ORM.L Regulatory News (ORM)

26 Jan 2006 07:01

Ormonde Mining PLC26 January 2006 Ormonde Mining plc New Gold Zone at Salamanca DUBLIN & LONDON: 26 January 2006 - Ormonde Mining plc ("Ormonde" or "the Company") reports positive exploration results obtained from the Salamanca Gold Project in western Spain, where it is earning a 90 per cent interest. The results confirm Salamanca as a highly prospective, multi-target gold play. Ormonde plans to advance the project through further exploration including drilling. HIGHLIGHTS • Results from a soil sampling survey highlight a large and coherent zone of gold anomalism, measuring 1.5 kilometres in length and up to 200 metres wide, possibly representing a new bulk tonnage target in the area. • Rock samples taken across the survey area from both newly recognised zones and known tungsten-gold occurrences, have returned a number of high-grade gold results including 51.4, 36.6 and 27.3 grams per tonne gold ("g/t Au"). • Prospecting work has highlighted several additional areas of interest, with one in particular returning sample grades including 56.2, 51.5, 29.9, 23.1 and 21.3 g/t Au over a wide area, suggesting that gold mineralization may be significantly more extensive than indicated by work of previous operators. Kerr Anderson, Managing Director, said today, "We are very pleased with the results so far from Salamanca, and the emergenceof new zones with discovery potential combined with the evaluation of known butunder-explored tungsten-gold prospects, gives us a very positive outlook forthis year's drilling programmes. Salamanca is a rapidly progressing project,demonstrating that in addition to La Zarza we have several projects in Spainwhich could add substantial value for shareholders." SOIL SAMPLING In areas where bedrock is not exposed at the surface, systematic soil samplinggives an indication of underlying gold enriched zones. Ormonde and its JVpartners have sampled an area of 14 square kilometres, which covers severaltungsten-gold occurrences and is also considered to be highly prospective forfurther, hitherto unrecognized gold mineralization. Sampling was carried out on a 200 by 50 metre grid. Interpretation of thesample results has produced an extensive and coherent gold anomaly (greater than75 parts per billion gold, with a maximum value of 315 ppb) over a portion ofthe area where no mineralization of any kind has previously been identified.The anomaly has a linear geometry, probably representing a structural trend,with a length of 1.5 kilometres and width between 100 and 200 metres. There ispotential for the anomaly to extend further in length into an area as yetunexplored; sampling in this area is currently in progress. Although bedrock exposure is very poor over the anomalous area, fieldobservations at one locality suggest that mineralization is typified by swarmsof arsenopyrite-bearing, quartz-filled fractures within a granite host rock.This is the same granite body which hosts the Barruecopardo Tungsten Mine (seebelow) and therefore has established mineralizing potential. Several other anomalous zones have been identified across the survey area, eachof which will be the subject of follow-up work in the current sampling phase.Once detailed sampling has identified the priority target areas, a preliminarydrilling campaign will ensue. ROCK SAMPLING Grab sampling of outcropping veins, loose blocks and mining waste dumps over thesame area as the soil survey has further confirmed the prospectivity of theSalamanca vein systems with results as follows: Total samples: 223Highest gold values: 51.4, 36.6, 27.3, 16.8 and 14.3 g/t AuSamples over 5 g/t Au: 10 (4 per cent)Samples between 1 and 5 g/t Au: 22 (10 per cent)Samples between 0.1 and 1 g/t Au: 95 (43 per cent). REGIONAL PROSPECTING Prospecting has assessed large areas of the permits, and has identified severalareas of interest for detailed evaluation. At one area in particular, samplingpredominantly of iron oxide rich quartz vein material along a 4.5 kilometretrend suggests that gold mineralization may be significantly more extensive thanindicated by previous operator work, with results as follows: Total samples: 166Highest values: 56.2, 51.5, 29.9, 23.1 and 21.3 g/t AuSamples over 5 g/t Au: 15 (9 per cent)Samples between 1 and 5 g/t Au: 23 (14 per cent)Samples between 0.1 and 1 g/t Au: 49 (30 per cent) TUNGSTEN POTENTIAL In addition to pure gold exploration plays exemplified by the new soil sampling,several tungsten-gold targets will be evaluated with a view to their jointcommodity potential. Prices of tungsten concentrates, which are traded throughprivate contracts and not on an open market, have increased three-fold in thepast year in market conditions which are expected to remain buoyant for the longterm. The Salamanca permits include the Barruecopardo Tungsten Mine, whichclosed in the early 1980s and which during its operation was one of Europe'slargest tungsten producers boasting one of the highest quality tungsten productsin the market. Enquiries to: Kerr Anderson, Managing Director,Ormonde Mining plc Tel: +353 (0)46 9073623 Fraser Gardiner, Director,Ormonde Mining plc Tel: +353 (0)86 3931178 Simon Rothschild / Nicola Biles / Keith IronsBankside Consultants Tel: +44 (0)20 7367 8888 ENDS BACKGROUND INFORMATION Ormonde considers the Salamanca area to be one of the most prospective goldterrains in Spain. The Company has agreements with two private Spanishcompanies to earn a 90 per cent interest in a permitted area of 720 squarekilometres, by staged funding of exploration totalling €2.2 million over a fiveyear period. The permits cover deposits with potential for high-grade zones andseveral prospects where there has been no or only limited follow-up exploration. Ormonde Mining plc is quoted on the AIM in London and the IEX in Dublin. TheCompany's objective is to build a mid-sized mining company by developing goldprojects in Spain where it has a strong local Spanish management team, supportedby a Board with extensive mine development and exploration experience. For more information and contact details including email, please visitwww.ormondemining.com. This information is provided by RNS The company news service from the London Stock Exchange