AMI.L Regulatory News (AMI)

19 May 2009 07:00



19 May 2009

For immediate release

African Minerals Limited

("AML" or the "Company")

 TONKOLILI IRON ORE PROJECT - RESOURCE ESTIMATE UPDATE 

TONKOLILI MAGNETITE IRON ORE MINERAL RESOURCE EXCEEDS 5 BILLION TONNES, WITH FURTHER POTENTIAL IDENTIFIED TO GROW RESOURCE TO 10 BILLION TONNES

African Minerals Limited (AIM:AMI) is pleased to announce an updated magnetite iron ore Mineral Resource estimate for its flagship iron ore project at Tonkolili in Sierra Leone. The updated resource estimate was prepared by independent consultants SRK Consulting (UK) Ltd ("SRK") . It reflects additional drill-hole and assay data obtained since the preparation of the last estimate reported 2 February 2009 and now incorporates a Mineral Resource estimate for the Marampon deposit.

HIGHLIGHTS

MINERAL RESOURCE

In total the updated Mineral Resource estimate is 5.1 billion tonnes at an average grade of 30.0% Total Iron, delivering growth in tonnage and grade from the previously reported figures of 4.7 billion tonnes at an average grade of 29.9% Total Iron announced on 2 February 2009. This exceeds the Company's target mineral resource of 5 billion tonnes for the current phase of development, with significant scope to grow the mineral resource reported in this announcement at depth, and along strike.

African Minerals has completed an additional 9,996m of drilling, bringing the total to 70,552m across Numbara, Simbili, and the newly reported Marampon deposit, located between Numbara and Simbili. The Mineral Resource from these three ore bodies is summarised in table 1.

Note: any differences between totals and sub totals are a function of rounding

SRK's full resource estimation report will be made available the week commencing 25 May 2009 on the Company's web-site at www.african-minerals.com.

RESOURCE POTENTIAL

In addition to this resource update, AML is pleased to announce confirmation of the extension of magnetite Banded Iron Formation ("BIF") mineralisation in the Kasafoni area to the North East of Numbara. Quantitative modelling of ground magnetic data has been used to target 5 reconnaissance diamond drill holes all of which successfully intersected significant occurrences of magnetite BIF over a strike length of 10km from Numbara. While there has been insufficient work completed to date to define a Mineral Resource and while it remains uncertain if further exploration/analysis will result in the determination of a Mineral Resource, independent consultants SRK concur with AML that the prospect of growing the total tonnage to 10 billion tonnes through strike extensions at Kasafoni is possible. 

MAGNETITE METALLURGY

Detailed metallurgical characterisation of the ore is underway, including ore characterisation at the CSIRO Iron Ore Group, and further Davis Tube Recovery (DTR) test work at AMDEL. 

The DTR method adopted for systematic analysis of drill core was a standard laboratory procedure which was not optimised for Tonkolili ores. Additional DTR work at AMDEL has focused on refining the DTR process with the objective of increasing the concentrate iron grade, and minimizing the SiO2 and Al2O3 impurities.

The new DTR work on selected samples has demonstrated that high grade concentrates containing over 68% can be consistently achieved at a grind size of 25 microns and with a mass recovery of over 30%. Impurities at levels less than 4.5% SiO2, 0.6% Al2O3, and 0.01% P are also achieved.

CONSIDERABLE HEMATITE POTENTIAL

A significant thickness and strike extent of hematite mineralisation comprised of hematite cap and oxidised transition zone overlies the primary magnetite resources at Tonkolili. Exploration to date suggests that this may comprise of the order of 800 million tonnes of material over Numbara, Simbili and Marampon alone. The principal focus of ongoing work is to define zones of high grade hematite within the above, preliminary metallurgical test work having already indicated that these should be amenable to upgrading to a saleable product.

The Company continues to expedite a comprehensive metallurgical program to assess the amenability of this material for product generation to provide early cash flow on commencement of production.

Additional drilling and geological modelling to enable the preparation of a JORC compliant mineral resource for these zones is also underway.

The potential quantity of hematite mineralisation given here is conceptual in nature. There has been insufficient work completed to date to define a Mineral Resource and it remains uncertain if further exploration/analysis will result in the determination of a Mineral Resource.

Commenting on the updated Resource Estimate, Frank Timis, Executive Chairman of AML said:

"I am delighted with the growth in the Resource Estimate to over five billion tonnes, making the Tonkolili project the largest currently reported iron ore magnetite resource on the African continent, and to have received SRK's independent confirmation of the potential for a total resource of 10 billion tonnes of magnetite following further exploration at depth and along strike.

We now have in place an executive management team led by CEO Alan Watling, with a proven track record of developing and operating projects of this scale to tight timescales. With access to one of the African continents largest deep water ports which will ultimately accommodate Cape-sized vessels, we have the potential to develop what I believe will be a leading iron ore operation on the world stage, serving the US, European, and Chinese markets, and competing with globally recognised industry players."

Qualified Persons

The information in this press release that relates to Mineral Resources is based on information compiled under the direction of Mr Howard Baker, who is a Member the Australasian Institute of Mining and Metallurgy ("AusIMM").

Mr Baker is a full time employee of SRK and has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves'. Mr Howard Baker has reviewed this press release and consents to the inclusion in the press release of the matters based on his information in the form and context in which this appears.

The information in this press release that relates to geological exploration is based on information compiled and reviewed by Marcus Reston, who is a Fellow of the Geological Society of London ("FGS"), and a Member of the Australian Institute of Geoscientists ("AIG"). Mr. Reston, Project Manager: Tonkolili Iron Ore, is a full-time employee of the Company and meets the requirements of a "Qualified Person" under the AIM Guidance Note on Mining, Oil and Gas dated March 2006. Mr. Reston has reviewed this press release and has consented to the inclusion in this press release of the matters based on his information in the form and context in which this appears.

In addition to the above, the press release as a whole has been compiled under the direction of Dr Mike Armitage, who is a Chartered Engineer and a Chartered Geologist and a Member of the Institute of Materials, Minerals and Mining. Dr Armitage is the managing director of SRK Consulting (UK) Ltd and has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves'. Dr Armitage has reviewed this press release and consents to the inclusion in the press release of the matters based on his information in the form and context in which this appears.

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