Herencia Resources Regulatory News (HER)

21 Nov 2005 15:47

Herencia Resources PLC21 November 2005 21 November 2005HERENCIA RESOURCES PLC("Herencia" or "the Company") Chile Silver Project Update Overview • Excellent project team assembled • Project office opened 1 November in Iquique, Chile • Exploration commenced 3 November • High silver and base metal values identified by reconnaissance samples at both Iquique and Paguanta • Paguanta drilling expected to commence mid January 2006 Since the announcement on 24 October 2005 Tarapaca has continued to progress theexploration programme requirements and review the historical data available onthe Iquique and Paguanta projects. The Company is pleased to announce that the establishment of the project team isnow complete. The team will be based at the Company's new office located inIquique, Chile, which became fully functional on 1 November 2005. The Iquique and Paguanta projects are to be managed by a very experiencedtechnical team comprising James Reeves (ex Placer Dome) who has been appointedas General Manager of Exploration. As from mid November, two qualified Chileangeologists (ex BHPBilliton and Barrick Gold) and one project geologist, AndrewJones (ex Newcrest Mining Limited and Aberfoyle Resources Limited), have alsojoined the team. The team will be further complemented by Jacob Rebek (ex Rio Tinto explorationmanager for South America) who was responsible for compiling the Tarapacaexploration portfolio. Jacob will continue to oversee the ongoing explorationprogramme. Additionally, Keith Liddell (ex Aquarius Platinum), who hasextensive metallurgical and project development skills, was recently appointedas a non-executive director of the Company. Melvin Campbell (ex Robe River,Goldfields Limited and Ranger Minerals), has been appointed as Chief FinancialOfficer for the Tarapaca group. All statutory approvals have been received including foreign investment approvalreceived on 15 November 2005 from the Chilean authority for Tarapaca Resourcesto conduct exploration business in the country through its wholly ownedsubsidiaries Iquique Resources (Chile) SA and Paguanta Resources (Chile) SA. Exploration in Chile commenced on 3 November 2005 with preliminary sampling inthe Iquique project area. The exploration activities for the next 2-6 monthswill be focussed on the prospective old mine sites at the Iquique project andthe walk-up drill targets at Paguanta. Iquique Project The Iquique project covers secured tenements over approximately 97 km2 in theIquique Mineral Field, which contains numerous old silver workings dating backto the Inca Empire and the Spanish colonial era. The project area covers almostthe entire old Iquique silver mining district, which in the 19th Century was thesecond largest silver producer in Chile with over 60 operating mines. Theproject area has historical assays which have produced numerous silver grades ofbetween 500 to 1000 grams per tonne. The Company hopes that the consolidation of the silver district under a singleownership structure will provide an opportunity to apply modern explorationmethods to discover new silver and copper deposits. From the ongoing review ofthe historical data it is evident that previous miners were unaware of thesilver potential of geologically unique surface reactions of salts which havebeen measured at between 3% and 11% silver chloride. The Iquique project is situated in an area with good communications andinfrastructure being located 20km from the deep water port of Iquique, near thewestern edge of a high plateau. The main road from Iquique to the nitratemines, which are located immediately east of the silver workings, also passesthrough the Iquique Project area. With a population of approximately 140,000,Iquique offers extensive services and necessary infrastructure for the miningindustry, as well as an international airport. The majority of old mines were underground following narrow high grade veins upto 600 metres in depth, with mineralization in veins extending along east-weststructures and around porphyry intrusions. Recently, dumps from these have beenretreated to recover silver. In the earliest mining period, wider ore bodieswere also exploited in near surface to produce oxidised, friable material thatcontained silver chloride mineralization and these should have potential forprocessing by simple leaching methods. As a result, one of the main aims of the Iquique Project is to investigate thepotential for bulk open cut mining of silver deposits in weathered oxidised rockwhere surface material may have been further enriched. In addition, the searchfor manto and skarn type silver-copper deposits like those mined in similarlymineralised districts in Peru and Mexico will also be undertaken. Some shaftshave intersected replacement copper and silver mineralization within favourablelimestone stratigraphy marginal to porphyry sills. Initial field work will include 1,350 soils and historical dump samples, 1,040rock and rotary chip samples and ground magnetics at the prospective RosaAmelia, Rosa Amelia North and Monte Cristo old workings. This will be followedby 3,500 metres of RC drilling. A summary of the prospective zones within the Iquique project are: Rosa Amelia Historical Workings • Five closely spaced parallel ENE trending sub-vertical veins on hillside • Near surface concentration of silver and oxide copper due to supergene regolith and saline effects • Grades exploited over 100 years ago were 500-1000g/t Ag • Stope maps from adits and tunnels show mineralization extends beyond controlling vein structures; recent spot samples gave 0.3% Cu with 400g/t Ag to 3% Cu with 30-50g/t Ag Rosa Amelia North • Oxide silver-copper ore in limestone from shaft dump • Green and red copper oxides • Limestone sequence has porphyry sills, with mineralization along contacts and in sub-vertical veins Monte Cristo • Vein and brecciated silicified limestone with visible lead • Possibly a lead, silver and zinc zone that is higher in system with copper potential at depth Paguanta Project The Paguanta Project is located in the northern part of the main Chileanporphyry copper belt, approximately 120km east of the coastal port of Iquiqueand 20 km south of highway to Bolivia. The Paguanta project covers a 39 km2tenement block which covers known silver-zinc-gold mineralization ("PatriciaZone") and copper-silver mineralization ("Doris Zone"). The Company wasattracted to the Paguanta Project by historic silver workings which wereestablished approximately 130 years ago when small-scale mining of high gradesilver veins was undertaken from a 450m adit. At Paguanta there are old workings which are drill ready targets wheremineralization is found over a width of 700 metres along the east-west trendingPatricia Zone structure. The project area historically has recorded adit andshaft dump assays averaging 125g/t silver, 5.71% zinc, 2.71% lead and 0.57 g/tgold. Initial field work will include 100 stream sediment samplings, 400 rockand dump samplings of old workings and mineralised zones, ground magneticsurveys and mapping of project area at the Patricia and Doris zones. This willbe followed by 2,000 metres of diamond drilling. The project area has sulphide veinlets rich in Silver and Zinc and quartzveinlets in porphyry host. The area is overlain by ignimbrite felsic volcanicand water table at floor of from 450m adit. Adit and shaft dump with maximumhistorical assays to 739g/t Ag, 22.88% Zn, 8.81% Pb, 1.8g/t Au (Patricia zone)have been noted and fractures northeast of the Adit area (Doris zone)historically assay up to 15.2% Cu and 805g/t Ag. Previously restricted by access, Compania Minera Costa Rica recently constructeda 28km road from the Iquique-Oruro (Bolivia) highway southward across theTarapaca River gorge to the Paguanta Project area. This new road has providedrelatively straightforward access and opened up the area to modern exploration.The site is at 3,300-4,200 metres elevation and in the mineralised areas theslopes are relatively gentle. With the full exploration team on board, field exploration activities consistingof rock and soils sampling is scheduled to commence on the 28 November 2005 withdrilling activities scheduled to commence mid January 2006 and continuing untilend of June 2006. A summary of the prospective zones within the Paguanta project are: Patricia Zone • Several high grade silver-zinc vertical lodes or veins mined 130 years ago and ore smelted on site • In old area there is silver-zinc-gold mineralization in high sulphidation epithermal veins and stockwork breccias hosted by andesite volcanic lavas and porphyry intrusions • Cathedral pinnacle located centrally Doris Zone • A virgin mineralised zone east of the old Patricia Zone workings • Visible copper sulphide minerals seen in outcrop reported to contain high silver and anomalous gold values • Selected samples grade up to 20% copper and 800g/t silver Cumbre Zone • Southern part in area of silicified limonitic breccias with old working to be investigated * * ENDS * * Enquiries: Herencia Resources plcAnthony Barton, Chairman +61418 923636Nabarro Wells & Co LimitedHugh Oram, Director +44 (0) 20 7710 7400St Brides Media & Finance LtdHugo de Salis +44 (0) 20 7242 4477 This information is provided by RNS The company news service from the London Stock Exchange