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Precious and Strategic Metals

TSX-V: DHM

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Show printable version of 'Deer Horn Metals Tellurium Update and Financing' in a New Window
 
Apr 17, 2012

Deer Horn Metals Tellurium Update and Financing

Delta, British Columbia April 17 2012 - Deer Horn Metals ("DHM" or "Deer Horn") has presented follow-up and supplementary information to its April 11, 2012 news release regarding the Deer Horn gold-silver-tellurium-tungsten property and updated NI 43-101 resource. The Deer Horn Property is located in west-central British Columbia 36 kms (23 miles) south of the Huckleberry Mine and approximately 150 kms (93 miles) southwest of the town of Burns Lake. The property hosts an NI 43-101 gold-silver-tellurium deposit with the following estimated resources:*

Indicated Resource
(1.00 g/t Au cut-off)
Tonnes Au
(g/t)
Ag
(g/t)
Te
(ppm)
Contained Ounces Contained Kg
Te
Au Ag
414,000 5.12 157.50 160 68,000 2,120,000 66,000
 
Inferred Resource
(1.00 g/t Au cut-off)
Tonnes Au
(g/t)
Ag
(g/t)
Te
(ppm)
Contained Ounces Contained Kg
Te
Au Ag
197,000 5.04 146.50 137 32,000 930,000 27,000

The 1.5-kilometre vein system containing the gold-silver-tellurium deposit remains open to the east, west and at depth. The property also contains tungsten and molybdenum. DHM is reviewing plans for further exploration to increase and upgrade the current resource. For more information on the latest resource estimate, please see Deer Horn's website and the news release dated April 11, 2012. "To the best of the company's knowledge, the tellurium deposit at Deer Horn represents the first and only NI 43-101 qualified tellurium resource ever reported," said DHM president and CEO Tyrone Docherty. "We believe this resource will continue to expand, as we have yet to find the limits of the vein system."

Tellurium, which is part of the "minor metals" family, is actually rarer than any of the "rare earth" metals. In fact it is one of the scarcest elements on earth and only slightly more abundant than gold and platinum.
Tellurium demand is increasing, primarily due to its growing use in cadmium-telluride (CdTe) solar cells to generate solar power. Tellurium supply, however, has remained relatively static (although exact production figures are unknown since most tellurium production is not reported). Metals supplier American Elements recently included tellurium on its 2011 U.S. Endangered Elements List. Very little tellurium is mined directly. About 90 percent of the world's tellurium is supplied as a by-product of copper mining. But while world copper production has increased in the past decade, tellurium production has not. This discrepancy is due to the decreasing use of electrowinning copper refinement and growing use of solvent exchange-leaching hydrometallurgy to process lower grade copper. Unfortunately for tellurium users, the electrowinning process is how copper mines extract tellurium.This looming demand/supply imbalance has caused tellurium prices to increase significantly and also become volatile. In 2004, tellurium traded for around US$10/kg. By 2009, the price had climbed to nearly $200/kg. Prices spiked to $440/kg in the spring of 2011, but have since slipped back to around $170/kg. For perspective on tellurium's value as a mined product, the current price equates to $170,000 per metric tonne.With the recent price instability, and with less tellurium available from copper mining, manufacturers that use tellurium are looking for alternative sources.

"The tellurium grades at Deer Horn rank well amongst those reported in the industry," said Deer Horn president Tyrone Docherty. "With the added gold, silver and even tungsten discovered to date, we believe the Deer Horn Property is emerging as an attractive prospect for companies seeking a viable source of tellurium in a politically stable jurisdiction."

The next phase of work proposed for Deer Horn includes infill drilling and extending the deposit westward beyond the limits of the 2011 work. Several new precious and base metal veins discovered in 2011 will also be investigated, along with the Harrison Scheelite tungsten occurrence located west of the Main Vein gold-silver-tellurium area.

* The updated resource estimate has been generated for the Company by G.H. Giroux and is presented in a NI 43-101 technical report entitled "Updated Resource Estimate for the Deer Horn Gold-Silver-Tellurium Property" (the "Deer Horn Updated Resource Report"), authored by independent consultants R.A. Lane, P.Geo. and G.H. Giroux, P.Eng.

Deer Horn Metals Inc. is pleased to announce a non-brokered Private Placement consisting of up to 5,000,000 units of the Corporation (the "Units") at a price of $0.10 per Unit for gross proceeds of up to $500,000. Each Unit shall consist of one Common Share and one share purchase warrant (the "Warrant"), Each Warrant entitles the holder thereof to purchase one additional common share (the "Warrant Shares") of the Company at a price from the date of issuance at $0.14 cents per share during the first year and at a price of $0.17 per share in the second year. The proceeds of the financing will be used for general working capital.

The Corporation may pay a finder's fee to certain introducing parties in respect of the Private Placement, subject to compliance with applicable securities legislation and TSX Venture policies. The Private Placement is subject to the approval of the TSX Venture Exchange Inc.


Cautionary Statement:
Mineral resources that are not mineral reserves do not have demonstrated economic viability. Mineral resource estimates do not account for mineability, selectivity, mining loss and dilution. These mineral resource estimates include inferred mineral resources that are normally considered too speculative geologically to have economic considerations applied to them that would enable them to be categorized as mineral reserves. There is also no certainty that these inferred mineral resources will be converted to the measured and indicated categories through further drilling, or into mineral reserves, once economic considerations are applied.


On behalf of the board of directors of
Deer Horn Metals Inc.
(signed) "Tyrone Docherty"
President and CEO

For further information please contact:

Primary Contact
Tyrone Docherty
President
Deer Horn Metals Inc.
(604) 952 7221
tdocherty@deerhornmetals.com


Forward Looking Information

Certain information regarding the Company set forth in this press release, including the use of proceeds, and management's assessment of the Company's future plans and operations contain forward looking information that involve substantial known and unknown risks and uncertainties. The forward looking information is subject to numerous risks and uncertainties, some of which are beyond the Company's and management's control, including but not limited to, the impact of general economic conditions, industry conditions, fluctuation of commodity prices, fluctuation of foreign exchange rates, imperfection of reserve estimates, environmental risks, industry competition, availability of qualified personnel and management, stock market volatility, timely and cost effective access to sufficient capital from internal and external sources. The Company's actual results, performance or achievement could differ materially from those expressed in or implied by, the forward looking information and accordingly, no assurance can be given that any of the events anticipated to occur or transpire form the forward looking information will provide any benefits to the Company.


"Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release."