pil announcement things are on the up

  1. 323 Posts.
    PIL - ASX Company Announcement
    21 February 2003
    Part 1/1

    HOMEX - Perth
    Jaguar Base Metal Project

    Pilbara Mines Limited (ASX: PIL) is reviewing development options for
    the Jaguar base metal deposit in Western Australia following the
    completion of initial resource and scoping studies on the project.

    Pilbara's joint venture partner, Inmet Mining Corporation, has
    calculated a resource of 1.4 million tonnes grading 3.7% copper,
    13.2% zinc, 0.9% lead, 140 g/t silver and 0.18 g/t gold for 184,800
    tonnes of contained zinc and 51,800 tonnes of contained copper and
    6.3 million ounces of contained silver.

    Inmet is earning a 70% interest in the Teutonic Bore Joint Venture,
    Pilbara's flagship exploration and development project located some
    260 kilometres north of Kalgoorlie.

    Inmet is continuing regional exploration to potentially expand the
    base metal resource inventory at Teutonic Bore while various
    feasibility options are considered.

    Jaguar potentially represents a very attractive development
    opportunity for the Joint Venture on two fronts either as part of a
    larger multi-mine base metal operation at Teutonic Bore or as a
    standalone underground mining operation.

    One option currently being examined is a proposal to excise the
    Jaguar deposit out of the Teutonic Bore JV. This would allow Pilbara
    to move immediately to a feasibility study to determine a development
    proposal under lower overheads and capital costs while the JV
    continues to explore for further satellite or standalone resources on
    the surrounding leases.

    The deposit could be developed as part of a broader regional
    development strategy if further Jaguar-style discoveries are made at
    Teutonic Bore, becoming in effect one of several key ore sources
    feeding a centrally located treatment facility.

    An independent preliminary scoping study and resource calculation of
    the Jaguar deposit has confirmed its potential to support a
    profitable underground mining operation, subject to further
    definitive studies, representing a 5-6 year mine life on a similar
    scale to the Emily Ann nickel project (1.18 million tonnes 3.36%
    Nickel, located in the Lake Johnston Greenstone Belt, 540 km ESE of
    Perth) which commenced production, from an underground mine, in
    November 2001 after development approval in December 2000.

    The Jaguar resource, which is classified as an Inferred Resource by
    the Canadian Institute of Mining Standards on Mineral Resources and
    Reserves, is based on 12 diamond drill holes completed last year
    spaced at 50-100 metres and will require limited infill drilling to
    convert to an Indicated Resource.

    The Inferred Resource compares to the ore mined from the original
    Teutonic Bore open cut and underground mine between 1980 and 1985 of
    1.5 million tonnes at a grade of 3.6% copper, 11.4% zinc and 167 g/t

    The Jaguar deposit has relatively simple geometry being comprised of
    a single, steeply - dipping continuous lens of massive sulphide
    mineralization averaging 4.2 metres in horizontal thickness and
    having a strike extent of some 400 metres in the plunge direction and
    comes to within at least 200 vertical metres from surface. This
    interpretation is based upon a set of cross sections through the
    deposit which were oriented at N66E with a spacing of 50 metres.
    Pierce points of each drill hole through the zone were projected onto
    a vertical longitudinal section and a simple polygonal model applied.
    Polygons were centered on each pierce point and constructed to extend
    a distance halfway to each surrounding hole or to 50 metres in
    directions where there is no drilling. Thickness of the polygon was
    the horizontal thickness of the massive sulphide mineralization as
    measured from cross sections. In instances where a potentially
    economic intersection measured less than 2m horizontal, the
    horizontal thickness was brought to 2 metres with dilution assumed to
    be at zero grade. Volumes of each block were calculated by
    multiplying the area of the polygon on the vertical longitudinal
    section by its horizontal thickness.

    Stringer sulphide mineralization was encountered locally in the
    drilling, particularly in the footwall to the massive sulphide lens.
    Occasionally this mineralization approached economic grade and
    thickness but was not included in the resource due to its apparent
    erratic and discontinuous nature.

    The proximity of Jaguar to the known surface resources (tailings and
    stockpiles) at Teutonic Bore (100% Pilbara owned), with an estimated
    $100 million of contained metal, could add value to a future mining
    operation and along with the regional infrastructure, could further
    enhance the economics of development scenarios.

    Infrastructure in the area includes several operating gold mines
    (notably the nearby Thunderbox Gold Project, commissioned in December
    last year), the Goldfields Gas Pipeline, the Leonora railhead and the
    Goldfields Highway.

    Inmet are due to commence diamond drilling shortly on key regional EM
    targets, Snowys Well, 4 kilometres south of Jaguar, and at Snowys
    South a further 6 km to the south.

    In addition, Inmet, the Canadian-based, base metals group has
    commenced extending its ground EM survey (which proved successful in
    the discovery of Jaguar) for some 10 kilometres to the north of
    Jaguar over the old Teutonic Bore mine and to the northern extent of
    the tenements.

    The EM survey completed by Inmet in 2001/2002 at Teutonic Bore has
    been further refined by down-hole EM results at Jaguar to generate
    very strong regional targets such as Snowys Well and Snowys South.

    It is also significant that Inmet is extending its EM survey to the
    north in an area that has not been subjected to an EM geophysical
    survey since the early 1980s. The potential for further Jaguar-style
    deposits is considered to be very good.

    Inmet has, to date, expended $2.65 million of its $3.5 million
    earn-in commitment to gain a 70% interest in the Teutonic Bore Joint

    In conjunction with ongoing exploration at Teutonic Bore, there will
    be an evaluation of development options over the next few months
    before making a decision on how to proceed in the best interests of
    Pilbara shareholders.

    John M Davis, Mem. AIMM, AIG has more than 25 years experience in the
    mining industry and qualifies as a competent person under the JORC

    For further information, please contact:
    Mr John Davis

    Telephone: (08) 9322-9999
    Mobile: (0417) 916-849

    Or visit Pilbara's web site:

    A copy of the full announcement, including the diagram, is available
    in PDF format on www.asx.com.au. Alternatively it is available for
    purchase from ASX Customer Service on 1 300 300 279.

    ends - AAP
arrow-down-2 Created with Sketch. arrow-down-2 Created with Sketch.