Metals Exploration Regulatory News (MTL)

16 Dec 2005 07:01

Metals Exploration PLC16 December 2005 METALS EXPLORATION PLC FIRST DRILL HOLE ASSAY RESULTS RECEIVED FOR THE RUNRUNO PROJECT GOLD AND MOLYBDENUM RESULTS MEET EXPECTATIONS 16 December 2005 The Board of Metals Exploration PLC ("the Company") is pleased to announce thatresults have been received for the first drill hole (MXD1) of the currentdiamond drilling programme being undertaken at its Runruno Project. MXD1comprises a total combined intercept of 30 metres averaging 2.37 g/t gold, and377 g/t molybdenum. Today's gold price is US$505/oz and the molybdenum price isUS$30/lb. There are 454 grams to an imperial pound. This first batch of results appears to vindicate the Company's belief that byfocusing on achieving good drill core recoveries (i.e. >90%), the gold assayresults should be better than those obtained during the 1969-1972 drillingcarried out by Fil-Am Resources Inc. ("Fil-Am"). As mentioned in previous newsreleases, the drill core recoveries experienced during Fil-Am's drillingcampaigns in the 1970s were very poor, particularly within the interpreted zonesof possibly higher grade gold mineralisation. In fact, the drill core recoveriesand results show more similarities to those obtained by Greenwater MiningCorporation ("Greenwater"), a subsidiary of Placer Dome Exploration of Canada,from the two holes that they drilled into the mineralised zones in 2001-2002. During the drilling of the first hole (MXD1), a 1.6 metre section of drill corewas lost from within the hangingwall mineralisation. This means that thisparticular interval was unable to return an assay result and subsequently theintersection width and average grade has possibly been downgraded to somedegree. The drilling company is re-drilling the hangingwall section of themineralisation to recover this part of the zone for analysis. As the drillingcrews become more familiar with the drilling conditions, the loss of drill core,particularly from within the mineralised zones, will be minimised. The results are highly encouraging as this also vindicates the Company's beliefthat the Runruno resource, as previously defined in the 1970s, could be upgradedto an average grade higher than 1.4 g/t Au as a result of focusing on achievinggood drill core recoveries. Within MXD1 there is a combined width of 30 metres of interceptions showinggreater than 0.7g/t gold mineralisation and the average grade over the 30 metresas a whole is 2.37g/t gold.. The upper hangingwall horizon starts at 38 metresand the bottom footwall horizon ends at 135 metres depth. The total width of themineralised zone is 97 metres. The individual intercepts for Hole MXD1 are: Drill-hole MXD1 Drill-hole Intercept (metres) Au Mo ID From to Thickness g/t g/t MXD1 38 40 2 1.82 68 MXD1 42 50 8 4.00 592 MXD1 107 110 3 2.57 408 MXD1 116 120 4 1.44 23 MXD1 122 135 13 1.68 394 Total Combined Intercept 30 2.37 377 (@ >0.7 g/t Au) There are currently four drill rigs on site and in operation. The Companyexpects to announce further results of its drilling programme by the end ofJanuary 2006. COMPARISON WITH PREVIOUS DRILL RESULTS 1969-1972 Fil-Am The nearest Fil-Am drillhole (DRQ-60) to MXD1 (56 metres away) only intersectedthe hangingwall mineralisation and did not intersect the footwallmineralisation. Comparing the hangingwall intersections of DRQ-60 with MXD1,there is a significant increase in the average grade of the zone from 9.1m @ 1.7g/t Au to 10m @ 3.56 g/t Au respectively. Similarly with the Fil-Am drillhole 90 metres away (DRQ-59), there is anincrease in the average gold grade of the hangingwall and footwallmineralisation with a total combined increase in the average grade from 1.93 g/tAu to 2.37 g/t Au. The Company believes that the difference in drill core recovery explains thedifference in the apparent average gold grades obtained. 2000-2001 Greenwater The two Greenwater drillholes (RUD-001 & RUD-004) nearest to MXD1, although morethan 90 metres from MXD1, showed many similarities to MXD1. In one ofGreenwater's holes, a combined width of interceptions of 44 metres showing anaverage grade of 3.09 g/t Au and 630 g/t Mo was encountered. Greenwater'ssecond hole returned a combined width of interceptions of 36 metres showing anaverage grade of 2.18 g/t Au and 837 g/t Mo. Greenwater's drill core recovery was thought to be in the order of 80-90%,compared with the Company's recovery of over 90% in this first hole. SAMPLING & ANALYSIS Sample Preparation The drill core is taken from the drill site to a secure compound at theCompany's field camp and is logged by the geologist. The drill core is thensplit into two equal halves along its long axis, with one half being sampled atpredetermined intervals, bagged and sent for analysis. The remaining half-coreis retained in core boxes and stored on site for future reference. The bagged half-core samples are being submitted to an independent 'ISO17025accredited' laboratory for sample preparation and analyses for gold andmolybdenum. All of the half-core samples are crushed by the laboratory and a900-1000 gram split is taken, pulverized and presented for analysis. Analytical Techniques Gold: Gold analysis is by classical 'Screen Fire Assay' technique that involves sieving a 900-1000 gram sample to 200 mesh (75um). The entire oversize and duplicate undersize fractions are fire assayed and the weighted average gold grade calculated. This is one of the most appropriate methods for determining gold content if there is a 'coarse gold' component to the mineralisation. Molybdenum: The sample is dissolved in Aqua Regia (3:1 HCl:HNO3) and Molybdenum analysis is carried out by Inductively Coupled Plasma - Optical Emission Spectrometry (ICP-OES) method. This is one of the most appropriate methods of determining the molybdenite content of rock. FORWARD LOOKING STATEMENT The Company's objective is to determine a gold (+molybdenum) resource over a 600metre strike, 100 metre width to a down-dip depth of 400 metres. Given theseparameters, the Directors are setting a resource target for this part of thedeposit of 45 to 55 million tonnes. The main Runruno mineralisation has beenmapped at surface over a strike distance of 2.5 kilometres. This is a forward looking statement and should not be regarded as anything elseand should not be regarded as a true indication of the resource until it hasbeen properly and fully explored. QUALIFIED PERSON Gary Powell (a Director of the Company) has been involved in the mining andexploration industry for more than 20 years. He has a Bachelor of AppliedScience degree in geology and is a member of the Australasian Institute ofMining and Metallurgy and the Australasian Institute of Geoscientists. He hascompiled, read and approved the technical disclosure in this regulatoryannouncement. ENQUIRIES: Steven Smith - Chairman: + 44 (0) 7797 721 858 Jonathan Anderson - Investor Relations: + 44 (0) 7950 410 680 or + 63 (0) 917 560 6654 Philip Haydn-Slater - WH Ireland Limited: + 44 (0) 2072 201 666 This information is provided by RNS The company news service from the London Stock Exchange