Breccia Ridge Underground Pre-Feasibility Study

 

VANCOUVER, BC - Silver Standard Resources Inc. reported the results of a pre-feasibility study for the underground component of the Breccia Ridge Zone at its wholly-owned Pitarrilla Project in Durango State, Mexico. Based on the pre-feasibility study, the underground component of Breccia Ridge now contains probable silver reserves of 91.7 million ounces. Scoping studies on underground bulk mining and open pit development for Breccia Ridge are continuing, and, if satisfactory, pre-feasibility studies will follow. Feasibility-level studies are also continuing on certain aspects of the project. The Breccia Ridge Zone, containing 63% of Pitarrilla's total silver resource of 643.6 million ounces of measured and indicated silver resources and 82.3 million ounces of inferred silver resources, is the main focus of current project activities and is one of five zones of mineralization identified to date on the property.

Iouri Iakovlev, Senior Mining Engineer of Wardrop, A Tetra Tech Company, and an "independent qualified person" for the purposes of National Instrument 43-101, estimated diluted probable reserves of 91.7 million ounces of silver for Breccia Ridge using a silver price of US$11.00/oz, zinc price of US$0.70/lb, lead price of US$0.50/lb and a US$50.00/tonne net smelter returns cut-off.

As presented in the pre-feasibility study, completed by Wardrop, A Tetra Tech Company, the underground project has a 12-year mine life, mining 4,000 tonnes per day and producing approximately seven million ounces of silver per year. Capital costs are projected at US$277 million with average operating costs of US$33.81/tonne. Recoveries vary by rock type with expected weighted average recoveries of 88.4% for silver, 93.2% for zinc and 89.6% for lead.

Ore processing will produce two concentrates: lead and zinc. The lead concentrate is expected to average 60.7% lead and approximately 8,000 g/t silver. The zinc concentrate is expected to average 48.5% zinc and approximately 400 g/t silver.

Based on the pre-feasibility study and spot metal prices at June 16, 2009, the underground component of the project has a net present value of US$320 million at a 5% discount rate.

In carrying out the pre-feasibility study, Wardrop identified the potential for underground bulk mining opportunities for the Breccia Ridge underground resource (shown below) which require further study. As a result, a scoping study to be followed, if warranted, by a pre-feasibility study on the Breccia Ridge underground project is underway.