12 November 2009

Increased resource estimates at James and Redmond iron ore deposits

New resource estimates for James and Redmond deposits show significant increase over historical resources  

Anglesey Mining plc is pleased to report that its 50% owned associate company Labrador Iron Mines Holdings Limited (TSX: LIM) has reported independent resource estimates, prepared in accordance with NI 43-101, for its 100% owned James, Redmond 2B and Redmond 5 deposits, which comprise the first stage of targeted production at LIM’s direct shipping iron ore project located in Western Labrador, near the town of Schefferville, Quebec.  

These new estimates show a significant increase in tonnage over the historical resources (not NI 43-101 compliant), previously estimated by the Iron Ore Company of Canada (IOC) prior to 1982, as shown in the following table:  

New Indicated Resource Estimates vs Historical Resources

                          (at a cut off grade of 50% iron)

The independent resource estimates were prepared by SGS Geostat Ltd., Blainville, Quebec, (Qualified Person Maxime Dupéré, P.Geo,) in accordance with NI 43-101.  The classification of resources was completed using the results of drilling and trenching carried out by LIM during the 2006, 2008 and 2009 field seasons, which comprised twinning, in-fill and step-out drilling and trenching, as well as drill and trench data previously conducted by IOC. 

Commenting on the James and Redmond resource estimates, John F. Kearney, Chairman, said, “The new resource estimates completed by SGS Geostat have indicated a substantial increase in tonnage over the historic estimates for these iron ore deposits. This is of particular significance as the increase will extend the expected life of our Phase One project, potentially extending it by up to two years.”

James Deposit

The resource estimate for the James deposit is based on 990 metres of reverse circulation drilling in 16 holes and 515 metres of trenching carried out by LIM, in addition to 5,800 metres of drilling and 3,000 metres of trenching previously carried out by IOC. The mineral deposit resource estimates were calculated using the inverse distance squared method.

The SGS Geostat resource estimates for the James deposit of 8.1 million tonnes at a grade of 57.7% iron in the Indicated category represent an increase of 100% over the historical resource of 4,006,000 tonnes.

Redmond Deposits

The Redmond property comprises two discrete deposits known as Redmond 5 and Redmond 2B. The resource estimates of these properties were calculated using the inverse distance squared method.

Redmond 5

The resource is based on 964 metres of reverse circulation drilling in 20 holes and 461 metres of trenching carried out by LIM, in addition to 1,370 metres of drilling previously carried out by IOC.

The SGS Geostat resource estimates for the Redmond 5 deposit, of 2.1 million tonnes at a grade of 54.9% iron in the Indicated category, represent an increase of 220% in mineral resources over the historical resource of 650,000 tonnes. 

Redmond 2B

The resource is based on 1,100 metres of reverse circulation drilling in 21 holes and 663 metres of trenching carried out by LIM.

The SGS Geostat resource estimates for the Redmond 2B deposit, of 0.85 million tonnes at a grade of 59.8% iron in the Indicated category, represent an increase of 45% in mineral resources over the historical resource of 580,000 tonnes. 

Block Modeling

The inverse squared distance method was used to estimate the resources by block modeling. SGS Geostat used a block model of 5m by 5m by 5m. The orientation of the blocks at James is 313.5˚, at Redmond 2B is 310˚, and at Redmond 5, 313˚. SGS Geostat used BlkCad software designed by SGS Geostat, for the resource estimation of the mineral deposits. SGS Geostat used the orientations (azimuth and dip) of the geological interpretations and the ore limits interpreted in plane and in section to define a search window. SGS Geostat used different search window according to the shape and distribution of the mineralized envelopes in each specified mineral deposit. 

Analyses

Analyses for all of the samples from the 2006, 2008 and 2009 drilling and trenching programs were carried out by SGS-Lakefield Laboratory and Activation Laboratories. The analytical method used was borate fusion whole rock X-Ray Fluorescence.

Density

A variable specific gravity (density) was used for the modeled ore types. SGS Geostat used the following equation: SG (in-situ) = (2.3388 + Fe x 0.0258) * 0.9. The regression formula was calculated by LIM based upon 229 specific gravity tests and validated by SGS Geostat and is considered a conservative measure of density.

 About Anglesey Mining

Anglesey Mining plc is a UK based company listed on the London Stock Exchange with a 50% interest in a 90 million ton iron ore project in Labrador, Canada, which is under active development towards mining production in 2010. The company also holds the Parys Mountain base metals project with a historical resource of 7.7 million tonnes at 9.3% combined copper, lead and zinc in Anglesey, UK. 

For further information:
Bill Hooley, Chief Executive            +(44) 1492 541981
Ian Cuthbertson, Finance Director   +(44) 1248 361333