Mindoro Resources Ltd.
TSX VENTURE : MIO
FRANKFURT : OLM

Mindoro Resources Ltd.

October 16, 2007 09:00 ET

Mindoro Resources Ltd. Further Positive Drill Results From Agata Nickel Laterite

EDMONTON, ALBERTA--(Marketwire - Oct. 16, 2007) - Mindoro Resources Ltd. (TSX VENTURE:MIO)(Frankfurt:WKN 906167) is pleased to report results from a further 12 drill holes on one long drill cross section (10400N) of the northern laterite zone on the Agata project, Philippines. The limonite horizon averages 1.17 percent nickel and 40.06 percent iron over an average thickness of 1.65 meters. The underlying saprolite horizon averages 1.29 percent nickel over an average thickness of 7.79 meters. Mineralization grades and thicknesses meet company expectations, and are in line with requirements for direct shipping grade material for ferro-nickel feedstock. Notwithstanding the recent softening of nickel price, demand remains solid for ferro-nickel feedstock. The Agata project has competitive advantages, in that it is two to three kilometers from tide water, with corresponding low haul distance and costs, and only two days shipping from China.

As reported on March 13, 2007, the current objective on the Agata northern nickel laterite project is to define a NI 43-101 compliant resource adequate, initially, for three to five years of production at a rate of 500,000 to 700,000 wet metric tonnes per annum of direct shipping-grade material for the ferro-nickel markets of China, India and Korea. Mindoro has a target production date of the first half of 2008, and would ramp up production to one million tonnes or more per year thereafter, depending on market demand. The initial drill program covers less then 15 percent of the area of nickel laterite mineralization mapped to date at Agata. On June 20, 2007, Mindoro released a revised global Exploration Target for the northern zone of the Agata project (see "About the Agata Nickel Laterite Project" below).

Results from section 10400N are comparable with previously reported drill sections 9950N, 10000N, 10050N, 10100N, 10150N and 10200N, 10250N, 10300N, and 10350N (see news releases dated June 6 and 18; July 3; August 14; and September 5, 2007). A drill location map, as well as the cross section showing assay results can be found on the company website. The iron-rich overburden above the limonite horizon, which averages 2.75 meters thick, also has high iron content of 44.48 percent, and 0.74 percent nickel, and has potential for blending purposes. This section covers an east-west distance of over 500 meters and is still open to the east and west, where mineralization is believed to continue for a further one kilometer approximately. The nickel and iron grades of the limonite horizon are robust, consistent between all ten sections reported to date, and are in line with grade requirements for ferro-nickel feedstock.

As reported on October 11, the Environmental Impact Statement, a prerequisite to the grant of an Environmental Compliance Certificate (the ECC), has now been filed with the Environmental Management Bureau of the Department of Environment and Natural Resources of the Philippines (the DENR-EMB). Shortly after receipt of the ECC, the company plans to commence construction of the mine haul roads and facilities, which is estimated to take approximately three months, subject to weather conditions and availability of materials and labor. The company currently does not anticipate any significant construction delays. The company has continued to receive expressions of interest from various parties to negotiate contracts for the sale and purchase of nickel laterite ore and will be pursuing serious negotiations in the coming months.

The reader is cautioned that the nickel laterite mineralization is currently an exploration target only. The company has not yet established mineral resources or mineral reserves that would support a commercial mining operation. There is no guarantee that future exploration will result in the discovery of mineral resources or that these resources, if delineated, will be economic or sufficient to support a commercial mining operation. Until a feasibility study has been completed there is no certainty that the company's projections will be economically viable.

On August 23, 2007, the company announced it had reached an agreement with Delta Earthmoving Inc. to explore, and advance to production if warranted, the Agata South Nickel Laterite Project. The agreement does not cover Agata North. Drilling commenced almost immediately and there are currently three drill rigs in operation at Agata South. This gives the company the opportunity to advance another nickel laterite prospect to production at no risk and cost, and the potential to share in significant cash flow.

ABOUT THE AGATA NICKEL LATERITE PROJECT

The nickel laterite prospect is situated on the Agata Project, Surigao Gold District, northern Mindanao, Philippines. There are several nickel laterite mines already in production in the Surigao District, providing direct shipping-grade ore to markets and processing plants in China, Japan, Korea and Australia. The geological extension of the Agata nickel laterite mineralization into an adjacent property, one kilometer south of Agata, is in production and product is being shipped to markets in China (a map can be viewed on the company's website). Mindoro's Exploration Target for the various laterite horizons in the northern laterite area is as follows:

Combined ferruginous overburden, limonite and saprolite horizons: 50 to 60 million wet metric tones (WMT) at a grade of 0.9 to 1.1 percent nickel and 28 to 32 percent iron. This includes the following division of tonnage between the overburden/limonite horizon and the saprolite horizon:

- Combined ferruginous overburden and limonite horizons: 30 to 35 million WMT of material at a grade of 0.9 to 1.1 percent nickel and 40 to 44 percent iron.

- Underlying saprolite horizon: 20 to 25 million WMT of material at a grade of 1.0 to 1.4 percent nickel and 8 to 10 percent iron.

The reader is cautioned that the potential quantity and grade of the Exploration Target described is conceptual in nature, that there has been insufficient exploration to define a mineral resource and that it is uncertain if further exploration will result in the target being delineated as a mineral resource. Until a feasibility study has been completed there is no certainty that the Company's projections will be economically viable.

The northern nickel laterite mineralization covers approximately 340 hectares. As shown on a map accompanying this news release on the company website, a total of over 90 drill holes have been completed to date within this area. Average thicknesses and grades encountered and a specific gravity of 1.5 grams per cubic centimeter were used to arrive at the above Exploration Target. The Exploration Target does not include significant thicknesses of low-grade, partially lateritized saprolitic rock, grading in the 0.6 to 0.8 percent nickel range, that also has market potential. Nor does it include additional areas of nickel laterite mineralization further south on the Agata Project.

This Exploration Target will form the basis for evaluating several attractive value-added processing options, which includes constructing a local blast or electric furnace for nickel pig iron production. In the meantime, Mindoro will continue to fast-track the direct shipping ore scenario with the objective of achieving production in 2008. Uniquely, direct shipping grade nickel laterite deposits have a low capital cost and offer a rapid route to production and cash-flow.

Programs are carried out under the supervision of Tony Climie, P.Geol., president of Mindoro, who is a qualified person as defined by National Instrument 43-101. Sample preparation and assaying is being 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, standard and blank samples.

ABOUT MINDORO

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 towards production, Mindoro is carrying out a major resource delineation program on its Kay Tanda gold-silver project. The company has also identified 22 porphyry copper-gold prospects in the Philippines and has an aggressive strategy of drilling multiple targets in 2007.

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.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.

Contact Information

  • Mindoro Resources Ltd.
    Penny Gould
    Executive Vice President
    (780) 413-8187
    Email: penny@mindoro.com
    Website: www.mindoro.com
    or
    Ascenta Capital Partners Inc.
    Trent Dahl
    Investor Relations-Canada
    (604) 628-5800 or Toll Free: 1-866-684-4209 ext. 228
    Email: info@mindoro.com
    or
    Argentuminvest GmbH
    Richard Mayr
    Investor Relations-Europe
    +49.9421.785250
    +49.9421.785255 (FAX)
    Email: info@argentuminvest.co