated for the Main Zone and the Paramount Zone using a total of 387 drill holes, or approximately 88,685 metres.

Copper Fox has earned a 100% working interest in the Schaft Creek project, subject to a 30% carried interest held by Liard Copper Mines, and an earn back option held by Teck Resources (NYSE:TCK, TSE:TCK.B).