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Last updated on April 17, 2014 at 15:32 EDT

DPM Exploration Drilling Continues to Confirm Potential for Bulk Mineable Open Pit Polymetallic Mineralization at Shahumyan Mine, Kapan, South East Armenia

September 4, 2008

TORONTO, ONTARIO–(Marketwire – Sept. 4, 2008) – Dundee Precious Metals Inc. (TSX:DPM)(TSX:DPM.WT) (the “Company” or “DPM”) announced that the initial program of diamond drilling results in the ‘Vein 5′ area in the north western part of the Shahumyan Mine at Kapan, Armenia, continues to confirm the potential for bulk mineable polymetallic open pit mineralization.

“We acquired Kapan for its world class polymetallic deposit potential. Our exploration team is working hard to advance this project in the shortest timeframe and I am very encouraged by these drilling results which represent less than 3% of the total deposit footprint that we are planning to test,” said Jonathan Goodman, President and CEO.

HIGHLIGHTS

– Diamond drill results have been returned from the initial 40m by 40m spaced drill program in the Vein 5 area at Shahumyan, which has been tested for a potential ‘starter’ pit to supplement underground ore for the Kapan milling facility

– Numerous wide polymetallic intercepts have been returned over the entire 600m strike length that has been drill tested to date. Many holes have multiple intercepts.

MAIN INTERCEPTS

Table 1 highlights key intercepts.

In situ gold equivalent (“AuEq”) grade is based on the following DPM long term metal price assumptions: Au: US$850/oz, Ag: US$16/oz, Cu: US$2.50/lb, Zn: US$1.00/lb.

BACKGROUND

The Kapan mining area is located in the south eastern corner of Armenia, 320 km south of the capital city of Yerevan and forms part of the Tethyan tectonic belt which extends from south east Asia to Europe and is one of the most strongly mineralized belts on earth. The belt contains world class porphyry copper-gold, polymetallic vein array and epithermal gold-silver deposits, and is host to the Chelopech deposit in Bulgaria and the Bor deposits in Serbia. Figure 1 shows the location of the Kapan mine.

The Kapan mine consists of two parts, a copper deposit known as Centralni and a polymetallic deposit of copper (Cu), gold (Au), silver (Ag), zinc (Zn) and lead (Pb). Production from the Centralni deposit started in the 1950s, initially from underground and then from both underground and an open pit, and records indicate that more than 30mt at approximately 1.3% Cu have been extracted to date.

The Shahumyan polymetallic vein array was first discovered in the early part of the 20th century and was briefly exploited on a small scale during World War II. Detailed exploration of the Shahumyan deposit commenced in 1976 and to date at least 280,000m of diamond drilling and over 33,000m of underground access development from adits on the 700m, 780m, 820m and 860m levels have been completed. Below the 700 level short exploration drives have been completed at the 605m and 505m levels. The bulk of the historical surface and underground exploration drilling has been conducted to the 550m mine level which is approximately 370m below the ground surface. The mineralization at Shahumyan occurs in altered dacite, andesite and basaltic host rocks. The main ore minerals are chalcopyrite, sphalerite and minor galena, along with gold and silver. Mineralization styles include massive sulphide veining, stockwork and network veining and disseminated styles.

To view Table 1, please visit the following link:

http://media3.marketwire.com/docs/duntab1b.pdf

An underground mining operation is currently being carried out at Shahumyan and two clean, readily saleable concentrates are produced, a copper-gold-silver and a zinc-silver-gold, which are transported by road and rail to the Black Sea for export.

In order to collect the data required to complete a National Instrument 43-101 (“NI 43-101″) compliant resource estimate, DPM has purchased three diamond drill rigs and three reverse circulation (“RC”) drill rigs and is in the final stages of equipping and commissioning a new assay facility, to be independently managed by SGS. In addition, all the extra equipment required to support a large drilling program have been put in place. To date, three diamond rigs and one RC are operational. A second RC rig is due to begin operations shortly, followed by the final RC rig.

RESULTS FROM THE DPM MANAGED DIAMOND DRILLING PROGRAM

A zone in the north west quadrant of the Shahumyan deposit, termed the Vein 5 Area, has been chosen for the first ‘starter pit’ drilling programme. A 600m long zone has been drilled out, firstly using an 80m by 80m collar pattern with a follow-up drill spacing of 40m by 40m. A total of 77 diamond drill holes for some 12,832.6 metres comprise the current program being reported on. Samples are collected using a 1m interval and the full standard set of DPM sampling and QAQC procedures have been employed throughout the drilling programme, including the submission of international standards in the assay sequence.

Until the full assay facility is commissioned at Kapan (the laboratory is currently undergoing initial commissioning), samples have been despatched for assay at the SGS managed laboratories in Perth, Western Australia, China and Chelopech in Bulgaria.

Figure 2 displays a plan view of the historical data set, as 5m composites, displayed in red, whilst the current DPM drilling data, also as 5m down hole composites, are displayed in yellow. Visible composites in Figure 1 return an in situ value of greater than $12 per tonne, using long term metal price assumptions of $850/oz for gold, $16/oz for silver, $2.50/lb for copper and $1.00/lb for zinc. A 500m grid is displayed in Figure 2, for scale.

Figure 2 also clearly shows the very large mineralized ‘footprint’ at Shahumyan (approximately 2.5km by 2km). The area drilled to date by DPM represents less than 2.5% of the footprint.

Drill hole collar data is displayed in Appendix 1, whilst a full set of intercepts from the current drill program, based on applying a cut off of $15 per tonne in situ value, a 5 metre minimum intercept length and a maximum consecutive waste interval of 5 metres, is displayed as Appendix 2.

Figure 3 shows a typical drill cross section, showing 5 metre down hole composites, colour coded by in situ value, using the above metal prices (north-south section, looking west, on 8623150E). The drill hole names are annotated in Figure 3 as numbers, for clarity (for example, hole SHDDR0028 is represented as ’28′). A 100m grid is displayed for scale. The colour scheme of the in situ values in Figure 3 is as follows:

– Less than $10/tonne (‘t’): Dark blue

– $10/t to $15/t: Light blue

– $15/t to $20/t: Green

– $20/t to $30/t: Yellow

– $30/t to $50/t: Red

– Greater than $50/t: Magenta

The multiple broad zones of mineralization, surrounding the ‘Veins,’, which have traditionally been the subject of underground mining, are clearly visible.

The drilling results to date are considered extremely encouraging for the development of a major large tonnage polymetallic deposit suitable for large scale open pit mining, considering that less than 2.5% of the total mineralization ‘footprint’ at Shahumyan has been tested by the DPM drilling being reported.

The assay data set, along with detailed geological and structural interpretations, surface topographic surveys and other necessary information is being compiled in order that an independent NI 43- 101 compliant report can be completed. The resultant resource block model will be used as the data source for pit optimization, pit design and scheduling studies in order to determine the location of a ‘starter’ pit to supplement the underground ore currently being used as the feed source for the processing facility at Kapan.

An intensive drilling programme, using multiple diamond and RC drill rigs, is underway in order to continue to drill out the foot print of the Shahumyan polymetallic deposit.

Dr. Julian F. H. Barnes, a qualified person under NI 43-101 and Executive Vice President of DPM, has supervised the preparation of the technical data included in this press release.

Dundee Precious Metals Inc. is a Canadian based, international mining company engaged in the acquisition, exploration, development and mining of precious metals. It currently owns the Chelopech Mine, a producing gold/copper mine, and the Krumovgrad Gold Project, a mining development project, both located in Bulgaria, and is engaged in mineral exploration activities in Serbia. In addition, Dundee Precious owns the Back River gold exploration project in Nunavut, Canada and a 95% interest in the Kapan Mine in Armenia.

FORWARD LOOKING STATEMENTS

This news release may contain certain information that constitutes forward-looking statements. Forward-looking statements are frequently characterized by words such as “plan,”"expect,”"project,”"intend,”"believe,”"anticipate” and other similar words, or statements that certain events or conditions “may” or “will” occur. Forward-looking statements are based on the opinions and estimates of management at the date the statements are made, and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking statements. These factors include the inherent risks involved in the exploration and development of mineral properties, the uncertainties involved in interpreting drilling results and other geological data, fluctuating metal prices and other factors described above and in the Company’s most recent annual information form under the heading “Risk Factors” which has been filed electronically by means of the Canadian Securities Administrators’ website located at www.sedar.com. The Company disclaims any obligation to update or revise any forward- looking statements if circumstances or management’s estimates or opinions should change. The reader is cautioned not to place undue reliance on forward-looking statements.

To view Figures 1, 2 and 3, please visit the following link:

http://media3.marketwire.com/docs/dunpicsb.pdf

To view Appendix 1, please visit the following link:

http://media3.marketwire.com/docs/dunapp1.pdf

To view Appendix 2, please visit the following link:

http://media3.marketwire.com/docs/dunapp2.pdf

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