Replacement - Increased MRE for Mambare

RNS Number : 2735F

Regency Mines PLC

13 June 2012

 

This announcement replaces the one released at 7 a.m. on Wednesday 13 June, RNS Number 2364F. This replacement contains the column headings for the first two tables in the announcement that were missing from the previous RNS.

REGENCY MINES PLC

INCREASED JORC Compliant Mineral Resource Estimate for the Mambare Nickel Laterite Project

13 June 2012

Regency Mines plc ("Regency"), the mining exploration and mineral investment company with interests in nickel and other minerals in Western Australia, Queensland, Papua New Guinea and Pakistan announces an updated JORC-compliant Mineral Resource Estimate ("MRE") for the Mambare Nickel Laterite Project in Papua New Guinea.

The combined Indicated and Inferred JORC-compliant Resource is:

162.5 million tonnes grading 0.94% nickel and 0.09% cobalt

1.53 million tonnes of contained nickel

at a 0.60% nickel cut-off grade

67% Increase in contained nickel on April 2012 estimate

Includes significant tonnages of higher grade mineralisation

This compares very favourably with the maiden JORC Resource of 95.1Mt at 0.96% nickel 0.08% cobalt, also using a 0.60% nickel cut-off grade, announced on 25 April 2012.

A detailed breakdown of the MRE is provided below, with the 'South' being from the slopes below the Mambare Plateau and the 'North' representing the plateau;

Area	Lith Type	Class	Cut off Ni%	Vol '000m3	Tonnes '000 t	Ni%	Fe%	Co%	MgO%	SiO2%
South	Limonite	Indicated	0.6	1,507	1,582	0.99	40.31	0.11	4.37	16.71
		Inferred	0.6	79,786	83,775	0.90	40.07	0.10	4.39	15.87
		Total	0.6	81,292	85,357	0.90	40.08	0.10	4.39	15.89
	Saprolite	Indicated	0.6	1,493	1,726	1.01	13.66	0.04	23.06	45.08
		Inferred	0.6	45,682	53,448	0.97	18.49	0.05	18.88	38.99
		Total	0.6	47,174	55,194	0.97	18.33	0.05	19.01	39.18
	Total	Indicated	0.6	2,999	3,328	1.00	26.33	0.07	14.18	31.60
		Inferred	0.6	125,467	137,222	0.92	31.67	0.08	10.03	24.87
		Total	0.6	128,467	140,551	0.92	31.54	0.08	10.13	25.03
North	Limonite	Indicated	0.6	0	0	0.00	0.00	0.00	0.00	0.00
		Inferred	0.6	12,691	13,325	0.90	44.45	0.13	2.62	12.18
		Total	0.6	12,691	13,325	0.90	44.45	0.13	2.62	12.18
	Saprolite	Indicated	0.6	0	0	0.00	0.00	0.00	0.00	0.00
		Inferred	0.6	7,408	8,668	1.25	15.56	0.05	22.53	39.56
		Total	0.6	7,408	8,668	1.25	15.56	0.05	22.53	39.56
	Total	Indicated	0.6	0	0	0.00	0.00	0.00	0.00	0.00
		Inferred	0.6	20.099	21,993	1.04	33.07	0.10	10.46	22.97
		Total	0.6	20.099	21,993	1.04	33.07	0.10	10.46	22.97
Total		Indicated	0.6	2,999	3,328	1.00	26.33	0.07	14.18	31.60
		Inferred	0.6	145,566	159,215	0.94	31.86	0.09	10.09	24.61
		Total	0.6	148,565	162,544	0.94	31.75	0.09	10.18	24.75

All tonnes in this announcement are dry metric tonnes.

The increase resulted from the inclusion of all 2008 drilling and 2011 ground-penetrating radar results.

Significant tonnages of higher-grade mineralisation have been identified within the Total Resource, as indicated in the tonnage-grade table below, including 47Mt at 1.23% nickel 0.08% cobalt, using a 1.00% nickel cut-off grade within the 0.60% nickel wireframe.

CUT OFF Ni%	TONNES '000 t	Ni %	Fe %	Co %	MgO %	SiO2 %
0	170,171	0.92	31.31	0.08	10.37	25.18
0.2	169,940	0.92	31.34	0.08	10.35	25.17
0.4	169,293	0.92	31.42	0.08	10.30	25.11
0.6	162,544	0.94	31.75	0.09	10.18	24.75
0.8	115,590	1.03	31.46	0.09	10.65	25.20
1.0	47,350	1.23	28.51	0.08	12.79	28.05
1.2	18,470	1.46	24.24	0.08	15.62	32.24
1.4	7,577	1.70	22.57	0.08	16.93	33.07
1.6	3,887	1.92	20.39	0.07	18.96	34.29
1.8	2,110	2.09	19.41	0.07	19.57	34.46
2.0	1,303	2.22	19.94	0.06	18.79	33.75

The tonnage-grade table is an indication only as grade continuity in an Inferred Resource category, which makes up the bulk of the Total Resource, cannot be guaranteed.

The updated MRE was calculated across a combined area of 27.8 km², including areas drilled in 2008 as well as the more recent 2011 drilling.  All 2008 drilling incorporated into this updated Resource is located on the southern slopes below the plateau.

The Mambare Plateau itself, rather than the adjacent slopes, is considered to be the long-term primary exploration target. To date, only 2 km² of the 80 km² plateau has been drill tested, highlighting the significant potential of the undrilled plateau area.

Exploration at the Mambare Nickel Laterite Project is being undertaken by Oro Nickel Ltd, a 50:50 Joint Venture of Regency Mines plc and Direct Nickel Pty Ltd. All values are reported on a total (100%) rather than attributable basis.

The MRE was independently calculated by CSA Global (Perth, Australia) ("CSA") based on all results of the 2011 and 2008 exploration campaigns, comprising 7,291 metres from 455 drill holes and 5 test pits, as well as the results of the 2011 Ground Penetrating Radar survey.

Details of the estimation methods, constraints and assumptions, and quality assurance and quality control (QA/QC) for this MRE were provided to Oro Nickel in a detailed report produced by CSA.

Mambare Project Manager, Ian Warden, commented:

"These latest results are exciting. Not only do they build the Mambare Nickel Project towards its potential to be a nickel laterite of world-class scale, the higher-grade zones identified have very positive implications for the economics of a future Mambare operation.

The continuity of mineralisation delineated in the 2008 and 2011 drill areas shows that the laterite mineralisation consistently blankets the underlying ultramafic bedrock, where not eroded by local drainage. The same ultramafic bedrock extends across the whole tenement area. Given the current resource lies mostly on the steeper and more eroded slopes below the plateau, we expect to find similar or better continuity of mineralisation in future drilling across the plateau surface.

The increased Mineral Resource Estimate, and the recent construction completion of Direct Nickel's Stage 1 Test Plant in Perth, which will test a bulk sample from Mambare, are important milestones on the path to bringing Mambare towards development.

Work continues to address future resource definition work, metallurgical testing, and scoping studies.

The Mineral Resource Estimate was completed by Rory Devlin under the direction of Dmitry Pertel and Mick Elias. Rory Devlin, Dmitry Pertel and Mick Elias are employees of CSA Global.  Mick Elias, FAusIMM is a Competent Person as defined by the Australasian Code for the Reporting of Exploration Results, Mineral Resources or Ore Reserves (JORC Code 2004 Edition), and as a Qualified Person within the meaning of AIM's Note for Mining and Oil & Gas Companies of June 2009.  Mr Elias has reviewed the information contained in this announcement and consents to the inclusion of such information in the form and context in which it appears.

For further information contact:

Andrew Bell	0207 402 4580 or 07766 474849	Regency Mines plc	Chairman
Sandra Spencer	0207 402 4580 or 07757 660 798	Regency Mines plc	Public and Investor Relations
Phillip Davies/David Porter	020 7444 0800	Religare Capital Markets	Nominated Adviser
Nick Emerson	01483 413500	Simple Investments Ltd	Broker

Updates on the Company's activities are regularly posted on its website, www.regency-mines.com.

http://www.rns-pdf.londonstockexchange.com/rns/2735F_-2012-6-13.pdf

 

Background on the Mambare Nickel Laterite Project

The Mambare project consists of two exploration licences with an aggregate area of over 459 km², including 255 km² of granted tenure. The licence areas are situated on the Mambare Plateau, located in the Oro Province of Papua New Guinea.

The Mambare Plateau is situated north and east of the Mambare River and on the south-western boundary of the Ajule-Kajale Range. The Kokoda district is situated to the south of the project area. Recent exploration activity has been undertaken from an exploration camp situated about 8 km north of Kokoda on the southern slopes of the plateau and north of the village of Botue.  Access to the project area is via sealed and gravel road from the provincial capital Popondetta to Kokoda. Sealed road also connects Popondetta to the commercial port of Oro Bay.

The Mambare Joint Venture has also secured two exploration licences covering 1,473 km² in the Mount Lamington and Hydrographers Range volcanic areas, and 191 km² in the Mt Trafalgar volcanic area.   These Exploration Licences have been granted to explore the region for geothermal heat, which could provide cheap, renewable energy for process heat and electrical energy for use in any future mine and DNi Process plant. Exploration will also assess the potential of any other minerals discovered within the application area.

Technical Glossary

Co	Chemical symbol for Cobalt
Cut-Off Grade	The estimated lowest grade of ore to be considered and included in the potentially economic part of the deposit
Fe	Chemical symbol for Iron
Grade	Quantity of metal for unit weight of host rock
Ground Penetrating Radar	Is a geophysical method that uses radar pulses to image the subsurface. This non-destructive method uses electromagnetic radiation in the microwave band (UHF/VHF frequencies) of the radio spectrum, and detects the reflected signals from subsurface structures. GPR can be used in a variety of media, including rock, soil, ice, fresh water, pavements and structures. It can detect objects, changes in material, and voids and cracks.
Indicated Mineral Resource	Defined in the JORC Code as "An 'Indicated Mineral Resource' is that part of a Mineral Resource for which tonnage, densities, shape, physical characteristics, grade and mineral content can be estimated with a reasonable level of confidence." For the purposes of the CSA resource estimate, Indicated Resources are defined by 100 x 100m drill hole spacings or smaller.
Inferred Mineral Resource	Defined in the JORC Code as "An 'Inferred Mineral Resource' is that part of a Mineral Resource for which tonnage, grade and mineral content can be estimated with a low level of confidence." For the purposes of the CSA resource estimate, Inferred Resources are defined by drill spacings of greater than 100 x 100m, with drill spacings generally being on 200 x 200m and 200 x 400m spacings.
JORC	The Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (the 'JORC Code' or 'the Code') sets out minimum standards, recommendations and guidelines for Public Reporting in Australasia of Exploration Results, Mineral Resources and Ore Reserves
Laterite	A strongly leached, iron and aluminium rich rock, formed at the surface by weathering in tropical conditions
Limonite	An amorphous, hydrated iron oxide, dark brown to black, occurs in earthy masses of various forms.
MgO	Chemical symbol for Magnesium Oxide
Mineral Resource	A concentration or occurrence of material of economic interest in or on the Earth's crust in such a form, quality, and quantity that there are reasonable and realistic prospects for eventual economic extraction. The location, quantity, grade, continuity and other geological characteristics of a Mineral Resource are known, estimated from specific geological knowledge, or interpreted from a well constrained and portrayed geological model
Mineralisation	Accumulations of economic or related minerals
Mt	Millions of dry metric tonnes
Ni	Chemical symbol for Nickel
Saprolite	A soft, earthy, red or brown, clay-rich and totally decomposed rock, formed in place by chemical weathering of igneous or metamorphic rocks, particularly in humid climates.  Structures that were in the unweathered rock are preserved in saprolite.
SiO2	Chemical symbol for Silicon Dioxide
Ultramafic	A rocky type very low in silica and rich in iron and magnesium. The typical source rock for the formation of nickel laterites

http://www.rns-pdf.londonstockexchange.com/rns/2735F_1-2012-6-13.pdf

 

 

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