Batangas JVMindoro Resources options 75% of Archangel to Avocet
2008-09-23 06:19 ET - News Release
Ms. Penny Gould reports
MINDORO AND AVOCET ANNOUNCE JOINT VENTURE ON ARCHANGEL PROJECT
Mindoro Resources Ltd. has signed a memorandum of understanding (MOU) with Avocet Mining PLC, a London-based AIM-listed gold producer, which will allow Avocet to earn up to a 75-per-cent interest in Mindoro's Archangel project, Batangas province, Philippines. Archangel includes the Kay Tanda epithermal gold-silver resource as well as several porphyry copper-gold prospects. Avocet will undertake an initial six-month due diligence period, which will include a minimum requirement of 1,500 metres of diamond drilling.
Under the terms of the MOU, Avocet may earn up to a 75-per-cent economic interest in the property from Mindoro's Philippine subsidiary, MRL Gold Phils Inc., by financing all exploration on the property until reaching a decision to mine. At decision to mine, Mindoro will receive a cash payment of $4-million, a 2-per-cent net smelter royalty on identified ounces, and may participate at production with a 25-per-cent interest; Avocet and Mindoro would then be responsible for financing their share of capital and operating costs. Avocet will undertake a preliminary six-month program, including a minimum 1,500 metres of diamond drilling, designed to complete a fast-tracked, but comprehensive evaluation of the Kay Tanda project, with a view to making a decision to enter prefeasibility and progress to feasibility. Additional terms are described with this release on Mindoro's website.
"Avocet's experience in successfully upgrading and advancing to production its open-pit gold mines in Malaysia and Indonesia makes it an ideal partner to advance our Kay Tanda project," commented Tony Climie, Mindoro's chief executive officer. "Avocet has also demonstrated it's commitment to building long-lasting relationships with the community and the government in the regions in which it operates, reflecting Mindoro's own philosophy. We welcome Avocet to the Philippines and look forward to a successful and financially rewarding joint venture."
Jonathan Henry, Avocet's chief executive officer, commented: "This transaction adds to our portfolio of advanced exploration projects with the potential to become a producing asset within three to four years. Entry to the Philippines represents an expansion of our geographic presence to an extremely prospective new country in South East Asia."
About Kay Tanda
Epithermal gold-silver mineralization at Kay Tanda is associated with extensive and intense quartz stockworks, veins and hydrothermal breccias, with accompanying base metal sulphides. Kay Tanda is reflected by an induced polarization chargeability anomaly that is about 1.5 kilometres by 1.4 kilometres in extent, which is part of a much larger chargeability anomaly and which extends over six kilometres along strike to the north-east. To date, drilling has been conducted only on the Kay Tanda part of the trend.
Mindoro has completed 147 reverse-circulation (RC) and 26 core drill holes at Kay Tanda. Almost all holes have encountered near-surface, generally flat-lying to gently dipping blanket-like low-grade stockwork mineralization. This is strongly to partially oxidized to depths of 40 to 160 metres and non-oxide below this. Drilling, especially at deeper levels, has encountered at least five steeply dipping, much higher-grade zones with bonanza grades to 246 grams per tonne (g/t) gold and over 1,000 g/t silver, which are interpreted as structurally controlled upflow, or "feeder" zones.
The high-grade mineralization appears to occur preferentially at elevations below 250 metres (ASL) interpreted to be a paleo-boiling zone. Few holes have penetrated to this depth to date. Such upflow zones can be associated with bonanza mineralization and constitute some of the world's best epithermal gold-silver deposits.
On Feb. 6, 2008, Mindoro released a National-Instrument-43-101-compliant mineral resource estimate, indicating that from 40 per cent to 67 per cent of the previously defined exploration target, at a cut-off of 0.5 g/t gold had been converted to resources. The complete report is available on SEDAR and Mindoro's website. Summary results of the National Instrument 43-101 report were:
- Total inferred resource: 11,599,000 at 0.7 g/t Au, three g/t Ag (262,000 contained ounces Au);
- Total indicated resource: 3,365,000 at 0.88 g/t Au, eight g/t Ag (95,000 contained ounces Au).
The tonnage and contained ounce figures above have been rounded to the nearest thousand and gold grades to the nearest second decimal.
Many gold mineralized intercepts, including much of the bonanza-grade material, were not included in the resource estimate due to wide drill spacing, averaging 50-metre centres, and lack of information on geological controls. High-grade intercepts were top cut to nine or 10 g/t gold. Additional drilling is required to understand these geological controls and potentially increase both the grade and tonnes of the gold-silver resource.
Tony Climie, PGeol, is the qualified person responsible for monitoring the supervision and quality control of Mindoro's programs, and who has reviewed and verified the technical information contained in this news release.
We seek Safe Harbor.