TORONTO, ONTARIO, September 10, 2003 – Crystallex International Corporation (TSX, AMEX: KRY) today announced that the economic viability of its Las Cristinas gold project located in Bolivar State in south-eastern Venezuela has been confirmed by a full Feasibility Study completed by SNC - Lavalin Engineers and Constructors, (SNCL).  A copy of the Executive Summary of the Feasibility Study will be available on the Company’s website at www.crystallex.com by early next week. 

“We are delighted with the results of the Feasibility Study which clearly distinguish Las Cristinas as a premier gold deposit that can be economically developed and operated by conventional mining and gold processing technology.  We look forward to quickly finalizing development plans with the CVG.  The reserves delineated by the Feasibility Study transform Crystallex into the fifth largest North American-based gold company in terms of reserves,” remarked Ken Thomas, Chief Operating Officer of Crystallex. 

Feasibility Study Operating Highlights

¹ Mineral reserve and mineral resource estimates in the Feasibility Study have been estimated in accordance with the standards of the Canadian Institute of Mining and Metallurgy as adopted by the Canadian Securities Regulators in National Instrument 43-101. 

² Mineral reserves, which were calculated using a gold price of US$325/oz., are included in the mineral resources.

³ VAT is charged on goods and services during the construction period; however, is fully recoverable from gold sales revenues.

⁴ Includes royalties.

Las Cristinas Economic Highlights

 The Feasibility Study financial results, calculated at a gold price of US$325 per ounce, demonstrate that Las Cristinas can be economically developed as a large, open pit mining operation utilizing a conventional gravity and carbon-in-leach (CIL) gold processing circuit.  SNC-Lavalin Capital’s financial model was based upon the assumption of an all-equity financed project.

Based upon current proven and probable reserves of 10.2 million ounces and a gold price of US$325 per ounce, Las Cristinas will generate pre-tax cumulative free cashflow of US$742 million.  At US$375 per ounce, pre-tax cumulative cashflow climbs to US$1.2 billion. 

The tables below reflect the before and after tax financial returns generated at a gold price of US$325 per ounce and also at gold prices more reflective of current market conditions.

¹Cumulative Free Cashflow is defined as cashflow net of development and sustaining capital, operating costs and royalties, including a 3% exploitation tax. Royalties include the 3% Exploitation Tax on gold sales payable to the Venezuelan Ministry of Mines and the royalty on gold sales payable to the CVG (1% if gold is <= $280/oz; 1.5% if gold is >$280/oz and < $350/oz; 2% if gold is >=$350/oz and <$400/oz and 3% if gold is >=$400/oz).

¹Cumulative Free Cashflow is defined as cashflow net of development and sustaining capital, operating costs and royalties, including a 3% exploitation tax, and an estimated 34% Venezuelan income tax.

Overview

The overall Feasibility Study for Las Cristinas was prepared by SNCL. The Qualified Person in charge of the overall execution of the feasibility study is John B. Scott, P. Eng.   The Study includes work performed by other independent consultants under the coordination of SNCL.  The geology, reserves and mining sections of the Study were prepared by Mine Development Associates of Reno Nevada.  Metallurgical pilot plant testwork was conducted by SGS Lakefield Research in Ontario.  Metallurgical process work was undertaken by J.R. Goode & Associates, Professor Andre Laplante of McGill University and SNCL.  A hydrology study was undertaken by SRK Consulting in Chile.   SNCL and Proconsult of Venezuela carried out environmental work.  Financial analysis was performed by SNC-Lavalin Capital Inc.

Las Cristinas is planned as a conventional truck and shovel open pit mine.  Processing consists of crushing, semi-autogenous primary grinding (SAG) and secondary ball mill grinding.  A gravity circuit is incorporated to recover free gold.  Gold extraction is achieved in a conventional carbon-in-leach (CIL) circuit.  Gold is removed from the loaded carbon by pressure stripping, electrowinning and smelting to produce a gold doré.  Mill throughput is planned at 20,000 tonnes per day; however, the mill has been designed to accommodate an expansion to 40,000 tonnes per day. 

Resource/Reserve Methodology and Verification

Mine Development Associates (MDA) completed a resource model that was based on an electronic database of drill, topographic, geologic and engineering data that Crystallex acquired from the Corporación Venezolana de Guayana, (CVG) in September 2002.  Data from 1,174 drill holes and 108 trenches were included in the Las Cristinas database.  Over 160,000 meters of drilling have been completed on the property (including trenches).  In addition, MDA and Crystallex undertook a drill and sample assay program to verify the presence and tenor of the mineralization reported in the acquired database.  The verification program included drilling 2,188 meters in twelve diamond drill holes and analyzing 275 quality assurance/quality control samples.  MDA found that the verification drill results and check samples corroborate the tenor of gold mineralization previously reported.  For additional confirmation, Crystallex and MDA re-assayed 262 pre-existing pulps, 200 pre-existing coarse rejects and 342 pre-existing quarter core samples.  Mean grades are similar for both datasets. 

Reserves

Mineral reserve estimates were developed by MDA from its resource model using Medsystem- MineSight computer software.  Two separate pits were designed: the larger Conductora, which contains the bulk of the reserves, and the Mesones.  The Conductora pit was divided into five phases or pushbacks to improve project economics and delay waste mining as much as possible.  Pit designs were based on a US$325 per ounce gold price and cut-off grades ranging from 0.46 g/t to 0.69 g/t, depending upon the material type. 

The deposit is open ended at depth.  Additional drilling may result in upgrading some or all of the 208 million tonnes of Inferred Resources to Measured or Indicated Resources, which could add to reserves.

Mining

The saprolite ore will likely be mined by a contractor using a fleet of all-wheel drive trucks, while the bedrock ore will be mined by Crystallex using a fleet of standard 136 tonne haul trucks and 21 cubic metre capacity excavators.  Different equipment is used in the saprolite and bedrock ores due to the different material characteristics. Mining will consist of drilling and blasting of the bedrock ore (the saprolite ore does not require blasting) and hauling by truck to stockpiles or a crusher located at the processing plant.

 The mine production schedule is based upon providing the plant with 20,000 tonnes of ore per day, or 7.3 million ore tonnes per year.  This results in a mine life of 34 years.  The average strip ratio over the life of the mine is 1.34:1.  

Stockpiling and blending of the ore types will be utilized to optimize plant throughput and gold recovery. 

Metallurgy

The Las Cristinas deposit comprises a sequence of oxidized saprolite (SAPO), sulphide saprolite (SAPS), carbonate leached bedrock (CLB) and carbonate stable bedrock (CSB).  Gold occurs in all ore types at similar grades.  Copper is absent from the SAPO, enriched in the SAPS and present at low levels in the CLB and CSB.

A review of available metallurgical data by SNCL and J.R. Goode and Associates and various trade-off studies indicated that direct leaching of the ore and on-site production of bullion would provide optimum gold recovery rates and project economics.  To confirm the direct leach process and to determine the gold recovery and reagent requirements and generate plant design data, a comprehensive bench test and pilot plant operation were conducted at SGS Lakefield Research during the months of April through August 2003.  The tests were conducted on several samples of all four ore types.  Samples of Conductora ore were also sent to McGill University for gravity recovery testwork.  Outokumpu also conducted pilot plant settling tests on several samples. Gold recoveries have been estimated by SGS Lakefield Research to be 98.0 % for SAPO, 86.8% for SAPS, 87.6% for CLB and 87.6 % for CSB.

The pilot plant was operated for three weeks in which blended, batch ground/gravity concentrated ore was subject to carbon-in-leach processing.  The gravity and pilot plant tests resulted in an overall average recovery (gravity+leaching) of 89% for the planned SAPO/SAPS/CLB/CSB ore blend.

Processing

The processing plant consists of crushing, semi-autogenous primary grinding, followed by secondary grinding in a ball mill.

A gravity recovery circuit is included in the grinding circuit for recovery of free coarse gold prior to regrinding in the ball mill.

Gold extraction is achieved in a conventional carbon-in-leach circuit. Gold is removed from the loaded carbon by pressure stripping, followed by electrowinning of the gold metal from the pregnant solution and smelting of a doré bar.

Infrastructure and Services

A long history of mining and industrial projects in Bolivar State makes the region very suitable for the development of a large gold mining project. The Las Cristinas site is serviced by paved highway from the Venezuelan port of Puerto Ordaz, a major industrial city located on the Orinoco River, some 360 kilometres from Las Cristinas.  Las Cristinas is located 6 kilometres west of the village of Las Claritas, which is on the main highway from Puerto Ordaz.

An existing 400 kV power line parallels the main highway from Puerto Ordaz.  A new substation was constructed six kilometres from Las Cristinas in 2001 to service the area.  The substation has two 150 MVA power transformers and provision has been made to supply Las Cristinas via a new six kilometre 230 kV overhead power line.  The site power demand is estimated at 30 MW which can be adequately supplied by the substation.  Adequate power is available to support a Project expansion to 40,000 tonnes per day. 

Tailings Management Facilities (TMF)

The tailings dam is a conventional centre line structure with a centre wall drain and buttressed by waste rock.  The dam wall is rolled saprolite and the dam floor is impervious saprolite (clay) up to 20 to 40 meters thick.  The area has an earthquake rating of zero (the lowest rating).  The TMF was designed to national and internationally accepted practise and risk ratings in respect of earthquake and flood events. 

Environmental Management

SNCL has conducted a preliminary environmental impact analysis and assessment of potential environmental impacts associated with the construction and operation of the Las Cristinas project.  A Preliminary Environmental Impact Assessment, (EIA) is scheduled for completion by SNCL shortly. A Final EIA, Site Closure and Rehabilitation Plan together with an Environmental Management Plan that meets Venezuelan and World Bank standards will be completed as detailed engineering progresses. 

As a result of the Project design parameters chosen and the nature of the orebody, the Preliminary Environmental Impact Analysis has concluded that:

·         Risk of significant environmental contamination from effluent discharges is low.

·         Risk of Tailings Management Facility failure or environmental contamination is low.

·         Permitting is expected to be straightforward based on ongoing discussions and informational review with the Venezuelan Ministry of Environment and Natural Resources.  All work will be completed to Venezuelan and World Bank standards.

·         Risk of contamination following closure is low.

Further work undertaken as the Project advances to the next stage will aim to confirm these conclusions.  

Capital Cost Estimates

Capital cost estimates are based upon new equipment and are expressed in US dollars.

¹ VAT of 16.5% has been applied to the total capital costs.  This is fully recovered over the first two and one half years from gold sales revenues.

Operating Cost Estimates (at US$325 gold)

Total cash costs for the first five years of production are estimated at US$130 per ounce before royalties and US$144 per ounce including royalties.  Over the life of mine, average total cash costs are estimated at US$182 per ounce of gold ($6.70/tonne of ore) before royalties and US$196 per ounce including royalties.   Unit operating costs by area are tabled below:

¹Excludes royalties.

Financial Analysis

SNC-Lavalin Capital prepared a financial model for the Las Cristinas Project.  The model was run in US dollars with no allowance for inflation.  The model includes all capital costs, operating costs, royalties and a 34% income tax.  Depreciation was conservatively assumed for a 20 year life on a straight line basis.  An existing investment tax credit of 10% of the development capital cost is utilized to offset income taxes during the first two years of production.  For simplicity, the model assumed that the Project is financed entirely with equity; however, the application of project debt will improve the already robust internal rate of return.  The Base Case model used a gold price of $325 per ounce.  Key results are as follows:

A sensitivity analysis was performed which considered the impact to the financial results from changes to the gold price, capital costs and operating costs.  The analysis indicated that the Las Cristinas financial results are most sensitive to changes in the gold price.  On an pre-tax basis, a 10% increase in the gold price resulted in a 29% increase in the IRR to 17.8%, while similar decreases to the capital or operating costs yielded IRR increases of only 15% in both cases. 

Sensitivity results, illustrated independently for changes to the gold price, operating costs and capital costs, on a pre-tax basis are presented below:

The Feasibility Study has been provided to the CVG in accordance with the Mining Operation Contract signed in September 2002.

Next Steps – Project Implementation

The next phase of advancing Las Cristinas, which is estimated to extend through the first quarter of 2004, will focus on awarding an Engineering Procurement and Construction Management mandate, initiating Detailed Engineering work, completing the Preliminary and Final EIS reports, and securing the Land Use Permit and the Permit to Impact the Environment.  The Company will also continue to advance the social programs committed to under the terms of Crystallex’s Mining Operation Contract.  These include providing new water treatment facilities, sewerage systems, houses and road improvements for the local communities.  In addition, the Company will continue to work with its financial advisors to determine the optimum financing structure and sources of debt financing for Las Cristinas.

About Crystallex:  Crystallex International Corporation is a Canadian based gold producer with operations and exploration properties in Venezuela and Uruguay. Crystallex shares are traded on the TSX and AMEX Exchanges. Crystallex is focused on strategic growth in South America. The Company’s principle asset is the Las Cristinas property in Venezuela. The Mining Agreement gives Crystallex 100 percent control of the reserves and resources of this project. Crystallex is currently working on the final feasibility study to support its development plans for Las Cristinas.                 

For Further Information:

Investor Relations Contact: A. Richard Marshall, VP at (800) 738-1577

Visit us on the Internet:  http://www.crystallex.com

Email us at: mail@crystallex.com

Note: This news release may contain certain “forward-looking statements” within the meaning of the United States Securities Exchange Act of 1934, as amended.  All statements, other than statements of historical fact, included in this release, including, without limitation, statements regarding potential mineralization and reserves, exploration results, and future plans and objectives of Crystallex, are forward-looking statements that involve various risks and uncertainties.  There can be no assurance that such statements will prove to be accurate, and actual results and future events could differ materially from those anticipated in such statements.  Important factors that could cause actual results to differ materially from the Company’s expectations are disclosed under the heading “Risk Factors” and elsewhere in documents filed from time to time with the Toronto Stock Exchange, the United States Securities and Exchange Commission and other regulatory authorities.

Please Note: The estimates described in this study and herein qualifies as reserves in accordance with Canadian National Instrument 43-101.  However, they do not necessarily qualify as reserves for United States reporting purposes.  Therefore, readers should not assume that the information provided in the study and in this release is acceptable for United States reporting purposes, Furthermore, readers should note that measured and indicated resources presented herein would not be acceptable for United States reporting purposes.

The Toronto Stock Exchange has not reviewed this release and does not accept responsibility for the adequacy or accuracy of this new release.