Rosebank Regulatory News (ROSE)

9 Mar 2006 09:01

Vane Minerals PLC09 March 2006 VANE Minerals Plc (AIM: VML) Additional Uranium Projects Termination of Choix copper agreement VANE Minerals Plc ("VANE" or "the Company") today announces an agreementregarding additional uranium projects in the Colorado Plateau Uranium Districtof the United States, and also provides an update on the Choix copper prospectin Mexico. Happy Jack Mine VANE Minerals (US) LLC ("VANE (US))" has entered into an agreement with privatecompany Happy Jack Minerals covering the Happy Jack Mine and surrounding claimslocated in San Juan County of south-eastern Utah in the Colorado Plateau UraniumDistrict. The property consists of seven patented lode claims, seven unpatentedclaims, and 29 unpatented lode claims staked by VANE during the due diligenceperiod, all of which are now included in the agreement. Under the terms of the agreement VANE (US), has agreed to: • submit an exploration plan within 6 months of the date of theagreement; • commence exploration within 6 months of the plan being approved bythe local authorities and commit a minimum of $75,000 within 12 months ofstarting exploration. Expenditures in excess of the minimum shall be applied tofuture years' work commitments; and • commit a further $125,000 to surface and underground explorationannually from the end of the initial work commitment to mine feasibilitycommencing. Expenditures in excess of the minimum shall be applied to futureyears' work commitments. The Happy Jack Mine agreement is for an initial period of five years, extendablefor a further five years on reaching production. If production does not begin,a sum of $100,000 shall be payable for the further 5 year term. The owner shallgrant VANE automatic five year extensions thereafter if production is occurring. The agreement provides for the following payments by VANE (US) to the owners ofthe Happy Jack Mine and surrounding claims: • An initial payment of $10,000 on signing the agreement; • A further payment of $10,000 at the end of the initial workcommitment in the event VANE (US) elects to continue with the agreement; • A payment of $20,000 on completion of the second work commitment; • A payment of $30,000 on completion of the third work commitment,unless the decision to commence commercial production has been made; and • payment of an advance royalty of $100,000 to the owner, at theannouncement of the decision to commence commercial production. When production is reached, VANE (US) will pay a production royalty of 5% onminerals mined from within the original areas held by the owner, and aproduction royalty of 2.5% on minerals mined from the additional areas claimed. The Happy Jack Mine, operated principally by Atlas Minerals, produced 3.1million pounds of U3O8 between 1949 and 1982 when, along with most of the mineson the Colorado Plateau, it closed due to low uranium prices. VANE (US)geologists have delineated a resource of approximately 155,000 pounds U3O8contained in several pods, some of which are accessible via existing mineworkings and which could therefore be put into production with minimaldevelopment work. A review of previous drilling results has revealed nine additional explorationtargets in which previous drilling intersected ore-grade mineralisation but wasnever explored with additional drilling or sampling. VANE (US) geologistsestimate a potential resource on the property of 1,000,000 pounds U3O8. Additional breccia pipe deposits The only mines to continue uranium production in the Colorado Plateau past themid-1980s were the high-grade breccia pipe deposits of northern Arizona whereVANE (US) has recently located four new US Lode Mining Claims, thereby addingtwo additional breccia pipe targets to its existing portfolio of 17 breccia pipetargets. During the past year, VANE has been sampling known ore-bearing pipesat ground surface to develop proprietary geochemical techniques to differentiatebarren from uraniferous structures. Using these techniques VANE (US) recentlycompleted geochemical sampling over three of its northern Arizona breccia pipetargets, all of which were found to have indications of uranium mineralisation.Deep drill tests on at least two of the breccia pipe targets are planned forlater in 2006. Historically, economic mineralised breccia pipes have containedbetween 1 million and 6 million lbs U3O8. Choix Copper Project Assay results from the six holes completed in December 2005 at the Choix copperprospect in the State of Sinaloa, Mexico, have been received. These results aredisappointing and indicate that the strongly mineralised porphyry outcrops atsurface lack "roots" and are actually isolated xenoliths or blocks "floating"upon the underlying batholithic rocks. The highest values found in the drill hole samples, 0.14% copper, illustratesthe abrupt decline in copper values from the surface, 1.50% copper, to depth andconsequently VANE has now discharged all obligations regarding the Choixproperty. VANE has no further financial obligations in this respect. Theprospect represented a very attractive, easily accessible, undrilled coppertarget which was inexpensively acquired and quickly tested with the overallexpenditure on the project less than $100,000. Outlook As the Company moves forward, its conviction in the continuing strategy oftesting a large number of attractive targets quickly and inexpensively remainsunshaken. The Company is confident that tests of a number of similar futureprospects will provide a high probability of success. Chairman Michael Spriggs commented: "VANE is pleased to announce the acquisitionof additional uranium projects, building on its already strong portfolio. TheCompany intends to explore the breccia pipe targets by drilling in order torealise the potential resource. Although the results of the Choix copperproject have disappointed, they have shown that the Company is capable ofeffectively turning these projects over cheaply and efficiently. The Company'sability to utilise its Freeport database and the contacts of the principals tocreate substantial deal flow, together with the cash flow from the Diablito gold/silver project in Mexico, enable VANE to evaluate a large number of prospectiveprojects, and we will continue to do so." Enquiries: VANE Minerals Plc Ambrian Partners LimitedMatthew Idiens Richard Brown+44 (0) 20 7667 6322 +44 (0) 20 7776 6417 Parkgreen Communications Daniel Stewart & CoJustine Howarth / Cathy Malins Alex Davies+44 (0) 20 7493 3713 +44 (0)20 7776 6550 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 development of potentially much larger projects. VANE is well on its way toachieving this objective as production began at the Diablito mine in Mexico inNovember 2005. The Company will use the revenue generated by this firstproducing mine to help fund development work across its attractive portfolio ofgold, silver and uranium assets in Mexico, Paraguay and the US. For further information, please review: www.vaneminerals.com. This information is provided by RNS The company news service from the London Stock Exchange