Initial results from Greenland maiden drill season

RNS Number : 8943H

Red Rock Resources plc

18 July 2012

 

Red Rock Resources

Thick BIF intersections delineated on first drill cross section

at Melville Bugt Iron Project, Greenland

18th July 2012

Red Rock Resources plc ("Red Rock" or the "Company"), the mining and exploration company with an iron ore project in Greenland, a producing gold mine in Colombia, advanced gold and copper exploration in Kenya, and interests in steel feed, uranium and rare earths, is pleased to announce the initial results from its maiden drill season in Melville Bugt, northwest Greenland.

Highlights

Drilling has been completed on the first phase of drilling at Havik East, the first of a number of banded iron formation (BIF) prospects to be drilled during the current program in Greenland (Fig 1).  Eight holes have been completed and the rig has been mobilised to the second prospect, the De Dødes West haematite target.

Figure 1: Location Map of the Melville Bugt Iron Project, Greenland.

http://www.rns-pdf.londonstockexchange.com/rns/8943H_-2012-7-17.pdf

Key outcomes from the first five holes include:

·     All holes intersected significant magnetite (Fe₃O₄) BIF intersections (Table 1)

·     Estimated true thickness of the BIF horizon, on this section, of up to 56m with potential thickening in the fold hinge.

·     Indications of localised haematite (Fe₂O₃) replacement and magnetite enrichment

Table 1: Havik East preliminary drill results 

	From (m DH)	Width (m DH)	Est % Fe (field XRF*)	Comments
HED001	22.95	51.55+	26.3%	Hole ended in BIF due to drilling issues
HED002	13.00	64.90	26.1%	Localised massive magnetite zones up to 64.1%
HED003	12.75	131.65+	24.0%	Hole ended in BIF due to drilling issues
HED004	20.45	29.90	23.8%	Magnetite BIF
	70.15	77.55	23.8%	Magnetite BIF
HED005	12.50	4.90	25.5%	Magnetite BIF
	57.60	20.45	24.2%	Magnetite BIF
	90.50	71.75+	25.1%	Hole ended in BIF due to drilling issues

^* Iron grades obtained from Niton field X-ray fluorescence (XRF) "spot" analyses. Chemical compositions are representative of expected grades, which will be determined by follow up assay work, however the XRF results are not considered as reliable as the full chemical analysis planned, and should be used as an indication of potential results.  A full description of the logging procedures is included below.

^** Downhole thicknesses with a '+' indicate the lower BIF contact was not reached due to drilling issues, indicating this value as the minimum thickness.

Andrew Bell, Chairman of Red Rock Resources, comments: "We have committed substantial   resources to drilling this year at the Melville Bugt Iron Project despite difficult market conditions. This reflected our belief that we would be able to declare a new iron ore province based on this year's exploration programme. These early results from Havik East, which are in line with expectations at this stage, are therefore a great encouragement to us. Our field XRF results are subject to adjustment when we get the laboratory samples back: last year they proved conservative, but that does not mean this would always be the case. There is still much to learn as we pursue our goal of two defined Mineral Resource Estimates this year, and we are now about to start drilling at our first haematite  target, De Dødes West, at a nearby coastal location. This is only our second field season in Greenland, and our  team has taken us from greenfields exploration based on a hypothesis of potential similarity with the Mary River deposits to an already significant discovery."

Detailed Discussion

Drill Program Objectives

The Havik East Prospect is the first target of Red Rock's maiden drill season on the Melville Bugt Iron Project, following the identification of significant outcrops of magnetite-BIF associated with extensive airborne magnetic anomalies during the Company's initial field season in 2011. 

The main objectives of the 2012 diamond core drill programme are to:

·     Delineate the sub-surface extent and continuity of the BIFs ;

·     Characterise geological structures that are key to understanding the geometry of BIF occurrences in the licence area;

·     Assess the extent and the implications of secondary haematite replacement;

·     Obtain preliminary geochemical data from core using a handheld XRF analyser prior to full chemical and physical analysis once the samples are exported;

·     Obtain a JORC Mineral Resource Estimate for one or more BIF targets in the licence area if possible.

·     Determine the grain size and nature of grain boundaries between iron oxides and silica an early stage

Results

While logistical issues and poor weather conditions delayed the start of drilling, good daily drilling rates and recoveries are currently being achieved, and very satisfactory results have been received from the drilling completed to date.

Drilling is currently being carried out at Havik East, utilising a close hole spacing to help define the morphology of the BIF units, and determine likely structural controls of the unit.  A total of 5 holes have been drilled and analysed to date, totalling 664m (Fig 2). A further 3 holes have been drilled and 3 more holes are planned on this target at a later stage, with target depths of 150-200m on a hole spacing of 100-400m along strike.  

Figure 2: Drilling location plan, Havik East

http://www.rns-pdf.londonstockexchange.com/rns/8943H_1-2012-7-17.pdf

Figure 3: Diamond core drill rig at Havik East

http://www.rns-pdf.londonstockexchange.com/rns/8943H_2-2012-7-17.pdf

Preliminary field XRF geochemical results from holes drilled to date on one north-south cross-section are presented in the Appendix, which shows the interpreted true widths of the intersections based on the interpretation below.

Geological Interpretation

Plotting the results and preliminary logs onto a cross section (Fig 4), it is possible to see the impact that deformation is having on the BIF horizon, which would originally have been a flat-lying unit of reasonably consistent thickness at this scale.

Figure 4: Havik East drill cross section

http://www.rns-pdf.londonstockexchange.com/rns/8943H_3-2012-7-17.pdf

Working interpretations, using drill intersections and detailed surface mapping, indicate the magnetite-rich BIF forms a shallow easterly-plunging fold hinge (Figure 4). Significant structural thickening of magnetite-rich BIF unit has occurred in the fold hinge-zone, and there are localised zones of partial haematite replacement.  

Disseminated haematite of up to 5-15% has been logged in the core in a number of places to date. It is thought that this is a secondary alteration feature, and understanding the processes involved and the potential extent of haematisation could extend exploration beyond the defined airborne magnetic anomalies. Haematite replacement is also often associated with the secondary removal of silica, potentially upgrading the iron grade of the BIFs.

Work Planned

Drilling at Havik East has continued to define the strike and depth extent of the identified BIF along strike. Surface indications and airborne geophysics suggest that the mineralised system is at least 2.5km in length, including a second potential fault-offset body to the North East.

Now that the initial delineation of the Havik East target has taken place, the focus of the program will move to the eastern prospects where thick haematite-rich BIF outcrops were located in 2011. Work on these prospects will commence with the aim of similarly delineating the extent of the units at depth. On 15 July the drill was mobilised to the second target, the haematite target at De Dødes.

Based on results follow-up and reconnaissance drilling will be completed as circumstances allow.

Samples for a comprehensive analytical program will be dispatched in three shipments, and work on Resource Estimation is expected to commence this year. SRK Consulting (UK) Ltd has been engaged to complete this work, and their representative Competent Person will visit the Project during August. 

Analytical procedures

All diamond drilling is being carried out by Cartwright Drilling Inc, using two heliportable CDI 500 diamond drill rigs drilling with a BTW core size. Downhole deviation surveys are conducted at the end of the hole using an Icefield Tools Gyroshot survey tool.  Orientated core measurements are taken systematically through the entire length of the hole using a Devico Devicore DC core orientation tool to allow for structural information to be gleaned from the heavily magnetic ground.  Precision collar surveys are taken using a Reflex Northfinder APS system.

All geological and structural core logging, core photography and sampling is carried out on-site. Sampling procedures, quality assurance and control (QAQC) and Rock Quality Designation (RQD) assessments are carried out commensurate with the Company's Standard Operating Procedures, which have been approved by the project consultants, SRK Consulting. Core is halved on site, with blanks, duplicates and standards inserted at systematic intervals. One half of the core is kept for reference and the other sent to the ISO17025 accredited ALS Minerals Laboratory in Ireland for assay. Analytical work includes XRF spectroscopy on homogeneous fused glass disks, Magnetic Susceptibility, Davis Tube Recovery, with selected exploration samples being tested by Fire Assay and Inductively Coupled Plasma Mass Spectrometry.

Ahead of obtaining laboratory assays, the Company is using a Niton XL3t GOLDD handheld XRF analyser to obtain first-pass chemical compositions from the core. This analysis enables the geological team to obtain field results of the core, allowing construction of a working model of the composition of iron formation as drilling progresses. The geologists operate the handheld XRF as a standard part of the core logging process, with one spot analysis per lab sample. Analysing core at the midpoint of every sample eliminates selective sampling and acts as an internal QAQC safeguard against sample bias. It should be noted that although the handheld XRF is a good indicator of bulk composition, data can be misrepresented as a result of factors, such as grain size, weathering/alteration and sample heterogeneity.  Consequently, the XRF data presented in Table 1 and the Appendix provides representative profile of the distribution of grades in iron formation at Havik East but should be considered an indicative result pending assay data.

Background

Red Rock currently operates under a Joint Venture agreement with North Atlantic Mining Associates Limited ("NAMA") under which it has already earned 25% in NAMA Greenland Ltd, which holds the exploration concessions at Melville Bugt.  Red Rock has the right to increase this percentage to 60% by funding 2012 exploration and defining a JORC Mineral Resource Estimate.

The information in this announcement that relates to Exploration Results has been reviewed by Mr Richard Evans, BSc(Hons), who is a Member of The Australasian Institute of Mining and Metallurgy. Mr Evans is a consultant to the Company and an employee of its associate Resource Star Limited, has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking, to qualify as a Competent Person as defined in the 2004 Edition of the "Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves" and as a "Qualified Person" as defined in the Note for Mining and Oil & Gas Companies, June 2009, of the London Stock Exchange. Mr Evans has reviewed this announcement and consents to the inclusion herein of the matters based on his information in the form and context in which they appear.

Enquiries:

Andrew Bell	020 7402 4580 or 07766 474849	Red Rock Resources plc	Chairman
Sandra Spencer	020 7402 4580 or 07757 660 798	Red Rock Resources plc	Press Relations
Gerry Beaney Daniela Amihood	020 728 5100	Grant Thornton Corporate Finance	Nominated Adviser
Nick Emerson	01483 413500	Simple Investments Ltd	Broker

Appendix: Havik East drill information 

Drill hole	UTM  (mE)	UTM   (mN)	End of Hole Depth (m)	Dip	Azimuth True	From (m)	BIF DH width (m)	Est'd True Thickness (m)	Est'd Fe%*	Comments	Max Fe%
HED001	505 000	8 467 383	78.10	-85°	196°	22.95	51.55+	51+	26.3%	Hole ended in BIF due to drilling issues	39.0%
HED002	505 000	8 467 383	117.35	-55°	196°	13.00	56.9	564	26.1%	Localised massive magnetite zones up to 64.1%. 10-15% haematite in zones of alteration.	64.4%
HED003	505 016	8 467 468	144.40	-85°	266°	12.75	131.65+	51+	24.0%	Hole ended in BIF due to drilling issues. Magnetite BIF	35.3%
HED004	505 016	8 467 468	162.05	-70°	274°	20.45	29.90	15	23.8%		31.4%
						70.15	77.55	59	23.8%		35.5%
HED005	505 010	8 467 524	162.50	-55°	190°	12.50	4.90	na	25.5%		34.0%
						57.60	20.45	na	24.2%		49.0%
						90.50	71.75+	na	25.1%	Hole ended in BIF due to drilling issues.	43.6%

^* Iron grades obtained from Niton field XRF "spot" analyses. Chemical compositions are representative of expected grades, which will be determined by follow up assay work, however the XRF results are not considered as reliable as the full chemical analysis planned, and should be used as an indication of potential results.  A full description of the logging procedures is included in the text.

^** Thicknesses with a '+' indicate the lower BIF contact was not reached due to drilling issues, indicating this value as the minimum thickness.

 

END

 

 

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