12 0 Adelaide S treet West, Suite 1900
Toronto, Ontario, M5H 1T1
www.mbacfert.com
Phone 416.367.2200
Fax 416.367.2244
investor@mbacfert.com
TSX: MBC OTCQX: MBCFF Shares Outstanding: 97,720,219 Fully Diluted: 105,007,635FOR IMMEDIATE RELEASE: January 31, 2012
MBAC REPORTS 28% INCREASE IN RESOURCES AT THE ITAFÓS ARRAIAS SSP PROJECT
Toronto, Ontario, January 31, 2012, MBAC Fertilizer Corp.
("MBAC" or the "Company") (TSX:MBC and OTCQX:MBCFF) is
pleased to report the results of an extensional and infill
drilling campaign, aimed at testing the north-eastern portion
of the Domingos target, located in close proximity to the
beneficiation plant at the Itafós Arraias Project. The
measured and indicated mineral resource estimate for the
project now totals 75.8 million tonnes grading 5.0%
P2O5 up from the previously
reported NI 43-101 measured and indicated mineral resource
estimate of 58.8 million tonnes grading 5.0%
P2O5.
As stated in the April 27th, 2011 press release,
systematic drilling of high-potential areas has led to the
identification of additional, shallower and higher than
average grade phosphate mineralization in the northern
Domingos Block. The new drilling campaign totaled 4,551m of
reverse circulation drilling and
768m of diamond drilling.
In addition, MBAC has refined the geological studies and
subsequent block modelling for the Canabrava Block. This has
led to an increase in the tonnage and grade of the resource
at the Canabrava Block as summarized in Table 1 below. No
additional drilling is expected to be done at the Canabrava
Block during 2012, however the Company believes that further
drilling in all directions at the Canabrava Block has the
potential to increase the current mineral resource estimate.
The 2011 drilling campaign targeted the northern extension of
the Domingos Block, and was aimed at converting indicated
mineral resources into measured mineral resources in an area
where the phosphate ore is relatively shallow and located
close to the future beneficiation plant site. Infill drilling
of the central parts of the Domingos Block has increased the
geological confidence and resulted in the conversion of
inferred resources into indicated mineral resources. The new
drilling has confirmed the Domingos Block as a target along
with the São Bento target to the north.
The updated mineral resource estimate has been classified,
effective as of December 20, 2011, by
Beau Nicholls (BSc (Geo) MAIG), principal consulting
geologist for Amazon Geoservices Ltda, who is a qualified
person in accordance with National Instrument 43-101. The
measured and indicated
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investor@mbacfert.com
mineral resource estimate comprises 75.8 million tonnes grading 5.0% P2O5 (using a 1.5% cut-off for the Domingos target and a 2.8% cut-off for all other targets).
Table 1 Arraias Phosphate Project Measured and Indicated and Inferred Mineral Resource Grade Tonnage Report 20 December 2011 Ordinary Kriging (OK) Block Model - 12.5mE X 12.5mN X 3mRL | ||
Target | Tonnage (Mt) | P2O5 % |
Near Mine | 2.8% cut off grade applied | |
Measured | 15.2 | 4.38 |
Indicated | 9.4 | 4.12 |
M&I | 24.6 | 4.28 |
Inferred | 3.8 | 3.99 |
Canabrava | 2.8% cut off grade applied | |
Measured | ||
Indicated | 20.4 | 5.53 |
M&I | 20.4 | 5.53 |
Inferred | 3.7 | 4.94 |
Domingos | 1.5% cut off grade applied | |
Measured | 4.4 | 6.54 |
Indicated | 26.4 | 5.01 |
M&I | 30.7 | 5.23 |
Inferred | 4.7 | 3.08 |
TOTAL M&I | 75.8 | 5.00 |
TOTAL Inferred | 12.3 | 3.93 |
Appropriate rounding has been applied to the figures in Table 1 above
Drilling, sampling and QA/QC procedures were established at
the beginning of the drilling campaign and conform to
acceptable industry standards. QA/QC results have returned
acceptable precision and accuracy.
Please refer to the technical report entitled "Arraias
Tocantins Definitive Feasibility Study Report"
dated October 26, 2010, as amended February 10, 2011,
available under the Company's SEDAR
profile at www.sedar.com for further details on the QA/QC
procedures.
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12 0 Adelaide S treet West, Suite 1900
Toronto, Ontario, M5H 1T1
www.mbacfert.com
Phone 416.367.2200
Fax 416.367.2244
investor@mbacfert.com
All recent drilling has been analysed at ALS Chemex Ltd laboratory.
Itafós Arraias Project Update
The Itafós Arraias Project is progressing in accordance with
the scheduled timeline. The detailed engineering for the
project is almost complete. All equipment on the critical
path to construction has been acquired. The earthworks for
the project concluded last year and civil construction has
commenced at the site, beginning with the water dam. MBAC
also has started hiring and training personnel for the
day-to-day operation of the SSP plant.
The detailed engineering has shown that the project capital
costs have increased in the range of 8-9% due to inflation,
but are still in line with the expected accuracy of the
feasibility study. The expected capital expenditures for the
project are currently fully funded through project finance
debt facilities secured by the Company and funds raised
through equity financings completed to date. The current
average selling price for SSP is currently more than 40%
higher than that used in the feasibility study. MBAC expects
construction of the project to be complete in Q4 2012 and the
commencement of SSP production in the same quarter.
Beau Nicholls, (MAIG) principal consulting geologist of
Amazon Geoservices Ltda, is the qualified person who has
approved the contents of this press release.
For further information:
Steve Burleton, Vice President, Corporate Development, at
416-367-2200, investor@mbacfert.com or
visit our website at: www.mbacfert.com
MBAC is focused on becoming a significant integrated producer
of phosphate and potash fertilizers in the Brazilian and
Latin American markets. MBAC has an experienced team with
over 150 years of combined experience in the business of
fertilizer operations, management, marketing and finance
within Brazil. In October 2008, MBAC acquired Itafós
Mineração Ltda, which consisted of a phosphate mine, a mill
and plant and related infrastructure, all located in central
Brazil. MBAC's exploration portfolio includes a number of
additional phosphate and potash projects, which are also
located in Brazil. The Santana Phosphate project is a high
grade phosphate deposit located in close proximity to the
largest fertilizer market of Mato Gross State and animal feed
market of Pará State. The Company continues to search for
additional fertilizer opportunities in the Brazilian and
Latin- American markets, where strong agricultural
fundamentals and unique opportunities are expected to provide
attractive growth opportunities in the near future.
Further information on MBAC can be found on the
Company's website at www.mbacfert.comand on
SEDAR at www.sedar.com.
3
12 0 Adelaide S treet West, Suite 1900
Toronto, Ontario, M5H 1T1
www.mbacfert.com
Phone 416.367.2200
Fax 416.367.2244
investor@mbacfert.com
FORWARD LOOKING STATEMENTS
This press release contains "forward-looking statements" within the meaning of applicable Canadian and United States securities legislation. Forward-looking statements include, but are not limited to, statements related to activities, events or developments that the Company expects or anticipates will or may occur in the future, including, without limitation, statements related to future drilling at the Canabrava Block, completion of detailed engineering at the Itafós Arraias Project and the completion of construction of the project and the commencement of SSP production in Q4 2012. Forward-looking statements are often identified by the use of words such as "plans", "planning", "planned", "expects" or "looking forward", "does not expect", "continues", "scheduled", "estimates", "forecasts", "intends", "potential", "anticipates", "does not anticipate", or "belief", or describes a "goal", or a variation of such words and phrases, or state that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved. Forward-looking statements are based on a number of factors and assumptions made by management and considered reasonable at the time such statements are made. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements to be materially different from those expressed or implied by the forward-looking statements, including among others, the Company continuing to successfully drill the various targets at the Itafós Arraias Project, the construction and commencement of production at the project meeting the current timeline, the Company's ability to hire and train qualified personnel for day-to-day operations at the SSP plant, the actual capital expenditures at the project being fully-funded, fluctuations in capital costs based on inflation and other factors, fluctuations in the average selling price for SSP, as well as those factors disclosed in the Company's current Annual Information Form and Management's Discussion and Analysis, as well as other public disclosure documents, available on SEDAR at www.sedar.com. Although MBAC has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate. The forward-looking statements contained herein are presented for the purposes of assisting investors in understanding the Company's plan, objectives and goals and may not be appropriate for other purposes. Accordingly, readers should not place undue reliance on forward-looking statements.
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