10th Mar 2006 07:01
Alexander Mining PLC10 March 2006 Alexander Mining plc 10th March 2006 Operations Progress Report • Significant progress at the Leon copper/silver project. • Resource drilling programme, mining engineering, mineral processing, community and environmental studies are well advanced. • Feasibility study, leading to mine go-ahead decision expected mid-2006. • Initial assay results for Rachaite show gold, silver and base metal mineralisation of geological interest, more results pending. • A 3,400m diamond drilling programme at the Sulcha gold/silver project in Peru starts next month. • Current cash reserves around £18.3m Alexander Mining plc ("Alexander", "the Company"), the AIM-listed copper, goldand silver mining company with projects in Argentina and Peru, is pleased torelease this Operations Progress Report. Argentina Leon Copper/Silver Project The project is located in the central part of the Salta Province of northwesternArgentina and consists of 109,000 hectares of mineral holdings. The project hasbeen divided into four separate entities, namely the Leon area, the S block, theP block and the new claims area. The 10,000m diamond core drilling exploration programme, which started inAugust, 2005, is nearly completed. At the end of February, 2006, 109 holes hadbeen completed, totalling 9,152m. Out of these, over 75% have intersected thecopper and silver mineralisation. ALS Chemex Laboratories is analysing the coresand results are expected to be released in the near term. ACA Howe has beenengaged to start in April 2006 an independent audit and resource calculation toJORC standard, with completion expected in the second quarter of 2006. The drilling programme is designed to evaluate the copper/silver mineralisationhosted in porous limestones and located on two parallel ridges strikingnorth-south named El Cobre and El Plomo. Also to be tested is the potentialmineralisation in fold closures on a ridge to the south known as Pelado and onthe northern extremities of El Plomo. Once the resources at Leon have beencalculated, a full feasibility study should be completed in the second quarterof 2006. A decision to proceed with the construction of a mine, subject to the findingsof the full feasibility study, is expected to be made in the middle of 2006.Once permitting has been completed, mine construction is scheduled to commencein late 2006, with commissioning in 2007. The mineralisation is normally located at the base of a limestone unit which hasa fine grained friable sandstone footwall. The drilling was planned initiallyon 100m section spacing, with three holes planned on each 'fence' to evaluatethe oxide zone and shallow sulphide mineralisation. A second stage was plannedto close-up the sections in the oxide zone to 50m spacing. A total of 46 holes have been completed on El Cobre (four of which are PQ sizedfor bulk metallurgical samples). Two sedimentary facies have been recognized, amuddy limestone and a porous oolitic limestone and it is in the latter that thebulk of the mineralisation is hosted. The oolitic facies dominates the northernand central parts of El Cobre, while the muddy facie is dominant in the south.The sediments are dipping between 80 degrees to the west to vertical. Forty six holes have been completed on El Plomo. Again the two facies arerecognized but are intercalated rather than occurring as separate units. Theoolitic facies has the higher concentration of mineralisation. The sedimentshave dips between 80 degrees to the east and vertical. To the north the strike ofthe sediments changes from north-south to east-west forming a fold closure whichis truncated on the west by a fault. The Pelado and El Plomo fold closures remain to be fully evaluated. Leon Regional Exploration Reconnaissance and exploration of the P and S blocks (5,814 hectares) and thenew 102,238 hectare claim area is in progress. Detailed exploration andadditional drilling is planned during 2006. Metallurgical Testwork In parallel with the exploration drilling programme, metallurgical testwork hasbeen underway at SGS Lakefield ("Lakefield") laboratories in Chile for both heapleaching and flotation of the near surface ore. Following successful results inChile, a more intensive testwork programme was developed with Lakefield inCanada for the heap leach option. Test results by year end were most encouragingand justified the development of a full column test programme, which is beingimplemented. The PQ sized bulk metallurgical samples are currently beingextracted. The flow sheet developed with Lakefield includes the recovery of bothcopper and silver. Environmental Studies Vector Engineering Inc. ("Vector") was engaged during the last quarter toimplement a full environmental impact study during 2006. Vector has substantialexperience in undertaking similar studies in Argentina. The first phase of thisprogramme was to establish a weather station for continuous monitoring purposesand to undertake a base-line air quality study at the site. Salta basedconsultants will undertake more detailed field studies of the flora and fauna atthe site, to complement the initial work completed by the company. Engineering Studies Scoping engineering studies have been undertaken for a heap leach copper/silverproject at Leon. The site is ideally suited to heap leaching and pit wastedisposal. There is a relatively flat area of ground between and in closeproximity to the proposed open pits. There is no pre-strip required and highlyleachable, good grade copper/silver mineralisation occurs at the surface. Wastematerial can be placed either within the same valley or in an adjacent valley,with minimal environmental impact. Preliminary capital and operating cost estimates have been completed by Vectorfor a conventional SX-EW plant and associated facilities. Other studies areunderway on alternative products such as cement copper or copper sulphate. The site location has excellent infrastructure, with a dual lane paved highwayto within 18 km of the site. Authorities have indicated the company can besupplied with cheap power, and water supplies are also available. The city ofSalta provides a wide choice of civil contractors and fabrication workshops formine construction purposes. Community Relations The local area consists of a small farming community living within a 20 kmradius. Many of the farm-hands have been employed as part of the explorationteam at site. The upgrading of the access road to the site during the thirdquarter of 2005 was much appreciated by the local population. Excellentrelationships have been maintained with all local government authorities and thecompany has received positive press coverage as a result of the professional wayit is conducting its activities. Rachaite Project A 1,500m diamond core drilling programme of six holes has been completed overthe 4km x 2km alteration zone. This was designed to test the areas wherelithology, alteration, structure and geochemistry were most favourable forencountering metallic mineralisation below the leached capping. The assayresults received to date show gold, silver, zinc, and lead mineralisation ofgeological interest. However, a full analysis is dependent upon the imminentreturn of additional assay results from all of the holes. Peru Sulcha Project The Sulcha Project is currently the company's main focus of exploration activityin Peru. The property is located approximately 55km to the east of the coastaltown of Trujillo and has an area of 700 hectares. Epithermal gold and silver mineralisation occurs in volcanic and volcano-clasticrocks, which have been hydrothermally altered. The mineralisation isconcentrated in veins, breccias and stockworks. A total of 187 rock chipsamples were taken in late 2005, with encouraging assay results - averaging 0.84grammes per tonne (g/t) gold and 99.62g/t silver. Significantly, gold grades of>3.0 g/t were recorded in six different locations over the property and coveringall outcrops. In addition, four samples assayed over 1,000g/t (32oz/t) silver. There are two mineralised zones, one to the north and one to the south. Bothhave a strike of roughly north-west to south-east and converging in the extremesouth-east. Parts of the northern zone are discontinuous due to a lack ofoutcrop but it has a potential strike length of 1,100m. The southern zone isexposed continuously over 600m in the south-west, with no exposure over adistance of 1,000m and then again exposed for 200m in the north-west. A 3,400mdiamond drilling programme is planned to commence next month. Matt Sutcliffe, Chairman and Chief Executive Officer, said that: "I am excitedby the progress the company has made in the last six months towards itsobjective of becoming a profitable and growing mining company in 2007." For further information please contact: Matt Sutcliffe, Chairman and Chief Executive OfficerAlexander Mining plc1st Floor35 PiccadillyLondonW1J 0DWTel: +44 (0) 20 7292 1300Fax: +44 (0) 20 7292 1313Mobile: +44 (0) 7887 930 758Email: [email protected]: www.alexandermining.com Nominated Advisor and BrokerEvolution Securities Limited100 Wood StreetLondonEC2V 7ANTel: +44 (0) 20 7071 4300 Public/Media RelationsGary MiddletonSt Swithins Public RelationsTel: +44 (0) 20 7929 4391Mobile: +44 (0) 7951 603 289 Notes for editors Alexander Mining plc is a mining company that intends rapidly to grow into a lowcost and highly profitable diversified metal producer. The company has a highlyskilled management team with expertise in both natural resources and finance. END This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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