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Erris Resources PLC (ERIS)

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Thursday 21 December, 2017

Erris Resources PLC

First Day of Dealings

RNS Number : 9851Z
Erris Resources PLC
21 December 2017

Erris Resources Plc / EPIC: ERIS.L / Market: AIM / Sector: Mining

21 December 2017

Erris Resources Plc ('Erris' or 'the Company')

First Day of Dealings on AIM


Erris Resources Plc, the European focused mineral exploration company with a portfolio of zinc prospects in Ireland and gold projects in Sweden, is pleased to announce that its ordinary shares will start trading on AIM at 8.00 a.m. today under the ticker ERIS.L ("Admission").  As part of the Admission process, the Company has raised £4 million, before expenses, through a Placing of 16,000,000 new ordinary shares at a placing price of 25 pence each implying a market cap of £7.8 million on Admission. 


The Company's Nominated Adviser is Allenby Capital Limited and its Joint Brokers are Shard Capital Partners LLP and Turner Pope Investments (TPI) Ltd.



·     Raised £4 million before expenses to develop what the directors consider to be a highly prospective portfolio of zinc assets in Ireland and gold projects in Sweden and to identify and acquire additional exploration opportunities that have potential to significantly re-rate though exploration

·     Strategy to create shareholder value through early generative exploration and discovery and advance projects via joint venture and industry partnerships

·     Industry backing at company and project level: Osisko Gold Royalties, has invested £1.47 million in the placing to become a 18.9% shareholder; and Centerra Gold has a Strategic Alliance with Erris to explore a portfolio of gold properties within a common Area of Interest in northern Sweden

·     Dynamic work programme planned with regular news flow from drilling reports and results, mapping, sampling and petrographic studies across key projects:

Abbeytown - a high grade, shallow, district-scale zinc exploration target in a proven mineral district in County Sligo, Ireland - 5,000-metre drill programme beginning Q1 2018

Brännberg - a large-scale gold target with historic drill results and high-grade float in the Skellefteå mining district, northern Sweden - geophysical surveys to be completed prior to drilling

Klippen - a gold project in northern Sweden, in which Centerra Gold has made an election to invest $1m (the first $0.4m of which has already been invested) to earn 51% - ongoing drilling

Käringberget - a silver, gold, copper and zinc project in Sweden with known deposits and in which Centerra Gold has made an election to invest $1m (the first $0.4m of which has already been invested) to earn 51% - ongoing drilling

·     Focus on building pipeline of base or precious metal exploration assets in proven mineral districts and in favourable European jurisdictions

·     Strong market fundamentals

Zinc in a period of sustained supply deficit, while demand continues to grow - Ireland represents a supportive jurisdiction with large scale historic zinc production

Gold likely to remain well supported in current economic climate given its 'safe haven' status

·     Led by a highly qualified team with proven experience and track record of discovery, resource delineation, joint ventures and trade sales


Erris CEO, Merlin Marr-Johnson, said, "Exploration is the lifeblood of the resource sector, yet in recent years discovery rates have collapsed as discretionary spending by mining companies on exploration has dried up.  As primarily a discovery-driven exploration company with a focus on zinc and gold, we aim to delineate resources that contribute to the next generation of mines.  To this end, we have a portfolio of highly-prospective mineral assets, an experienced team, and the support of two significant industry partners with strong balance sheets, Osisko Gold Royalties and Centerra; these companies have endorsed both our business model and team, and recognise our potential to make commercial discoveries.  Furthermore, we are operating in a great space, exploring for key commodities in pro-mining regions within low-risk jurisdictions. As we embark on multiple drilling programmes during 2018, I look forward to updating shareholders regularly throughout the year."


For further information and the full Admission document, visit or contact:


Merlin Marr-Johnson

Erris Resources plc

+44 (0) 7803 712 280

David Hart/Liz Kirchner

Allenby Capital (Nominated Adviser)

+44 (0) 20 3328 5656

Damon Health / Erik Woolgar

Shard Capital (Joint Broker)

+44 (0) 20 7186 9952

Andy Thacker

Turner Pope Investments (TPI) Ltd (Joint Broker)

+44 (0) 20 3621 4120

Hugo de Salis/Gaby Jenner

St Brides Partners (Financial PR)

+44 (0) 20 7236 1177






Erris Resources was established in 2012 as a mineral exploration and development company. It was initially set up with the aim of exploring the northwest of Ireland for gold and base metals and has subsequently expanded into Sweden with a funded exploration programme with Centerra, pursuant to the Centerra JV agreement.


In Ireland, six contiguous prospecting licences totalling 159 km² in area were applied for by Erris Resources direct from the Ministry for Communications, Energy and Natural Resources in 2013. The Abbeytown Project consists of these six licences and includes the historic Abbeytown deposit as well as three separate, exploration targets in the 15 km to the west of the town of Ballysadare. The Abbeytown Project is 100 per cent. owned by Erris Resources and is subject to a 1 per cent. net smelter return royalty to Osisko (a company listed on the TSX with a market capitalisation of approximately C$2.5 billion). The principal target of the Abbeytown Project is economic zinc mineralisation, with ancillary lead, silver and copper potential.     


In 2016, Erris Resources entered into a strategic alliance with Centerra, a wholly owned subsidiary of Centerra Gold Inc., a TSX listed gold and copper producer with a market capitalisation of approximately C$2.2 billion, over a defined Area of Interest ("AOI") of 65,796 km² in Northern Sweden. Erris Resources has rights granted or pending over licences covering 313 km² within Centerra's AOI. Under the terms of the Centerra JV Agreement, Centerra is currently funding an on-going annual generative programme to develop a pipeline of projects through area selection, permit application and then ongoing exploration work. The principal target is economic gold mineralisation. Erris Resources manages the exploration programmes and Centerra has a one-off right to elect to farm-in to selected "Designated Project Areas" ("DPAs"). Under the terms of the Centerra JV Agreement, for each DPA which is elected, Centerra can elect to spend US$1,000,000 on further exploration and development at that DPA to earn a 51 per cent. interest in the DPA over two years, and has the option to earn a further 19 per cent. by investing a further US$2,000,000 over the subsequent two years, to reach 70 per cent. in total. Erris Resources has rights granted or pending over 18 licences in seven separate project areas, each at different stages of technical development. The three most advanced projects are Klippen, Käringberget and Brännberg. Centerra has made elections in respect of Klippen and Käringberget and is expected to invest US$1,000,000 in each project over two years to earn 51 per cent., which started with two US$400,000 drilling programmes in the second half of 2017. Results from these drilling progammes are pending, and are anticipated to be ready for release in January 2018. Following a site visit and visual inspection of the drill core, Centerra has confirmed that it intends to invest the remaining US$600,000 in each DPA in 2018. Work at Klippen is likely to consist largely of drilling. At Käringberget, drilling will resume after a number of geophysical surveys are carried out. The Brännberg project in northern Sweden is 100 per cent. owned by Erris Resources and hosts gold mineralisation in historic drilling. It is a high priority target for Erris Resources and accordingly it plans to carry out geophysics, sampling and drilling at Brännberg during 2018. The exploration permits in Sweden are all subject to a 1 per cent. net smelter return royalty to Osisko (regardless of whether Centerra takes any ownership interest in the relevant DPA) and the exploration permit known as Grundträsk nr 7 is also subject to a 1 per cent. net smelter return royalty to Beowulf and a 1 per cent. net smelter return royalty to Scanex and Mirab.


Investment Case

The Directors believe that significant shareholder value can be created through the process of discovering new ore deposits. Well-managed exploration success finding commercially viable deposits can create capital value even in a period of weak metal prices. The Directors believe that Erris Resources is specifically configured in a way that maximises the chance of making commercial discoveries in an efficient manner. The key components of the Erris Resources discovery model are as follows:


1.    Technically-led team

The Directors and senior management team have significant exploration and capital markets expertise, with a track record of deposit discovery from first principal through to resource definition and technically de-risking assets, advanced studies and mine development. In addition, the team has a corporate record of public company management, mergers and acquisition, trade sales, joint ventures and strategic alliances.


2.    European jurisdictions

The Erris Resources portfolio comprises mineral licences in areas with proven metallogenic potential, an active mining industry, and transparent permitting processes. Erris Resources has a zinc project in Ireland and gold projects in Sweden, countries that rank highly in the Mining Journal, World Risk Report 2017. Ireland scored '74', Sweden scored '81' and Sweden was the only non-North America jurisdiction to register a AAA rating. New targets in Europe are currently being assessed.


3.    Prospective Property Portfolio

The current portfolio includes the Abbeytown Project, a 15km trend of discrete lead-zinc-silver prospects, barely explored since the 1980s, wholly reinterpreted after several years of fieldwork, systematic data integration and fresh geological thinking, centred on the historic Abbeytown deposit. In Sweden, Erris Resources has a portfolio of gold and polymetallic projects in northern Sweden.


4.    Dynamic Work Programme

Several drilling campaigns are planned for 2018, starting with an initial 5,000m exploration programme at the Abbeytown Project, Ireland. In Sweden, diamond drilling is expected to continue at Klippen (gold) and then at Käringberget (zinc-copper-gold), under the terms of the Centerra JV Agreement. Brännberg will also be advanced, with geophysical surveys completed prior to drilling. Company news flow from mapping, sampling, petrographic studies on these and other projects will supplement drilling reports and results.


5.    Industry Backing

The Company's discovery model is validated by support from industry partners both at a project level and at the corporate level. Osisko, a TSX listed precious metal royalty and stream company with a market capitalisation of approximately C$2.5 billion, has a 1 per cent. royalty on the Abbeytown Project and Erris's Swedish licences and has invested £1,469,000 in the Placing, an amount equivalent to 18.91 per cent. of the Enlarged Ordinary Share Capital. At the project level, Centerra, a wholly owned subsidiary of Centerra Gold Inc., a TSX listed gold and copper producer with a market capitalisation of approximately C$2.2 billion, is expected to fund the generative exploration in Sweden within the framework of the Centerra JV Agreement, and it has selected Klippen and Käringbergert as projects to farm into, where project expenditure of US$1,000,000 by Centerra on each project over two years will earn it a 51 per cent. interest in each project, with Erris Resources retaining a 49 per cent. interest without having to invest any additional funds.


6.    Value Creation Strategy

Deposit discovery is a process that includes growing a resource base in terms of size through exploration but also improving value per tonne of resource through detailed study. The Directors and senior management of the Company draw on decades of experience in technically de-risking resource targets through infill work, as well as stepping out to continue to define economic mineralisation of the system under exploration.




The Abbeytown Project consists of six prospecting licences covering a total of 159 km². The licences are 100 per cent. owned by Erris Resources and are subject to a 1 per cent. net smelter return royalty to Osisko. The prospecting licences held were granted to Erris Resources over the course of 2013, for a period of six years (subject to periodic renewals), most recently having been renewed on 22 November 2017 for the remainder of the licence periods after the minimum collective expenditure threshold of €90,000 was met for the licences.


Area Number

Licence Number

Date Granted

Date Expire

Area Ha


Project Sub Area

















Abbeytown, Lugawarry,











Streamstown Abbeytown North














Table 1: Abbeytown Project Prospecting Licences held by Erris.


Situated within the southern part of the Sligo Basin lies the Abbeytown Deposit which was mined historically (1951-1961) for lead. The Abbeytown Deposit covers approximately 1 km² and is surrounded by an active aggregates quarry, which sets a permitting precedent for industrial activity at the locality. Abbeytown is well served by local infrastructure and has a temperate climate. (Source: CPR - Section 1.2)


The Abbeytown area has a long history of mining dating back to the 1700s and possibly 1500s when monks at the abbey in Abbeytown mined silver from argentiferous galena. Mining is reported to have continued through the 18th, 19th and early 20th centuries. In the 1940s the Abbeytown Mining Company started open cast operations but later moved underground and the company was bought by Johannesburg Consolidated Investment Co. in 1950. Room and pillar mining ceased in 1957 due to declining metals prices, although some mining and milling of stockpiled ore was restarted in 1958. The mine finally closed in 1961.


Exploration was conducted by numerous companies at various times throughout the last 70 years, but little deep drilling was undertaken except for a few holes close to the Abbeytown Deposit. Vertical diamond core hole ABC-06, drilled by Chevron in the mid-late 1980s, located 300m south of the mine intersected significant mineralisation down to 148.8m which led to renewed interest at the time. Hole ABC-06 returned two significant intersections of 8m @ 3.7 per cent. Pb, 2.3 per cent. Zn and 38g/t Ag from 114m; and a lower copper zone of 3m @ 2.1 per cent. Cu. In addition, channel-chip samples taken by Chevron in the exposed, lower western mineralised zone returned a result of 20.7 per cent. Zn, 5.6 per cent. Pb and 223 g/t Ag. The samples were taken over 26m approximately along the strike of a replacement bed less than 1m in thickness.


At the Skreen prospect in the west of the prospecting licence block, the bulk of previous work was undertaken by Tara Exploration over a number of years between 1964 and 1976. The entire Skreen area as far as the coast to the north was soil sampled. The historic soil data outlined a zinc-lead anomaly with values of up to 1,000ppm Zn and 1,000ppm Pb, the upper detection limit for the analysis technique used. The anomaly extends for at least 3 km in a northwest direction through the area known as Skreen and attains a width of up to 1 km. Several other smaller anomalies were also detected. Limited drilling was conducted by Tara Exploration and subsequently Billiton Exploration Ireland during the early 1980s.


The Competent Person has not been able to verify the results of historical data from soil sampling, rock sampling and drilling described in this report. Although the CP has no reason to doubt the results described, they should be considered as indications of the presence of mineralisation only and may not accurately reflect true metal concentrations and mineralized thicknesses.


Erris Resources has collated and synthesised the historic data and carried out additional exploration work including regional soil sampling, digitising, re-modelling, sampling, re-interpretation and drilling four diamond holes, ER001-ER004. Erris now believes that Abbeytown is a carbonate replacement deposit, similar to Harberton Bridge or Kilbricken in the Irish Midlands. The CP agrees with this interpretation. At Abbeytown, there appears to be strong geochemical zonation with a copper zone at the base, a lead-rich lower zone through to a zinc>lead middle zone and a pyrite-calcite upper zonation or cap. Erris Resources believes the copper mineralisation probably occurs proximal to the source or structure feeding hydrothermal fluids into the carbonate basin whereas zinc is precipitated at lower temperatures more distal to the feeder and the deposit.


From 2015 to 2017, Erris Resources has drilled four holes ER001-ER004, three of which yielded encouraging results and confirmed the previous mineralisation while allowing Erris to develop a new exploration model in the absence of previous core. The drilling returned the following significant intersections (no significant intersections in hole ER004):


Hole ID

m From

m To


Pb %

Zn %

Cu %

Ag g/t


























































Table 2: Highlights of the drilling of ER001-ER003. Source: CPR - Table 4.5


Composites are generated using a length weighted average for assays >2 per cent. Pb+Zn, maximum total length of waste 2m, maximum consecutive length of waste 1m. Thicknesses have not been converted to apparent thickness at this time due to lack of data and uncertainty of deposit geometry. Integration of all datasets, including structural and geophysical interpretation of data, soil survey results, digitised mine records, chip samples, core logging and general re-interpretation of the geological model has led to the establishment of a series of exploration targets.


Work Programme

Erris Resources has costed a total potential of 21,700m of diamond drilling over an eighteen-month period at the Abbeytown Project. The drilling allocations for the target areas are as follows (Table 3) and will be dependent on the results from the initial Phase 1 drill programme:


Erris Resources Abbeytown Drilling Programme, 2017-2018


Project Area

Total potential metres




















Table 3: Erris Resources proposed drill programme for 2017-2018, subject to funding being available. Source: CPR - Table 4.6


(i)           Phase 1, Planned drill programme

Drilling to identify resources adjacent to the Abbeytown mine is planned for 2018. In addition, exploration drilling will start on targets at Skreen, Lugawarry, Streamstown and near the Ox Mountains Fault. Erris plans to use up to three drilling rigs during the Phase 1 drilling programme.


Drilling in the near mine area will aim to identify and outline mineralisation that extends southwards from the mine to the location of drill hole ER001 and beyond. Inclined holes will test areas selected due to preferential structural and lithological factors. Targets include areas at depth below the centre of historic mining activity, and on strike from known zones of mineralisation. Mineralisation will be tested down to a vertical depth of between 150m and 200m.


At Skreen, Lugawarry and Streamstown, drilling will test exploration targets selected on the basis of coincident anomalism. Factors contributing to target selection include geological mapping, structural interpretation, geophysical interpretation, analysis of historic data and soil geochemistry.


The Phase 1 drill programme will consist of up to approximately 5,000m of diamond drilling in total, of which up to 2,000m is allocated to near-mine targets at Abbeytown. The remaining 3,000m will be ascribed to exploration drilling at Skreen, Lugawarry and Streamstown.


Once the initial 5,000m is completed, Erris Resources will compile the results and review data before deciding on the location and quantity of future drill holes.


(ii)          Phase 2, Contingent drill programme

As noted above, Erris Resources has costed a total potential of 21,700m drilled with 5,000m to be completed in Phase 1 and a further 16,700m drilled in Phase 2.


At present Erris Resources has location plans for 92 holes for near mine exploration. Clearly, the results of the first 2,000m drilled in Phase 1 will affect the location of the remaining holes planned for Phase 2. It is anticipated that Erris will allocate a further 7,200m of drilling to near-mine exploration at Abbeytown in 2018. At Streamstown, Lugawarry and Skreen, a further 9,500m is planned.


The plan may be amended or changed as the drilling programme progresses, assay values are received and geological models and understanding develop, as well as to reflect funding available.




Erris holds a portfolio of Exploration Permits in Sweden. The three most strategically important projects are Klippen, Käringberget and Brännberg. Erris also holds other granted or pending permits on early stage targets which have little or no previous exploration work. These include Storklinten, Orrträsket, Skarvsjö, and Gunnarbäcken. All licences held by Erris or its affiliates in Sweden are subject to 1 per cent. net smelter return royalty on the sale of minerals produced from the licences in favour of Osisko. In addition, the licence known as Gundträsk nr 7 is subject to a 1 per cent. net smelter return royalty in favour of each of Beowulf and Scanex and Mirab.


The Klippen and Käringberget projects have been elected pursuant to the Centerra JV Agreement, whereby Centerra is expected to fund the further exploration of these projects in accordance with the terms of the agreement.


The Klippen, Käringberget and Brännberg projects are located in the Västerbotten County (or Västerbotten län) in the north of Sweden and are within 100-200 km of the cities of Skellefteå and Umeå, both of which have international airports. The Klippen and Brännberg projects are divided over four and six immediately adjoining EPs respectively with three EPs for the Brännberg project having been granted in May 2017.



Area Ha



Licence ID

Valid From

Valid To

Klippen nr. 13



gold, silver, copper,




lead, zinc

Klippen nr. 12



gold, silver, copper,




lead, zinc

Klippen nr. 11



gold, silver, copper,




lead, zinc

Klippen nr. 10



gold, silver, copper,




lead, zinc

Käringberget nr. 2



gold, silver, copper,




lead, zinc, molybdenum

Brännberg nr. 1



gold, silver, copper,




lead, zinc, molybdenum

Brännberg nr. 2



gold, silver, copper,




lead, zinc, molybdenum

Grundträsk nr. 7







Brännberg nr. 4



gold, silver, copper, lead,




zinc, molybdenum

Brännberg nr. 5



gold, silver, copper, lead,




zinc, molybdenum

Brännberg nr. 6



gold, silver, copper, lead,




zinc, molybdenum

Table 4: Swedish Exploration permits of material importance held by Erris



The Klippen project area has undergone limited and sporadic exploration by a number of companies since the early 1980s. The most significant work was conducted by Terra Mining AG who initially discovered the prospect by till sampling. Historic work includes:

·     Till sampling and follow up detailed till sampling grids;

·     Base of till and bedrock geochemical samples;

·     Ground magnetics and EM surveys;

·     Trenching; and

·     Drilling (focused in one area by Terra Mining AG and two lines of RC holes by Ovoca Gold plc).


Klippen lies along the southern extension of the "Gold Line" district, a regionally distinct corridor of mineralisation associated with a crustal shear zone hosting multiple gold deposits. The Klippen concession package is located in a particularly thick package of 'greenstone' along the continuation of a major NW structure but also coincident with the E-W gravity 'break'. It is likely that a number of reverse faults or thrusts are present in the greenstone package and some may be remobilised or folded in later shearing.


The data indicates that gold is associated with Cu, Sb, and Bi hosted in metasediments and volcanics adjacent to a granodiorite intrusive. It should be noted that historic drilling was very shallow compared to the known deposits in the Gold Line area. Furthermore, drilling may not have been in the right orientation to intersect the mineralised structures and none of the previous operators completed their exploration programmes. (Source: CPR - section 1.3).


The Erris Resources work identified an area of interest with 3.6 km of strike length on which Centerra agreed to fund a drill programme as part of their earn-in.


An initial 1,800m has been drilled and the core is currently being prepared for submission for assay. Once returned, the assay data will be sent to Centerra and a process of joint interpretation, review and planning will take place. The integrated results from the 2017 work programme and details of the proposed 2018 work plan are expected to be announced in January 2018.


The Competent Person has not been able to verify the results of historical data from soil sampling, rock sampling and drilling described in this report. Although the Competent Person has no reason to doubt the results described, they should be considered as indications of the presence of mineralisation only and may not accurately reflect true metal concentrations and mineralized thicknesses.

The phase 1 drill programme involved drilling of nine angled holes totalling 1,800m with fences of holes to test the Thor zone and test at depth under the previous shallow drilling and trenching which had economic gold intersections. No historic core survives so core is required to update the geological and exploration model. The phase 1 drill programme has cost US$400,000.


Centerra has confirmed that it intends to fund an additional US$600,000 in expenditures on the project in 2018, which will include additional exploration drilling. On a proportional expenditure basis the extra funding will allow for extra drilling, so planning for a further 3,000m of diamond drilling at Klippen is underway.


While Klippen has been the subject of multiple exploration programmes in the past, the approach has not been systematic, and the results of different programmes were not effectively tied together by past operators. The Directors believe Erris Resources has compiled and reviewed a great deal of geochemical, geophysical and geological information over the project and have developed promising targets for further investigation.



The Käringberget project is located in the north of Sweden in the Malå municipality, Västerbotten County, 15 km northwest of Malå town. A number of gravel roads cross the project area.


The associated permits have been held by several companies in the past, including Boliden Minerals AB, Mawson Minerals and North Atlantic Natural Resources AB. Past work includes very limited drilling and trenching (no data remaining), mapping and sampling.


The project area at Käringberget lies at the western end of the Skelleftea Zn-Cu-Pb-Ag-Au District, in an area of Palaeoproterozoic sediments. Approximately 12 km to the northeast is the Eurasian Minerals' Adak project, which covers four past-producing mines reported to have produced 12.1Mt at 1.5 per cent. Cu between 1940 and 1977 (the Competent Person has not been able to verify these figures). The mineralisation occurs as both stratiform to stratabound chalcopyrite-rich ore in altered volcanics and as breccia or vein breccia ore hosted by quartzite. The mineralisation occurs at the upper contact with andesitic layers, within a two-kilometre-wide felsic dome. It has previously been described as VMS style mineralisation, but replacement mineralisation may be a more correct term.


Locally, at Käringberget the geology of the project area consists of an east-west striking, north to north- northeast shallow-dipping volcanic package consisting of mafic, intermediate and felsic volcanics intruded by a plagioclase porphyritic intrusive rock which appears to be a sill while a diorite dyke is also mapped. From mapping of the available outcrop, which is relatively well exposed for Northern Sweden, there appears to be some zonation in alteration minerals from an outer chlorite zone, to a chlorite-sericite-silica+\-pyrite to an inner silica-pyrite zone which is locally intense.


At Käringberget, the observed broad mapped alteration zone and sample analytical results are encouraging although no high gold grades have been encountered to date. However, given the shallow northeast-dipping nature of the volcanics at Käringberget, a zone of replacement mineralisation may well lie at depth in the sequence and the observed mineralisation and alteration at surface would be in the hanging wall of any potential deposit. Massive pyrite veins and pegmatitic sulphide-rich veins carrying low grade gold and copper cut the volcanic sequence and may have been remobilised from a sulphide body at depth.


The exploration target model for the prospect area is a sulphide body, either massive sulphide or replacement mineralisation, occurring at depth under and adjacent to the alteration zone. Mineralisation and alteration cuts across all lithologies as do sulphide veins, some of which have vuggy sericitic margins.


Käringberget is an early stage exploration project. Indications from regional dataset interpretation, geochemistry and alteration mapping and geological and mineralisation observations and similarities with deposits in the area clearly suggest the presence of a mineralising system and good potential for deposit development.


The Competent Person has not been able to verify the results of historical data from soil sampling, rock sampling and drilling described in this report. Although the CP has no reason to doubt the results described, they should be considered as indications of the presence of mineralisation only and may not accurately reflect true metal concentrations and mineralized thicknesses.


Erris Resources is in the process of completing a work programme to test the zoned alteration and geochemical anomaly at Käringberget. Drilling to test if there is any potential at depth under the silica-pyrite alteration zone, which has the highest grades for most metals including Au and Ag, was carried out in the second half of 2017 and was funded by Centerra. As at Klippen, work on data collation, joint interpretation, review, and planning is underway. The integrated results from the 2017 work programme and details of the proposed 2018 work plan are expected to be announced in January 2018.


Centerra has confirmed that it intends to fund an additional US$600,000 in expenditures on the project in 2018, which will include geophysical surveys and additional exploration drilling.



The Brännberg project lies 84 km west-northwest of Skellefteå and 28 km east of Malå in Västerbotten County Northern Sweden. The project area is accessible by a sealed public road which traverses part of the project area while other gravel roads and forestry tracks are present.


The project area consists of lithologies formed in a marine volcanic-arc environment dominated by intermediate to felsic volcanics and volcaniclastics with overlying sediments, mainly greywackes. Gold mineralisation at Brännberg was first documented in the 1990s by Scanex-Mirab Exploration in joint-venture with Barrick. Beowulf then took up the licences when they became available in 2003. Various phases of drilling were carried out, with many holes intersecting gold mineralisation.


Erris has conducted a review of the available drill core and historic data and has noted that gold occurs within sheeted quartz-arsenopyrite veinlets and that anomalous gold is associated with disseminated arsenopyrite and chalcopyrite. Strong silicification is always present in the mineralised intervals while strong carbonate alteration usually occurs outboard of the silicification.


The quartz-arsenopyrite veins are planar cutting the breccia and clasts and are crosscut by later quartz- carbonate veins. The later quartz-carbonate veins often carry trace amounts of chalcopyrite throughout all holes suggesting that there is a significant amount of copper in the system.


Significant intersections in past drilling include those in hole 6002 with 5.2m @ 4.3g/t Au, 8.1m @ 2.5g/t Au and 5.2m @ 1.6g/t Au. These intersections occur in a broad zone of 27.5m with arithmetic mean grade of 2.0g/t Au although it should be noted that it includes gaps with intervals of >1m at <1g/t Au. Potential for high-grade mineralisation is also demonstrated with 12.6g/t over 1.2m from 5.8m to 7.0m in hole 6002 (within the interval of 5.2m @ 4.3g/t Au).


The Competent Person has not been able to verify the results of historical data from soil sampling, rock sampling and drilling described in this report. Although the CP has no reason to doubt the results described, they should be considered as indications of the presence of mineralisation only and may not accurately reflect true metal concentrations and mineralized thicknesses.


Table 5 below includes all intersections for values of >0.5 g/t Au, minimum length 2m and maximum consecutive length of waste 2m. True thickness conversions were not completed at this time due to limited geological understanding.






Au g/t

Ag g/t












2. 9























































































Table 5: Selected grade composites from historic drilling for the Brännberg project.


Erris Resources plans to carry out a short exploration programme to augment the existing data set at Brännberg prior to instigating a new diamond drilling campaign. It is too early to define the nature and the extent of that diamond drilling campaign although it is not unreasonable to justify a programme to drill deeper on the areas of known mineralisation and also to extend drilling further to the south where the inferred structure is thought to lie. Drilling will better test the structural corridor that appears to be associated with mineralisation.


The Brännberg work programme includes:

·     Continued mapping, float sampling and prospecting, especially on the central 'structural corridor';

·     Bottom till/top of bedrock sampling;

·     Revision of existing core and submission of samples for assay; and

·     Remote sensing data acquisition and interpretation.


Erris Resources views Brännberg as a high priority target and accordingly has [budgeted to work on the project from the start of 2018 using funds raised]. Centerra retains the right to elect Brännberg as a 'Designated Project Area' ("DPA"), in which case the work programme would be funded by the Centerra earn-in.


It is clear that Brännberg has not had systematic exploration carried out on the project area in the past. Despite the incomplete work, the cumulative data and the current understanding of controlling features on gold mineralisation in the Skelleftea district makes Brännberg a prospective target.




In Sweden, Erris Resources also holds the Orrträsket, Gunnarbäcken, Storklinten and Skarvsjö licences. These licences are early stage projects that have been granted to Erris Resources direct from the Swedish Geological Agency (SGU) and they fall within the Centerra JV Agreement in northern Sweden.


Erris also maintains an active target generation process seeking exploration licences in other European jurisdictions to further diversify its portfolio of projects. Ideas are advanced from remote sensing studies to target ranking then ground-truthing and licence application. Erris is targeting European jurisdictions that have a demonstrable track record of supporting an international mining industry. It favours districts with proven mineral potential, typically historic mining areas, and will preferentially apply for licences that offer a potentially fast-track to drill-ready status.




The zinc price was approximately $3,265 per tonne (as at 3 November 2017) and the primary aim of the Group is to delineate resources containing economic mineralisation which, by definition, will have to accommodate prevailing metal prices. The Directors believe that the zinc price will remain supported at or above current levels because of a number of factors. Metal prices typically vary as the interplay between supply and demand varies, either creating periods of supply deficit when above-ground stocks are consumed to match underlying demand, or periods of supply surplus when above-ground stocks accumulate.


Demand growth, driven by global economic growth rates is expected to remain steady. On 10 October 2017 the IMF published global economic growth forecasts of 3.6 per cent. in 2017 and 3.7 per cent. in 2018 - its highest rate since 2010.


On the supply-side of the equation, mine production has fallen in recent years with the closure of some large mines (Century in Australia, Lisheen in Ireland). Teck Resources Limited notes that committed and operating mine production is peaking and that replacement projects are being delayed.


The combination of modest demand growth and weak supply has contributed to a rise in zinc prices from $1,454 per tonne in January 2016 to current levels of $3,265 per tonne. The combined London Metal Exchange and Shanghai Futures Exchange stock levels are at similar levels to 2006 when zinc prices rose rapidly. Treatment charges at smelters have fallen significantly, indicating low levels of concentrate stocks. Some industry commentators predict an ongoing supply/demand deficit which is typically associated with rising metal prices.




As at 3 November 2017 the gold price was approximately $1,268 per ounce and the primary aim of the Company is to delineate resources containing economic mineralisation which, by definition, will have to accommodate prevailing metal prices.


Gold price forecasting is notoriously difficult as the metal tends to behave both as a currency and a commodity. In currency terms the market centres on its historic 'safe haven' status. The argument runs that in a world of fiat currency, gold is tangible, fungible and a historic currency, and will therefore remain well supported in the current economic climate.


On the supply, primary gold from mine production can be correlated to investment in exploration and development.


In March 2017 S&P Global Market Intelligence published a World Exploration Trend study which calculated that the mining industry's total budget for nonferrous metals exploration was just US$7.2 billion in 2016, compared with the record US$21.5 billion budgeted in 2012. The report notes that the decline in exploration budgets can be attributed to investor wariness of exploration and a significant reduction in spending by producing companies as they sought to improve profit margins.


The World Exploration Trend study reported that globally, gold remained the top-explored commodity last year, accounting for 48 per cent. of the global exploration budget, matching the record high of 2011. In dollar terms, gold exploration fell to its lowest level since 2006, dropping US$643 million, or over 16 per cent., to US$3.30 billion.




Jeremy Martin (aged 40). Non-Executive Chairman

Jeremy is a founding director of Erris Resources. Mr. Martin holds a degree in mining geology from the Camborne School of Mines, and a MSc. in mineral exploration from the University of Leicester. He has worked in South America, Central America and Europe, where he was responsible for grassroots regional metalliferous exploration programmes through to resources definition and mine development. Jeremy has been involved in the formation of a number of publicly listed mineral resource companies. He is currently Chief Executive of Horizonte Minerals and holds BSc (Hons), MSc, ACSM, MSEG.


Merlin Marr-Johnson (aged 46). Chief Executive Officer

Merlin joined Erris Resources as CEO in April 2017. He is a graduate in geology from Manchester University and holds a Masters Degree in Mineral Deposit Evaluation from the Royal School of Mines, Imperial College. Merlin started his career as an exploration geologist on zinc and copper projects for Rio Tinto in southern Africa before completing his MSc and subsequently working as an equity and commodities analyst at HSBC between 1997 and 2003. In 2003 Merlin founded Palladex plc, and was CEO until mid-2007. At Palladex he raised US$9.8m on admission to AIM in 2004, worked in Central Asia, delineated and then divested gold assets in Kyrgyzstan and Tajikistan, identified the geological potential of the Tulu Kapi gold deposit in Ethiopia, and renamed the company Minerva Resources plc. Between 2008 and 2009 he was Exploration Director at Zamin Ferrous, running multiple programmes in South America, including a significant discovery in Uruguay. Merlin worked at Blakeney Management between 2010 and 2015, as Natural Resources Portfolio Manager - Middle East and Africa, covering exploration, development and producing assets in Oil & Gas and Mining. Since 2015 he has consulted for Tavistock Communications, Golden Star Resources and Ferrum Crescent Ltd among others. He holds BSc (Hons) in geology, MSc, DIC and FGS.


Cherif Rifaat (aged 46). Chief Financial Officer

Cherif is a UK chartered accountant who has more than 20 years of venture capital, corporate finance, operational turnaround and investor relations experience since his qualification with KPMG. He has primarily worked with technology, mining and real estate companies, with an emphasis on those in a start-up, pre- IPO or restructuring phase. He has been a corporate and financial adviser to the lithium mining company, Bacanora Minerals, since it listed on AIM in 2014. Cherif is a graduate from the University of St Andrews, Scotland. He holds MA (Hons) in modern history and has been a member of the ICAEW since 1998. Prior to Admission Cherif provided certain services to the Company through a consultancy company in connection with the Admission and the Placing.


Graham Brown (aged 59). Non-Executive Director

Graham holds a BSc. from the University of Strathclyde, Glasgow. He has been a Fellow of the Society of Economic Geologists ("SEG") since 1999, participated in the Colombia Senior Executives programme in 2004 and the Duke Business Leaders programme in 2007. He is a past councilor of the SEG and current British Geological Survey industry adviser and Natural History Museum honorary research fellow. In 2011 he was the co-recipient of the PDAC Thayer Lindsley Award and from 2013 attained both Chartered Geologist and European Geologist professional status. Mr. Brown joined Amax as an exploration geologist in 1980 and worked on a variety of exploration and mining operations in the Circum-Pacific region. For almost a decade Mr. Brown worked as a consultant involved with the exploration and evaluation of a number of major discoveries in both Asia and Europe. In 1994, he joined Minorco as Chief Geologist. Subsequently he became the Europe-Asia region's Vice President Exploration and following the Minorco-Anglo American plc merger in 1999, he served as Vice President Geology. In 2003 he was appointed Senior Vice President Exploration and managed geosciences, technical services, and R&D programs. In 2005 he was promoted to Head of Base Metals Exploration and in 2010 he took up the position of Group Head of Geosciences for the Anglo American Group.


Jeremy Taylor-Firth (aged 47). Non-Executive Director

Jeremy has worked in investment management since 1996. He initially worked at Matheson Securities, which was acquired by Prudential-Bache Ltd and subsequently renamed Dryden Wealth Management.

 In June 2006, he joined Singer & Friedlander Investment Management as an Investment Director. This business was then acquired by Williams de Broe where he worked until October 2010. Jeremy is currently an Investment Manager with Hanson Asset Management, where he has worked for the last six years. He is also the non-executive chairman of Primorus Investments plc. Jeremy holds CISI Level 6 PCIAM.


Andrew Partington (aged 53). Non-Executive Director

Andrew is a partner with Toronto based investment bank Paradigm Capital Inc. specialising in corporate advisory, M&A, and equity raising for mining and metals companies and was also a principal with Beacon Group Advisors between 2001 and 2003, which was the predecessor to Paradigm's mining team. In addition, Andrew has served as a mining equity analyst with Deutsche Bank's Global Mining and Metals team and Newcrest Capital covering the base metals and gold industries. Andrew holds a B.Sc. (Hons) Engineering Geology from the University of Portsmouth and an MBA from York University's Schulich School of Business as well as MIMMM and FGS.


Key Management and Technical Adviser


Aiden Lavelle Chief Operating Officer

Aiden is an experienced exploration manager who played a key role in the discovery of the Pandora prospect in Djibouti. His international work also includes target generation, project management and resource definition. He holds BSc (Hons), MSc, MIGI, P.Geo and is based in Ireland.


David Hall Technical Adviser

David was a founding director of Erris Resources. Mr Hall is a graduate in geology from Trinity College Dublin and holds a Masters Degree in Mineral Exploration from Queens University, Kingston, Ontario. He has 29 years of experience in the exploration sector and has worked on and assessed exploration projects and mines in over 50 countries. From 1992, Mr Hall was Chief Geologist for Minorco SA, responsible for Central and Eastern Europe, Central Asia and the Middle East. He moved to South America in 1997 as a consultant geologist for Minorco South America and subsequently became exploration manager for AngloGold South America in 1999, where he was responsible for exploration around the Cerro Vanguardia gold mine in Argentina, around the Morro Velho and Crixas mines in Brazil and establishing the exploration programme that resulted in the discovery of the La Rescantada gold deposit in Peru as well as certain joint ventures in Ecuador and Colombia. Mr Hall is also founder and former Executive Director of Stratex International Plc, an AIM traded company with exploration assets in Turkey and in which Teck Resources Limited is an equity shareholder. Mr Hall is a fellow of the Society of Economic Geologists and EuroGeol. He is currently CEO of Thani-Stratex and non-executive chairman of Horizonte Minerals. He holds BA (Hons), MSc, FSEG, MIGI, P. Geo.



This announcement should be read in conjunction with the full Admission document, available from the Company's website

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