Formation Metals Inc. Begins Processing Silver & Gold Concentrates
VANCOUVER, BRITISH COLUMBIA -- (Marketwire) -- 05/02/12 -- Formation Metals Inc. ("Formation" or the "Company") (TSX: FCO) announces today that it has received notice that it has been placed on the Approved Refiners and Brands official list of the Commodity Exchange Inc. (COMEX). Effective April 30, 2012 the "SUNSHINE" silver brand will be deliverable against the Exchange's Silver futures contract.
Quality silver has been consistently produced for at least five years at the Company's Sunshine Precious Metals Refinery which is one of the criteria for the listing. The Refinery is part of the Company's Big Creek hydrometallurgical complex, located in the Coeur d'Alene mining district in the Silver Valley area of northern Idaho. COMEX is a division of the New York Mercantile Exchange, a commodity futures exchange.
"The COMEX listing will attract a wider range of customers," stated Mari-Ann Green, CEO of Formation Metals Inc. "In anticipation of the listing, we have also been preparing the hydromet plant to accept silver/copper and gold concentrates. As we gear up and have both facilities in operation the hydromet plant will serve to provide additional feed for the refinery. We are expecting a significant positive impact on revenue generation."
The Sunshine Silver Refinery refines silver and gold dore, high grade silver residues and other high content silver materials into high quality silver and gold bullion for customers. This provides the Company with a steady positive operating margin. Over the past few years however, there have been significant changes to refining and concentrate processing capabilities around the world. Formation therefore, has received numerous requests from local mines and mines across North and South America to process their concentrate. Interestingly, the Big Creek hydrometallurgical plant type of concentrate processing is not presently available in the United States, and for certain types of concentrates not available in the western hemisphere. In addition, the hydrometallurgical plant can operate as a low emission, zero liquid discharge facility and can process materials that traditional smelters find difficult or impossible to process under modern strict environmental standards.
After review of the material specifications and analysis of the hydrometallurgical plant's capability, the Company's technical staff and market consultants concluded that the operating margin at the complex could be greatly improved by processing copper/silver and gold concentrates in addition to refining dore and other materials. It was also determined that this could be accomplished with minimal capital costs.
Mr. Michael Irish, General Manager of Formation Metals U.S., commented, "The plant has processed locally sourced concentrates under previous ownership with great success at considerably lower silver prices than today's. Since that time, there have been significant upgrades, inspections and modifications made, including a gold concentrate treatment system. We will be excited to once again see this facility process concentrate materials. The facility has been shown to be a value added alternative to other process options for our customers." Mr. Irish concluded, "This is a great opportunity to work with our neighboring mines and mines from around the world."
Earlier in the year, the Company entered into an agreement to process silver concentrates from the Crescent Mine located three miles from the Refinery. The first delivery of concentrate from the Crescent Mine for pilot runs was delivered last week. In addition, gold concentrate is being delivered weekly for processing, and other contracts are currently being negotiated. Research and testing of various concentrate materials is ongoing and the Company expects to process an increasing variety of concentrates with a wider range of acceptable impurities in the future.
Formation Metals Inc.
This press release contains "forward-looking statements" within the meaning of applicable Canadian securities legislation. Generally, forward-looking statements can be identified by the use of forward-looking terminology. Forward-looking statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of the Company to be materially different from those expressed or implied by such forward-looking statements. Although the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. The Company does not undertake to update any forward-looking statements that are contained herein, except in accordance with applicable securities laws. Further information on the Company is available at www.sedar.com.
The statements contained in this news release in regard to Formation Metals Inc. that are not purely historical are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including Formation Metals Inc.'s beliefs, expectations, hopes or intentions regarding the future. All forward-looking statements are made as of the date hereof and are based on information available to the parties as of such date. It is important to note that actual outcome and the actual results could differ from those in such forward-looking statements. Factors that could cause actual results to differ materially include risks and uncertainties such as technological, legislative, corporate, commodity price and marketplace changes.
Formation Metals Inc.
E.R. (Rick) Honsinger, P.Geo.
V.P. Corporate Communications