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Kremnica Gold Project

Tournigan Signs Option Agreement on Kremnica Gold Property

On January 28, 2010, Tournigan Energy executed a share purchase agreement with Ortac Resources plc of London for Ortac acquire all of the shares of Kremnica Gold s.r.o and Kremnica Gold Mining s.r.o. the holder of the Kremnica gold deposit located in Slovakia. This new agreement supersedes a previous June 7, 2009 option agreement. On closing of the amendment agreement, Ortac will purchase and take possession of 100% of the Kremnica Shares for consideration of US$2 million to be paid in a combination of US$100,000 cash and a US$1,900,000 non-interest bearing promissory note that will be due for settlement upon Ortac completing a Public Listing (IPO) during 2010. Upon future production, Ortac will pay Tournigan US$3,750,000 in cash or in Ortac shares and a 2% net smelter return (NSR) royalty on gold and silver production. Ortac may buy back half the NSR granted to Tournigan by paying Tournigan US$ 1 million cash. For details, click here for the January 28, 2010 news release.

Kremnica Gold Project - Slovak Republic

The Kremnica gold project is located in central Slovakia beside the historic mining town Kremnica, which lies 185 km northeast from Bratislava, the nation's capital. The property has easy access to electricity, natural gas, rail and paved-road infrastructure. Historical production of 1.5 million ounces of gold on the property dates back to the 14th century.

The Kremnica resource is within a deposit known as "Šturec" which, in modern times, was an open pit mine from 1987 to 1992. The mine was abandoned as unprofitable in 1992, a time when the price of gold was trading in the range of US$330 per ounce to $360 per ounce. Tournigan acquired the mine and surrounding exploration licenses spanning 123 km² in 2003 and has since conducted a detailed exploration program on the property in addition to a pre-feasibility study completed in May 2007 (see below).

Tournigan continued in 2008 to infill drill the deposit and gather geotechnical information about the property. The geotechnical drilling was in support of a groundwater monitoring program, a detailed open pit design and the siting of the tailings facility and the processing plant. The company has also commenced base line data gathering for environmental purposes.

The complete technical report in support of the prefeasibility study completed by Beacon Hill Consultants (1988) Ltd. of Vancouver is available from this link: 43-101 Kremnica Technical Report (PDF, 10 mb). The study's mineral resource estimate is as follows:

Kremnica, Sturec Deposit - Measured, Indicated & Inferred Resource
(Beacon Hill Consultants, May 2007)

Category	Tonnes	Au / Ag	Ounces Au	Ounces Ag
Measured	8.2 million	1.61 Au / 13.3 Ag	425,000	3.5 million
Indicated	15.4 million	1.24 Au / 10.3 Ag	615,000	5.1 million
Inferred	10.6 million	1.01 Au / 6.27 Ag	345,000	2.1 million

(0.50 g/t AuEq cut-off)

The study's base case indicates that the project could recover 674,500 ounces of gold with an internal after tax rate of return (IRR) of approximately 13%, assuming a gold price of US$525 per ounce and a silver price of US$9.25 per ounce. The prefeasiblity study also indicated an IRR of 26% assuming a gold price of US$675 per ounce. The current spot price of gold is available at this link: www.kitco.com/charts/livegold.html. Tournigan is progressing with its efforts to optimize the project's economics.

Kremnica Gold Project prefeasiblity study summary (Beacon Hill, May 2007)

Gold Recovered (life of mine)	674,500 ounces
Silver Recovered (life of mine)	3,739,000 ounces
Gold Price Used	US$525/oz
Silver Price Used	US$9.25/oz
Capital Cost (millions)	US$106.2
Ongoing Capital and Reclamation (millions)	US$24.2
Operating Cost per Gold Equivalent Ounce	US$227.00
Production Rate (tonnes milled per day)	6,000
Strip Ratio (Ore to Waste)	1.61
Metallurgical Recovery (Gold)	93.0%
Metallurgical Recovery (Silver)	66.0%
Mine Life	7.7 years
Approximate Payback Period	4.4 years

Gold Price (US$ per ounce)	Cashflow (After Tax) (US$ millions)	IRR
$375	($12,617)	-2.55%
$425	$17,198	3.29%
$475	$46,802	8.53%
$525 (Base Case)	$75,028	13.08%
$575	$101,895	17.07%
$625	$128,762	20.79%
$675	$169,063	26.00%

Tournigan Licences, Central Slovakia

{Click to Enlarge}

District Scale Potential at Kremnica

Kremnica has produced over 1.5 million ounces of gold, essentially from one vein system. This epithermal vein represents only a small fraction of an area of at least 120 square kilometers of Tertiary-age volcanic rocks. These rocks exhibit alteration and geochemical anomalies indicating the possibility of additional significant mineralization. Although there has been some reconnaissance exploration in the surrounding prospective ground, most exploration has focused on the footprint of the historic mining. Tournigan believes that there is the potential to discover one or more additional mineralized systems similar to Kremnica in the adjacent ground within Tournigan's exploration licences, to the south of the historic resource.

Tournigan staff is compiling the historic exploration data along with data generated during the 2008 geochemical sampling program. This is in order to produce a district-scale compilation of geologic, structural, geochemical and geophysical data. It is expected that the result of this compilation will be the generation of new targets which may be worthy of follow up.

This page was updated on Feb 26, 2010

Dorian L (Dusty) Nicol, B.Sc. Geo, M.A. Geo., Tournigan's President and CEO, is a Qualified Person as defined by National Instrument 43-101 and has reviewed and approved the technical disclosure contained on this website.