Adriana Resources Inc.

Adriana Resources Inc.

August 23, 2011 16:53 ET

Adriana Announces Completion of Mineral Resources Estimate

TORONTO, ONTARIO--(Marketwire - Aug. 23, 2011) - Adriana Resources Inc. (TSX VENTURE:ADI) ("Adriana" or the "Company") is pleased to report the recent completion of an updated National Instrument ("NI") 43-101 Mineral Resource estimate ("the estimate") using information from the 43-hole 2010-2011 infill drilling program on the South Zone of the Lac Otelnuk Iron Project. The estimate was completed by Watts, Griffis and McOuat Limited ("WGM"), Consulting Geologists and Engineers, of Toronto, Canada, and resulted in 4.89 billion tonnes of Measured and Indicated Mineral Resources and an additional 1.56 billion tonnes of Inferred Mineral Resources based on a Davis Tube Weight Recovery ("DTWR") cut-off grade of 18%. The DTWR and Davis Tube Concentrate (DTC) grades are shown in the table below:

Summary of Mineral Resource Estimate
(using a DTWR cut-off grade of 18%)
(in billions)
% Total Fe
% DTWR % SiO2
% Fe
Measured 4.40 29.1 27.4 3.4 68.4
Indicated 0.49 28.3 26.3 3.2 68.5
Total M&I 4.89 29.0 27.3 3.4 68.4
Inferred 1.56 29.6 27.1 3.6 68.0

WGM re-modeled the upper five geological sub-units (2A, 2B, 2C, 3A and 3B) of the Lac Otelnuk iron formation based on the results of the new drilling. Specific gravities for the estimation of tonnage were on a per unit basis and were identical to those used for the original Mineral Resource estimate. The infill drilling was successful in upgrading the categorization of the Mineral Resources, which was the main goal of this program.

The estimate was done using an Inverse Distance to the power of one method with a block size of 100m x 100m x 5m high. Measured Mineral Resources are defined as blocks being within 350 m of a drillhole intercept, Indicated Mineral Resources are defined as blocks from 350 m to 500 m from a drillhole intercept and Inferred Mineral Resources are defined as blocks more than 500 m distance from a drillhole intercept and interpolated out to a maximum 1,000 m where the drilling is more sparse. The deeper mineralization on the northeastern extension of the deposit that dips below 40 to 70 m of cover rock was also categorized as Inferred, regardless of the distance to a drillhole. The infill drilling program showed that the iron formation units show excellent continuity of geology/geometry and grade.

Mr. Michael W. Kociumbas, P.Geo., Vice-President of WGM, and Mr. Richard Risto, P.Geo., are independent Qualified Persons (QPs) in accordance with National Instrument 43-101 Standards of Disclosure for Mineral Projects. Mr. Kociumbas has reviewed and is responsible for the Mineral Resources presented in this news release. WGM has previously visited the site, collected independent core samples and reviewed the QA/QC data received to date. Mr. Risto has reviewed and approved the underlying sampling, analytical and test data used for the Mineral Resource estimate.

The Company currently has two drill rigs operating on site with a third rig scheduled to arrive in two weeks. The 2011 drill program consists of several widely spaced exploration drill holes and delineation drilling north and south of the South Zone deposit. Recent drilling has extended the potential strike length of the iron formation from 25 km to 42 km. In addition, several large diameter PQ drill holes are planned for the collection of bulk samples for metallurgical testing at SGS Minerals in Lakefield Ontario.

On November 30, 2005, the Company entered into an option agreement (the "Lac Otelnuk Option") to earn a 100% interest in certain claims comprising part of the Lac Otelnuk Property. The Company has also staked additional mineral claims directly adjacent to and surrounding the claims subject to the Lac Otelnuk Option. Pursuant to the Lac Otelnuk Option, as amended, the optionor is entitled to a combination of cash, shares and work commitments, all of which have been fulfilled, and a royalty (the "Lac Otelnuk Royalty") equal to (i) 2.5% from the sale of iron ore products mined from the claims subject to the Lac Otelnuk Option payable on commencement of commercial production; and (ii) 2.5% net smelter returns from the sale of any other minerals mined from such properties annually. The Lac Otelnuk Royalty is subject to minimum advances payable by November 30 of each year until commencement of commercial production. The Company may purchase one-half of the Lac Otelnuk Royalty for $5.5 million at any time prior to December 31, 2015 and for $11 million thereafter.

The Company filed an application with the Quebec Superior Court for a judicial interpretation of certain provisions of the Lac Otelnuk Option agreement. The clauses for which clarification was sought relate to the timing of the exercise of the option and certain aspects of the royalty payments. On August 19th, the parties entered into a conditional settlement agreement. The litigation in the Quebec Superior Court was adjourned pending the satisfaction of the settlement's conditions.


Allen J. Palmiere, President and CEO

Certain information regarding the Company, including the Company's plans to increase and upgrade mineral resources and management's assessment of future plans and operations, may constitute forward-looking statements under applicable securities laws and necessarily involve known and unknown risks and uncertainties. Without limitation, statements relating to potential mineralization and resources, exploration results, mining and development, future plans and objectives of the Company and imprecision of mineral resources estimates, are forward-looking statements that involve various degrees of risk.

Certain important risk factors could cause the Company's actual results to differ materially from those expressed or implied by such forward-looking statements including, without limitation, changes in the world wide price of mineral commodities and currency fluctuations, general market conditions, the uncertainty of future profitability and access to sufficient capital, risks inherent in mineral exploration, development, construction and mining operations, delays in obtaining or failures to obtain required governmental, environmental or other project approvals, environmental risks, access to labour and services and competition from other companies. As a consequence, actual results may differ materially from those anticipated in the forward-looking statements and caution should be exercised on placing undue reliance on forward looking information.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this press release.

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