ROSE.L Regulatory News (ROSE)

4 Sep 2006 07:03

Vane Minerals PLC04 September 2006 4th September 2006 VANE Minerals Plc (AIM: VML) Encouraging Results from Drilling Programme at Diablito Mine VANE Minerals Plc ("VANE" or "the Company") is pleased to announce that it's100% owned Mexican subsidiary, Minerales VANE SA de CV, has recently completedan encouraging drilling programme at its high grade Diablito silver-gold mine,in Nayarit State, Mexico. The Diablito mine commenced production from the Main or Lower Vein in November2005 at a daily rate of 50 tonnes per day and is currently generating US$420,000of income per month, with a total mining, processing, transportation andsmelting cost of US$ 125/t. The latest drilling was undertaken to further define and extend the remainingresource of 93,000 tonnes @ 12.13g/t gold and 1,319g/t silver (undiluted)calculated over a 130m section of the 300m surface expression of the Lower Vein.The programme has returned encouraging assay results from this vein as well asconfirming good mineralisation in a new vein, the Upper Vein, which has beenrecently identified. Other areas on the concession have also been newlyidentified for further exploration. The drilling programme consisted of 20 diamond drill holes drilled from thesurface, both inclined and vertical, within the Diablito concession. Assayshave now been received for all the drill core sampled and a new resourceestimate will be calculated once all assay results and drill hole data has beencollated. The Company expects this work to be completed in September and willthen review the mine plan with the intention of increasing the daily productionrate. In order to facilitate the additional production and generate cost savings, theCompany is in discussion with financiers to provide a convertible debt facilityfor the construction of its own mill and flotation plant near the project site. Lower and Upper Vein results: Holes DIA 36, 37, 38, 39, 40, 41 and 47, were drilled to confirm the presence ofthe Lower Vein between the mine workings and holes DIA 30 and 31, which weredrilled in a previous programme. In addition, eight drill holes, 42, 43, 44, 45,46, 48, 50 and 51, were drilled to define the mineralisation down dip from theprevious drilling. Vein intersections confirm the extension of the mineralisation to the south ofthe current resource blocks. The new drill holes showed that the Lower Vein isflattening and locally thickening with depth and is still open to the southwestwhile hole DIA 46 indicates that the mineralisation is probably cut off to thesoutheast. The more significant intersections in the Lower Vein are: Hole No: TD: Interval: Intercept: Weighted Average: (grams per tonne)DIA 36 99.5 92.2 to 93.2 1.00 3.9 g/t Au, 621 g/t AgDIA 38 100.5 97.2 to 98.2 1.00 6.6 g/t Au, 1118 g/t AgDIA 39 95.7 90.4 to 92.7 2.35 3.2 g/t Au, 701 g/t AgDIA 41 105.5 91.0 to 91.8 0.8 1.0 g/t Au, 249 g/t AgDIA 43 107.0 87.6 to 94.6 7.00 10.6 g/t Au, 1021g/t AgDIA 47 135.5 95.5 to 96.5 1.00 3.5 g/t Au, 435 g/t AgDIA 48 122.0 109.0 to 112.0 3.00 3.34 g/t Au, 695 g/t AgDIA 49 51.0 46.6 to 48.0 1.40 2.71 g/t Au, 636 g/t AgDIA 50 107.0 95.0 to 96.5 1.50 2.19 g/t Au, 367 g/t AgDIA 53 35.0 29.0 to 29.5 0.50 0.99 g/t Au, 269 g/t AgDIA 55 66.3 61.9 to 62.6 0.70 7.71 g/t Au, 1873 g/t Ag The new drill holes have confirmed the presence of significant mineralisation inthe Upper Vein. This vein is parallel to the northeast-southwest trending LowerVein and was originally observed in holes from the previous drill programme andin the western part of the underground workings. Along strike to the north eastthe Lower and Upper Veins appear to merge into one. The Upper Vein is not included in the current mineral resource. However, it willbe accessible from existing mine workings and will not require extensive newdevelopment. The more significant intersections in the Upper Vein are: Hole No: TD: Interval: Intercept: Weighted Average:DIA 36 99.5 84.2 to 85.6 1.4 27.2 g/t Au, 1548 g/t AgDIA 37 98.0 85.0 to 87.0 2.0 29.8 g/t Au,1507 g/t AgDIA 38 100.5 87.5 to 89.2 1.7 3.7 g/t Au, 313 g/t AgDIA 39 95.7 85.0 to 86.7 1.7 12.9 g/t Au, 919 g/t AgDIA 40 107.0 83.5 to 84.0 0.5 2.8 g/t Au, 155 g/t AgDIA 42 127.5 83.0 to 83.7 0.7 6.2 g/t Au, 598 g/t AgDIA 43 107.0 80.4 to 83.1 2.7 6.0 g/t Au, 468 g/t AgDIA 44 107.7 90.5 to 92.5 2.0 4.0 g/t Au, 233 g/t Ag New Areas to explore on the concession: The Diablito Mine is located on a 300m section of a northeast - southwesttrending vein system bounded to the east and west by faults. A number of holeswere drilled to test for the extension of the vein on the "far side" of thesefaults. East Area: A faulted, offset, portion of the Lower Vein outcrops to the east of theDiablito mine workings and was intersected in hole DIA 26 (from an earlier drillprogramme). Holes DIA 49, 53 and 55 were designed to determine the Lower Vein'swidth, strike, thickness and grades. All three holes intersected anomalous gold and silver mineralisation andindicate that this segment of the vein has a strike length of at least 45m andextends down dip from the vein sub-crop for 75m. The mineralised intercepts arebetween 4.90 metres and 8.00 metres wide and have a typical grade of less than1g/t gold and 200g/t silver. However, there are two intercepts that are moreencouraging: DIA 55 0.7 metres @ 7.71g/t gold and 1873g/t silverDIA 49 1.4 metres @ 2.71g/t gold and 636g/t silver The Directors believe that further drilling is warranted on this portion of thevein structure. West Area: One hole, DIA 52, was located to the west of the main Diablito workings, acrossa fault identified in the earlier drilling and subsequently in the undergroundworkings, in an attempt to locate the fault offset portion of the vein system.Siliceous volcanic rocks with trace amounts of visible sulphide mineralisationwere encountered at the lithic tuff - andesite contact. Anomolous gold andsilver mineralisation was identified intermittently over a 2m interval, with apeak of 0.69 g/t Au and 116.6 g/t Ag. This anomaly will be investigated further. Cantina Vein: Drill hole DIA 54 was designed to explore the newly discovered Cantina vein,with approximately 100m of strike length, located 600 metres northwest of theDiablito mine and northeast of the village of Las Lumbes. The hole intersected a5.2m thick composite zone with quartz veins and volcanic rocks. Visible sulphides included galena and sphalerite. Assay values for gold andsilver are low and zinc and lead assays are pending. Old Workings: Sampling and mapping in the old workings indicate possible near-surface openpittable ore as well as extensions of the underground ore zones. Comments: The Directors of VANE believe that the Diablito concession holds promise foradditional resources both in the area of the current mining operations as wellas from more distal parts of the concession. Geologic mapping and sampling willcontinue to evaluate these areas as sources of future ore. Michael Spriggs, Chairman of VANE commented, "We are very encouraged by theresults of this drill programme and are confident that the additional resourceswill more than replenish that which has been mined to date. Diablito hasprovided important funds for VANE, allowing us to grow and develop ourportfolio, and we will continue to optimise the returns from this mine goingforward." Clark Arnold, Ph.D Geology, who is Director of Geology for VANE Minerals and whomeets the criteria of a qualified person under the AIM rule guidance for mining,oil and gas companies, has reviewed and approved the technical informationcontained within this announcement. About VANE Minerals: VANE Minerals was founded by the former international exploration team ofFreeport McMoRan Copper & Gold Inc., one of the world's largest producers ofcopper and gold. The team negotiated exclusive access to Freeport-McMoRan'sglobal exploration database, made up of 7,000 plus files generated over nearly100 years of exploration and, following the review of these files, VANE isideally placed to capitalise on project acquisition opportunities. The Companyhas assembled a highly qualified and experienced management team with a proventrack record in exploration and development, who have spent their entire careerssearching for and defining large scale mineral deposits. The Company's principal objective, as set out at the time of its listing in June2004, is to be a self-funding exploration company. As such, the initial focushas been to identify high grade gold-silver projects which can be brought intoproduction as quickly as possible in order to provide revenue towards fundingthe discovery of potentially much larger projects. VANE is well on its way toachieving this objective as production began at the Diablito silver-gold mine inMexico in November 2005. The Company is using the revenue generated by thisproducing mine to help fund exploration work across its attractive portfolio ofgold, silver, copper and uranium assets in Mexico, Paraguay and the US. For further information, please review: www.vaneminerals.com. Enquiries: VANE Minerals Plc Ambrian Partners LimitedMatthew Idiens Richard Brown+44 (0) 20 7667 6322 +44 (0) 20 7776 6417 Parkgreen Communications Daniel Stewart & CoCathy Malins / Annabel Leather Dan Willmott+44 (0) 20 7493 3713 +44 (0)20 7776 6550 This information is provided by RNS The company news service from the London Stock Exchange