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Gold/Mining/Energy : Chesbar Resources- CBI Montreal

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To: Mongo Slade who wrote ()2/28/2000 12:24:00 PM
From: Mephistopheles  Read Replies (1) of 980
 
Tuesday, February 22, 2000, 5:03 PM EST

Toronto, Ontario
The Company has undertaken a program of preliminary test pitting
across a favourable horizon of lateritic nickel mineralization at
its Buena Vista Project located in Guatemala. A 3090 hectare
property called "Sechol" is the first property licensed to the
Company's joint venture Guatemalan subsidiary. Chesbar is funding
the current US$300,000 exploration program whereby it is earning
an additional interest in the project. At completion, Chesbar
will vest 70% and its partner, Intrepid Minerals Corp. (CDNX-IAU)
("Intrepid") will own 30%. The Company has applied for four
additional licenses in the same area, which after being granted
will increase the Company's total land holding to approximately
22,000 hectares. The Company's geologists have identified
extensive areas of lateritic nickel mineralization, which will be
tested for economic potential in the ongoing exploration
campaign.

Lateritic nickel mineralization was identified in the area by
Inco subsidiary Exmibal in the early 1970's and steps were
undertaken to exploit this nickel at that time but this project
was shut down when the large escalation in fuel costs resulting
from the OPEC oil crisis made the process then being used
uneconomic. In the mid 70's and then again in the mid 90's work
by Transmetales and by Cominco Ltd. respectively at the Buena
Vista Project completed programs of test pits to assess an area
of lateritic nickel mineralization measuring 1900 meters by 800
meters. These pits have been backfilled but some of the resulting
data have been made available to the Company's geologists. This
property reverted to the Guatemalan government and was acquired
from the government by the Chesbar - Intrepid joint venture in
1999 as part of the "Sechol" exploration licence.

The Company's interest in the Buena Vista project is based on the
rapidly developing new technology for the treatment of lateritic
nickel ores using Pressure Acid Leaching (PAL) followed by
Solvent Extraction and Electrowinning (SX/EW). This technology is
now recognized as a revolutionary development in the nickel
industry and is already being employed in several new operations,
notably in Western Australia.

Work by Chesbar to date has included the digging and sampling of
tests pits within the previously identified zone, to confirm the
results of earlier work and to provide samples for metallurgical
test work to determine the applicability of the new PAL-SX/EW
process to this material. Numerous test pits are also being dug
on other parts of the Sechol property where nickel bearing
lateritic material has been identified by Company geologists.
Test pitting is an effective method of assessing deposits of this
type because, by the very nature and means of formation of
laterites, they lie near surface and are relatively easy to dig.

Results of the Company's current tests pits dug at intervals
along a 1500-metre length within the previously identified zone
of nickel mineralization are presented in Table 1. Pits are hand
dug from surface, encountering variable depths until finishing at
bedrock. Sampling is conducted in one meter vertical channel
samples of the pit walls during excavation. Samples are
geologically described, weigh typically 2.5 kg, are tagged and
then sent for sample preparation at Guatemala City with final
assaying completed at XRAL Laboratories in Toronto, Ontario. It
can be concluded that the broad spaced verification pits over the
known nickel zone reveal significant nickel values. The average
nickel content from the 4 pits just completed is 1.72% Ni. (See
Table 1)

Table 1

Pit No. SC-51 SC-52 SC-53 SC-54
Average % nickel 1.83 1.62 2.22 1.37
Depth of pit (meters) 10 12 7 10

The Company has begun a metallurgical study of the mineralogy and
geochemistry of the nickel mineralization through a series of
tests being conducted by Dynatec Corporation's Metallurgical
Technologies Division. In conjunction with gaining a necessary
understanding of the applicability of new technology at the
property, Chesbar is accelerating its "Buena Vista" program of
test pitting over the known nickel zones. At the earliest
opportunity, the Company hopes to establish a nickel resource
base calculated at the Main Zone. The additional test pitting
programs conducted over other lateritic targets at the Company's
properties are expected to provide significant increments to this
resource. Metallurgical test work is expected to be an ongoing
activity, as Chesbar will be seeking the most efficient
technology for the economic extraction of the nickel contained at
the Company's properties in Guatemala
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