AVANTI MINING RECEIVES POSITIVE FEASIBILITY STUDY CONFIRMING ROBUST ECONOMICS FOR RESTART OF KITSAULT MOLYBDENUM MINE

TSX-V:AVT

VANCOUVER, Dec. 16 /CNW/ - Avanti Mining Inc. (TSX-V:AVT) ("Avanti") is pleased to release the results of the NI 43-101 Feasibility Study ("FS") prepared by AMEC on its 100% owned Kitsault Molybdenum property in northwest British Columbia, Canada. The complete report will be filed on SEDAR and Avanti's web site, www.avantimining.com, within 45 days of the issue of this press release. All figures are in US dollars and were derived assuming 100% equity funding.

Highlights include:

• An increased resource estimate containing Measured and Indicated mineral resources totaling 298.8 million tonnes grading 0.072% molybdenum and 4.20 g/t Ag containing 472.5 million pounds of Mo and 40.3 million ounces of Ag. This represents a 9.7% increase of contained molybdenum and an 18% increase of contained silver over our prior estimate for measured plus indicated mineral resources. In addition, the Inferred category totals 157.1 million tonnes grading 0.050 % Mo and 3.65 g/t Ag containing 172.2 million pounds of molybdenum and 18.4 million ounces of silver an increase of 330% of contained molybdenum and 360% of contained silver over our previous resource estimate for inferred mineral resources.
• The mine plan calls for a total of 232.5 million tonnes of proven and probable reserves grading 0.081% molybdenum to be mined over a 16 - year mine life, producing 373.9 million pounds of molybdenum. The first five years of production averages 0.101% Mo;
• A long term exchange rate of .92 has been used to convert CDN$ to US $
• Initial capital costs are estimated at $770 million (+/- 15% accuracy estimated in C$ at $837 million);
• Cash operating costs (mine gate) are estimated to be $4.76/lb of molybdenum;
• The average annual price of molybdenum for the base case scenario over the mine life as forecast by  the CPM Group ranges from $13.75/lb to $18.25/lb based upon their June 2010 Molybdenum Market Outlook. The average over the Kitsault mine life is $16.76 per pound of molybdenum. Forecasts were also prepared for a low and a high price scenario.
• The base case after-tax NPV(8%) is $798 million, with an IRR of 26.8%
• Projected undiscounted net cash flow (after-tax) is $2.0 billion;
• Annual metal production for the mine life averages 23.4 million pounds of molybdenum with the first five years averaging 29.6 million pounds per year;
• There is a life of mine roasting agreement in place with Molymet that assures roasting capacity for the project;
• The mine has certain infrastructure in place with road and ocean freight access to the mine site and will be serviced by the existing BC Hydro transmission grid;
• The reopening of the mine is projected to create over 350 high paying local jobs during its 16 year life, and at the peak of construction, over 650 jobs. The construction period is estimated at 25 month;
• The project is progressing through environmental assessment process under the BC and federal legislation as well as the Nisga'a Final Agreement and expects to submit its Application in April 2011.

"We are delighted with the plan developed in this Feasibility Study by AMEC and other contributors" stated Craig J. Nelsen, Avanti's President and CEO.  "We are pleased with the projects robust economics and plan to utilize this study as the basis for negotiating strategic partnerships to assist with the financing plan for Kitsault. Our schedule anticipates receipt of permits toward the end of 2011 and construction to follow in early 2012 with initial production in 2014"

Project Description

The Kitsault property is located about 140 km north of Prince Rupert, British Columbia, and south of the head of Alice Arm, an inlet of the Pacific Ocean.  The property includes three known molybdenum deposits, Kitsault, Bell Moly, and Roundy Creek.  The Kitsault mine was a producer of molybdenum between 1967 and 1972 and from 1981 to 1982 with total production on the property during both periods being approximately 31 million pounds of molybdenum. 

Kitsault has road access to the mine site, which is approximately 12 km from ocean transport routes and is serviced by the BC Hydro transmission grid.  The Feasibility Study estimates that the Kitsault Mine would operate at an annual resource throughput rate of 14.6 million tonnes, or 40,000 tpd, with a strip ratio of 0.77:1 during a mine life of 16 years.  The ore mined will be crushed in a gyratory primary crusher, then ground using a SAG-ball mill configuration. Conventional flotation and five stages of cleaning will produce molybdenum concentrate that will be dried and packaged into bags for shipment.  The life-of-mine molybdenum production is estimated at 373.9 million pounds of molybdenum contained in 326,150 tonnes of molybdenum concentrate produced from the processing of 233.7 million tonnes of reserves plus planned dilution grading 0.081%Mo.  Total molybdenum recovery varies depending on mill head grade but is estimated to average 89.9%.

Mineral Resource/Reserves Statement

The mineral resources are reported in accordance with Canadian Institute of Mining, Metallurgy and Petroleum (CIM) Definition Standards for Mineral Resources Mineral Reserves and their Guidelines, and are compliant with National Instrument 43-101 ("NI 43-101").  The resource estimate was prepared under the supervision of Greg Kulla, P.Geo, an independent Qualified Person (QP), as this term is defined in NI 43-101. The mineral resource statement for the Kitsault molybdenum project is presented in Table 1 below:

Table 1

Kitsault Mineral Resources, Effective Date 8 November, 2010, Greg Kulla, P. Geo. (cut-off 0.021% Mo)

Category	Volume	Density	Tonnage	Mo	Mo	Ag	Ag
	Mm^3	g/cm^3	Mt	%	MLb	Ppm	Moz
Measured	27.6	2.65	73	0.093	150.3	4.28	10
Indicated	84.9	2.66	225.8	0.065	322.2	4.17	30.3
Measured + Indicated	112.4	2.66	298.8	0.072	472.5	4.2	40.3
Inferred	58.8	2.66	157.1	0.05	172.2	3.65	18.4

Notes:

1. Mineral Resources are inclusive of Mineral Reserves
2. Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability
3. Mineral Resources are defined with a Lerchs-Grossmann pit shell, and reported at a 0.021% Mo cut-off grade
4. Mineral Resources are reported using a commodity price of Can$15.62/lb Mo, an average process recovery of 89%, a process cost of Can$ 5.84/t and selling cost of $1.24 /lb of Mo sold. No revenue was assumed for Ag
5. Tonnages are rounded to the nearest 1,000 tonnes, grades are rounded to three decimal places for Mo and two decimals for Ag
6. Rounding as required by reporting guidelines may result in apparent summation differences between tonnes, grade and contained metal content
7. Tonnage and grade measurements are in metric units; contained molybdenum is in imperial pounds.
8. There is potential for a 30 to 50% recovery of the silver reporting to a saleable concentrate.  As of December 1, 2010, the metallurgical work in support of this is indicative only, suggesting that although there may be a reasonable prospect to extract this silver resource there is insufficient work to define the level of benefit that would support inclusion of silver in a reserve estimate.  No dedicated silver recovery circuit has been included in the process design, but there are reasonable expectations that this can be added in the future.

The mineral resources are reported at a cut-off grade to reflect the "reasonable prospects" for economic extraction. This estimate of the Kitsault molybdenum deposit is based open pit extraction and Avanti and AMEC has not considered underground mining methods for deeper portions of the deposit. Although silver has been reported in the mineral resource, it has not been included in the economic analysis or the reserve statement below. There is sufficient metallurgical testwork to suggest it could be an economic contributor but this work has not yet reached the feasibility level of confidence. The recovery of silver remains a potential project upside contributor, as well as the opportunity of conversion of Inferred to higher confidence categories through additional drilling. Additional drilling will continue through the 2011 field season in parallel with Basic and Advanced Engineering studies

The following Table 2 reflects the sensitivity of the resource estimate to various cut-off grades.

Table 2

Mo Cut-off Grade Sensitivity Analyses within Resource Pit - Measured and Indicated Resources

	MEASURED & INDICATED RESOURCES
Cut-off	Tonnes	Mo	Ag	Mo	Ag
Mo%	(kt)	(%)	(ppm)	(Mlbs)	(Moz)
0.010	348,203	0.064	4.09	489.7	45.8
0.015	328,421	0.067	4.13	484.2	43.6
0.021	298,835	0.072	4.2	472.5	40.3
0.025	278,316	0.075	4.26	462.1	38.1
0.030	249,895	0.081	4.34	444.8	34.8
0.035	224,460	0.086	4.4	426.7	31.8
0.040	204,924	0.091	4.47	410.6	29.4

AMEC conducted a complete re-evaluation of all old historic and recent drilling information and recalculated the mineral resources from first principals. 10 holes from the previous database were not used in the calculation because of inability to verify core quality (recoveries) and assay methods.

The Kitsault mine Mineral Reserves have been prepared in accordance with NI 43-101 standards and CIM Definition Standard (2010). This statement has been prepared by Mr. Ryan W. Ulansky (P.Eng.) of AMEC, a QP as defined in NI 43-101. These reserves are sufficient for 16 years of operation at an annual production rate of 40,000 t/d. Mineral Reserves are summarized by category in Table 3. The notes accompanying Table 3 are an integral part of the Mineral Reserves and should be read in conjunction with the Mineral Reserve statement.

Table 3

Kitsault Mineral Reserves, Effective Date 8 November, 2010, Ryan Ulansky, P. Eng. (cut-off 0.026% Mo)

Category	Tonnage (Mt)	Mo (%)	Contained Mo
			(MLb)
Proven	69.7	0.097	148.5
Probable	162.8	0.075	267.3
Total Proven and Probable	232.5	0.081	415.8

Notes: 

1. Mineral Reserves are defined within a mine plan, with pit phase designs guided by Lerchs-Grossmann (LG) pit shells, and reported at a 0.026% Mo cut-off grade, after dilution and mining loss adjustments. The LG shell generation was performed on measured and indicated materials only, using a molybdenum price of Cdn$13.58/Lb, an average mining cost of Cdn$1.94/t mined  a combined ore based cost of Cdn$5.84/t milled, and  a selling cost of $1.24 /lb of Mo sold. Metallurgical recovery used was a function of the head grade, defined as Recovery =7.5808*Ln (Mo %) +108.63 with a cap applied at 95%. Overall pit slopes varied from 42 to 48 degrees.
2. Dilution and Mining loss have been accounted for based on a waste neighbour analysis.   1.5Mt of measured and indicated material above cut-off was routed as waste.  1.9Mt of measured and indicated material below cut-off has been included as dilution material.  An additional 0.2Mt of inferred dilution material with grades set to zero is included in the mine plan as millfeed.
3. Tonnages are rounded to the nearest 1,000 tonnes, grades are rounded to three decimal places for Mo.
4. Rounding as required by reporting guidelines may result in apparent summation differences between tonnes, grade and contained metal content
5. Tonnage and grade measurements are in metric units; contained molybdenum is in imperial pounds.
6. The life of mine strip ratio is 0.77

Mining

The single ultimate pit will be mined in six phases, with elevated cut-offs in the early years and low grade stockpiling.  A bulk mining approach has been selected, mining on 10m benches.  The selected mining fleet features one 26 m³ rope shovel, one 28 m³ electric hydraulic shovel, one 18 m³ front end loader, and up to ten 218-tonne haul trucks with related support equipment. Benches will be drilled with 8 m by 8 m production drill patterns and wall control patterns as required. The holes will be loaded and shot with a 70% emulsion/30% ANFO blend blasting agent. Ore control will be based on blasthole samples assayed for molybdenum.

Waste rock will be stored in an expansion to the existing Patsy Waste Management Facility. Low grade ore will be stockpiled throughout the mine life on the top of the existing Clary Waste Management Facility. This ore stockpile will be reclaimed and processed during the last two years of the operation.

The mining production schedule is presented in Table 4.

Table 4

Summarized Production Schedule

		Ore to
Mining	Ore Direct	Low Grade	Waste	Total	Strip	Mill	Mo Grade
Period	to Mill (kt)	Stockpile (kt)	Mined (kt)		Ratio	Production	(%)
-2	-	-	-			-	-
-1		362	8,500		23.48
1	13,836	3,801	19,910	37,547	1.13	14,029	0.104
2	14,600	4,126	22,940	41,666	1.23	14,600	0.106
3	14,600	3,088	21,375	39,063	1.21	14,600	0.114
4	14,600	5,969	13,315	33,884	0.65	14,600	0.088
5	14,600	2,833	15,349	32,782	0.88	14,600	0.096
6	14,600	2,581	14,136	31,317	0.82	14,600	0.096
7	14,600	2,087	12,675	29,362	0.76	14,600	0.089
8	14,600	1,043	12,725	28,368	0.81	14,600	0.082
9	14,600	1,024	11,061	26,685	0.71	14,600	0.08
10	14,600	291	8,125	23,016	0.55	14,600	0.074
11	14,600	-	6,523	21,123	0.45	14,600	0.072
12	14,600	-	5,360	19,960	0.37	14,600	0.068
13	14,600	-	3,657	18,257	0.25	14,600	0.079
14	14,600	-	2,103	16,703	0.14	14,600	0.081
15	1,833	-	475	2,308	0.26	14,600	0.037
16	-	-	-	-		14,245	0.031
Totals	205,469	27,205	178,229	410,903	0.77	232,674	0.081

Note:  As part of the dilution / mining loss adjustments, an additional .202 kt of inferred dilution material with grades set to zero is routed to the mill

Processing

The proposed concentrator in this study is based on an annual resource throughput rate of 14.6 Mt, or 40,000 tpd at 92% plant availability, for the production of a molybdenum concentrate.  The processing plant is expected to operate 24 hours/day, 365 days/year.  Over the life of mine, the processing plant will produce an estimated 326,150 t of molybdenite concentrate grading 52% Mo.  The molybdenum recovery is variable with the average estimated at 89.9%. 

The proposed process design is based on historical testwork results, the results from a recent (2009 and 2010) test program and utilizing plant data from the previous Kitsault concentrator operations. Plant design, principally the crushing-grinding circuit has been revised to reflect current technologies using a primary crusher-SAG-ball mill configuration. The process design is composed of the following unit processes:

• Primary crushing using a gyratory crusher;
• Grinding using a SAG-ball mill-pebble crusher configuration with cyclones for flotation feed size classification;
• Rougher and scavenger flotation;
• Five stages of cleaner flotation with three stages of regrinding;
• Final molybdenum concentrate thickening, leaching for the removal of contaminants, and the filtering, drying and packaging of the final concentrate; and
• Flotation to produce desulfidized tailings which will have a portion cycloned for dam construction and the remainder will be deposited by gravity into an on-site Tailings Management Facility (TMF). Pyritic tailings will be deposited in a separate submerged cell in the TMF to prevent oxidation.

Capital Costs

Initial capital costs are estimated at $770 million, which includes $50 million for mobile mining equipment.  Preproduction stripping costs of $13 million are reflected in the initial operating costs.  Life of Mine sustaining mine capital was estimated to be $50 million, which is comprised mainly of mobile equipment and TMF embankment ongoing construction.  All capital costs are [+/-15%] in this estimate.

The capital costs for the mine, plant and TMF are given in Table 5 below.

Table 5

Capital Cost Summary

Area	Description	Cost
		(US$M)
1000	Mining	83.8
2000	Site preparation and roads	35.5
3000	Process facilities	195.1
4000	Tailings management and reclaim systems	89.8
5000	Utilities ties	39.7
6000	Ancillary buildings and facilities	38.4
	Total Direct Costs	482.3
8000	Owner's costs	21.1
9000	Indirects	266.7
	Total Indirect Costs	287.8
	Contingency	Incl above
	Total Capital Costs	770

Operating Costs

LOM unit cash operating costs are US$7.64/t milled and operating costs for the processing plant are estimated at $4.36/t milled (±15% accuracy).  General and administrative costs have been estimated at $1.00/t milled. The Life of Mine unit cash operating costs are also summarized in Table 6 below:

Table 6

Unit Cash operation costs (LOM average - US$)

Area	Total LOM($000)	US$/t Milled	US$/lb Mo
Mine Operations	528,038	2.27	1.42
Processing Operations	1,014,030	4.36	2.71
Administration	232,745	1.00	0.63
Total	1,774,813	7.64	4.76

Project Economics

The Feasibility Study economic results utilized assumptions summarized in the Table 7 below:

Table 7

Financial Analysis Parameters

Parameters	Inputs
General Assumptions
Mine Life	16 years
Available mill operating days per year	365 days/y
Production Rate (average)	40,000tpd
Average Process Recovery	89.9%
Molybdenum Concentrate - LOM	326,150t
CDN$:US$ exchange rate	.92
Market
Discount Rate	8%
Base Case LOM average molybdenum price	$16.76/lb
Royalty
Amax Zinc (Newfoundland) Ltd Net profits Interest	9.22%
Alcoa Royalty	1.0%

The FS economic model for the base case in this study assumes a LOM average molybdenum price of $16.76/lb for revenue purposes, as projected by CPM Group. 

The after-tax NPV at an 8% discount rate over the estimated mine life is $798 million.  The after-tax IRR is 26.8%.  Payback of the initial capital investment is estimated to occur in 2.6 years after the start of production

Sensitivity

Sensitivity analysis for key economic parameters is shown in Table 8 prior to tax effects.  This analysis suggests that the project is most sensitive to exchange rates followed by commodity prices.   The Project is least sensitive to operating and capital costs.

Table 8  Base Case Sensitivity to Pre-Tax NPV at 8% Discount Rate

	SENSITIVITY OF PRE-TAX NPV @ 8%	Change in Factor
		-30%	-20%	-10%	0%	10%	20%	30%
Factor	Exchange rate	2,424	1,922	1,531	1,219	963	749	569
	Capital expenditure	1,426	1,357	1,288	1,219	1,150	1,080	1,011
	Operating expenditure	1,485	1,396	1,307	1,219	1,130	1,041	953
	Metal price	365	650	934	1,219	1,503	1,787	2,071

Development Timetable

A construction schedule has been established that is contingent on the following milestones to be realized:

Table 9:

Project Milestones

Milestone	Date
Notice to proceed	1-Jan-12
Begin crushing and screening at pit site	1-Jan-12
Begin earthworks at plant site	2-Mar-12
Begin work at south embankment	1-Apr-12
Construction camp ready for partial occupancy	1-Jun-12
Construction power and communications at plant site compete	30-Jun-12
Commence concrete at plant site	1-July-12
Construction camp ready for full occupancy	30-Sep-12
Truckshop construction complete	30-Oct-13
Complete installation of power and distribution	31-Oct-13
Complete NE tailings dam	31-Oct-13
Begin commissioning	1-Dec-13
Plant ready for start-up	29-Jan-14
Complete SW tailings dam	30-Jan-14

The NI 43-101 Preliminary Feasibility Study, Avanti Mining Inc., Kitsault Molybdenum Property, British Columbia, Canada was prepared by industry consultants, all of whom are independent of Avanti Mining Inc. and are QP's under National Instrument 43-101.  The QP's have reviewed and approved this news release.  The consultants (QP's) with their responsibilities are as follows:

AMEC Inc. under the direction of Mr. Greg Kulla (P. Geo.) for matters relating to geology and mineral resource reporting.

AMEC Inc. under the direction of Mr. Ryan W. Ulansky (P.Eng.) for matters and costs relating to mineral reserve statements, mining, mining capital, and mine operating costs.

AMEC Inc. under the direction of Mr. Tony Lipiec (P.Eng.) for matters relating to the metallurgical testing review, mineral processing, and process operating costs.

SRK Consulting (Canada) Inc. (SRK Canada) under the direction of Mr. Peter Healey (P.Eng) for matters and costs relating to mine closure and reclamation.

SRK US under the direction of Mr. Michael Levy (P.E., P.G.) for matters relating to the pit slopes.

Knight Piésold Ltd. (KP) under the direction of Mr. Bruno Borntraeger (P.Eng.) for matters and costs relating to plant site geotechnical conditions, surface water diversions and the Tailings Management Facility (TMF).

Avanti Mining Inc. is focused on the development of the past producing Kitsault molybdenum mine located north of Prince Rupert in British Columbia.  Mr. Kenneth Collison, Senior Vice President of Project Development for the Company and a Qualified Person as defined in NI 43-101, has reviewed and approved the scientific or technical information in this press release.

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.

Forward-Looking Statements:  This news release contains certain forward-looking information concerning the business of Avanti Mining Inc. (the "Corporation").  All statements, other than statements of historical fact, included herein including, without limitation; statements about the recoverability of molybdenum at the Kitsault property, the results of the feasibility study, operating cost, capital cost, cash flow, the anticipated dates of commencement of construction and production, production schedule, molybdenum products meeting the specifications of the London Metals Exchange and other matters related to the development of the Kitsault molybdenum mine, are forward-looking statements.  These forward-looking statements are based on the opinions of management at the date the statements are made and are based on assumptions and subject to a variety of risks and uncertainties and other factors that could cause actual events to differ materially from those projected in forward-looking statements. Important factors that could cause actual results to differ materially from the Corporation's expectations include fluctuations in commodity prices and currency exchange rates; uncertainties relating to interpretation of drill results and the geology, continuity and grade of mineral deposits; uncertainty of estimates of capital and operating costs, recovery rates, production estimates and estimated economic return; the need for cooperation of government agencies and native groups in the exploration and development of properties and the issuance of required permits; the need to obtain additional financing to develop properties and uncertainty as to the availability and terms of future financing; the possibility of delay in exploration or development programs or in construction projects and uncertainty of meeting anticipated program milestones; uncertainty as to timely availability of permits and other governmental approvals; and other risks and uncertainties disclosed in the Corporation's Annual Information Form for the year ended December 31, 2009, which is available at www.Sedar.com. The Corporation is under no obligation to update forward-looking statements if circumstances or management's opinions should change, except as required by applicable securities laws.  The reader is cautioned not to place undue reliance on forward-looking statements.

please visitwww.avantimining.com, or contact:

Craig J. Nelsen, Chief Executive Officer, 303-565-5491, extension 4471, or
A.J. Ali, Chief Financial Officer, 303-565-5491, extension 4472