21 Jul 2011 07:00
21 July 2011
Ormonde Mining plc
("Ormonde" or "the Company")
La Zarza Copper Project - Progress Update
The Board of Ormonde is pleased to provide an update on activities at its La Zarza Copper Project in the Huelva Province of southern Spain.
Main Points
·; Ormonde's wholly owned subsidiary, Ormonde España SL ("OESL"), is preparing documentation to submit to the provincial mining authority for the re-activation of the La Zarza Mining Concession.
·; The required documentation will be submitted prior to the end of 2011 and will be the culmination of our ongoing assessment of development options at La Zarza in the context of sustained higher global copper prices.
·; Separately, significant progress has been made in relation to the four new investigation permits covering a total area of some 95 square kilometres along strike to the east and west of the known mineral resources at La Zarza, for which applications were made in September, 2010 with a view to increasing the copper resources currently defined at La Zarza. These permits are now expected to be issued shortly.
·; Work programmes to be carried out on these new permits will be funded by Ormonde's joint venture partner on La Zarza, Antofagasta Minerals SA ("Antofagasta"), with an agreed budget for the programme of US$1.3 million under the earn-in terms of the joint venture.
Kerr Anderson, Ormonde's Managing Director, said:
"I am pleased to report that we are preparing documentation to submit to the provincial mining authorities to re-activate the La Zarza Mining Concession and will be liaising closely with the regional administration to ensure compliance with all regulatory requirements. This forms an important step in our strategy to extract maximum value from our La Zarza Project.
In addition, the new permits under application will be an important addition to our ground holdings in the La Zarza Copper Project area and we will be moving forward with an aggressive 2011 works programme, funded by our Joint Venture partner Antofagasta. I look forward to reporting further progress on all our La Zarza activities in due course."
Background
In October 2009, Ormonde entered into a joint venture agreement with Antofagasta to explore for additional copper resources on the La Zarza Copper Project, whereby Antofagasta could earn an initial 51% interest in the La Zarza permit area by spending US$7 million over a three year period on exploration activities. Under the terms of the agreement, Antofagasta has the right to increase its interest in the area to 75% by the completion of a feasibility study on a mining project that would meet its investment criteria. Work during the first year of the joint venture culminated in the reporting in September 2010 of an in-house, unclassified, non-JORC compliant global resource totalling 61Mt grading 0.80% Cu, 0.9g/t Au, 0.56% Pb, 1.96% Zn, 5.7g/t Ag (1.34% CuEq cut-off). During this period, OESL submitted applications to the provincial mining authority for additional permits covering any strike extension of the La Zarza system and controlling structures, as suggested by regional airborne magnetics surveying carried out in the 1990s (Click to view magnetic survey. New permit application areas shown with black borders). Based upon recent communications from the provincial mining authority, it is believed that these permits will shortly be awarded and the joint venture agreement has been amended to include the permits, with the work programmes, funded by Antofagasta, being extended over these new permit areas. Accordingly, the timing of the 51% earn-in date under the terms of the joint venture agreement has now been extended to 11 April 2015.
Although additional copper resources are required by Antofagasta to support a project that would meet their investment criteria, Ormonde is advancing the documentation required by the regional and provincial mining authorities to re-activate the mining concession at La Zarza. The Mining Concession is currently in suspension with respect to mining activities, with this suspension requiring renewal on a yearly basis. Theapplication will be supported by detailed documentation, as required by the Huelva mining authorities, to be submitted during 2011. The submission of this documentation will be the culmination of our ongoing assessment of development options at La Zarza given sustained higher copper prices
Kerr Anderson PhD EurGeolPGeo, Managing Director of Ormonde Mining plc, and a qualified person as defined in the Guidance Note for Mining, Oil and Gas Companies, June 2009, of the London Stock Exchange, has reviewed and approved the technical information contained in this announcement.
A glossary explaining technical terms contained in this announcement can be found at www.ormondemining.com/en/investors/technical_glossary
For more information please visit www.ormondemining.com or follow Ormonde on Twitter https://twitter.com/ormondemining or Linkedin http://www.linkedin.com/company/ormonde-mining-plc
Enquiries to:
Ormonde Mining plc
Kerr Anderson, Managing Director Tel: +353 (0)46 9073623
Bankside Consultants
Simon Rothschild Tel: +44 (0)20 7367 8888 Mob: +44 (0)7703 167065
Murray Consultants
Ed Micheau Tel: +353 (0)1 4980300 Mob: +353 (0)86 803 7155
Davy (Nomad / ESM Adviser)
Eugenée Mulhern / Roland French Tel: +353 (0)1 6796363
Fairfax I.S. PLC (Joint Broker)
Ewan Leggat / Katy Birkin Tel: +44 (0)207 598 5368
ENDS
About Ormonde
Ormonde Mining Plc is quoted on the AIM in London & the ESM in Dublin. Ormonde is a mineral development and exploration company focused on Spain (Ticker ORM).
Ormonde's key activities include:
The Barruecopardo Tungsten Project - Ormonde is developing a low cost mining operation at Barruecopardo to initially produce ~8% of non-Chinese global mine production from 2012.
The La Zarza Copper-Gold Project - Joint Venture with Antofagasta Minerals - a large "massive sulphide" deposit with significant copper, gold and zinc resources; exploration for an enlargement to the current copper resources is being funded by Antofagasta.
Gold Explorationin several highly prospective areas of western Spain.