Arc Minerals Regulatory News (ARCM)

17 Mar 2009 07:00

For Immediate Release 17 March 2009

Templar Minerals Limited

('Templar Minerals' or 'the Company')

Operations Update

Rio Parnaiba Project - Commencement of Phase 1 - Initial Drill Programme:

Templar Minerals Limited (AIM: TMP) is pleased to announce that the phase one exploration works have commenced on the Rio Paranaiba Project ("the Project").  The Project represents a new iron ore discovery in the Brazilian State of Minas Gerais. It covers 14,000 ha (140 km2) and is located 210km from the city of Divinopolis, a key manufacturing hub and steel production centre.

Initial geological sample results from the Project range in values for iron from 26.8% to 67.2% with an arithmetic average 45.6% iron and 0.07% phosphorous. Recently received sulphur test work, which was undertaken following the previously released sample results, has confirmed all samples had low sulphur levels, typically below 0.01%.

As a result of the encouraging geological sampling received to date, the Company has decided to bring forward an initial drill program on the Project. This drill programme is designed to test the strike and depth extents of iron mineralisation at several locations along the 28km of previously identified iron mineralisation at the Project.

The selection of drill-hole locations and initiation of logistical planning for this drill program has commenced. The first holes in this drill program will commence in early April 2009. The initial drill programme will be undertaken concurrently with the other Phase One exploration works already underway, and represents an expansion and acceleration of exploration activities at the Project.

Disposal of Adjara Project, Republic of Georgia:

The Company announces that it has disposed of its 90% interest in the Adjara Project in Republic of Georgia. Goldencrest Enterprises Limited, a wholly owned subsidiary of the Company, has agreed to sell its portion of Templar Georgia Limited to locally based minority shareholders.  The Company has thereby relinquished all rights relating to the Adjara Project. The Company has previously fully provided for the acquisition and development costs capitalised on the Adjara Project which amounted to approx $7.4 million in its Interim results reported in December 2008. Therefore prior to disposal it was carried in Company's accounts at Nil value.

The Adjara Project covered a license area of approximately 104 km2 in the Caucasus Mountains of southwestern Georgia, encompassing several known mineralized polymetallic vein occurrences identified and developed during the Soviet era. While encouraging results were obtained during the recent exploration phase, all work on the Adjara Project was suspended in September 2008 due to the conflict between Russia and Georgia. 

Following careful consideration of the recent instability in Georgia and current economic conditions, it has been decided that continuation of the Adjara Project would not represent best use of available resources. The Company has accordingly disposed of all interest in the Adjara Project.

Vatukoula Gold Mine Investment:

As previously announced in the Company's 2008 Annual Report and Accounts, the Company acquired, in October 2007, 285 million shares in Vatukoula Gold Mines plc ("VGM"). Subsequently, as previously announced in March 2008, the Company entered into arrangements to acquire a further 143 million shares ("additional shares") in VGM.

These arrangements to acquire the additional shares have not been completed to this date. Negotiations with the sellers (Viso Gero Global Inc - "VGG") over the past few months, have resulted in the Company not attaining any rights to these additional shares. In addition, should the Company not settle the arrangement to acquire the additional shares by 31 March 2009, the Company shall transfer 200 million shares in VGM to VGG as full and final settlement of all outstanding obligations between the two parties. These shares are currently held as security by VGG's lawyers until 31 March 2009. The Company has also made aggregate payments to VGG for deferment costs of approximately £0.95 million.

On this basis, the Company settles a possible claim totalling £9 million for the payment of 200 million VGM shares currently valued £1.45 million plus deferment costs.

Chairman David Lenigas commented;

 "Templar Mineral's withdrawal from the Adjara Project due to Georgia's recent conflict with Russia together with the restructuring of the Company's arrangements with VGG provides a stable financial platform to adequately meet exploration commitments on the Rio Paranaiba Project in Brazil."

"Commencement of Phase 1 of the Rio Parnaiba Project is an exciting time for the Company. In addition the decision to start a preliminary drill program has the potential to deliver early results and is in line with the Company's stated objectives of acquiring & developing high potential mineral deposits at low cost. The Paranaiba Iron Ore project has the potential to be a significant asset for the Company."

Competent Person:

The technical information contained in this announcement has been reviewed by Mr. Alastair Clayton, a qualified Geologist. He is the Qualified Person who has reviewed the field data. Mr. Clayton has worked for over 15 years as a geologist and has sufficient experience relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking, to qualify as a Qualified Person for the purposes of this announcement.

Enquiries

Templar Minerals Limited

David Lenigas Tel: +44 (0)20 7016 5100 

Beaumont Cornish Limited

Roland Cornish / Rosalind Hill Abrahams Tel: +44 (0)20 7628 3396