Macarthur Minerals Limited: Lake Giles, Western Australia, Magnetite Iron Ore Resources Estimate Update, Increase of 40%
VANCOUVER, BRITISH COLUMBIA–(Marketwire – June 16, 2008) – Macarthur Minerals Limited (TSX VENTURE:MMS) today advises that it has received an updated resource estimate from Hellman & Schofield Pty Ltd (“H&S”) for the Lake Giles magnetite iron ore project in Western Australia.
Since H&S estimated the resources, and compiled a NI 43-101 Technical Report for the project in October 2007, Macarthur has drilled a further 21 RC holes, and five diamond holes in the Clark Hill North area. The diamond holes have not yet been assayed, and are not included in the resource update.
For the resource update, the Company supplied H&S with a drill hole database comprising collar location, downhole survey, and geology logs. Analytical data for mineralised portions of these holes include Davis Tube concentrate results which measure the proportion of sample extractable by magnetic separation. Material concentrated by the Davis Tube test was assayed by X-Ray fluorescence (XRF) for iron and other elements of interest.
Updated resource estimates have been produced for Clark Hill North using a simple polygonal approach, consistent with the 2007 estimates. This estimation methodology was adopted due to the broad and irregular drill spacing. More stringent estimation methodologies such as block Kriging will be considered after future, more closely spaced drilling. Estimates for the other mineralised domains at Lake Giles have not been updated.
The H&S updated resource estimates show an increase in the estimated resource of approximately 40%. (This is an increase of approximate 40% over the original NI 43-101 compliant resource estimate in August 2007 of 82.5 million tones of magnetite iron ore.) The updated resource estimate is shown in Table 1. Estimates for the Clark Hill South domain include chromium concentrate grades of potential economic interest. Chromium grades are not reported for the other domains or for the total resource. Table 2 compares the current estimates with the previous resource estimate. The resources are reported from estimates within the interpreted magnetite zones, rather than at a nominal iron cut off grade. They are based on drill hole intersections of significant magnetite mineralization as identified by the Company’s geologists.
In addition to the Inferred Mineral Resource estimate shown in Table 1, broadly spaced drill holes suggest the presence of mineralisation with exploration potential in the Lake Giles area of 25 to 50 million tonnes, representing approximately 7 to 14 million tonnes of magnetic concentrate. This potential mineralisation has had insufficient exploration to define a Mineral Resource, and the estimates of tonnage are conceptual in nature. It is uncertain that further drilling will convert any of the exploration potential to a Mineral Resource.
Drilling has not yet defined the extents of the Lake Giles magnetite mineralization. There is potential for substantial additional mineralization, particularly in the Clark Hill North area which has currently been drill tested by only scattered, very broadly spaced drill holes. Not even conceptual tonnage estimates are currently possible for this mineralization.
Table 1: Lake Giles Inferred Mineral Resource Estimates ——————————————————————– —— ______________Resource__________________Magnetic Concentrate __________ Tonnes____Fe__ Tonnes____Fe Al2O3__SiO2____ P__ MgO____ S__ LOI Domain____Million____ %__million____ %____ %____ %____ %____ %____ %____ % ——————————————————————– —— Snark________26.3__27.5____ 5.92__64.3__0.15__ 9.6__0.03__0.33__0.27__-2.5 Clark Hill North______ 37.1__26.0____ 10.4__61.9__0.14__11.9__0.03__0.81__0.25__-2.4 Subtotal: Cr poor____ 63.4__26.6____ 16.3__62.8__0.14__11.1__0.03__0.64__0.26__-2.4 Clark Hill South______ 48.5__21.9____ 10.1__61.8__0.18__10.7__0.04__1.89__0.22__-2.2 ——————————————————————– —— Total________ 112__24.6____ 26.4__62.4__0.16 10.93__0.03__1.12__0.24 -2.35 ——————————————————————– —— (rounding errors may occur) Table 2: Comparison of current and 2007 Lake Giles Inferred Mineral ________ Resource ——————————————————————– —- ______________________Estimate Resource__________Magnetic Concentrate Estimates________Tonnes (Million)____ Fe%______ Tonnes (Million)______Fe% ——————————————————————– —- 2007________________________82.5____24.6__________________ 18.5____ 63.1 2008________________________ 112____24.6__________________ 26.4____ 62.4 ——————————————————————– —- Difference____________________36%__ – 0.3%____________________43%____-1.0% ——————————————————————– —- (rounding errors may occur) Notes: – Magnetite mineralisation at Clark Hill North is interpreted to comprise __steeply north, and east dipping zones associated with banded iron __formation (BIF) and ultramafic rocks. The current resource estimates __extend from the base of oxidation to generally 180 to 200 metres below __surface dependent on local drill hole coverage. – Drill hole coverage of the Clark Hill North area is widely and __irregularly spaced, with spacing between drill holes varying from __approximately 25 metres to more than 600 metres. – Validity of the drill hole database, and quality of the sampling and __assaying for pre-October 2007 drilling was assessed and reported in the __NI43-101 Technical report. H&S considers this data is suitable for the __basis of estimates of Inferred Mineral Resources. – For the recent drilling, H&S confirmed the validity of database __analytical result entries by comparing them to supplied laboratory __source files, but have made no other checks of the database validity __or assessment of sampling and assay quality. – H&S accepts responsibility for classifying the current resource __estimates as Inferred. Macarthur accepts responsibility for the quality __of the post October 2007 drilling and sampling data, for the geological __interpretation used for estimation, and for the project’s potential __economic viability.
Mr. Jon Abbott, MAusIMM, who is a full-time employee of H&S and is an Independent Qualified Person, has reviewed and approved the above technical information relating to resource estimates contained in this release.
The updated estimates include RC drilling completed up to Stage 4. The Stage 5 drill program, which focused on the Sandalwood Project area, was completed on June 9, 2008, for a further 25 RC holes, totaling 5,653 meters. All samples from this program have now been submitted for Davis Tube testing which will allow for a further resource update.
No assessment of the exploration potential has been made for the unexplored Deep South area. Two drill rigs are expected to commence work on the Deep South area this week.
LPD Holdings (Aust) Pty Ltd acquired 30% of the Lake Giles Project through its C$10 million investment interest in the Company’s wholly-owned subsidiary, Internickel Australia Pty which was formalized in a Shareholder Agreement with the Company on 28th April 2008. LPD now has the option to acquire a further 50% of Internickel if a resource of 500 million tonnes is estimated by September 30, 2008. To satisfy this requirement within the agreement, the tonnage estimate does not have to comply with NI 43- 101 standards for resource estimates.
Macarthur Minerals remains committed to distributing the majority of the $C100 million investment by LPD (after income tax), to Shareholders as a special dividend. The due date for LPD to purchase its additional interest is 30th September 2008.
Mr. Nick Revell, BSc, a member of AusIMM, and a Company director, is a Qualified Person as defined in National Instrument 43-101 Standards of Disclosure for Mineral Projects (“NI 43-101″), in charge of the exploration on the Lake Giles project.
On behalf of the Board of Directors,
MACARTHUR MINERALS LIMITED
David K. Barwick, President, Chairman & CEO
This news release contains “forward-looking statements” regarding ongoing and upcoming exploration work and anticipated resource estimates. Actual results could differ from those projected in any forward-looking statements due to numerous factors. Such factors include, among others, the inherent uncertainties associated with mineral exploration and development stage exploration companies. Although management believes that statements contained in this press release are reasonable, actual results may differ materially from those anticipated in these statements.
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