Exploration Programme Progress & Other News
Brancote Holdings PLC
1 February 2000
Contacts: Richard Prickett, Chairman
Bill Humphries, Manager Director
Brancote Holdings PLC 0171 493 1002
David Bick
Holborn Public Relations 0171 929 5599
david_bick@holbornpr.co.uk
BRANCOTE HOLDINGS PLC
Argentine 60% Joint venture - Progress Report on Exploration programme
and
Acquisition and Appointment of Advisers
Highlights
* RESOURCE ESTIMATE - Results from the 1999 drilling programme on the
Galadriel, Elena and Julia deposits take the resource defined to date on the
highly prospective Cordon de Esquel to in excess of 1 Million ozs of gold of
which 75% is in the Measured and Indicated Categories.
* DRILLING RECOMMENCES - Extending Galadriel Sur further south with the first
three diamond core drill holes all intersecting the target vein and GD 63, the
last hole drilled, intersecting mineralisation and veining over 60 metres in
width.
* CANADIAN ACQUISITION - A Heads of Agreement has been signed with Landore
Resources, a Canadian Venture Exchange listed Company, to vend in Brancote
North American properties in exchange for equity and management control.
* APPOINTMENT OF ADVISERS - Brancote also announces the appointments of
Benfield Advisory as an additional financial adviser. Grant Thornton remains
as the nominated financial adviser, and Seymour Pierce as stockbrokers to the
Company. KPMG is appointed as the Company's auditors.
Bill Humphries, Managing Director of Brancote Holdings PLC, said:
'The excellent drilling and exploration success of last year's programme has
provided a sound base from which we believe a world class deposit can be
developed.'
Resource Estimate
In October 1999, Minera El Desquite (M.E.D.) requested Pincock Allen and Holt
(PAH), a leading mine engineering consulting company based in Denver,
Colorado, to produce a resource estimate that could be used by M.E.D. to
evaluate the past year's drilling programme of approximately 9,000 metres that
had defined resources in five deposits namely Galadriel, Galadriel Sur, Elena
Norte, Elena Sur and Julia.
The resource summary reported by PAH is:
Table 1-1
Brancote Holdings PLC
Cordon de Esquel Project
Project Resource Summary
Resource Cutoff Grade Resource Gold Grade
Category Gold gpt Tonnes gpt
Measured 1.0 1,677,000 8.14
2.0 1,220,000 10.64
3.0 1,024,000 12.22
4.0 858,000 13.90
5.0 739,000 15.43
Indicated 1.0 1,288,000 7.59
2.0 901,000 10.22
3.0 740,000 11.91
4.0 615,000 13.62
5.0 549,000 14.74
Inferred 1.0 300,000 4.85
2.0 148,000 8.33
3.0 103,000 10.95
4.0 91,000 11.91
5.0 78,000 13.15
Total 1.0 3,265,000 7.62
2.0 2,269,000 10.32
3.0 1,867,000 12.03
4.0 1,564,000 13.67
5.0 1,366,000 15.02
At 1 gram cut off = 800,000 oz of Gold
M.E.D. had previously acquired the Joya Del Sol property located 3 Kilometres
to the North of the Galadriel Vein in late 1998 on which Sunshine Mining had
carried out a drilling programme that established a
resource of = 206,000 oz of Gold
giving a total combined resource of = 1,006,000 oz of Gold
Due to time restrictions, PAH did not model silver, however by using average
composite silver grades they were able to provide an estimate of 950,000 oz of
Silver at a ratio of 1.2 silver to 1 gold (note 7:1 at La Joya Del Sol)
Highlights of PAH's Resource statement are:
* Due to the relatively close spaced drilling used by MED, 94% of the resource
is in the Measured and Indicated categories
* The Galadriel deposit contains 625,000 ounces of Gold of which the main vein
structure contains 514,000 ounces grading 16,4 g/t.
* 'In the areas sampled by chip-channel samples (the north end of Galadriel
and Julia) excellent potential exists to define additional resource by
drilling. PAH has not defined a significant tonnage of inferred resources
in these areas due to the lack of sufficient data.'
Note:
Galadriel is open both along strike and at depth. Furthermore to the south it
is improving at depth in both grade and width of structure. To date only 520
metres of its known length of 1050 metres has been tested by drilling and
then, only to a vertical depth of 70 metres.
Julia 'The drilled portion of the vein is only 70 metres long (strike 260
metres) and the mineralised intercepts are at a depth of less than 25 metres
below surface. Mineralisation is open both along strike and at depth'.
PAH's scope of work included a review of the geology and data collection used
by MED including mapping, drilling sampling, assaying, quality control
procedures and data base compilation.
PAH report can serve as an independent report prepared by a Competent Person
as defined by the Council of Mining and Metallurgical Institutions in the UK.
On the exploration potential, PAH comments include:
'Exploration and mapping on the concession continues to locate gold
mineralisation, both in vein outcrops and mineralised float samples. This
activity along with results from the initial drilling has identified several
drill targets, the most prominent being the south and north ends of Galadriel
and Julia area.'
'There is a high probability that a significant increase in resources can be
defined by this additional drilling. The exploration potential in these areas
is excellent.'
Year 2000 Drilling programme
Drilling recommenced on 21st January using two UDR 650 multipurpose drilling
rigs supplied under contract by Major Drilling of Canada.
The initial programme for the year 2000 is for 11,000 metres, comprising 3,000
of Diamond core and 8,000 metres of Reverse Circulation, to be completed by
mid May.
The three areas to be drilled are:
1. Galadriel - Extension to the south and the north
- Infill sections
- Parallel structures to the east.
2. Julia/Antonia
3. Galadriel Sur to Gandalf (1,800 metres).
At time of writing the first three Diamond core holes have been completed on a
line 40 metres to the south of section GR 38/59 on Galadriel Sur.
All three holes have intersected the target vein showing increasing width and
competence of structure with depth.
Hole GD 63, the latest hole drilled has mineralisation including veins,
containing brecciated chalcedony replacement textures and adularia, from 43
metres to 103 metres and is similar to the high grade hole GD60 located 80
metres to the north.
Assays are awaited.
Disposal of Non Core Assets
Significant progress has been achieved towards the orderly disposal of
Brancote's non core assets in Australia and North America.
Australia Mount Cuthbert Copper Project (40% Brancote). Heads of
agreement have been exchanged with Murchison United (60% and
Manager) for Brancote to convert its 40% of the Mt Cuthbert
project into a 2% Net Smelter Royalty over all minerals and
metals produced from the properties held by the J.V. as from
January 1st 2001.
Murchison will assume all J.V. liabilities, past present and
future (including environmental) as from January 28th 2000 in
exchange for the grant of 400,000 Brancote Options at £1 per
share.
North America Brancote has entered into a Heads of Agreement with Landore
Resources Inc. of Ontario-Canada, a company listed on the
Canadian Venture Exchange, that Brancote will acquire
approximately 6,000,000 shares in Landore, representing some
25%, in exchange for 40 precious and base metal exploration
properties held by subsidiaries Brancote USA and Canada.
Completion of the proposed transaction is scheduled for mid
April.
The above essentially completes the disposal of Brancote's non core assets
allowing the Directors to now concentrate all efforts and funding towards
advancing the exciting Argentine asset.
The excellent drilling and exploration success of last year's programme has
provided a sound base from which we believe a world class deposit can be
developed.
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