Treasury Metals Completes Advanced Staged Metallurgical Results - Goliath Gold Project, Ontario

TSX:TML

TORONTO, Sept. 17, 2012 /CNW/ - Treasury Metals Inc. ("Treasury Metals" or the "Company") today announced the results of the advanced level metallurgical testwork program completed at G&T Metallurgical Services Ltd. (part of ALS Metallurgy "ALS") with John A. Wells retained to oversee the program on behalf of the Company. The results confirm excellent gold recoveries from the Goliath Gold Project in northwestern Ontario consistent with the Company's scoping study level work performed in 2011 and the large bulk sample performed by former owner Teck Resources Ltd. The advanced level metallurgical test results could support a Feasibility Study on the Goliath project in the future.

Metallurgical testing focused on assessment of two principal flowsheets that involved gravity concentration and cyanidation unit operations while incorporating optimization of the selected flowsheet. The recovery of gold is consistently high in all tests, and ranged between 93 and 98 per cent. The gravity recovery circuit plus Carbon in Leach (CIL) processing of the gravity tails was identified as the best metallurgical flowsheet for the Goliath Gold Project reporting an average gold extraction of 96 per cent. In addition, a high proportion of the gold reported to a gravity concentrate ranging between 69 and 72 per cent. The results also confirmed that the leach kinetics were rapid and majority of the gold in the gravity tails solubilized within six to ten hours.

The test results demonstrated medium hardness ore, low to moderate cyanide and lime consumption, good settling and low viscosity, and all of this is supported by the mineralogy, that shows well liberated gold. A copy of the ALS Metallurgy Technical Report titled "Feasibility Metallurgical Testing, Goliath Gold Project" and the flowsheet will be made available on the Company's website (www.treasurymetals.com).

Martin Walter, President and Chief Executive Officer, commented, "These results are very encouraging as they clearly demonstrate that very high gold recovery rates using known low-cost separation methods. The Company continues to deliver on the milestones we have committed to over the past few years and we look forward to continued development of our mining project in northwestern Ontario."

John A. Wells, an independent Metallurgical Consultant, was retained by the Company to oversee the advanced level testwork at ALS and to provide a final flowsheet together with an independent assessment of the gold and silver recovery. Mr. Wells has extensive industry experience in minerals processing, particularly in the recovery of gold and silver. He has held senior positions in head office consulting, project development and operations with Goldfields Limited, AngloGold Ashanti, Barrick Gold Corporation and Aquiline Resources Inc.

The samples for this program were received at ALS on April 24, 2012 and consisted of 163 samples in the form of half diamond drill core taken from Goliath Gold Deposit. The estimated weight was 398.5 kilograms. The master composite was composed of a specific mass from each of the 163 samples and had a measured gold feed grade of about 2.2 g/tonne. For variability testing, 10 separate composites were created to give a range of grades and locations throughout the mineralized zone. These composites, which ranged in gold grade from about 0.4 to 15.4 g/tonne, were tested separately and returned the aforementioned recoveries of 93 to 98 per cent.

The successful test revealed that a range of 42 to 72 percent of the gold is considered liberated or "free gold" with the remaining gold mass associated with pyrite, gangue or multi-phase.

Comminution results showed the rock to be of low to medium hardness with an A*b parameter equal to 50.0 and the Bond ball mill work index was measured to be within a range of 8.9 and 13.9 kWh/tonne.  In final, a gravity/CIL flowsheet was selected as the optimal process with a grind size of 94 μm K₈₀, a sodium cyanide concentration of 1,000 ppm and using air as the sparging medium.

With these results, Treasury Metals is now in the position to move ahead on the process design and capital cost estimates to a feasibility level.

Technical information in this press release has been reviewed and approved by Mr. John Wells, M.A. Sc., Treasury Metals' Consulting Metallurgist, and Mark Wheeler, P. Eng., Senior Mining Engineer, who are both Qualified Persons for the Goliath Gold Project under the definitions established by National Instrument 43-101.

To learn more about Treasury Metals, please visit the Company's website at www.treasurymetals.com.

Forward-looking Statements
This release includes certain statements that may be deemed to be "forward-looking statements".  All statements in this release, other than statements of historical facts, that address events or developments that management of the Company expect, are forward-looking statements. Actual results or developments may differ materially from those in forward-looking statements.  Treasury Metals disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, save and except as may be required by applicable securities laws.

SOURCE: Treasury Metals Inc.

Greg Ferron
Vice President, Corporate Development
T: 1.416.214.4654
[email protected]

Mark Wheeler
Senior Mining Engineer
T: 1.416.214.4654
[email protected]