Release: Herald Resources: Upgrade of resources at Lae Jehe ? Anjing Hitam mine planning update
Friday, February 29 2008 - 05:10 AM WIB
(29 February 2008)--Herald Resources Limited is pleased to announce a further substantial increase in the Resource estimate at its Lae Jehe deposit at the Dairi zinc/lead project in North Sumatra, Indonesia.
The new estimated Combined Resources at Lae Jehe are 8.5Mt at 11.2% zinc, 6.1% lead and 5g/t silver. The Lae Jehe prospect is located about 1.5km north of the main Anjing Hitam orebody and 800m north of the planned concentrator site and is the most advanced target to provide future mill feed beyond the initial 7 year mine life, which as mentioned above, is currently based solely on the Anjing Hitam deposit.
A new intersection, in drillhole SOP282D, of 17.95m @ 14.5% zinc, 7.6% lead is the primary basis for the increased tonnage at Lae Jehe. This intersection was significantly better than anticipated.
The intersection for drillhole SOP280D at Lae Jehe of 26.0m @ 11.3% zinc and 6.1% lead has also increased the resource estimate as this intersection is wider than allowed for in the previous estimate.
Drillhole SOP282D has intersected the deeper portions of the M2 horizon at Lae Jehe and has continued to confirm the continuity of this very important horizon (see attached Figures 1 and 2). The Resources still remain open along strike in both directions and at depth beneath the lower bounding fault and there is therefore excellent potential for increasing the Lae Jehe Resources with the ongoing drill programme.
The latest Lae Jehe Resource estimates are based on the results of 40 DD holes for a total of 19,435m within the Resource area. Nearly all drillholes have their collars accurately surveyed in UTM grid and all holes are downhole surveyed at 30m intervals with an Eastman camera.
Drillhole intersection spacings are approximately 100m x 100m on the local grid, although some of the more recent intersections are more closely spaced. Core size is either triple tube HQ or NQ. Samples of quarter or half core at intervals up to 1m are selected within geological boundaries. Sample preparation and assaying are carried out by Intertek Testing Services (ITS) at Medan and Jakarta. Internal and external assay quality controls are implemented and results have been found to be satisfactory. Density values are derived from numerous direct measurements by ITS on selected drill core samples.
Wireframe geological models have been constructed using local grid cross sectional interpretations based on mineralised envelopes constructed at a nominal 5% zinc equivalent cut-off grade. Samples within the wireframes are composited to even 1.0m intervals. The zinc equivalent used is 1% Pb = 1% Zn which reflects expected medium term metal prices and is the same as used in the previous estimate.
A local grid block model was created for the estimate with block sizes of 1m EW x 20m NS x 4m vertical with sub-cells of 0.5m x 10m x 2m. The 3D wireframe models were used to constrain the block model in which blocks were assigned grade and density values utilising domain dependent, inverse distance cubed interpolation methods. No top cuts were applied to assay values; whilst blocks with less than 5% zinc equivalent were excluded from Resource estimates.
Resource classification was carried out on the basis of continuity of mineralisation and drillhole spacing. Blocks were classified as indicated Resources when those blocks were within 50m of a drillhole intersection and within the wireframe models, whilst those blocks which were greater than 50m and less than 150m from an intersection and within the wireframe models were classified as inferred Resources.
This recent resource estimate yielded a 12% increase in tonnage at similar grades to the previous estimate which was based on 39 drillholes. The results of the earlier 2008 estimate were a combined Indicated and Inferred Resource of 7.6 million tonnes at a grade of 11.1% zinc and 6.1% lead at a cut off grade of 5% zinc equivalent in which 1% Pb was equal to 1.0% Zn.
The deeper portion of the M2 horizon, which now contains nearly 70% of the overall Resources, is a prime target for further exploration. This deeper M2 mineralisation has yielded 840,000 tonnes per 100m interval of strike and still has about 400m of potential strike length to the south and 600m of potential strike length to the north, towards Bongkaras, to be tested as shown on Figure 1. Potential for further Resources also exists in the general shallower Basecamp - Lae Jehe area as well as at depth beneath a fault zone that has to date been used as a boundary to Resources. Lae Jehe thus has the potential to substantially grow with further exploration.
ANJING HITAM MINE PLANNING
In accordance with normal planning practice and on-going appraisal work of the Dairi Project economics, Herald is currently undertaking an optimisation review of the underground mine plan for the Anjing Hitam deposit. The purpose of the review is to identify a method for mining the Anjing Hitam deposit which is superior to that contemplated by the Dairi Feasibility Study (Feasibility Study), which is mainly based on the Long Hole Stoping method. The current review takes into consideration long term zinc and lead forecast prices revised since the date of the original Feasibility Study. The review involves a more selective mining method, using Cut and Fill as the primary method.
The Cut and Fill method under the new design has advantages over the Long Hole Stoping method, as it:
? provides additional access drives into the ore body
? provides a greater number of areas of ore available to mine
? enables a faster ramp up to production tonnage and the ability to maintain a constant production rate
? provides better grade control
? provides more locations underground for paste fill disposal which alleviates the demand on the tailings storage facility
? maximises the resource recovery rate at Anjing Hitam
? avoids large openings of unsupported ground that can become a safety risk
The Directors currently anticipate the new mine plan (adopting Cut and Fill as the primary method), when complete, to deliver additional tonnes of zinc and lead ore at a slightly higher operating cost than the mine plan currently contemplated by the Feasibility Study. The Directors note, however, that there can be no guarantee that the new mine plan will be adopted by Herald in the future or that, if adopted, it will deliver additional tonnes of zinc and lead ore at that time. (end of edited release)