Red Rock Resources plc Settlement of Legal Proceedings (6851E)

TIDMRRR

RNS Number : 6851E

Red Rock Resources plc

22 October 2018

Red Rock Resources PLC

("Red Rock" or the "Company")

Settlement of Legal Proceedings

22 October 2018

Red Rock Resources Plc, the natural resource investment and development company, announces, further to its announcement of 15 June 2018, an update in relation to the legal proceedings instituted by Red Rock and its local partner (the "Applicants") in May 2015 against the Ministry of Mining in Kenya.

A Consent has been signed on behalf of the Attorney General and the Company and is being filed with the court. Under the terms of the Consent, the parties have agreed that the case be marked as withdrawn with no order as to costs, that the Applicants are at liberty to apply for licenses under section 225(6) of the Mining Act 2016, and that previous decisions will not be prejudicial to such applications.

The Company welcomes this settlement and has caused the appropriate applications to be made.

Andrew Bell, Chairman of Red Rock comments: "We spent many millions exploring these licenses and producing an initial 1.2m oz Mineral Resource under the JORC Code at the beginning of the decade. Our activity on the ground in gold exploration was second to none in its commitment, speed, and extent, and went so far as applying for a Mining License on one area. It was a disappointment and we believed an injustice to us that external factors then created obstacles in the way of following up this progress.

This settlement we hope will open the way to renewed progress towards our aim, which is to have a producing gold mine. Our desire, and that of the authorities and local communities, is to see work towards this recommence without delay.

We shall make further announcements as the applications progress."

Background

The Company has a 100% economic interest in two special licenses granted under the former Mining Act.

The licenses lie in South West Kenya near the Tanzanian border, more or less parallel with and north of the North Mara mine operated by Acacia Mining plc. The project, which in places shows alteration and shearing up to 250m wide, appears to be a typical greenstone sequence of interbedded meta-sediments and meta-volcanics with thin sheets of intrusions parallel to the contact with the granite to the south. Shearing, quartz veining and traceable zones of mineralisation appear mostly to be sub-parallel to bedding.

Mineralisation extends from surface, where artisanal miners conduct shallow, small scale, high grade mining activities at a number of places along strike, down to the limit of current drill testing (170m).

Work on these licenses underwent several phases of historical drilling since the late 1980s including a resource estimate under the Canadian NI 43-101 resource reporting standard in 2006.

In December 2012, following an extensive drilling and exploration programme by the Company, CSA Global (UK) Ltd produced a Mineral Resource Estimate ("MRE") as follows:

At a 0.5 g/t Au cut-off grade, the updated JORC-compliant, Indicated and Inferred Resources total was:

29.4 Mt @ 1.26 g/t Au with contained metal content of 1.193 MOz Au

 
                      Inferred        Indicated              Total 
                     Mt    g/t Au    Mt     g/t Au    Mt     g/t Au    kOz 
                                   ------  -------  ------  -------  ------ 
 KKM                1.41     1.15   16.34     1.00   17.75     1.01     577 
                   -----  -------  ------  -------  ------  -------  ------ 
 KKM-West           3.03     1.02    1.13     1.07    4.16     1.04     139 
                   -----  -------  ------  -------  ------  -------  ------ 
 Nyanza             1.15     1.70    1.17     3.73    2.32     2.73     203 
                   -----  -------  ------  -------  ------  -------  ------ 
 Gori Maria         3.78     1.16       0        0    3.78     1.16     141 
                   -----  -------  ------  -------  ------  -------  ------ 
 MK                 0.58     1.76    0.77     4.05    1.35     3.07     133 
-----------------  -----  -------  ------  -------  ------  -------  ------ 
  Mikei Resources   9.95     1.21   19.41     1.29   29.36     1.26   1,193 
-----------------  -----  -------  ------  -------  ------  -------  ------ 
 

Table 1 Summary of 2011-2012 JORC-compliant MREs (0.5 g/t Au cut-off) for the project (NB. Apparent errors may occur due to rounding).

-- Metallurgical test work on samples from the MK prospect showed that gold recoveries in excess of 90% were achievable

-- Mineralisation at all prospects remains potentially open at depth (including down plunge) and along strike of key higher grade zones.

Section 225(6) of the Mining Act 2016 reads: "A mineral right for prospecting, mining or dealing in minerals granted prior to this Act shall not be extended or renewed but where the granted Mineral Right provided a right to apply for a renewal or extension of the right, the holder of that mineral right may apply, subject to this Act for a similar type of licence or permit as provided for under this Act on a priority basis".

Glossary

 
 Alteration               Changes in the chemical or mineralogical composition 
                           of a rock, produced by weathering or hydrothermal 
                           solutions. 
 Archaean                 A period in geological time between approximately 
                           2.5 - 3.8 billion years ago. 
                         ----------------------------------------------------- 
 Cut-off grade            A lower grade level used to define continuity 
                           of mineralisation. 
                         ----------------------------------------------------- 
 Grams per tonne, 'g/t'   A chemical measure of the amount of gold or 
                           other metals in a rock. Exactly equivalent 
                           to 'ppm' or parts per million. 
                         ----------------------------------------------------- 
 Greenstone               A broad term for volcano-sedimentary sequences, 
                           usually of Archaean age, that are known to 
                           host gold mineralisation. Referred to as 'green' 
                           due to their common alteration state, and 
                           contain noticeable amounts of the greenish 
                           mineral chlorite. They generally occur in 
                           tectonic belts that are longer than they are 
                           wide. 
                         ----------------------------------------------------- 
 Indicated Resource       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. It is based on exploration, 
                           sampling and testing information gathered 
                           from locations such as outcrops, trenches, 
                           pits, workings and drill holes. The locations 
                           are too widely or inappropriately spaced to 
                           confirm geological or grade continuity but 
                           are spaced closely enough for continuity to 
                           be assumed. 
                         ----------------------------------------------------- 
 Inferred Resource        An "Inferred Mineral Resource" is that part 
                           of a Mineral Resource for which volume or 
                           tonnage, grade and mineral content can be 
                           estimated with a low level of confidence. 
                           It is inferred from geological evidence and 
                           assumed but not verified geological and/or 
                           grade continuity. It is based on information 
                           gathered through appropriate techniques such 
                           as outcrops, trenches, pits, workings and 
                           drill holes which may be limited or of uncertain 
                           quality and reliability. 
                         ----------------------------------------------------- 
 JORC                     The Australasian mineral resource reporting 
                           standard. 
                           The Joint Ore Reserves Code is defined as 
                           the code for reporting of Mineral Resources 
                           and Ore Reserves and is widely accepted as 
                           a standard for professional reporting purposes. 
                         ----------------------------------------------------- 
 Metallurgical testwork   Any of a range to tests designed to characterise 
                           the requirements to extract a mineral or metal 
                           from a particular rock; frequently includes 
                           metal recovery after particular physical and 
                           / or chemical processes. 
                         ----------------------------------------------------- 
 Mineralisation           The parts of a geological system that are 
                           enriched in the metal of interest. 
                         ----------------------------------------------------- 
 MRE                      Mineral Resource Estimate, as defined by JORC. 
                         ----------------------------------------------------- 
 MOz                      Millions of ounces of contained metal. 
                         ----------------------------------------------------- 
 Mt                       Millions of tonnes. 
                         ----------------------------------------------------- 
 Quartz vein / reef       A secondary accumulation of a silica-rich 
  / lode                   mineral, quartz, along a fracture surface 

                           usually caused during the deformation of a 
                           volume of rock, and often the host to, or 
                           associated with, gold mineralisation in greenstone 
                           belts. Can vary from millimetre-scale up to 
                           a number of metres thick. 
                         ----------------------------------------------------- 
 Shear zone / system      A volume of rock in which shearing across 
                           a measurable width, and such that the rock 
                           is deformed as much by ductile deformation 
                           as it is by discrete planar breaks or faults. 
                         ----------------------------------------------------- 
 Strike                   eg 'along strike'. The direction a geological 
                           feature, such as a shear zone, bedding or 
                           a quartz vein, is trending. 
                         ----------------------------------------------------- 
 

This announcement contains inside information for the purposes of Article 7 of EU Regulation 596/2014.

For further information, please contact:

Andrew Bell 0207 747 9990 Chairman Red Rock Resources Plc

Scott Kaintz 0207 747 9990 Director Red Rock Resources Plc

   Roland Cornish/ Rosalind Hill Abrahams 0207 628 3396        NOMAD Beaumont Cornish Limited 

Jason Robertson 0207 374 2212 Broker First Equity Ltd

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October 22, 2018 02:00 ET (06:00 GMT)