Lahontan Gold Corp. announced the results of a review of metallurgical data for its 26.4 km2 flagship Santa Fe Mine project. The data review was completed by Kappes, Cassiday and Associates of Reno, Nevada, a global leader in metallurgical and process consulting.

KCA reviewed metallurgical test work on oxide gold and silver mineralization completed by previous operators of the Santa Fe Mine as well as production data. Gold and silver recovery estimates were primarily based upon prior metallurgical test work for the Santa Fe Mine as described below. When recovery estimates of the individual deposits are applied to the Mineral Resource Estimate ("MRE") shown in the Santa Fe Mine Technical Report*, it results in weighted project-wide gold recoveries of 74.4% for gold and 29.0% for silver at a ½-inch crush size from oxide mineralization.

It is typical to apply lab-to-field recovery discounts as a scale up factor when projecting commercial heap leach performance. This is generally a 2% to 5% deduction on the recovery, depending on the amount of available information. For the estimate, a 3% gold recovery deduction was applied to Santa Fe and 5% gold recovery deductions were applied to the other deposits.

Five percent silver recovery deductions were applied to all the deposits. When recovery estimates of the individual deposits are applied to the Mineral Resource Estimate ("MRE") shown in the Santa Fe Project Technical Report*, it results in weighted project-wide gold recoveries from oxide mineralization of 74.4% for gold and 29.0% for silver at a ½-inch crush size. Preliminary review of the data indicates little benefit to recovery from crushing finer than this.

The data reviewed included the results of a 1,860-ton crushed and agglomerated test heap of Santa Fe pit oxide mineralization. The heap was agglomerated with 5.5 kg/t cement addition yielding a 73.8% overall gold recovery, and 80.3% gold recovery on the flat surfaces for the ¾" crushed test heap. Operational data review indicates a total crushed oxide mineralization recovery of 65.5% over the life of the mine from 1988 to 1995.

However, crush size seemed to vary throughout the life of the operation, ranging from 1-1/2 inches down to 5/8 inches towards the later stages of the mining operation. Consistent crushing at ½-inch should improve precious metal recoveries. In order to reduce risk for the Project, KCA recommends that two more agglomerated column tests on each of Slab and Calvada East oxide mineralization at ½" crush size be performed to confirm gold and silver recoveries for these areas where recovery data is sparse.

KCA also recommends development of preg-robbing indices for the various types of mineralization in order to better understand metallurgical risks of the Project.