Lorraine Copper

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Lorraine Copper Update

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April 09, 2009
Lorraine Copper Update
A New Player in Central British Columbia

The prolific Quesnel Terrane, a geologic belt running the length of the province and hosting numerous copper-gold porphyry deposits, including our own Lorraine occurrences, has attracted a large new player to BC. South African based Gold Fields Limited has announced that it has taken an option to acquire a 51% interest in Cascadero Copper Corporation’s Toodoggone property (approx. 100 km north of Lorraine) by incurring expenditures of $5 million over a three year period and may acquire an additional 24% interest in the property by spending a further $15 million.

Gold Fields is one of the world’s largest gold producers with annual attributable production of approximately four million ounces from nine operating mines in Peru, Ghana, Australia and South Africa. In addition the company has an extensive exploration portfolio with highly prospective projects in all of the major gold provinces of the world. Despite being a “pure gold” company, one of the more recent projects developed by Gold Fields is the Cerro Corona Mine in Peru which came on line in 2008. The Cerro Corona Mine is an open pit copper-gold porphyry mine with an economic model type that has many similarities to Lorraine.

It has become very evident over the last few years that gold companies are including large copper-gold porphyry deposits on their target list for a source of gold as they find that large gold-only deposits are becoming harder and harder to find. You may see that in the future these deposit types get referred to as Gold-Copper deposits instead of Copper-Gold to protect the gold-only producers from being labeled as copper producers. The bonus for the gold companies is the added revenue from the copper side where we are seeing a nice recovery in the price of late (US$2.05/lb.; 4/9/09). Many analysts believe that copper price is the bellwether of the economy and is a leading indicator to a pending recovery as it is a metal critical to industrial and domestic use.

It is a strong statement of credibility for BC and the exploration potential of the Quesnel Terrane to see Gold Fields enter our territory to explore alongside us.

At Lorraine Copper we are looking forward to continuing to explore and develop the Lorraine Project. Teck Cominco Ltd., Lorraine Copper’s option partner, may earn an initial 51% interest in the Lorraine Project (including subsequent expansions) by spending $9 million by December 31, 2010. Upon earning a 51% interest, Teck Cominco has a right to earn an additional 9% interest by funding and completing a feasibility study and a further 5% interest by arranging financing on behalf of Lorraine Copper for its share of capital costs. As we are all aware, Teck Cominco, having spent approximately $8.4 million to date, has been seriously affected by the recent economic downturn. Teck has not yet advised the company of the ongoing exploration plans for Lorraine but we are confident that the project will continue to garner success for Lorraine Copper.