Zaruma Resources Updates Luz del Cobre Project

Zaruma Resources Updates Luz del Cobre Project

Zaruma Resources Inc. provided a further update on the progress of the Luz del Cobre copper project in the State of Sonora, Mexico.

The Company stated that it has not yet been able to arrange additional project financing to finish the development and construction of the mine and production plant. Of the estimated US$37 million capital cost of the project, US$22 million has been paid to contractors and suppliers, the full amount provided under the Glencore International AG financing commitment.

Although discussions continue with parties interested in financing the project to production, the outcome of these discussions is not assured, and the time required to reach an agreement remains unpredictable. In the meantime, the Company’s Mexican subsidiary, Minerales Libertad, S.A. de C.V., has suspended further onsite development..

Field activity started in November, 2007 and open pit mining commenced in September, 2008, with the ore being stockpiled for expected crushing and stacking on the leach pad starting at the end of November. Virtually all the equipment to complete the electricity generating plant and the copper SX-EW production plant has been ordered, has been received, or is ready for shipment to the site. The timetable had projected the first production of copper cathodes in February, 2009, but the suspension of activity announced today will directly impact this date.

Thomas Utter, President of Zaruma stated that the current price of copper was not indicative of where the supply and demand for the metal will settle prices for future deliveries, and that he was optimistic about successfully completing financial arrangements to bring the project to production.

Exploration drilling in the Sapo-Carrizo area is continuing, with 1,400 metres of the 2,000 metre programme drilled in 6 holes. Geological logging has been completed on the first two holes at Carrizo, (No.1 to 475m, and No.2 to 351m down-hole depth) and identified several very encouraging characteristics. Both holes penetrated breccia essentially throughout their length, supporting the possibility of a favourable host body with significant width and depth. The highly fractured rocks contain sulphides in veinlets and finely dispersed disseminations. Pyrite dominates the sulphides, but copper-minerals such as chalcopyrite were noted in significant quantities along with local lesser concentrations of chalcocite, bornite and pyrrhotite. Assays are pending.

Zaruma Resources Inc. is listed on The Toronto and Frankfurt Stock Exchanges, (symbol: ZMR). Common shares outstanding: 117,608,747.

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