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Ormonde Mining PLC ORM Antofagasta opt out of La Zarza



  Ormonde Mining PLC (ORM) - Antofagasta opt out of La Zarza

RNS Number : 7652Q
Ormonde Mining PLC
09 November 2012
 

09 November 2012

 

                              Ormonde Mining plc

                         ("Ormonde" or "the Company")

                                       

                  Antofagasta opt out of La Zarza Agreement

 

The Board of Ormonde provides an  update on activities in connection with  the 
option   agreement   (the   "Option")    with   Antofagasta   Minerals    S.A. 
("Antofagasta").

 

Following the  recent completion  of exploration  programmes on  the four  new 
investigation permits and the assessment by Antofagasta of the resultant data,
Antofagasta has  now informed  the  Company it  considers  that a  deposit  of 
sufficient  size  and  scale  to  meet  Antofagasta's  requirements  does  not 
currently exist at La Zarza and therefore  it has elected not to fund  further 
activities at La Zarza and to  cease its Option.  Accordingly Antofagasta  has 
not  earned  any  interest  in  the  La  Zarza  project  or  the   surrounding 
investigation permits.

In October 2009, Ormonde entered into an option agreement with Antofagasta  to 
explore for  additional  copper resources  on  the La  Zarza  Copper  Project, 
whereby Antofagasta could earn an initial 51% interest in the La Zarza  permit 
area by spending  US$7 million  on exploration  activities over  a three  year 
period.  Activities during 2009 and 2010 were focussed on the La Zarza deposit
and results were  reported in September  2010.  Based on  work to that  point, 
including  geophysics,  drilling  and  a  new  structural  interpretation,   a 
preliminary non-JORC compliant  global mineral resource  of 61Mt grading  0.8% 
Cu, 0.9% g/t Au, 0.6% Pb, 2.0% Zn and 5.7 g/t Ag, was estimated.

The option agreement  was subsequently  amended in  April 2011  to cover  four 
additional permit areas around  La Zarza with the  earn-in period extended  to 
2015.  A budget of  US$1.3 million was approved  and funded by Antofagasta  at 
this time for the exploration programme now completed.

 

Main Results of Exploration Programmes on the Four New Investigation Permits

 

·     Detailed gravity and airborne  electromagnetic surveys were carried  out 
over the permit areas

·     Diamond drilling of several target areas has been completed with a total
of 3,048 metres drilled on eight targets, principally defined by a combination
of gravity, airborne EM and geology

·     Drilling in hole UC002 intersected altered and brecciated volcanics over
an interval  of 147  metres, with  pyrite mineralisation  throughout but  most 
intensely developed in  the upper  40 metres.  Although  relatively weak  base 
metal and gold  values were  returned, the style  and vertical  extent of  the 
mineralisation is  that  of a  stockwork  which is  commonly  associated  with 
mineral deposits in this area.

 

 

Kerr Anderson, Ormonde's Managing Director, said:

 

"Although Antofagasta has taken the decision  to opt out of the agreement,  it 
is understood to be principally based upon the group's corporate  requirements 
with regards to  minimum deposit size  and scale at  La Zarza. The  programmes 
completed in the  past year  have provided further  important information  and 
results, including the mineralisation discovered in hole UC002, which will  be 
valuable in the  assessment by  Ormonde of  the potential  for further  copper 
resources. We will  provide further  information on our  deliberations in  due 
course."

 

 

Detail

Four investigation  permits  (comprising  a  total  area  of  some  95  square 
kilometres), covering  the  strike  extension  of  the  La  Zarza  system  and 
controlling structures, were awarded by  the provincial mining authorities  to 
Ormonde's subsidiary Ormonde Espana SL in August 2011, and these were included
in the Option with Antofagasta, with  work programmes on these permits  funded 
by Antofagasta.  The following work programmes were completed:

·     1,039 gravity stations on a 400 x 50m grid over the permit area

·     1,031  line  kilometres of  airborne  electromagnetics (VTEM)  over  the 
permit area

·     Structural interpretation and mapping of relevant areas

·     3,048 metres of diamond drilling in eight holes testing geophysical  and 
geological targets

Of  the  eight  holes  drilled,  one  hole  (UC002)  encountered  altered  and 
brecciated volcanics  over  an interval  of  147 metres  hosting  fine-grained 
pyrite mineralisation.   Although  only weak  base  metal and  localised  gold 
values were returned, the style and  vertical extent of the mineralisation  is 
that  of   a   significant   stockwork,  and   closely   resembles   stockwork 
mineralisation observed  below the  massive  sulphides at  La Zarza.   A  thin 
faulted "slice" of similar altered  and mineralised volcanics was  intersected 
in a second hole (UC001) drilled some 1.5 kilometres to the east of UC002.

Following the notification by Antofagasta of its intention not to fund further
activities and  withdraw from  the Option,  the Company  will now  review  its 
position with regards to  exploration options in light  of the results of  the 
programmes completed and the mineralisation in hole UC002.

 

Kerr Anderson PhD EurGeolPGeo, Managing Director of Ormonde Mining plc, and  a 
qualified person  as defined  in the  Guidance Note  for Mining,  Oil and  Gas 
Companies, June 2009, of the London Stock Exchange, has reviewed and  approved 
the technical information contained in this announcement.

 

 

A glossary explaining technical  terms contained in  this announcement can  be 
found at www.ormondemining.com/en/investors/technical_glossary.

 

For more information please visit  www.ormondemining.com or follow Ormonde  on 
Twitter         https://twitter.com/ormondemining         or          Linkedin 
http://www.linkedin.com/company/ormonde-mining-plc

 

 

Enquiries to:

 

Ormonde Mining plc

Kerr Anderson, Managing Director  Tel: +353 (0)1 8253570

 

Bankside Consultants

Simon Rothschild  Tel: +44 (0)20 7367 8888   Mob: +44 (0)7703 167065

 

Murray Consultants

Ed Micheau  Tel: +353 (0)1 4980300  Mob: +353 (0)86 803 7155

 

Davy (Nomad / ESM Adviser)

Eugenée Mulhern / Roland French  Tel: +353 (0)1 6796363

 

 

ENDS

 

 

 

About Ormonde

Ormonde Mining Plc is admitted  to trading on the AIM  market in London &  the 
ESM market in Dublin. Ormonde is a mineral development and exploration company
focused on Spain (Ticker: ORM).

 

 

                     This information is provided by RNS
           The company news service from the London Stock Exchange
 
END
 
 
MSCEAEFNELPAFFF -0- Nov/09/2012 11:00 GMT
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