EDMONTON, AB, June 26 /CNW Telbec/ - Mindoro Resources Ltd. (TSXV: MIO;
Frankfurt: WKN 906167) is pleased to provide an update on its Agata North
Nickel Laterite Project. A weakening in nickel prices, as well as for direct
shipping ore (DSO) feedstock for Chinese nickel pig iron furnaces, was
previously noted by Mindoro (news release dated May 27, 2008). Nickel prices
seem likely to firm once the Chinese stainless steel industry resumes its
anticipated strong growth later this year, and the option to commence a DSO
operation, currently on hold, will be kept open. However, as stressed over the
past year, Mindoro's primary objective remains to define the total global
resource potential and to identify the optimal technology for enhanced value,
local processing of its nickel laterite resource.
The softening in prices quoted for DSO nickel laterite ore appears to be
the result of the shutting down of many old-generation nickel pig iron blast
furnaces in China for a variety of economic and environmental reasons.
Nevertheless, it is apparent that the Chinese stainless steel industry, which
is projected to continue its dramatic expansion later this year, will require
increasingly large quantities of nickel feedstock, for which nickel pig iron,
and higher quality ferronickel products, have formed an important source. It
is uncertain how this demand for nickel feedstock will be met. Mindoro
believes that this situation will present opportunities, since it is likely
that the shutdown will lead to the accelerated construction of new-generation
processing plants offshore, and proximal to the laterite resources themselves.
Mindoro believes there is very high potential for the development of a
large integrated nickel laterite mining and processing industry in the
Philippines, and for its resources to be part of this future. On-site
processing has the potential to provide a significantly higher return from the
resource than under the DSO scenario, which typically values the contained
nickel at just 10 to 15 percent of the LME nickel price.
On April 30 of this year Mindoro announced an early-stage 43-101
compliant mineral resource estimate for the Agata North Nickel Laterite
Project (see About The Agata Nickel Laterite Project below). The resource area
is a small part of Agata North as mapped to date and resource expansion
drilling is continuing. To date, 47 holes have been completed in a Phase Two
drill program that commenced in December, 2007. Ten of these were designed to
twin previous holes for geostatistical and QAQC purposes. Received drill
results are being compiled and will be released next week. The previous drill
contractor was making slow progress and has been replaced by a new contractor.
Four rigs are operating at Agata North and a further seven drill holes have
been completed in just nine days. Results of these will be released when assay
results have been received and compiled.
In addition to the core drilling, a further six manual auger rigs are
being employed on a reconnaissance drill program on Agata North, and other
Mindoro projects in the Surigao District, to define favorable areas for
follow-up resource delineation drilling with core rigs.
ABOUT THE AGATA NICKEL LATERITE PROJECT
Location in the Prolific Surigao Copper-Gold and Nickel District
The Agata Nickel Laterite Project is situated on the Agata Project,
Surigao Gold District, northern Mindanao, Philippines. The Surigao Gold
District is not only a current and historical gold producing district but,
with the recent discovery of a cluster of porphyry copper gold deposits by
Anglo American, it also has high potential to become a major copper-gold camp.
Mindoro has multiple gold and copper-gold targets in the Surigao District at
varying stages of drill evaluation.
The Surigao Region is now emerging as a major nickel producing district,
and there are a number of nickel laterite deposits either in production or
being developed; providing DSO to markets and processing plants in China,
Japan, Korea and Australia. A preliminary, starter resource has been released
for Agata (see below).
Agata North Mineral Resource Estimate
In April 30, 2008, Mindoro announced an early-stage 43-101 compliant
mineral resource estimate for the Agata Nickel Laterite Project. The estimate
for combined Measured and Indicated Resources, for both limonite and saprolite
combined, is 4.40 million wet metric tonnes (WMT) grading 1.25 percent nickel,
0.063 percent cobalt and 23 percent iron, at a cut-off grade of 0.80 percent
nickel. In addition, the Inferred Resource estimate is 2.45 million WMT
grading 1.23 percent nickel, 0.062 percent cobalt and 22 percent iron, also at
a cut-off grade of 0.80 percent nickel. A total of 134 drill holes, comprising
2,921 meters of diamond drill core and 2,874 assay samples, were used for the
estimate. The resource area is a small part of Agata North as mapped to date
and resource expansion drilling is continuing. Additional areas of potential
laterite mineralization have been mapped on other projects and are being
Enhanced Value, On-Site Processing Alternatives
While sulphide nickel deposits have dominated historical nickel
production, the future belongs to nickel laterite deposits. Once regarded as
too difficult metallurgically, break-throughs and technological refinements,
still in their relative infancy, are leading rapidly to a new generation of
much larger nickel production centers from laterite deposits. The Agata
Project with its excellent infrastructure, proximity to tide water and the
markets that really count, is attractively placed for potential development.
While much of the Surigao District nickel laterite production has been as
DSO to processing plants in Japan, Australia and China, several attractive
alternatives are emerging for local processing, which include; constructing an
on-site electric arc furnace for nickel pig iron production (a low grade
ferronickel product); ferronickel smelting (a ferronickel smelter recently
commenced operation not far away in NW Mindanao); heap-leaching, for which
pilot testing on another Philippine laterite deposit has produced promising
results; atmospheric (tank) leaching; and an improved generation of High
Pressure Acid Leach (HPAL) plants. HPAL technology is currently being used
with great success by Sumitomo on its Philippine Coral Bay operation, and
shows considerable promise for the local processing of Surigao ores. In fact,
Sumitomo recently announced plans to proceed with permitting to construct an
HPAL plant in the Surigao District. This HPAL technology has a proven track
record, in contrast to several HPAL operations previously attempted in
Australia, and is ideally suited to the low-grade Philippine nickel laterites.
As noted in a February 7, 2008 news release, there is abundant evidence
of the beginning of a trend for local/on-site processing of Philippine
laterite ores and the growth of a large high-value industry in the
Philippines. Mindoro expects that the prolifically nickel laterite-mineralized
Surigao District will be an important part of this evolution.
While options are being kept open for DSO production in the short term,
on-site processing offers much more exciting and high value opportunities.
Construction of a local processing plant, rather than simply shipping out raw
product, would greatly increase the returns to all stakeholders; including
Mindoro, its Philippine partner, the local people, local government units, and
to the Philippines itself.
Programs are carried out under the supervision of Tony Climie, P.Geol.,
CEO and COO of Mindoro, who is a qualified person as defined by National
Instrument 43-101. Sample preparation and assaying were performed by McPhar
Laboratory of Manila, an ISO 9001/2000 accredited laboratory. Ni, Co, Fe, MgO
and Al2O3 assays are performed by AAS after an HCl-HNO3-HClO4 digest, and SiO2
by gravimetric method. Normal Quality Control and Quality Assurance procedures
are being carried out, using a system of duplicate samples. MRL has also
conducted assays verification by using standard samples and re-assaying of
field, coarse and pulp duplicates.The TSX Venture Exchange has not reviewed
and does not accept responsibility for the adequacy or accuracy of this
Mindoro is a Tier 1 Issuer trading on the TSX Venture Exchange (MIO) and
the Frankfurt Stock Exchange (WKN 906167). In addition to advancing the Agata
Nickel Laterite Project, Mindoro has announced an initial 43-101 compliant
gold-silver mineral resource estimate on its Kay Tanda gold-silver project,
and is proceeding to advance this project. The company has also identified
22 porphyry copper-gold prospects in the Philippines and is currently involved
in several advanced joint venture discussions.
The TSX Venture Exchange has not reviewed and does not accept
responsibility for the adequacy or accuracy of this release.
This release may contain forward-looking statements including
management's assessments of future plans and operations, and expectations of
future production. These statements are based on current expectations that
involve a number of risks and uncertainties, which could cause actual results
to differ materially from those anticipated. These risks include, but are not
limited to, the risks associated with the mining and exploration industry
(e.g. operational risks in development, exploration and production; delays or
changes in plans with respect to exploration or development projects or
capital expenditures; the uncertainty of reserve estimates; the uncertainty of
estimates and projections relating to production). The assumptions used in the
preparation of such statements, although considered reasonable at the time of
preparation, may prove to be imprecise and, as such, undue reliance should not
be placed on forward-looking statements.
For further information:
For further information: Investor Relations - Canada: Mindoro Resources
Ltd.: Penny Gould, President, email@example.com, 780.413.8187, Toll Free:
1.877.413.8187; www.mindoro.com; Renmark Financial Communications Inc.:
Barbara Komorowski, firstname.lastname@example.org; Jason Roy,
email@example.com, (514) 939-3989, Fax: (514) 939-3717;
www.renmarkfinancial.com; Investor Relations - Europe: Richard Mayr, info
@argentuminvest.com, Argentuminvest GmbH, +49.9421.785250, Fax: