Commencement of exploration drilling

4 Aug 2005 09:16

4th August 2005 COPPER RESOURCES CORPORATION ("CRC" or "the Company") COPPER RESOURCES STARTS EXPLORATION DRILLING ON ITS COPPER SPUR CLAIMS IN COLORADO (USA) Copper Resources Corporation (AIM: "CRC") has commenced an initial drillingprogramme at its Colorado (USA) Copper Spur property, where it owns 23unpatented lode claims covering approximately 186 hectares. The copper depositon the property has historically been mined as an underground operation. Theinitial programme comprises 15 shallow exploration holes along strike at 50mintervals, to a maximum depth of 90m per hole. If the initial drilling programis successful, the Company will develop a detailed second phase programme.CRC's principal assets are the Hinoba-an Copper Project in the Philippines andthe Haib Copper Project in Namibia, Funds raised by CRC from its April 2005 IPOon the London AIM Exchange will be used to complete a detailed BankableFeasibility Study on the Hinoba Copper Project (2.0 billion pounds ofrecoverable copper) over the next 12-18 months at an expected cost of ‚£3.1million. In addition, the Company has initiated metallurgical study work on itslarge scale Haib copper project in Namibia (1.2 billion pounds of recoverablecopper for CRC's initial 60% interest) to determine the optimal processrecovery route. With its cash position of approximately ‚£9.2 million(equivalent to ‚£0.33/share), CRC is well-positioned to undertake work on itscurrent projects and to evaluate other copper acquisition opportunities. For further information please contact: Copper Resources Nabarro Wells & Co. Westhouse Securities Mitchell Alland Keith Smith Cailey Barker Executive Vice Chairman +44 (0)787 569 5563 +44 (0)20 7710 7400 +44(0) 20 7601 6100 Additional information is available from the Company's website, www.copperresources.com, or from Westhouse Securities Ltd. Background Information on Copper Resources Corporation Hinoba Copper Project (Philippines)Copper Resources is the ultimate holding company of a group of mineralexploration, development and operating companies. The Group effectively has a92.5 per cent economic interest in the Hinoba-an Porphyry Copper Project (the"Project"), subject to a 3 per cent net benefits royalty payable to theoriginal claimowner. The Project is located on the island of Negros in theRepublic of the Philippines, approximately 700 km south of Manila.Over the years, a significant amount of exploration and metallurgical testworkhas been performed on the Hinoba-an property with its previous owners havingspent approximately C$14.7 million. The Hinoba-an property has been subject toapproximately 48,000 metres of diamond drilling and 11,000 metres of reversecirculation drilling. A scoping study undertaken in 1998 envisioned a 15 yearmine life based on a geological resource of 254 million tonnes at 0.46 per centcopper at a 0.30 per cent copper cut-off. The study showed that the depositscould be profitably mined by open pit method with the ore processed in aconventional flotation milling operation to produce approximately 2 billionpounds of recoverable copper and other by-products. Annual production wasestimated at 56,000 tonnes of recoverable copper with an average cash cost(including smelting, refining and by-product credits) of US$0.48/lb of copper.The Company will complete additional infill core drilling on the property and afeasibility study within the next 18 months. Upon completion of the feasibilitystudy, and assuming favourable economics, the Group plans to develop apotential 15 million tonnes per annum open pit copper mine on the Hinoba-anproperty. The development of the Project will be dependent on obtaining futurefinancing.Haib Copper Project (Namibia)Copper Resources has an option to earn up to a 90% interest in the HaibProject, a substantial low grade sulphide copper porphyry deposit, located insouthern Namibia 8 km from the Orange River and the South African border. With52,000 meters of drilling, the Haib Project is a well-defined deposit that wasplaced on care and maintenance in the late 1990s owing to low copper prices.The most recent feasibility study work, undertaken in 1995-1997, focused onproducing cathode copper utilizing a roast-leach-electro-winning process plant.In 1996, Behre Dolbear estimated the Haib Project resource at 244 milliontonnes, grading 0.37% Cu, using a cut-off grade of 0.3% Cu. This equates to 2billion pounds of contained copper (net 1.2 billion pounds Cu to CRC based on60% ownership). CRC intends to use the extensive geological and metallurgicaldatabase available on the Haib Project to evaluate the optimal process recoverymethod for project development.Under the terms of the Option Agreement, CRC can earn a 60% interest in theHaib Project by incurring initial expenditures of US$1.2 million and throughthe issuance of 120,000 CRC shares. With further expenditures of US$1.0 millionand the issuance of a further 150,000 CRC shares, CRC can earn up to a 90%interest in the Haib Project. ENDSCOPPER RESOURCES CORPORATION