Lonrho Regulatory News (LONR)

20 Feb 2009 10:38



20 February 2009

LONRHO PLC

(the 'Company')

Lonrho Mining Update

Lonrho Plc (AIM: LONR), the conglomerate with a structured portfolio of African investments, is pleased to note that Lonrho Mining Ltd (formerly known as Nare Diamonds), which is owned 24.16% by Lonrho, has reinforced the Lulo kimberlite potential following positive microprobe results.

Set out below is the text of the announcement released by Lonrho Mining to the Australian Securities Exchange earlier today:

HIGHLIGHTS

Microprobe analysis of key indicator minerals from six aeromagnetic targets returns encouraging results.

93% of all pyrope garnets and 85% of picro-ilmenites classified as kimberlitic.

Results indicate high potential for diamond preservation, especially in kimberlite K72.

Heavy mineral geochemistry clearly identifies K71 and K72 kimberlites as priority targets for drilling and bulk sampling.

Strong basis to progress exploration and evaluation of the Lulo Diamond Project.

Further to its announcement of 23 January 2009, Lonrho Mining Limited (ASX: LOM) is pleased to report further highly encouraging results from follow-up microprobe analysis of sampling results of the first six targets the Lulo Diamond Concession in north-eastern Angola.

The results indicate that 93% of the pyrope garnets and 85% of the picro-ilmenites recovered from the six target areas can be classified as kimberlitic, with the heavy mineral geochemistry clearly identifying the K71 and K72 kimberlites as the priority targets for drilling and bulk sampling. 

The microprobe analysis was undertaken as a follow up to the results announced last month from field-based inspection and surface sampling which confirmed the presence of high quantities of kimberlitic indicator minerals at all six targets. These represent a small proportion of the 217 magnetic targets so far identified within the Lulo Concession, which lies within the diamond-bearing Cacuilo / Lulo River catchment areas of north-east Angola.

Microprobe Analysis 

As previously outlined, Lonrho's exploration team completed detailed field inspection of the six priority aeromagnetic/satellite targets in December 2008. The target selection was based on the size of the magnetic footprint, the size of the satellite image feature and/or the surface disturbance pattern from garimpeiro workings. Based on empirical evidence, the larger targets were considered to be more prospective.

One 20kg to 40kg soil sample was collected from the centre point of each anomaly with this material screened to -2mm and concentrated in the field, using a gold pan. These concentrates were then dispatched to the MSA Group laboratory in Johannesburg for analysis.

Kimberlitic pyrope garnets and picro-ilmenites were recovered from all of the samples submitted. A selection of 150 pyrope garnets and 150 picro-ilmenites were then submitted for electron microprobe analyses. The results are summarized in Table 1 below:

Of the 150 garnets probed, 140 grains (93%) show that they are kimberlitic and peridotitic in origin with mostly lherzolitic (G9) compositions. A small percentage has eclogitic compositions. Most of the grain colours are mauve and cerise with traces of orange. 

All of the six targets sampled produced kimberlitic picro-ilmenites, with 127 of the 150 grains (85%) classified as kimberlitic. The variability of the geochemical signatures presents an important clue as to the diamond content of the pipes based on the diamond preservation index which indicates how many diamonds survived the journey from the upper mantle (about 150 km deep) to the surface.  

A high percentage of the ilmenite grains fall within fields 3 and 4 of this index, suggesting that the potential for diamond preservation (especially within kimberlite 72) is high.

The Canguige River, which drains both the K71 and K72 (and other) magnetic anomalies, has historically recorded alluvial diamonds with grades of 9cpht to 20cpht. This provides an important backdrop to the results received to date.

Forward Program

The six targets sampled represent just 2.8% of the total 217 magnetic anomalies which, based on the mineral geochemistry seen to date, are believed to be mainly due to underlying kimberlite bodies within the Lulo Diamond Concession. 

This limited soil sampling exercise has enabled the Company to successfully prioritise the six initial selected targets.

The marked geochemical signature variability is encouraging, as it will be possible, using cheap and rapid soil sampling techniques, for early selection of the most diamond prospective pipes within this province.

As outlined previously, the Company is planning to fast-track its 2009 exploration program, with drilling and bulk sampling initially targeting the kimberlite K72 and the adjacent probable kimberlite K71, with the remaining targets to be prioritized in the following order: L6, K50, K6 and K14.

The results received to date - viewed against the background of a known alluvial diamond province (the diamond-bearing Cacuilo River system) - provide the Company with further significant encouragement regarding the prospectivity of the Lulo Diamond Project.

The 2009 exploration program will be finalized following completion of the recently announced Entitlements Issue, which aims to raise up to $1.7 million to underpin diamond exploration activities in Angola in the year ahead. The closing date for acceptances under the Entitlements Issue is 12 March 2009.

Update - Lonrho Mining SA (Pty) Ltd (In Provisional Liquidation)

The proceedings for the liquidation of Lonrho Mining SA (Pty) Ltd (In Provisional Liquidation), referred to in the Company's announcement of 9 February 2009, have been adjourned to 13 March 2009.

It is anticipated that a final winding up order will be made on 13 March 2009, unless the proceedings are further adjourned or withdrawn, or an interested party can show cause why the final winding up order should not be granted. The assets of Lonrho Mining SA (Pty) Ltd (In Provisional Liquidation) currently remain under the control of the Provisional Liquidator, and will be under the control of its Liquidator if a final winding up order is granted.

- ENDS -

Competent Persons Disclosure

The information in this report that relates to Exploration Results, Mineral Resources or Ore Reserves has been prepared by Consulting Geologists Manfred Marx and Consulting Geophysicist, E.O. Kostlin. Messrs Marx and Kostlin are consultants to the Company and have sufficient experience with the relevant style of mineralisation and type of deposit under consideration and to the activity which they are undertaking to be qualified as a Competent Person as defined in the 2004 Edition of the 'Australian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves'. Each of Messrs Marx and Kostlin consents to the inclusion in the report of the matters based on their information in the form and context in which it appears.

LONRHO ENQUIRIES