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La Mancha Resources Inc.
(TSX:LMA - News)
RESOURCE INCREASE HIGHLIGHTS:
-- First half of the exploration
program already adds 180,000 ounces of
gold (91,800 ounces
attributable to La Mancha) to M&I resources,
substantially more
than the 150,000 ounces targeted for the entire
program
-- Drill results suggest
mineralization remains thick at depth while
resource remains
open at the limit of current drilling
-- Management expects further
resource growth on completion of the three
remaining drill
platforms
HIGHLIGHTS OF PRELIMINARY DRILL RESULTS:
-- Preliminary results from
second half of drilling campaign returns more
high-grade
intercepts, including:
-- 13.5m @ 8.58 g/t Au with true
thickness of 12.3m
-- 14.5m @ 7.00 g/t Au with true
thickness of 12.1m
-- 16.0m @ 7.14 g/t Au with true thickness
of 9.9m
-- 16.57m @ 6.31 g/t Au with true
thickness of 9.7m
-- Results indicate that new
zones are more highly prospective than those
previously drilled
La Mancha Resources Inc. (TSX:LMA - News) (hereinafter "La
Mancha" or "the Company") is pleased to report that the
ongoing resource delineation program at its 51%-owned Frog's Leg underground
mine in Western Australia has already significantly surpassed its objective,
with more than half of the drilling yet to be factored in. As of September
30, 2010, the Frog's Leg Measured and Indicated resource amounted to 866,000
ounces of gold (441,660 ounces attributable to La Mancha), of which 180,000
ounces (91,800 ounces attributable to La Mancha) are the direct result of the
successful exploration conducted below the first two drill stations installed
at the bottom of the mine. (See Figure 1 of appendix)
Dominique Delorme, President and CEO of La Mancha, noted: "We are
thrilled with the Frog's Leg resource delineation program to date for the
following reasons. First, the objective for the entire program was to add
150,000 ounces of gold to the Frog's Leg resource. With only 45% of the drill
results modelled to date, we have already exceeded that objective. Second,
the drill results received from the second segment of the program continue to
return very interesting intercepts, suggesting that the Frog's Leg resource
will continue to grow in the mine's year-end resource report. However, the
most interesting potential identified to date by our resource delineation
program is the suggestion of the continued thickness of the Frog's Leg
mineralization and the presence of more high grades intercepts at depth.
Should they be confirmed, these two characteristics bode well for the future
of the Frog's Leg deposit as it suggests a continued resource increase. All
these reasons, reaffirm the robust nature of the Frog's Leg deposit, making
us even more confident of further extending the Frog's Leg's mine life by
developing the mine well beyond the current resource envelope."
The aforementioned extensive underground resource drilling program,
aimed at testing the continuity of the Frog's Leg deposit at depth, started
in early 2010. The program involves 35,000 metres of diamond drilling across
the entire 1,200-metre strike length of the deposit. Management anticipates
that this drilling has the potential to extend the mine depth by another 180
metres, and further development of the mine below the 600-metre level looks
probable. The resource extension drilling is being done from five main drill
platforms, as illustrated in Figure 1 of the appendix.
To date, drilling has been completed from the first four drill
stations installed at the bottom of the mine. The new resource statement is,
however, only based on the modeling of the drill results from the first two
drill stations, which corresponds to a total of 15,813 metres drilled, representing
a mere 45% of the total resource drilling program. As shown in Table 1 of the
appendix, the new resource statement includes the drill results published on
August 3 as well as the newly-obtained results.
As illustrated in Figure 1, the resource increase is a result of new
discovery and conversion of areas of Inferred material contained within the
April 2009 Resource Statement. To date, the exploration program has added
180,000 ounces (91,800 ounces attributable to La Mancha) to the Frog's Leg
Measured and Indicated resource, in addition to the 60,000 ounces (30,600
attributable to La Mancha) already identified in the December 31, 2009
resource statement.
The following table shows the new Frog's Leg project resource estimate
on a 100% basis:
Table 1: Comparative Resource Statement
As of December 31, 2009
As of September 30, 2010
-------------------------- ------------------------
Grade Ounces
Grade Ounces
Tonnes (g/t) (oz) Tonnes (g/t) (oz)
--------- ------ --------- --------- ------ -------
Resource Base
Already Defined Resource
Measured
492,000 7.6 121,000 1,002,000 8.2 265,000
Indicated
3,240,000 6.7 696,000 1,865,000 6.0 361,000
Total M&I
3,732,000 6.8 817,000 2,929,000 6.6 626,000
Inferred
143,000 7.1 32,500 94,000 5.6 17,000
---------
------ --------- --------- ------ -------
Resource Extension
Measured
23,000
5.4
4,000 116,000 9.7 36,000
Indicated
304,000 5.7 56,000 1,119,000 5.7 204,000
Total M&I
327,000 5.7 60,000 1,235,000 6.0 240,000
Inferred
1,143,000 5.0 183,000 490,000 4.6 72,000
--------- ------ --------- --------- ------ -------
Total Resource
Measured
515,000 7.5 125,000 1,118,000 7.9 301,000
Indicated
3,544,000 6.6 752,000 2,984,000 5.9 565,000
Total M&I
4,059,000 6.7 877,000 4,164,000 6.5 866,000
Inferred
1,286,000 5.2 215,500 584,000 4.7 89,000
--------- ------ --------- --------- ------ -------
Reported resource figures were calculated using an Au cutoff grade of
3.0 g/t, consistent with the resource estimates reported in the
December 2009 End of Year Statement.
The project's Measured and Indicated resource now stands at 866,000
ounces of gold (441,660 oz attributable to La Mancha) after nearly three
years of sustained mining activity.
Based on the historical conversion of resources to reserves, it is
anticipated that this interim resource increase will result in a one-year
extension of the current mine life. In 2010, more areas of ore development
have opened up with dual parallel drives, while the number of stoping fronts
has increased and a crown pillar has been established for mine stability.
Results to date indicate that there is potential well beyond the
current resource as the extensions and growth areas display geology and grade
consistent with what is seen in previous orebody modelling. Figure 2 of the
appendix indicates a 10-m wide (true thickness) intercept some 200 metres
below the current mine plan, indicating an increase in true width at the
lowest point of drill information. This is more than the current average
thickness seen in the Mist-Rocket Lode. This result demonstrates the robust
nature of the Frog's Leg deposit and the potential for further development of
the mine below the 600-metre level. Drilling to further assess this potential
is planned in 2011.
The impact of the resource extension on mining method will be fully
evaluated during the reserve modelling process once the next resource update
is complete.
PRELIMINARY DRILL RESULTS FOR THE SECOND PORTION OF THE CAMPAIGN
As previously mentioned, the drilling program continued from the
remaining three drill stations at the bottom of the mine. Drilling at
stations 3 and 4 started in July and was completed in early November, with
15,000 metres drilled. A further 5,000 metres is planned and will be drilled
on the fifth extension zone before the end of the year.
The preliminary drill intercepts reported today come from only 15% of
the drill core from stations 3 and 4. These results are shown in Table 1 of
the appendix. The intercepts are characteristic of the widths and grades
already seen around the current Indicated boundary.
Jean-Jacques Kachrillo, VP Exploration of La Mancha, noted that:
"It is important to highlight the significance of these initial drill
results as it confirms our belief that the zones currently being drilled are
more highly prospective than the areas drilled previously. The drill holes
reported here have returned significant grade intersections, confirming the
continuity of the mineralization. Furthermore, drill results suggest that the
mineralization remains thick at depth, under drill stations 3 and 4, as
suggested from the results at the end of this press release. We are
particularly excited about the three drill results received from station 4,
as they all show grades above 6.3 g/t Au over a length of at least 14 metres,
with impressive true thicknesses of 9.7 to 12.1 metres. This continuity of
the mineralization and its continued thickness bodes well, as it indicates
that the Frog's Leg deposit could continue to significantly grow. "
NEXT STEPS
All resource extension drilling from the remaining fifth drill station
is on track to be completed by year-end. Resource modeling for the last three
stations is scheduled for completion in early 2011 and should be included in
the year-end resource update. A new reserve and life-of-mine plan will be
developed following completion of the new resource statement in 2011.
In light of the program's recent exploration success, five deep
exploration holes are budgeted for 2011, targeting mine extensions identified
in the resource model from the 2010 extension drilling program.
ABOUT LA MANCHA AND FROG'S LEG
La Mancha is an international gold producer based in Canada with
operations, development projects and exploration activities in Africa,
Australia and Argentina. La Mancha's shares trade on the Toronto (TSX) under
the symbol "LMA". For more information on the Company, please visit
its website at http://www.lamancha.ca.
QUALITY CONTROL
The updated resource review and estimation conform to the requirements
of NI 43-101 and CIM Best Practices for Estimation of Mineral Resources.
There are numerous uncertainties inherent in estimating mineral reserves,
including many factors beyond the Company's control. Resource estimation is a
subjective process, and the accuracy of any resource estimate is a function
of the quality of available data and engineering and geological
interpretation and judgment. Results from drilling, testing and production,
as well as material changes in metal prices subsequent to the date of an
estimate may justify revision of such estimates. To the best of La Mancha's
knowledge, at the time of estimation there were no known environmental,
permitting, legal, title, taxation, socio-economic, marketing, political or
other relevant issues that would materially impact on the eventual extraction
of the mineral resources.
The drilling program was carried out by, and under the supervision of,
Trevor Eddie B.Sc. (Geol.) MAusIMM, Geology Manager of La Mancha Australia.
The program was conducted in accordance with industry best practice
standards.
La Mancha has established an Analytical Quality Assurance Program to
control and assure the analytical quality of assays in its gold exploration.
This program includes the systematic addition of blank samples and internal
material references ("standards") to each batch of samples sent for
analysis. Blank samples are used to check for possible contamination in
laboratory, while standards determine the analytical accuracy. All samples
are half NQ diamond drill core sampled based on geological intervals..
Samples utilized for the resource update comprise half NQ2 diamond drill
core. Samples were assayed at SGS Australia, Kalgoorlie, using a 50 g fire
assay, followed by solvent extraction and flame AAS.
The Frog's Leg geological re-interpretation was completed by La Mancha
Australia staff under the supervision of Trevor Eddie, and the block model,
including the building of the wireframes for the model, resource estimation
and classification was undertaken Trevor Eddie B.Sc. (Geol.) MAusIMM, Geology
Manager, also of La Mancha Australia. Mr. Eddie has sufficient experience in
the resources calculation, the style of mineralization and type of deposit to
qualify as a Qualified Person as defined in the 2005 Edition of
"National Instruments 43-101, Standards of Disclosure for Mineral
Projects". Based on his information, Mr. Eddie has consented to the content
of this press release in the form and context in which it appears. He has
read National Instrument 43-101 of the Canadian Securities Administrators
("NI 43-101") and has ensured that this press release has been
written in compliance with the Instrument.
FORWARD-LOOKING STATEMENTS
This press release contains certain "forward-looking
statements", including, but not limited to, the statements regarding the
quantity of mineralization in place, particularly in numbers of ounces of
gold, the mineable character of the drill results, mining exploration risks,
estimation and evolution of mineral resources, potential for resources
additions (in particular the possibility of converting a portion of the
resources into proven and probable reserves), statements regarding extending
mine life and at-depth mining, future work programs and objectives associated
therewith, drilling targets and anticipated results, statements regarding the
prospective level of the three remaining drill stations, interpretation of
work results and anticipated timetables. Forward-looking statements express,
as at the date of this press release, the Company's plans, estimates,
forecasts, projections, expectations or beliefs as to future events and
results. Forward-looking statements involve a number of risks and
uncertainties, and there can be no assurance that such statements will prove
to be accurate. Therefore, actual results and future events could differ
materially from those anticipated in such statements. Risks and uncertainties
that could cause results or future events to differ materially from current
expectations expressed or implied by the forward-looking statements include,
but are not limited to, factors associated with fluctuations in the market
price of precious metals, mining industry risks, risks associated with
foreign operations, environmental risks and hazards, uncertainty as to
calculation of mineral reserves and other risks referred to in La Mancha's
2009 Annual Information Form filed with the Securities Commissions of all
provinces in Canada, as well as the Toronto Stock Exchange.
The complete press release can be downloaded from the following link: https://irdirect.companynewsgroup.com/documents/PJ/CO/2010/171715_88_GKBN_11-22-September-2010-Resource-Update-Vf.pdf
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