Positive Assay Results Underpin Value of Mpokot...

Positive Assay Results Underpin Value of Mpokoto Gold Project

Armadale Capital Plc

Armadale Capital Plc / Index: AIM / Epic: ACP / Sector: Investment Company

4 September 2014

Armadale Capital Plc (‘Armadale’ or ‘the Company’)
Positive Assay Results Underpin Value of Mpokoto Gold Project

Armadale, the AIM quoted investment company focused on natural resource projects in Africa, is pleased to announce a series of positive assay results from the recently completed 2,307m drilling campaign at its Mpokoto Gold Project in the Katanga Province in the Democratic Republic of Congo (‘Mpokoto’ or ‘the Project’). The drilling program was designed and conducted with the aim of expanding the current JORC resources, both along strike and up dip, and to upgrade the classification of the JORC resources by confirming the robustness of the mineralisation model. This updated resource should feed into an expanded and updated Scoping Study, increasing the overall value of the Project. To view the full press release with associated maps and drawings please visit the Company’s website www.armadalecapitalplc.com.

Highlights

  • Results confirm mineralisation is open along strike and at depth in all areas tested
  • Significant assays include:
    • MKTO-006 returned 20m @ 2.56g/t Au from 14.0m depth
    • MKTO-020 returned 16m @ 1.76g/t Au from 16.0m depth
    • MKTO-040 returned 14m @ 2.67g/t Au from 31.0m depth
    • MKTO-023 returned 6m @ 4.26 g/t Au from 9.0m depth
    • MKTO-037 returned 4m @ 4.42g/t Au from 56.0m depth
    • MKTO-011 returned 8m @ 1.65g/t Au from 20m depth
  • A new zone of continuous mineralisation (Target Zone 2) confirmed over a strike length of approximately 750m to an average depth of 60m down dip
  • Program successfully tested exploration targets, extended mineralisation trends and confirmed continuity
  • It is anticipated that the results will supports conversion of the existing 10Mt-15Mt at 1.2g/t-1.5g/t Au exploration target to classified resource
  • Results demonstrate excellent potential for economic exploitation of the shallow oxide mineralisation and confirm the robustness of the applied Mineral Resource model, underpinning Mpokoto’s value as a solid gold development project with attractive economic fundamentals even at gold price of US$1,100/oz

Justin Lewis, Director of Armadale, said, “With mineralisation at Mpokoto confirmed open along strike and at depth in all tested areas and a significant new zone of mineralisation identified over a strike length of approximately 750m, these drill results are highly encouraging. This exploration program further underpins Mpokoto’s value as a low cost gold development project and validates our targeted approach as we focus on the shallower, lower cost oxide resource. These results are expected to be incorporated into an updated and classified Mineral Resource estimate which will further expand the resource base at Mpokoto, which in turn will be incorporated into an expanded and updated Scoping Study.”

Further Information

A detailed drilling program was planned for the Mpokoto Project following the completion of an updated Mineral Resource estimate in early 2014. A total of 46 shallow RC (Reverse Circulation)1 drill holes were completed between June and July 2014 for a total of 2,307m as part of a targeted drilling program that focused on demonstrating the continuity of mineralisation up-dip and along strike.

CSA Global Pty Ltd (“CSA”) were engaged in the capacity of independent technical advisors and Qualified Persons (‘QP’) to undertake a review of drilling data and propose a follow-up work program. CSA had previously estimated additional gold mineralisation potential in the project area of between 10 and 15 million tonnes at 1.2g/t - 1.5g/t Au at Mpokoto. The drill holes completed to date are part of a more comprehensive drilling program aimed at testing the interpreted mineralisation geometry for continuity, near-surface mineralisation, refining of the geological model in selected areas and converting exploration potential to resources.

Overall, drilling was conducted along strike to the northwest and up-dip of Mineralisation Zone 4, up-dip of Mineralisation Zone 3 and up-dip and along strike in target Mineralisation Zone 2 (not classified resources).

Drilling in Target Zone 2 (southernmost area) confirmed that continuous gold mineralisation occurs in two sub-parallel, moderately southwest dipping lenses that can be traced over a strike length of about 750m. The upper lens is, in places, up to 17m wide whereas the lower lens has a maximum width of 4m. The mineralisation is currently confirmed to a maximum vertical depth of 100m (average 60m). The drill section spacing is now reduced to about 50m.

The drill holes sited in the Mineralisation Zone 3 area targeted mineralisation at shallow depth in the central and northern part of the “Inferred” mineralisation. In the central area the shallow drill holes intersected low-grade mineralisation conforming with the interpreted zones of mineralisation. However, in the northern area the shallow holes confirmed the tenor of mineralisation and suggest that future drilling may allow the mineralisation in Mineralisation Zone 3 to be joined with that in Mineralisation Zone 4 to the north.

The majority of drill holes were drilled along strike to the northwest and up-dip of Mineralisation Zone 4. The drilling in this area was particularly successful. Continuous mineralisation in several mineralised lenses has now been confirmed over a strike length of 1,000m and the mineralisation is open to the northwest. This is a net increase of mineralisation strike length of 300m in Mineralisation Zone 4. All drill holes targeted the up-dip and oxide zone of mineralization.

The drilling program to date, has been highly successful in confirming continuity of mineralisation, substantiating the geometry of mineralisation and concepts used and has demonstrated that good potential exists in the area for shallow economic mineralisation.

About Mpokoto Gold Project

Mpokoto is located in the western part of the Katanga Province approximately 250 km west of Kolwezi in the Democratic Republic of Congo, and approximately 25km from the Zambian border. The area is highly prospective, with local operators including Ivanplats Limited and Glencore Plc.

Since 1998 approximately US$20 million was spent on gold exploration at the Project. In 2012, mining consultancy TetraTech completed a mineral resource estimation in line with JORC 2004 and NI 43-101 guidelines. At a cut off of 0.5 g/t Au the deposit was estimated to contain 7.2 million tonnes at 1.6g/t Au for approximately 380,000 ounces of gold (Table 1). Of this, approximately 5.3 million tonnes at 1.6g/t Au are classified in the Indicated category for 290,000 ounces.

CSA Global conducted an updated Mineral Resource estimation that Mpokoto currently has a resource of 11.12 million tonnes @ 1.42g/t gold (‘Au’) at a cut-off grade of 0.5 g/t Au classified as Indicated and Inferred.

In addition, CSA Global is of the opinion that potential exists for an Exploration Target of between 10 and 15 million tonnes at 1.2g/t - 1.5g/t Au. The potential for additional resources and reserves is therefore good. Should this target mineralisation be converted to Inferred and Indicated resources and then to reserves, it is likely that the proposed project throughput rate can be substantially upgraded.

Competent Person Statement:

Scientific or technical information in this release has been prepared by Dr Simon Dorling of CSA Global Pty Ltd, Armadale’s geological consultant. Dr Simon Dorling is a member of the Australasian Institute of Geoscientists (MAIG) and has sufficient experience which is relevant to the style of mineralisation under consideration and to the activity which they are undertaking to qualify as a Competent Person as defined in the 2012 Edition of the “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves” (the JORC Code). Dr Simon Dorling consents to the inclusion in this report of the Information, in the form and context in which it appears.

A copy of the announcement, which includes a map and drawings relating to Mpokoto’s location and geology can be found on the Company’s website at www.armadalecapitalplc.com.

**ENDS**

Enquiries:

 
 

Company

Justin Lewis, Director +44 20 7233 1462
Charles Zorab
 

Nomad and broker: finnCap Limited

Stuart Andrews/ Christopher Raggett +44 20 7220 0500
 

Press relations: St Brides Media & Finance Ltd.

Susie Geliher/Charlotte Heap +44 20 7236 1177

Notes

Table 1: Table of all recent drilling results composited at 0.3g/t economic cut-off, maximum of 2m internal dilution.

Hole_ID       From (m)       To (m)       Interval       Lable    
MKTO-002       1.00       7.00       6.00       6.00@0.51
MKTO-002       10.00       14.00       4.00       4.00@0.55
MKTO-002       34.00       38.00       4.00       4.00@0.71
MKTO-003       4.00       6.00       2.00       2.00@0.53
MKTO-003       6.00       16.00       10.00       10.00@0.64
MKTO-003       22.00       26.00       4.00       4.00@0.63
MKTO-003       32.00       35.00       3.00       3.00@0.54
MKTO-003       35.00       39.00       4.00       4.00@1.90
MKTO-004       26.00       29.00       3.00       3.00@0.54
MKTO-004       29.00       39.00       10.00       10.00@0.83
MKTO-004       41.00       44.00       3.00       3.00@0.55
MKTO-005       17.00       20.00       3.00       3.00@0.63
MKTO-006       1.00       5.00       4.00       4.00@0.58
MKTO-006       5.00       8.00       3.00       3.00@0.61
MKTO-006       14.00       34.00       20.00       20.00@2.56
MKTO-006       44.00       48.00       4.00       4.00@0.56
MKTO-007       3.00       5.00       2.00       2.00@0.51
MKTO-007       27.00       29.00       2.00       2.00@0.51
MKTO-007       36.00       48.00       12.00       12.00@0.80
MKTO-008       2.00       8.00       6.00       6.00@0.87
MKTO-008       17.00       26.00       9.00       9.00@0.70
MKTO-009       10.00       16.00       6.00       6.00@0.55
MKTO-009       25.00       27.00       2.00       2.00@0.58
MKTO-009       29.00       36.00       7.00       7.00@0.71
MKTO-010       4.00       7.00       3.00       3.00@0.52
MKTO-010       39.00       41.00       2.00       2.00@0.57
MKTO-010       46.00       49.00       3.00       3.00@0.57
MKTO-010       53.00       59.00       6.00       6.00@1.06
MKTO-011       20.00       28.00       8.00       8.00@1.65
MKTO-012       18.00       27.00       9.00       9.00@0.55
MKTO-012       27.00       34.00       7.00       7.00@1.03
MKTO-012       35.00       37.00       2.00       2.00@0.55
MKTO-013       4.00       6.00       2.00       2.00@0.51
MKTO-013       45.00       50.00       5.00       5.00@0.57
MKTO-014       0.00       11.00       11.00       11.00@0.91
MKTO-015       1.00       8.00       7.00       7.00@0.59
MKTO-015       32.00       35.00       3.00       3.00@0.65
MKTO-016       7.00       12.00       5.00       5.00@0.50
MKTO-017       2.00       8.00       6.00       6.00@0.51
MKTO-017       23.00       27.00       4.00       4.00@0.67
MKTO-017       30.00       32.00       2.00       2.00@0.62
MKTO-017       33.00       37.00       4.00       4.00@1.14
MKTO-018       1.00       11.00       10.00       10.00@0.53
MKTO-018       12.00       14.00       2.00       2.00@0.60
MKTO-018       16.00       18.00       2.00       2.00@0.51
MKTO-018       21.00       25.00       4.00       4.00@0.72
MKTO-018       42.00       46.00       4.00       4.00@0.85
MKTO-019       0.00       5.00       5.00       5.00@0.82
MKTO-019       11.00       14.00       3.00       3.00@0.50
MKTO-019       15.00       17.00       2.00       2.00@0.53
MKTO-020       0.00       6.00       6.00       6.00@0.87
MKTO-020       11.00       16.00       5.00       5.00@0.51
MKTO-020       16.00       32.00       16.00       16.00@1.76
MKTO-020       37.00       40.00       3.00       3.00@0.65
MKTO-021       0.00       13.00       13.00       13.00@1.10
MKTO-021       30.00       32.00       2.00       2.00@0.59
MKTO-021       32.00       37.00       5.00       5.00@0.60
MKTO-021       41.00       45.00       4.00       4.00@0.64
MKTO-021       46.00       58.00       12.00       12.00@1.14
MKTO-022       1.00       7.00       6.00       6.00@0.79
MKTO-022       12.00       15.00       3.00       3.00@0.75
MKTO-022       17.00       23.00       6.00       6.00@0.93
MKTO-023       0.00       6.00       6.00       6.00@0.72
MKTO-023       9.00       15.00       6.00       6.00@4.26
MKTO-024       0.00       21.00       21.00       21.00@1.21
MKTO-025       1.00       5.00       4.00       4.00@0.55
MKTO-026       2.00       7.00       5.00       5.00@0.73
MKTO-026       9.00       12.00       3.00       3.00@0.52
MKTO-026       14.00       22.00       8.00       8.00@0.95
MKTO-027       11.00       16.00       5.00       5.00@0.67
MKTO-028       21.00       23.00       2.00       2.00@0.56
MKTO-028       27.00       31.00       4.00       4.00@0.64
MKTO-028       35.00       43.00       8.00       8.00@0.79
MKTO-032       47.00       60.00       13.00       13.00@0.83
MKTO-034       56.00       58.00       2.00       2.00@0.59
MKTO-037       27.00       39.00       12.00       12.00@0.85
MKTO-037       56.00       60.00       4.00       4.00@4.42
MKTO-038       7.00       14.00       7.00       7.00@0.58
MKTO-039       4.00       17.00       13.00       13.00@0.96
MKTO-039       36.00       38.00       2.00       2.00@0.68
MKTO-040       31.00       45.00       14.00       14.00@2.67
MKTO-040       46.00       48.00       2.00       2.00@0.58
MKTO-040       49.00       52.00       3.00       3.00@0.63
MKTO-041       12.00       28.00       16.00       16.00@1.01
MKTO-041       40.00       44.00       4.00       4.00@0.85
MKTO-042       1.00       4.00       3.00       3.00@0.77
MKTO-043       3.00       5.00       2.00       2.00@0.59
MKTO-044       48.00       53.00       5.00       5.00@0.83

NOTE: 1. All holes are Reverse Circulation (RC) holes. All samples comprise crushed rock samples. 3. Assaying is conducted at ALS Chemex Laboratories, Johannesburg, South Africa using industry standard 30g Fire Assay with AAS finish. Assays >100g/t Au are finished gravimetrically. 4. Certified reference materials, blanks and crushed lab duplicates are inserted into the sample stream and monitored by CSA Global UK. 5. Down hole intercepts are quoted to two decimal places using a >0.2g/t lower cut-off which includes no more than 3m of internal dilution (>0.2g/t Au). 6. No high cut-off grade has been applied. 7. True widths are approximately 45-65% of the reported down-hole interval. 8. NSI – no significant intercept.

Table 2: Table of all Collar positions of the reported programme

Drill Hole ID       East (UTM)       North (UTM)       RL       Dip       Azimuth (magnetic)       Hole Type       EOH       Comments    
MKTO-001       811521       8817800       1115       -55       45       RC       40       assays received
MKTO-002       811506       8817784       1115       -55       45       RC       45       assays received
MKTO-003       811481       8817767       1115       -55       45       RC       50       assays received
MKTO-004       811471       8817746       1115       -55       45       RC       49       assays received
MKTO-005       811483       8817824       1112.5       -55       35       RC       60       assays received
MKTO-006       811460       8817802       1112.5       -55       35       RC       50       assays received
MKTO-007       811439       8817786       1112.5       -55       35       RC       50       assays received
MKTO-008       811434       8817850       1112.5       -55       35       RC       50       assays received
MKTO-009       811416       8817833       1112.5       -55       35       RC       40       assays received
MKTO-010       811400       8817810       1112.5       -55       35       RC       60       assays received
MKTO-011       811350       8817907       1112.5       -55       35       RC       60       assays received
MKTO-012       811334       8817888       1112.5       -55       35       RC       40       assays received
MKTO-013       811317       8817870       1112.5       -55       35       RC       50       assays received
MKTO-014       811616       8817750       1115.9       -55       45       RC       40       assays received
MKTO-015       811598       8817732       1115.9       -55       45       RC       50       assays received
MKTO-016       811668       8817731       1115.9       -55       45       RC       35       assays received
MKTO-017       811650       8817714       1115.9       -55       45       RC       50       assays received
MKTO-018       811615       8817678       1115.9       -55       45       RC       55       assays received
MKTO-019       811710       8817703       1115.9       -55       45       RC       35       assays received
MKTO-020       811692       8817685       1115.9       -55       45       RC       60       assays received
MKTO-021       811674       8817667       1115.9       -55       45       RC       60       assays received
MKTO-022       811793       8817646       1117       -55       45       RC       50       assays received
MKTO-023       811756       8817607       1117.2       -55       45       RC       40       assays received
MKTO-024       811738       8817589       1117.2       -55       45       RC       55       assays received
MKTO-025       812008       8817656       1117.1       -55       45       RC       45       assays received
MKTO-026       812071       8817649       1118       -55       45       RC       40       assays received
MKTO-027       812133       8817643       1121.5       -55       45       RC       35       assays received
MKTO-028       812115       8817625       1121.5       -55       45       RC       55       assays received
MKTO-029       812170       8817609       1121.5       -55       45       RC       35       assays received
MKTO-030       812152       8817592       1121.5       -55       45       RC       55       assays received
MKTO-031       812308       8817354       1122       -60       47       RC       55       assays received
MKTO-032       812392       8817263       1120.5       -60       47       RC       60       assays received
MKTO-033       812569       8817085       1120.5       -60       47       RC       50       assays received
MKTO-034       812646       8817020       1119.6       -60       47       RC       60       assays received
MKTO-035       812661       8816966       1119.9       -60       47       RC       60       assays received
MKTO-036       812713       8816947       1119.6       -60       47       RC       60       assays received
MKTO-037       813044       8816133       1082       -60       45       RC       60       assays received
MKTO-038       813110       8815942       1092.414       -60       48       RC       49       assays received
MKTO-039       813307.2       8815539       1085.458       -60       60       RC       50       assays received
MKTO-040       813267.4       8815575       1084.966       -60       60       RC       60       assays received
MKTO-041       813249.7       8815678       1088.269       -60       60       RC       50       assays received
MKTO-042       813202.6       8815800       1086.979       -60       60       RC       34       assays received
MKTO-043       812234.5       8817420       1122.333       -60       60       RC       60       assays received
MKTO-044       812444.1       8817174       1120.839       -60       60       RC       60       assays received
MKTO-045       812479.3       8817139       1120.839       -60       60       RC       50       assays received
MKTO-046       812584.9       8817032       1120.839       -60       60       RC       50       assays received

1 RC (reverse circulation) drilling is a cost-effective drilling method by which an air pressure driven hammer penetrates the rock sequence and generated a rock sample of crushed material as opposed to continuous core as in diamond drilling.

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