Serabi Regulatory News (SRB)

14 Oct 2005 07:00

Serabi Mining plc14 October 2005 SERABI PURCHASES OPTION TO ACQUIRE POMBO GOLD PROJECT----------------------------------------------------- Serabi expands into Southern Tapajos Region with advanced exploration project-----------------------------------------------------------------------------Serabi announces that it has purchased an option to acquire 100% of the PomboGold Project ("Pombo") from a subsidiary of US-based Gold Standard Inc. Pombo islocated 33 kilometres north east of the town of Terra Nova do Norte, in thesouthern region of the Tapajos, in Brazil's Mato Grosso State. The propertyconsists of four concessions covering an area totaling approximately 10,800hectares. Advanced exploration has already identified extensive high-grade,gold-copper mineralisation but without drilling, which Serabi will now commenceat the earliest practical opportunity. Overview of the Pombo Gold Project----------------------------------The main gold-copper mineralisation at Pombo is found within a majornortheast-southwest trending fracture/shear zone structure, containing severaloreshoots that vary from 2 to 8 metres in width. The structure is set within aporphyritic-granite host rock and has been mapped in detail along a strikelength of 3.9 kilometres, over which mineralisation has so far been identifiedalong 700 metres of strike length. In addition, there is associated evidence ofextensive alteration and stockwork type mineralisaion. The oreshoots are made ofsilicified granite, with up to 30% sulphide mineralisation. The main sulphideminerals at Pombo are pyrite and chalcopyrite, with lesser quantities of borniteand chalcocite. Following its discovery in July 2002, a number of garimpeiros exploited thenear-surface, mainly oxidized section of the main orebody at Pombo usingrudimentary methods of mining and ore treatment. The garimpeiros reached thelimits of their technical abilities at approximately 14 metres depth beforeabandoning the project but leaving exposed a sulphide-rich oreshoot. From July,2002 to June, 2003 an extensive exploration and evaluation programme was carriedout at Pombo by Gold Standard that included detailed surface geological mapping,geophysics, soil geochemical analysis for gold and copper, channel sampling ofthe garimpeiro workings and trenching. In total, 32 garimpeiro workings weremapped and sampled for analysis. This programme identified a number of drilltargets, which to-date have not been tested. Results and planned work programme at Pombo-------------------------------------------Examples of the widespread gold mineralization include results from 38 rock chipsamples taken along the 700 metres of mineralized strike which averaged 6.84 g/tgold. A trench also displayed one ore zone with a width surpassing 6 metres andaveraging 12.13 g/t gold. In addition, channel sampling from this earlyprogramme returned favourable assay results that included: 2 metres 37.03 g/t2 metres 22.35 g/t2 metres 15.25 g/t3 metres 15.10 g/t During the company's own due diligence work at Pombo, Serabi sampled thegarimpeiro tailings which returned assay results of 29.2 g/t, 27.5 g/t, 23.2 g/tand 14.1 g/t gold. Overall, the trenching results, soil geochemistry and rock sampling appear tocorrelate well with induced polarization ("IP") chargeability anomalies and alsowith the actual locations of garimpeiro workings. Furthermore, geophysicalprofiles indicate the ore shoot structures may expand at depth. Serabi plans tobuild on the existing geological work done at Pombo and select drill targetsaccordingly. Drilling is expected to begin by January 2006. Commenting on the transaction, Graham Roberts, Chairman of Serabi said,"As stated during the recent IPO process, part of the proceeds raised were to beallocated to new project acquisitions. Pombo represents the first addition of anadvanced exploration project to Serabi's portfolio, in an area of the Tapajoswhere the company has not previously been operating that also has distinctoperating and logistical benefits. Serabi's reputation within the Tapajos regionof being able to develop exploration projects into an operating mine like Palitois beginning to pay dividends, as more and more opportunities such as Pombo arebeing presented to the company for consideration. The similarities between Pombo and our operating Palito Gold Mine areencouraging and point to the opportunity for Serabi to bring its expertise tobear on this new project." Enquiries: Serabi Mining plc----------------------------Graham Roberts Tel: 020 7618 7752Chairman Mobile: 07768 902 475 Clive Line Tel: 020 7618 7754Finance Director Mobile: 07710 151 692 Chris Sattler Tel: 020 7618 7774Manager, Corporate Development Mobile: 07717 748 275 email: contact@serabimining.com This information is provided by RNS The company news service from the London Stock Exchange