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Trading Symbol: ADA:TSX; C2Z-Frankfurt
Shares Outstanding: 153,402,907
HALIFAX, Dec. 10 /CNW/ - Acadian Mining Corporation (TSX: ADA) ("Acadian" or the "Company") announced today that it is scaling back its operations at its Scotia Mine (zinc-lead) in the face of continued deterioration of metal prices. Operations staff has been further reduced by 38 bringing the total mine staff down to 70. A revised mine plan is being implemented which will focus on mining currently developed run of mine grade ore and lower grade (approximately 2% zinc) material at surface with a zero strip ratio. Waste stripping will be deferred until economic conditions have sufficiently improved. These additional operational measures were necessary due to the rapid decline in metal prices over the past two months. On October 1, 2008, zinc and lead prices were US$0.75 per pound and US$0.82 per pound respectively. On December 1, 2008, the prices for zinc had declined 33% to US$0.50 and lead 49% to US$0.42 per pound. On January 1, 2008, zinc and lead prices were US$1.08 per pound and US$1.23 per pound respectively.
The revised mine plan is anticipated to supply sufficient ore to the mill until the end of Q1-09. Zinc-lead operations beyond this date will be contingent upon a significant rebound in metal prices.
The Company is currently evaluating the merits of modifying the mill to treat gold bearing material sourced from a planned open pit gold deposit, the 'Touquoy deposit', located approximately 45 km east of Scotia Mine. The Touquoy deposit which is owned by ASX listed Atlantic Gold NL ("Atlantic"), subject to a 40% carried interest by privately owned Moose River Resources Ltd., has received environmental approval, and subject to financing and certain additional regulatory approvals could potentially be brought into production in Q2-09 or Q3-09. The proposals being discussed with Atlantic, the Touquoy project operator, envisages trucking and treating 3,000 tpd (1,000,000 tpy), in the Scotia Mill.
In the event the proposed plan to treat material from the Touquoy deposit does not come to fruition, the Scotia Mill is expected to be put on care and maintenance pending more favourable zinc and lead prices.
The Company is currently exploring funding possibilities, including divesting of certain assets, to strengthen its balance sheet. Failure to raise additional capital will hinder the Company's ability to proceed with the proposed Touquoy gold initiative and will impact on the Company's ability to continue operations.
About the Company
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Acadian is a Halifax, Nova Scotia, Canada based mining company which operates a zinc-lead mine (Scotia Mine) at Gays River, Nova Scotia and is exploring and developing gold, zinc-lead, and barite properties in Atlantic Canada.
Forward Looking Statement
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Certain information regarding the Company contained herein may constitute forward-looking statements within the meaning of applicable securities laws. Forward-looking statements may include estimates, plans, expectations, opinions, forecasts, projections, guidance or other statements that are not statements of fact. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to have been correct. The Company cautions that actual performance will be affected by a number of factors, many of which are beyond the Company's control, and that future events and results may vary substantially from what the Company currently foresees.
Discussion of the various factors that may affect future results is contained in the Company's Annual Information Form dated March 28, 2008, which is available at www.sedar.com. The Company's forward-looking statements are expressly qualified in their entirety by this cautionary statement.
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For additional information on the Company's properties and activities, please visit our web site at www.acadianmining.com.
No regulatory authority has approved or disapproved the contents of this
release.
Source: Canada NewsWire (December 10, 2008 - 9:40 AM EST)
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