Strategic Minerals PLC Leigh Creek Copper Mine Drilling Update (2898Q)

TIDMSML

RNS Number : 2898Q

Strategic Minerals PLC

18 February 2019

Market Abuse Regulation (MAR) Disclosure

Certain information contained in this announcement would have been deemed inside information for the purposes of Article 7 of Regulation (EU) No 596/2014 until the release of this announcement.

18(th) February 2019

Strategic Minerals plc

("Strategic Minerals", "SML" or the "Company")

Leigh Creek assay results support the successful infill drilling at Paltridge North

Strategic Minerals plc (AIM: SML; USOTC: SMCDY), a producing mineral company actively developing projects prospective for battery materials, is pleased to announce the assay results from the full diamond drill programme at Paltridge North and the first diamond drill hole from Rosmann East. The Paltridge North assays support the historic results and highlight areas of higher-grade copper (including 1m @ 8.7%). The Initial Rosmann East hole extends mineralisation significantly below the existing pit floor and an additional 6 holes have been completed with results to follow.

Highlights:-

-- Paltridge North infill diamond drill programme has been completed with the aim of providing metallurgical test samples, testing historic drilling and geotechnical testwork

-- 8 of the 10 holes intersected significant copper mineralisation including malachite, azurite, chalcocite and native copper

   --     Significant intersections include; 

o PND18-04: 26.2m @ 1.14% Cu, including 11.2m @ 1.85% Cu

o PND18-06: 28.4m @ 1.17% Cu, including 4.3m @ 3.6% Cu

o PND18-07: 24.0m @ 1.15% Cu, including 8.9m @ 2.8% Cu

-- 6 of the 10 holes have an intersection average of 1.34% which is significantly greater than the resource average of 0.81%

   --     Reinforces previous Paltridge North resource model estimate 

-- Rosmann East extension drilling has been completed with 7 diamond drill holes testing below existing pit floor

-- First Rosmann East hole provides strong support for continued mineralisation 60m below existing pit floor and 30m below previous drilling, with RED18-01 returning 69m @ 0.37% Cu

-- Results from other holes at Rosmann East, which have targeted known areas of higher grade, will be released when available.

Commenting, John Peters, Managing Director, Strategic Minerals, said:

"The Paltridge North deposit assays, arising from the first diamond drilling programme for 32 years, have delivered better than expected results and provide the SML Board confidence that Paltridge North could be a significant copper producer in the near future.

"Additionally, the assays from the first hole at the Rosmann East deposit support potential additional mineralisation below the existing open pit floor. This is good news due to the ease of accessibility to this ore.

"Management and the Board look forward to restarting the Mountain of Light operations in the first half of 2019 and moving into long term, higher volume production at a later date."

   1.1       Paltridge North Infill Drill Programme 

Ten PQ3 (83mm diameter) diamond drill holes, for a total of 496.2m, were completed at Paltridge North in August 2018 with the aim of providing metallurgical samples, resource confirmation and geotechnical data for the feasibility study due for completion in the latter half of 2019. The assays have been received as part of the metallurgical testwork and are summarised below.

   1.2       Results 

The full assay results are now available and are summarised in the table below. All holes intersected oxide copper mineralisation (malachite and azurite) as expected, and eight holes continued into chalcocite mineralisation, with some native copper being observed in the core. The mineralised intersections contain a number of high grade intervals with a best of 1m at 8.7% Cu in PND18-07.

Table 1 - Paltridge North Infill Drilling Results

 
             Mineralisation    Depth From   Depth To   Interval   Copper Grade 
 Hole ID      Type              (m)          (m)        (m)(1)     (% Cu)(2) 
            ----------------  -----------  ---------  --------- 
 PND18-01    Oxide                             not yet assayed 
----------  ----------------  ------------------------------------------------ 
 PND18-02    Oxide             22.5         27.5       5.0        1.23 
----------  ----------------  -----------  ---------  ---------  ------------- 
 PND18-02    Chalcocite        27.5         34.9       7.4        2.04 
----------  ----------------  -----------  ---------  ---------  ------------- 
 PND18-02    Total             22.5         34.9       12.4       1.72 
----------  ----------------  -----------  ---------  ---------  ------------- 
 PND18-03    Oxide             24.3         29.6       5.3        1.58 
----------  ----------------  -----------  ---------  ---------  ------------- 
 PND18-03    Chalcocite        29.6         35.5       5.9        1.82 
----------  ----------------  -----------  ---------  ---------  ------------- 
 PND18-03    Total             24.3         35.5       11.2       1.71 
----------  ----------------  -----------  ---------  ---------  ------------- 
 PND18-04    Oxide             22.3         37.3       15.0       0.61 
----------  ----------------  -----------  ---------  ---------  ------------- 
 PND18-04    Chalcocite        37.3         48.5       11.2       1.85 
----------  ----------------  -----------  ---------  ---------  ------------- 
 PND18-04    Total             22.3         48.5       26.2       1.14 
----------  ----------------  -----------  ---------  ---------  ------------- 
 PND18-05    Oxide             19.7         26.5       6.8        1.32 
----------  ----------------  -----------  ---------  ---------  ------------- 
 PND18-05    Chalcocite        26.5         30.1       3.6        0.52 
----------  ----------------  -----------  ---------  ---------  ------------- 
 PND18-05    Total             19.7         30.1       10.4       1.04 
----------  ----------------  -----------  ---------  ---------  ------------- 
 PND18-06    Oxide             17.3         38.4       21.1       1.14 
----------  ----------------  -----------  ---------  ---------  ------------- 
 PND18-06    Chalcocite        38.4         45.7       7.3        1.24 
----------  ----------------  -----------  ---------  ---------  ------------- 
 PND18-06    Total             17.3         45.7       28.4       1.17 
----------  ----------------  -----------  ---------  ---------  ------------- 
 PND18-07    Oxide             16.8         31.9       15.1       0.74 
----------  ----------------  -----------  ---------  ---------  ------------- 
 PND18-07    Chalcocite        31.9         40.8       8.9        2.80 
----------  ----------------  -----------  ---------  ---------  ------------- 
 PND18-07    Total             16.8         40.8       24.0       1.51 
----------  ----------------  -----------  ---------  ---------  ------------- 
 PND18-08    Oxide             25.6         30.7       5.1        0.26 
----------  ----------------  -----------  ---------  ---------  ------------- 
 PND18-08    Chalcocite        30.7         39.2       8.5        0.37 
----------  ----------------  -----------  ---------  ---------  ------------- 
 PND18-08    Total             25.6         39.2       13.6       0.33 
----------  ----------------  -----------  ---------  ---------  ------------- 
 PND18-09    Oxide             22.8         33.8       11.1       0.48 
----------  ----------------  -----------  ---------  ---------  ------------- 
 PND18-09    Chalcocite        33.8         36.6       2.8        0.61 
----------  ----------------  -----------  ---------  ---------  ------------- 
 PND18-09    Total             22.8         36.6       13.9       0.51 
----------  ----------------  -----------  ---------  ---------  ------------- 
 PND18-10    Oxide             21.4         24.6       3.2        0.30 
----------  ----------------  -----------  ---------  ---------  ------------- 
 

[1] Intervals are downhole however most holes are drilled perpendicular to the deposit orientation

2 Some grade totals maybe include a minor rounding error

3 PND18-01 has not been assayed in order to provide typical core for viewing and assessment by potential mining contractors

The Paltridge North deposit is a relatively flat tabular deposit hosted in a fine-grained siltstone. Mineralisation has varied from predominantly copper oxide minerals, malachite and azurite, in the upper levels of the deposit grading into a relatively sharp contact where the copper minerals are predominantly chalcocite with some minor native copper observed in the drill core. Only minor bornite and chalcopyrite have been identified in core to date.

6 of the 10 holes assayed have an average intersection grade of 1.34% which is significantly greater than the current resource average of 0.81%. Given the infill nature of the drilling, this may not reflect an equivalent uplift in the resource grade but provides encouragement for high grade zones in the Paltridge North deposit.

   1.3       Further Work 

The results are generally of the grade and width predicted by the existing resource model and therefore provides confidence that the historic drilling is representative of the Paltridge North deposit. An updated resource model, which will incorporate these results, is in the process of being generated with a new resource estimation expected for completion in March 2019. The results will be released when they become available.

Metallurgical testwork on the samples obtained from the drilling is ongoing.

   1.4       Rosmann East Drilling 

Seven PQ3 diamond holes for a total of 675.2m were completed at Rosmann East in January 2019 with the aim of testing for extensions to existing copper oxide and chalcocite mineralisation zones beneath the existing open pit. This drilling is also designed to provide metallurgical samples and geotechnical information for a feasibility study on the Rosmann East deposit. The shallow nature and proximity to the Mountain of Light processing plant makes mineralisation from Rosmann East an attractive ore source for initial production.

   1.5       Results 

Assay results for the first hole, RED18-01, are now available and are tabulated below. This hole was drilled from the existing pit floor and intersected low grade chalcocite mineralisation (with minor pyrite, chalcopyrite and bornite) from 11m through to 72m, then an 8m wide zone of oxide mineralisation (malachite and azurite) against a faulted contact with an intrusive diapiric breccia.

Table 2 - Rosman East RED18-01 Assay Results

 
              Mineralisation    Depth From    Depth    Interval   Copper Grade 
 Hole ID       Type                 (m)       To (m)      (m)        (% Cu) 
             ----------------  -----------  --------  --------- 
 RED18-01     Total                11.0       80.0       69.0         0.37 
 including    Chalcocite           11.0       17.0       7.4          0.37 
 Including    Chalcocite           31.0       49.0       18.0         0.50 
 including    Chalcocite           53.0       70.2       17.2         0.42 
 including    Oxide                72.0       80.0       8.0          0.47 
-----------  ----------------  -----------  --------  ---------  ------------- 
 

These results support and expand on the previously reported results from the two reverse circulation holes drilled from the bottom of the Rosmann East pit in October 2018:

   --     RERC18-01: 12-62, 50m at 0.43% Cu 
   --     RERC18-02: 13-67, 54m at 1.41% Cu 

RED18-01 demonstrates that copper mineralisation extends to at least 60m below the current pit floor and approximately 30m below the previously deepest known mineralisation.

   2          Competent Person's Statement 

The exploration results in this announcement are based on information compiled by Mr. David Larsen, who is a Member of the Australian Institute of Geoscientists. Mr Larsen is the Principal of D&J Larsen Consulting Pty Ltd and is a consultant to the Company. He has sufficient experience relevant to the style of mineralisation and type of deposit under consideration and to the activity he is 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 and a qualified person as defined in the AIM Note for Mining and Oil & Gas Companies dated June 2009. Mr Larsen has over 35 years' Australia and international experience in exploration, mining geology and resource estimation for gold, base metals and iron ore deposits.

   3          Forward Looking Statements 

This report contains "forward-looking information" that is based on the Company's expectations, estimates and forecasts as of the date on which the statements were made. This forward-looking information includes, among other things, statements with respect to the Company's business strategy, plans, objectives, performance, outlook, growth, cash flow, earnings per share and shareholder value, projections, targets and expectations, mineral reserves and resources, results of exploration and related expenses, property acquisitions, mine development, mine operations, drilling activity, sampling and other data, grade and recovery levels, future production, capital costs, expenditures for environmental matters, life of mine, completion dates, commodity prices and demand, and currency exchange rates. Generally, this forward-looking information can be identified by the use of forward-looking terminology such as "outlook", "anticipate", "project", "target", "likely", "believe", "estimate", "expect", "intend", "may", "would", "could", "should", "scheduled", "will", "plan", "forecast" and similar expressions. The forward-looking information is not factual but rather represents only expectations, estimates and/or forecasts about the future and therefore need to be read bearing in mind the risks and uncertainties concerning future events generally.

 
For further information, please contact: 
 
                                                                [phone] 
Strategic Minerals plc                                           965 
John Peters 
Managing Director 
www.strategicminerals.net 
 
Follow Strategic Minerals on: 
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                                                                [phone] 
SP Angel Corporate Finance LLP                                   0470 
Nominated Adviser and Broker 
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Laura Harrison 
 
 

Notes to Editors

Strategic Minerals Plc is an AIM-quoted, operating minerals company actively developing projects prospective for battery materials. It has an operation in the United States of America and development projects in the UK and Australia. The Company is focused on utilising its operating cash flows, along with capital raisings, to develop high quality projects aimed at supplying the metals and minerals being sought in the burgeoning electric vehicle/battery market.

In September 2011, Strategic Minerals acquired the Cobre magnetite tailings dam project in New Mexico, USA, a cash-generating asset, which it brought into production in 2012 and which continues to provide a revenue stream for the Company. This operating revenue stream is utilised to cover company overheads and invest in development projects orientated to supplying the burgeoning electric vehicle/battery market.

In January 2016, the portfolio was expanded with the acquisition of shares in Central Australian Rare Earths Pty Ltd, which holds tenements in Western Australia and the Northern Territory that are prospective for cobalt, gold, nickel sulphides and rare earth elements. The Company has since acquired all shares in Central Australian Rare Earths Pty Ltd. In September 2018, the Company entered contracts for the sale of certain CARE tenements that have been identified as gold targets.

In May 2016, the Company entered into an agreement with New Age Exploration Limited and, in February 2017, acquired 50% of the Redmoor Tin/Tungsten project in Cornwall, UK. The bulk of the funds from the Company's investment were utilised to complete a drilling programme that year. The drilling programme resulted in a significant upgrade of the resource. The 12-hole 2018 drilling programme has been completed and the subsequent resource update was announced in February 2019.

In March 2018, the Company completed the acquisition of the Leigh Creek Copper Mine situated in the copper rich belt of South Australia and is currently working to bring this into operation in 2019.

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact [e-mail] or visit www.rns.com.

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February 18, 2019 02:00 ET (07:00 GMT)