Mount Oxide Copper and Cobalt Project - Drill Program and Results

 

Drill hole MOXD105 was targeted to investigate continuity around recently released high grade intercepts from MOXD089 (which included 23m at 8.9% copper from 395m) and to understand the geology and plunge of mineralisation.  The hole was drilled immediately south of the MOXD089 intercepts within approximately 90m and has intersected a long interval with a number of high grade copper zones (Figures 1 and 2).

 

The mineralised sediments with coarse chalcocite and bornite mineralisation correlate well with the other intercepts in the area  Higher grade silver is also noted in these deeper zone. The intercepts are interpreted to be oblique to the mineralisation and interpreted to be at least 60% of true thickness.

 

The significant intercepts from MOXD105 include (Table 1):

?           8m at 0.9 % copper and 0.12 % cobalt from 256m,

?         13m at 3.2 % copper from 280m,

?         13m at 3.8 % copper from 297m,

?         16m at 5.4 % copper and 49 g/t of silver from 329m.

 

These results from MOXD 105 follow the recent release of results from MOXD104 (on 18 August 2008), which included 12m at 15.3 % copper and are further confirmation of the continuity and the higher grades of silver being reported at depth.

 

Details on the results of MODX89 were announced to the ASX on 5 June 2008 and details of MODX104 were announced to the ASX on 18 August 2008.

 

A number of significant zones of cobalt mineralisation are noted which do not directly correlate with the high grade copper zones.  The distribution of the cobalt is spatially associated but distinct to the higher grade copper.  A number of long intervals of very significant cobalt have been reported.  Intersections based on a 0.1 % cobalt cut-off have included (Table 2):

?         MOXD 87              17m at 0.37 % cobalt and 0.1 % cooper from 152m,

?         MOXD 88              36m at 0.23 % cobalt and 1.0 % cooper from 187m,

?         MOXD 89              20m at 0.34 % cobalt and 6.4 % cooper from 259m,

?         MOXD 91              48m at 0.36 % cobalt and 1.0 % cooper from 149m,

?         MOXD 93              22m at 0.26 % cobalt and 1.0 % cooper from 79m,

 

Detailed assessment of these cobalt rich zones is underway and will be incorporated into a new resource calculation when the current drilling program has been completed.  These values are considered especially important for the commercialisation of a stand-alone operation.

 

Mount Oxide Copper and Cobalt Project ? Preliminary Metallurgical Testwork

 

Initial metallurgical testwork conducted by AMMTEC indicates favourable recoveries of

?                                 Copper               90 %

?         Cobalt                50-60%

?         Silver                 75%

for a range of economic grade samples tested:

 

Figure 1.  Mt Oxide Resource Drill Section 70700Mn, looking north with resource model and MOXD105 drill holes.   

 

Figure 2.  Location Plan of drill holes at Mount Oxide deposit with new holes reported.

 

 

Table 1.  Mount Oxide Drill Results, 0.5 % Copper (?Cu?) cut off, Maximum Internal Dilution 2m, >3 m%

Table 2.  Mount Oxide Drill Results, 0.1 % Cobalt (?Co?) cut off, Maximum Internal Dilution 2m,

 

Background to the Mount Oxide Project

(100% owned)

The Mount Oxide project is located in the Mount Isa region Western Succession that includes several major sediment hosted breccia copper deposits. The deposit was intermittently mined between 1920 and 1971 by way of a small open pit and underground operation. The project lies 25 kilometres north of the existing Mount Gordon mine operated by Aditya Birla Minerals Limited.

 

The deposit is a chalcocite dominated system associated with strong silica-hematite alteration and copper mineralisation developed on the margins of the hematite core.  The mineralisation is hosted in a sedimentary package associated with a strong structural control along the northeast trending Mount Oxide fault and associated cross cutting faults.

 

 

Competent Person Statement

 

The information in this report that relates to Exploration Results and Mineral Resources is based on information compiled by Mr. Bruce G.D. Hooper who is a full-time employee of the company and is a member of the Australian Institute of Geoscientists. Bruce Hooper has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the ?Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves?. Bruce Hooper consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

 

Background to Perilya

 

Perilya Limited is an ASX 200 Australian base metals mining and exploration company. Perilya is investing in the development of its three major projects located in the Broken Hill, Mt Isa and Flinders regions as well as exploration in the surrounding tenements.

 

For more details, visit www.perilya.com.au

 

 

______________________________________________________________________________________________________________________________________________________

 

ASX and Media Release

 

18 August 2008

Further High-Grade Copper and Silver intercepts at Mount Oxide

Perilya Limited (ASX: PEM) is pleased to announce continued exploration success from drilling at the Mount Oxide copper and cobalt project in the Mt Isa region in Queensland.

Perilya?s latest round of drilling has confirmed further highly encouraging high grade copper and silver intercepts that extend at depth and below the current resource.

The high grade intercepts returned from deeper drilling in drill hole MOXD104 (Figure 1) included:

?         17m at 4.2 % copper from 248m,

?         32m at 4.5 % copper (uncut) from 287m,

?         12m at 15.3 % copper (uncut) and 161 g/t of silver from 345m.

MOXD104 was drilled approximately 30 metres south of drill hole MOXD089, which previously reported (5^th June 2008) drill intercepts including 31m at 6.2% copper from 346m and 23m at 8.9% copper from 395m.

Perilya?s Executive Chairman, Patrick O?Connor, said our new drilling results, which included 12m at 15.3% copper from 345m, were primarily below the current resource. They also further demonstrate the continuity of mineralisation along replaced sedimentary horizons and the excellent potential at depth.

?A further hole MOXD105 has also intercepted good visual mineralisation 90m south of the initial intercept and results are pending.?

?All these results bode well for the commercialisation and development process, which has commenced, with a number of overseas and Australian parties formally expressing interest in participating in the further development of the Mount Oxide copper and cobalt project either in partnership with Perilya by way of joint venture, or through outright purchase of the project.?

?The continuation of the high grade zones at depth and outside the current resource adds to the project and further demonstrates its potential,? he added..

Mount Oxide Copper and Cobalt Project - Drill Program and Results

 

In April, a program of diamond drilling commenced with two rigs targeting extensional mineralisation to the north and at depth of the current Mount Oxide resource.

 

Drill hole MOXD104 was targeted to investigate potential at depth around the recently released high grade intercepts from MOXD089 and to understand the geology and plunge of mineralisation.  Hole MOXD104 was drilled immediately south of the MOXD089 intercepts within approximately 30m and at a slightly higher elevation and has intersected replaced sedimentary horizons with strong hematite alteration associated with a structurally complex zone.

 

Mineralisation is hosted in brecciated sediments and consists of coarse veins of bornite and chalcocite.  The high grade zone is interpreted to be a structural intersection at depth off cross cutting structures and a parallel structure to the main mineralised fault.  Lower grade zones between contain strong haematite alteration.  The high silver grades are also of significant interest in this deeper zone. The intercepts are interpreted to be oblique to the mineralisation and interpreted to be at least 60% of true thickness.

 

The significant intercepts from MOXD104 include:

?         17m at 4.2 % copper from 248m,

?         32m at 4.5 % copper (uncut) from 287m,

o        which includes 1m @ 21.3 % copper from 306m, and 2m at 24.3 % copper from 312m,

?         12m at 15.3 % copper (uncut) and 161 g/t of silver from 345m

o        which includes 5m at 33.0 % copper from 345m

Previously reported (5^th June 2008) significant intercepts from drill hole MDOX089, include:

?         22m at 6.3 % copper and 0.3 % cobalt from 258m

?         19m at 3.7 % copper from 315m

?         31m at 6.2 % copper from 346m

?         23m at 8.9 % copper from 395m

 

Further follow up drilling at depth is also providing significant encouragement with recent hole MOXD105 intersecting good visual mineralisation approximately 90m south of the MOXD89 intercept in a similar geological setting again demonstrating a plunge direction and continuity at depth, the results are still pending.

 

Results are also reported from holes drilled north and above the MOXD89 intercept that contained only altered zones demonstrating the geological complexity in the zone.

 

These mineralised copper zones at depth are outside of the current resource, which is very encouraging for the addition of significant high grade resources at depth.

 

A track mounted rig has recently arrived on site and is testing some of the steep topographic zones north of the planned open pit to test at shallow depth below outcropping copper mineralisation.  Good visual mineralisation has been noted during logging with the results still pending from this drilling.

Figure 1.  Mt Oxide Resource Drill Section 70800Mn, looking north with resource model and MOXD089 and MOXD104 drill holes.   

Figure 2.  Location Plan of drill holes at Mount Oxide deposit with new holes reported.

Table 1.  Mount Oxide Drill Results 0.5 % Cu cut off, Maximum Internal Dilution 2m, >3 m%. No cut

 

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Issued by

Purple Communications

Level 3, 28 Kings Park Road, WEST PERTH WA 6005

Ph: 08 9485 1254     Fax: 08 6263 0455

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