Rosebank Regulatory News (ROSE)

17 Nov 2006 07:25

Vane Minerals PLC17 November 2006 17th November 2006 VANE Minerals Plc (AIM: VML) Increased Silver - Gold Resource at Diablito Mine, Mexico - Potential to increase daily production by 50% VANE Minerals Plc, ("VANE" or "the Company") today announces that its 100% ownedMexican subsidiary, Minerales VANE SA de CV has substantially increased thesilver and gold resource at its wholly-owned high grade Diablito silver-goldmine, in Nayarit State, Mexico. Highlights • As of 1st August 2006 the JORC compliant resource has increased by approximately 52% net of production to 141,277 tonnes containing 6.07grams per tonne ("g/t") gold ("Au") and 684 grams per tonne silver ("Ag"). • The resource is allocated as follows: o Measured and Indicated 110,077 tonnes at an average grade of 7.20 g/t Au and 747 g/t Ag o Inferred 31,200 tonnes at an average grade of 2.10 g/t Au and 461.7 g/t Ag • VANE management believe that the new resource would justify an increase in daily production from 50 to 75 tonnes per day ("tpd") As announced on 4th September 2006, the drilling programme, which was undertakento further define and extend the resource, consisted of 20 diamond drill holesdrilled from the surface, both inclined and vertical, within the Diablitoconcession. This drilling has increased the Diablito resource by approximately 52% from93,000 tonnes to a total of 141,277 tonnes, having an average grade of 6.07 g/tAu and 684 g/t Ag. Please see tabulation of the resource in Table 1, below. The Diablito mine commenced production in November 2005 at a daily rate of 50tonnes per day and is currently generating US$420,000 of gross revenue permonth. A total of 17,659 tonnes have been mined to 1st August 2006. VANE now hasthe option of either increasing daily production from 50 to 75 tpd or extendingmine life by some three years at the current rate of production. The Company remains on track to construct its own mill and flotation plant closeto the Diablito mine site which will serve to dramatically reduce transportationcosts and remove the current reliance on third party toll milling arrangements(refer to the Interim report, 12th September 2006). The plant will have atarget capacity of 100 tpd, which allows for a further potential increase indaily production, should this be appropriate. The facility is expected to beoperational by mid 2007. Michael Spriggs, Chairman of VANE, commented: "The increase in the resource atDiablito confirms our confidence in the presence of additional resources at theproperty and we will look to build on this further by looking closely at theother areas of interest. The ramp up in production, aided by the constructionof our own plant, will significantly boost our cash flow and will continue toprovide important revenue for the exploration and development of our otherprojects in Mexico, Paraguay and the US." Exploration continues in an effort to identify additional measured resources. Clark Arnold, PhD Geology, who is Director of Geology for VANE Minerals and whomeets the criteria of a qualified person under the AIM Guidance Note for Mining,Oil and Gas Companies, March 2006 has reviewed and approved the technicalinformation contained within this announcement. The resource has been calculated by Independent Mining Consultants Inc.(IMC) ofTucson, Arizona, USA and this announcement has been approved by IMC. 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 is using the revenue generated by the Diablito mine to help fundexploration work across its attractive portfolio of uranium, gold, silver, andcopper projects in the US, Mexico and Paraguay . For further information, please review: www.vaneminerals.com. Enquiries: VANE Minerals Plc Ambrian Partners Limited Matthew Idiens Richard Brown +44 (0) 20 7667 6322 +44 (0) 20 7776 6417 Parkgreen Communications Daniel Stewart & Co Annabel Leather Dan Willmott +44 (0) 20 7493 3713 +44 (0)20 7776 6550 Table 1: Minerales Vane S.A. de C. V. (100% attributable) Diablito Drill Hole Intercept - Polygon Resource Estimate, Diluted to 2m Oct-06 Vein Category Tonnes Gold, g/t Silver, g/t MAIN ZONE Lower Measured 30,154 9.08 998.8 Upper Measured 3,770 11.38 705.5 Total 33,924 9.34 966.2 Lower Indicated 40,634 5.42 643.6 Upper Indicated 12,472 8.62 568.5 Total 53,106 6.17 626.0 Lower M&I 70,788 6.98 794.9 Upper M&I 16,242 9.26 600.3 Total 87,030 7.41 758.6 EAST ZONE Lower Indicated 4,306 2.10 461.7 OUTSIDE MAIN ZONE Indicated 36,400 7.41 758.6 COMBINED M&I 127,736 7.23 748.6 MINED (As of August 2006) 17,659 7.41 758.6 MEASURED & INDICATED RESOURCE 110,077 7.20 747.0 INFERRED RESOURCE (East Zone) 31,200 2.10 461.7 GRAND TOTAL MII 141,277 6.07 684.0 This information is provided by RNS The company news service from the London Stock Exchange