Conquest Mining Limited (ASX:CQT) Definitive Feasibility Study Update At Silver Hill Project

Perth, Oct 8, 2009 AEST (ABN Newswire) - The Board of Conquest Mining Limited (ASX:CQT)(PINK:CQMLF) advises that it continues to progress the Definitive Feasibility Study (DFS) for the Silver Hill project in northern Queensland for the production of high grade gold and silver concentrate.

Conquest Managing Director John Terpu said the Company's main focus has been and continues to be on high grade concentrate production.

The scope of the DFS is restricted to evaluation of the technical plus economic feasibility of mining the currently defined Silver Hill resource1, and processing to produce a high grade sulphide concentrate, with potential additional processing at some future stage to access gold/copper locked up in a minor portion of the tailings stream.

The Company considers that the economics of this sulphide concentrate are likely to be enhanced based on the recent discovery of a potential high grade silver pit at Silver Hill and encouraging grade control drilling results (as detailed in ASX announcements released on 4 September 2009 and 18 September 2009).

"The recent grade control drilling results indicate that the greatest near-term upside and optimised shareholder value lies in the production of high grade concentrate from the project," Mr Terpu said.

"For a number of months, we've been undertaking various drilling programs underway to quantify the potential upside to the existing Silver Hill resource. As part of that program, trial grade control pattern and reverse circulation drilling has detected spectacular and wide zones of high grade gold mineralisation, confirming the robust and consistent nature of the deposit. Combined with the recent identification of what we believe could be a stand-alone silver pit with potential production of 4.5-5 million oz of silver in the first three months, this work provides us with the basis to focus the DFS on near term production of high grade concentrates," said Mr Terpu.

The Silver Hill DFS continues on schedule for completion in November 2009, including the engineering, development and procurement of long lead items for the project, with the aim of enabling gold production from Silver Hill in the shortest possible timeframe.

Planning for the mine will be completed later this month and metallurgical testwork on the float plant has now been completed, with encouraging results.

"The progress of the DFS, as well as advanced off-take and funding negotiations, means we are well placed to take advantage of the high grade resource at Silver Hill and the positive pricing environment for gold and silver," Mr Terpu said.

Additional to the current focus on high grade sulphide concentrate production, the Company continues to assess options for potential secondary production processes.

"We're undertaking initial testwork on secondary processing options but this is only at an evaluation stage and a decision to proceed with any recovery methods will only be made following consideration of economic and operational factors. This work, which is being undertaken outside the scope of the current DFS, is expected to be completed in early-mid 2010." Mr Terpu said.

"Accordingly the decision on any secondary processing steps is not one that will be made until the testwork evaluating various options is complete. Our focus now is the timely production of high grade gold and silver concentrate from the Silver Hill project and we're on track to deliver on that objective. The economics of a high grade sulphide only production remain extremely attractive," added Mr Terpu.

Contact

John Terpu Managing Director Conquest Mining Limited Tel: +61-8-9240-4111 Email: john@chellingtons.com.au