BPC.L Regulatory News (BPC)

18 Oct 2005 07:00

Falkland Gold and Minerals Ltd18 October 2005 Falkland Gold and Minerals Ltd ('FGML' or 'the Company') Strategic Review and Operational Update • Concept of an economically viable gold deposit in the Falkland Islands remains strong • Strategy, as communicated at the time of the Company's flotation on AIM in December 2004, remains in place • Current and planned expenditure is on target - FGML expects to complete its two year, initial exploration, programme on budget Overview Having completed approximately 25% of the planned drilling programme the Boardof FGML has carried out a strategic review of the Company's original explorationprogramme set out in its November 2004 prospectus. The Board has concluded thatthis original strategy, and the timetable of planned activity within it, remainsthe optimum work programme to identify gold and minerals in the FalklandIslands. To enhance the exploration work FGML is appointing independent consultants toreview the selection and siting of new drill holes and ensure that noopportunity has been overlooked. In addition, a series of extensions to groundgeophysics and ground geochemistry on sub peat soil sampling has been approvedby the Board. This is intended to define further anomalies for drilling. The Board is pleased to note that drilling continued throughout the Australwinter. Drilling Operations Drilling activity began in March 2005 and by 30 September 2005 a total of 6,000 metres of core had been drilled, testing seven of the originally identifiednine priority targets. FGML remains on target to complete Stage 2 of itsprogramme on schedule and to drill approximately another 18,000m, by Q4 2006, onthe other fourteen of the twenty three identified targets, and any other targetssubsequently identified. Initial broad scale geochemistry has indicated promising new targets in theGlorious Hill region. These targets will be followed up with further soilsampling and drilling. Drilling results have, to a large extent, confirmed prior geologicalinterpretation and are being used to further refine target selection. Theresults to date, and the knowledge derived from them, have allowed the original model to be refined and improvedand will focus future drilling activity. Progress to date has covered more ofthe identified targets than was originally planned and the improved model willcontinue this trend. Financial The total cash outflow is expected to be of the order of £100,000 per monthuntil the conclusion of the exploration phase of the drilling at which timethere will be in the region of £5.5million available for the definition drillingprogramme, which if required, could commence by Q4 2006. Richard Linnell, Executive Chairman of FGML, commented: "Our strategic review has confirmed my original confidence that the FalklandIslands represents an exploration target with real potential for a gold deposit.I am satisfied that we have sufficient financial resources to complete ourpreliminary exploration activity and define any discoveries" Enquiries Falkland Gold & Minerals LimitedRichard Linnell, Chairman +27 82 440 6710 Bell Pottinger Corporate & FinancialNick Lambert +44 (0) 20 7861 3232 This information is provided by RNS The company news service from the London Stock Exchange