Garson Gold Corp. - QwikReport

GARSON GOLD CORP. : http://www.garsongold.ca/ : QwikReport

Corporate

Garson Gold Corp. owns a 100% interest in the New Britannia Mine (NBM) and mill located in Snow Lake, Manitoba.

The NBM assets include the New Britannia Mine, with associated plant, infrastructure and equipment including a fully permitted 2,150 tonne per day modern mill and tailings facility. The NBM property consists of approximately 4,840 hectares of mineral claims and leases containing many known gold showings and a very high potential for new discoveries.

In April, 2008 the Company released the results from its NI 43-101 Preliminary Assessment on the No.3 Zone. In addition to confirming the positive economics of re-activating mining activity at this zone, Garson is currently updating and evaluating other gold resources on the NBM property with the objective of expanding the scope of the study and further enhancing project economics.

The current Measured, Indicated and Inferred resource inventory for the property is as follows:

MEASURED AND INDICATED

Deposit/Zone	Tonnes	Grade (g/t)	Gold (oz)

NBM Main Mine (Measured)¹	79,000	4.77	12,000
NBM Main Mine (Indicated) ¹	2,132,000	5.14	352,000
No. 3 Zone - Main (Indicated)²	394,000	6.72	85,000

TOTAL	2,605,000	5.37	449,000

Deposit/Zone	Tonnes	Grade (g/t)	Gold (oz)

NBM Main Mine ¹	305,000	4.59	45,000
Birch Zone ¹	569,000	4.42	81,000
Squall Margaret Upper ²	100,000	4.85	16,000
Squall Margaret Lower ²	337,000	5.40	59,000
No. 3 Zone Main ³	261,000	7.85	65,000
No. 3 Zone Footwall ³	314,000	5.04	51,000

TOTAL	1,886,000	5.22	317,000

1) NI 43-101 Technical report on the New Britannia Mine Property and Review of the Mineral Resource Estimate, Snow Lake Manitoba. Completed for Garson Resources, Pegasus Mine Ltd, and Piper Capital Inc. by William J. (Bill) Lewis, P. Geo and Richard Gowans, P. Eng., Micon International Ltd., October 2006.

2) NI 43-101 Technical Report on the Squall Lake Property, The Pas Mining Division Snow Lake Manitoba completed for Garson Resources Ltd. by D. Beilhartz, P. Geo., April 2006.

3) NI 43-101 Technial Report Audit of the 3 Zone Mineral Resource Estimate on the New Briannia Mine Property, Snow Lake, Manitoba Completed for Garson Gold Corp. by William J. Lewis, P. Geo and Charley Murahwi. M.Sc. Micon International Letd. July 20, 2008.

The Company is not aware of any environmental, permitting, legal, title, taxation, socio-political, marketing or other issue that may materially affect its estimate of mineral resources

Mineral resources which are not mineral reserves do not have demonstrated economic viability

The No. 3 Zone

The No. 3 Zone is a satellite deposit containing a 43-101 indicated resource of 85,000 ounces of gold (394,000 tonnes @ 7.72 g/t gold) and a further 117,000 ounces (575,000 tonnes @ 6.31 g/t gold) in the inferred category (Micon International Ltd., see News Release dated June 9, 2008). Past gold production from the No. 3 Zone totaled approximately 30,000 ounces (219,000 tonnes at an average grade of 4.32 g/t).

Preliminary Economic Assessment

On April 28, 2009 GARSON GOLD released the results from its Preliminary Assessment ("PA" or "study") which assessed the economics of mining at No.3 Zone and re-activation of the 2,150 tonne per day New Britannia mill which is currently on care and maintenance. The PA was completed by Micon International Limited ("Micon") in compliance with National Instrument ("NI") 43-101.

The The No.3 Zone is located 1.5 kilometres from the New Britannia mine and mill and remains open for expansion down plunge. The study was based only on the mining and processing of approximately 149,000 oz gold from 830,000 tons (753,000 tonnes) at an average grade 0.179 ounces per ton (6.14 grams per tonne) from the No.3 Zone. The Company is currently updating and evaluating other gold resources on the NBM property, based on 2008 as well as historical drilling, with the objective of expanding the scope of the study and further enhancing project economics.

Highlights of the study and results of the base case economic analysis are as follows:

No. 3 Zone Resource:

Indicated resource of 434,000 tons (394,000 tonnes) at an average grade of 0.20 ounces per ton ("opt") (6.72 grams per tonne); approximately 85,000 ounces
Inferred resource of 634,000 tons (575,000 tonnes) at an average grade of 0.18 opt (6.31 grams per tonne); approximately 117,000 ounces

Mining and Processing:

Mining plan for approximately 830,000 tons (753,000 tonnes) at an average grade 0.179 opt (6.14 grams per tonne) inclusive of mining dilution and losses (approximately 149,000 ounces)
A mining rate of 1,000 tons per day (750 tons mill feed and 250 tons waste) for a mine life of approximately 3 years and a total project life of approximately 3.8 years.
Milling rate of 1,300 tons per day on a 4 day per week basis at an estimated recovery of 92% (approximately 137,400 ounces)

Economic Analysis:

An after tax internal rate of return (IRR) of 18.9% based on US$ 725 per ounce gold and an exchange rate of C$1.20 per US$1.00
Cumulative undiscounted cash flow of C$16.64 M and an NPV of C$7.73M at an 8% discount rate and an NPV of C$10.66M at a 5% discount rate.
Pre-production capital expenditures of C$22.33M and sustaining capital expenditures of C$13.95M (undiscounted and includes a C$4.15M contingency)
Average cash operating cost of US$362.38 per ounce or C$72.00 per ton milled

Expansion Potential:

The No.3 Zone remains open for expansion at depth
Several other zones on the property are at an advanced stage of assessment and exploration and have the potential to contribute to the mining plan thereby extending mine life and increasing mill throughput.

Ongoing Advanced Exploration

Garson Gold is engaged in an extensive program of diamond drilling and resource evaluation on the NBM Property, which includes the exploration of a prospective north-northwest trending corridor that encompasses the New Britannia Main Mine, the Boundary Zone, and the No. 3 Zone. The drilling results to date confirm the potential for new discoveries and resource expansion within this prospective corridor and elsewhere on the property.

The study validates the Company's decision to proceed with updating and evaluating property resource estimates concurrently with advancing exploration of other known mineralized zones.

History of the New Britannia Mine:

1949-1958: initial mine operation (Nor Acme); produced 610,548 oz.
1995-2004: High River and Kinross re-commenced mining to produce 822,550 oz (gold @ US$274-$409 oz)recovery rate 93%.
Total historic production from main mine, 3 Zone and Birch open pit: 12,147,163 tons Grading 4.23 gpt totaling 1,443,098 oz
Mine site put on care and maintenance January '05
Piper Capital Inc. & Garson Resources Ltd. acquired 100% interest in December 2006.
Garson Gold Corp. (formed through the amalgamation of Piper Capital and Garson Resources in June 2007) owns 100% of the New Britannia Mine

Technical Reports

Ni 43-101 Technical Report Preliminary Assessment Of The No. 3 Zone On The New Britannia Mine Property Snow Lake, Manitoba

NI 43-101 Technical Report Audit Of The 3 Zone Mineral Resource Estimate On The New Britannia Mine Property Snow Lake, Manitoba (July 2008)

Structural Geology of New Britannia Mine Area
by C.J. Beaumont-Smith and J. Lavigne

New Britannia Mine NI 43-101 Technical Report (October 2006)

NI 43-101 Squall Lake Property Technical Report (April 2006)

Project Maps and Tables

Click to enlarge Boundary Zone			Click to enlarge Assay Results for Boundary & Kim Zones
Click to enlarge New Britannia Mine Exploration & Development Zones			Click to enlarge Boundary Surface Plan

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This page was created on Mon Sep 6, 2010 at 12:04:53 PM Pacific Time.