ORM.L Regulatory News (ORM)

16 Jan 2006 07:00

Ormonde Mining PLC16 January 2006 Ormonde Mining plc La Zarza Drilling Results and Update DUBLIN & LONDON: 16 January 2005 - Ormonde Mining plc ("Ormonde" or "theCompany") reports the first set of results received from its Phase Two drillingprogramme at the La Zarza Gold-Copper Project in southern Spain, where it isearning a 70 per cent interest. Further progress in the metallurgical testworkprogramme is also reported. Ormonde's objective at La Zarza is to establish a mining operation producinggold, copper and silver. Results from ongoing drilling, metallurgical testworkand resource estimation will be incorporated into a Preliminary Assessment Studyto be conducted in Q2 2006, leading to a feasibility study later in the year. MAIN POINTS • Drilling results demonstrate continuity in copper mineralization over extensive intervals with an intersection of 47.2 metres grading 2.0 per cent copper, including 12.0 metres grading 2.5 per cent copper. • Gold intersections include 4.0 metres grading 6.2 grams per tonne. • Further positive results received from metallurgical testwork. Kerr Anderson, Managing Director, said today, "With the Phase Two drilling programme at the half way stage, we are satisfiedthat this work, in conjunction with the testwork programme, will enable us tomove into a feasibility study this year. This will be a major step in achievingour objective of adding significant value for shareholders by developing a goldand copper mining operation at La Zarza." PHASE TWO DRILLING Results have been received for holes ORM12 to ORM17, drilled on two profiles inthe western section of the La Zarza deposit, with significant intersections asfollows: Hole From (m) Width (m) Gold g/t Copper % Silver g/t Gold equiv. ORM12 295.0 3.0 4.5 1.7 26.3 9.1 ORM14 67.9* 47.2 0.6 2.0 35.6 6.1 includes 67.9 7.2 0.7 2.4 75.0 7.8 and 79.0 12.0 0.7 2.5 45.0 7.5 199.0 5.0 0.6 2.5 29.0 7.2 219.0 4.0 6.2 0.3 27.0 7.4 ORM15 72.0* 37.0 0.6 1.7 25.7 5.2 includes 81.0 5.0 0.8 2.1 25.6 6.3 134.0 24.0 0.4 2.1 24.8 5.9 ORM16 149.0 6.0 4.5 0.4 27.8 6.0 includes 150.0 2.0 10.2 0.4 26.0 11.6 Notes: All intersections are hosted by the Silicatado unit, with the exception of ORM16which occurs within Massive Sulphide at the contact with the Silicatado. In-situ gold equivalents, shown for comparative purposes, are calculated usingthe following prices: $450/oz Au, $3,500/t Cu, $8/oz Ag. * = Due to drilling angles these two intersections are on average 20 metresapart. Ormonde's Phase Two drilling programme is partially infilling the areas coveredby previous operator SEIEMSA's 1997 non-JORC resource estimate, to determinegrade and geological continuity of gold and copper mineralization to a higherlevel of confidence and thereby allow a proportion of the deposit to beclassified in the JORC Indicated Mineral Resource category. This category ofresource is required for preliminary mine design purposes as part of thefeasibility study. The programme is focusing on the upper part of the La Zarzadeposit where historical underground mine workings to extract pyrite extend intothe gold-copper body. The drilling to-date has demonstrated continuity in copper mineralization overextensive intervals, although structural offsets may have resulted in moreirregular distribution of gold mineralization in the upper-western part of thedeposit. The Phase Two programme is ongoing and due for completion in February. Onreceiving all assay data from the programme, the Company will conduct a revisedgeological interpretation of the deposit, leading to a JORC-compliant resourceestimation. METALLURGICAL TESTWORK Further results have been received from ongoing metallurgical testwork on boththe Gold and Copper Silicatado Composites. Gold Composite Initial flotation tests showed up to 60 per cent of the gold was recovered bystandard flotation procedures to first-stage copper and lead concentrates, witha further 20-30 per cent going into a pyrite concentrate (previously reported).Initial leach tests on the pyrite concentrate show gold recoveries of around 20per cent, however it is anticipated that this may be improved by using otherrecovery techniques. Ongoing flotation testwork is targeted at maximising the amount of gold andsilver that can be recovered to the copper and lead concentrates, this being thesimplest and lowest cost processing route. Importantly, flotation would alsorecover value from the copper contained in the Gold Silicatado, not previouslycontemplated by a leaching option. Copper Composite Results from a second copper composite indicate even better recoveries thanthose previously reported, suggesting that final copper concentrates should havegrades of greater than 20 per cent copper at recoveries of 80-90 per cent.Conventional, single-stage flotation is envisaged to recover copper and silverfrom the Copper Silicatado, and Locked Cycle tests have been commissioned toestablish final concentrate specifications. Enquiries to: Kerr Anderson, Managing Director,Ormonde Mining plcTel: +353 (0)46 9073623 Fraser Gardiner, Director,Ormonde Mining plcTel: +353 (0)86 3931178 Simon Rothschild,Bankside ConsultantsTel: +44 (0)20 7367 8871Mobile: +44 (0)7703 167065 BACKGROUND INFORMATION The La Zarza Gold-Copper Project is located in the Iberian Pyrite Belt miningdistrict of southwest Spain. Historically mined for pyrite by open pit andunderground, unexploited gold and copper mineralization was drilled in the 1990sby a BRGM-Normandy joint venture (SEIEMSA), which outlined a non-JORC resourceestimate of 950,000 ounces of gold, 9.5 million ounces of silver and 81,000tonnes of copper. In June 2004, Ormonde signed an agreement with the propertyowner whereby Ormonde can acquire a minimum 70 per cent interest in the La Zarzaconcessions by spending €1.8 million over three years. Ormonde Mining is quoted on the AIM and IEX markets in London and Dublin,respectively. The Company is focused on acquiring and developing gold projectsin Spain where it has a strong local Spanish management team, supported by aBoard with extensive exploration expertise and mine development experience. For more information and contact details including email, please visitwww.ormondemining.com. 16 January, 2006 This information is provided by RNS The company news service from the London Stock Exchange