Shearwater Regulatory News (SWG)

25 May 2006 07:00

Aurum Mining PLC25 May 2006 For immediate release 25 May 2006 AURUM MINING PLC ("Aurum" or "the Company") Drilling Update on the Andash Deposit Aurum Mining plc (AIM: AUR), the company formed to acquire gold and othermineral extraction projects in the Former Soviet Union (FSU), is pleased toprovide an update on progress at its Andash gold and copper project in theKyrgyz Republic following the completion of an infill drill programme at AndashZone 1 and of on-going exploration work at Zones 2 and 3. Highlights • Completion of infill drilling programme for Zone 1 meets expectations. Inferred resources will be transferred to Measured and Indicated • Initial exploration drill results confirm extensive mineralisation of Zones 2 and 3 • On track for completion of Feasibility Study in September The infill drill programme at Zone 1 was designed to provide further details onthe copper and gold grades in the Zone 1 orebody to allow the completion of theFeasibility Study while the exploration work at Zones 2 and 3 was designed togive an improved understanding of the additional resource opportunities withinthe licence area, including the location of higher grade deposits. The infill programme at Zone 1 comprised 19 NQ core holes totalling 2,652mdesigned to confirm previous copper and gold grades, but also to provide a morerobust and up-graded classified resource. Although all of the assay results arenot yet available, initial results and inspection of cores confirm previousestimates. This will allow Wardell Armstrong International (WAI) to update thecurrent resource model to bring all the inferred category to Measured andIndicated as stipulated by the JORC Classification and complete the FeasibilityStudy by September 2006. Aurum has also completed 5 HQ core holes totalling 713mfor geotechnical purposes and resource estimation in and around the proposedpit. In addition, the Company has embarked on an aggressive exploration programme totest the extent of Zones 2 and 3, which lie to the west of Zone 1, and to lookat the possible faulted extension to Zone 1 itself. Recent analysis of new geological and geophysical data on Zones 2 and 3 greatlyimproves our understanding of the structural and morphological characteristics.Most mineralised zones are confined to approximate east-west trending, gentlynortherly dipping structural-tectonic zones, with thickness variations from tensto hundreds of metres. These zones appear further localised by cross-faults. Preliminary work has indicated that the distance between orebodies isapproximately 200m. They have variable thickness and can be traced along strikefor more than 1km. The gold and copper content also appears variable from nearbackground levels up to tens of g/t gold and 1.5% copper. The proliferation of altered, hornblende-rich host rocks in proximity to normalcomposition granodiorites appears to be an important feature for the detectionof further mineralisation. Such mineralisation was uncovered during cleaning anddeepening of an old trench at the presumed continuation of Zone 2 in hornblendesiltstones giving an intersection of 4m at 13.3g/t Au. Importantly, halos ofsuch hornblende alteration have been found to be associated with geophysicalanomolies (IP) characterised by high polarisation (4-6%), which may beassociated with concealed sulphide mineralisation. This suggests that other IPanomalies may indicate similar alteration zones. To test this, Aurum has embarked on a preliminary exploratory drilling programmeon a 200x80-280m grid, with sections aligned across the known mineralised zones,and to intersect the large IP anomaly identified to the north of Zones 2 and 3.Aurum proposes to drill 5-6 sections with 3-4 holes per section to a depth of150-250m, giving a total distance of some 3,000m. However, this programme willbe constantly evolving as new geological data emerges. The first drilling results from the new programme have been received. Threeholes, P15, P16 and P17, drilled approximately 50m apart all intersectedmineralization in zones 2 and 3, with hole P17 testing the near surface ore zoneand holes P15 and P16 intersecting the structure further down dip. Holes P15 andP16 proved the presence of blind mineralisation localised in a brecciatedgranodiorite (similar to Zone 1) and associated with hornblende siltstone. HoleP17 also intercepted mineralised breccia and hornblende siltstone. This supportsour hypotheses of using the hornblende siltstone, which shows up as an IPanomaly, as an exploration target. Results from the 3 holes show the ore zone intersections vary in thickness. Inhole P17, where the ore zone comes close to surface, mineralization is seen tooccur as thin stringers in a clay rich formation. This becomes more coherentdown dip as seen in holes P15 and P16. The ore zone is seen to increase inthickness and grade in the down dip portion to approx 50m in hole P15, with goldvalues varying between 1.5g/t and 0.31g/t. Although the average grade from the 3holes is 0.49g/t, initial interpretation indicates that that selective mining ofthe ore zone would be possible. Intersections of higher grade in hole P15 (26mat 1.51g/t) indicate that gold grade improves down dip. This confirms what hasbeen seen in previous drilling, which has shown that the gold content increasesto an average of 1.4-1.5g/t to a maximum of 2.23-2.35g/t. Higher level targetsanalogous to this are the aim of this present exploration programme.Encouragingly, dozer road preparation for hole P37 (the next hole to be drilled)has already cut previously unknown surface mineralisation. WAI has reviewed the planned exploration programme and is monitoring progress tooptimise the probability of the discovery of additional, near surfacemineralisation. Mark Jones, Aurum Mining's Chief Executive, said: "These results representanother important step forward for the Company and give us confidence both inmeeting our target of completing our Feasibility Study for Andash Zone 1 inSeptember and increasing the resource level in Zones 2 and 3." For further information: Aurum Mining plc Tel: 020 7478 9050Mark Jones, Chief Executive Arbuthnot Securities Tel: 020 7012 2000Graham Swindells Buchanan Communications Tel: 020 7466 5000Mark Court/Amy Rajendran Notes to editors Aurum Mining joined the AIM market of the London Stock Exchange in May 2004 withthe strategy of seeking, evaluating and acquiring gold and other mineralextraction projects in the Former Soviet Union (FSU). In January 2005 theCompany completed its first acquisition, giving the Company an explorationlicence over the Andash gold and copper project in the Kyrgyz Republic. In itsState Register, the State Commission of Resources of the Kyrgyz Republic hasincluded 21.7 million tonnes of C1 and C2 reserves from the project, amountingto gold and gold equivalent of more than 1.5 million ozs. This information is provided by RNS The company news service from the London Stock Exchange