Apogee Minerals Ltd.

Apogee Minerals Ltd.

October 11, 2006 09:52 ET

Apogee Updates Progress at Silver-Zinc Projects

Operations Improvements Begin At La Solucion Mine, Major Resource Definition Drill Program Ongoing

TORONTO, ONTARIO--(CCNMatthews - Oct. 11, 2006) - Apogee Minerals Ltd. (TSX VENTURE:APE) has begun planning and implementing operational improvements at the 100% owned La Solucion Mine. The company is also in the midst of a 33,500m diamond drilling program to delineate potential mineral resources at its Bolivian Silver-Lead-Zinc projects where exploration programs in the first half of 2006 have located significant high grade silver, lead, zinc and locally, gold mineralization. Eight diamond drills are currently operating.

The La Solucion Mine

The recently-acquired, 100% owned La Solucion Mine is located 17 km by paved road from the Capital city of La Paz. The mine has been producing for the past 14 years with an ore processing capacity of 120 tonnes per day and an existing flotation mill that produces zinc and lead concentrates. The production facility is in good operating condition however the mine has received little capital investment in the past 10 years. The previous mine operators were focused on zinc and have used antiquated non-mechanized mining methods, mine planning and grade control have been non-existent, and safety practices have been poor. There has been virtually no exploration activity in the past 10 years prior to Apogee beginning its diamond-drilling programs in 2005. As a result, both mining efficiency and ore grades realised in production have suffered. Very recent production under previous ownership has averaged over 2300 tonnes of ore per month and grades have averaged 49 g/t silver, 4.5% zinc, and 1.3% lead, down from historical grades and production levels.

Apogee Vice President, Operations and Chief Operating Officer Rick Irvine commented: "The La Solucion Mine represents a tremendous opportunity for capital investment and the application of modern mining techniques to be used to implement a new mining focus on silver, improve the efficiency and safety of mining, realize higher ore grades, and improve the profitability of the mine. Our exploration results to date have demonstrated the existence of higher grades of silver and zinc than currently being mined, in addition to anomalous gold, and we are well on our way to delivering a new Business Plan that we anticipate will have significant impact on these critical areas."

Evaluation, planning and improvements have begun at the mine and recent hirings have increased the level of technical expertise in both planning and operations. The company has identified key areas where efficiencies can be realised as it creates a new Business Plan to 1) maximize the profitability of the current operations, 2) carry out an intermediate production expansion and 3) continue exploration to define a NI 43-101 compliant Resource that would support a significant expansion of mining and production activities.

The initial intermediate expansion to double production is focused on the identification of new resources in, underneath, and around the operating mine. The current crushing capacity will accommodate a doubling of the throughput, and some investment in additional milling and flotation cells will be required for this initial expansion. The new Business Plan is expected to be completed within the next 60 days.

Recent capital investment in the mine with an eye to improving operating efficiencies has included:

- Upgrade of the underground tramming system and procurement of a new 5 ton locomotive and 10 rail cars.

- Improvements to the drill and blast cycle; purchase of new drills, compressed air line and compressor.

- Construction of a new core shack and offices.

- Changeover from a two-shift to a three-shift work schedule incorporating worker transportation and a new change house.

Apogee President and CEO John Carlesso commented: "We are entering the final period of what has to date been a very active and productive year for Apogee. The company has been very successful at meeting or exceeding its objectives at all of its projects and we anticipate being in a position to further quantify the value in both our producing and exploration assets by year-end. Quickly developing an efficient plan to expand production at La Solucion remains a key priority for us and we anticipate delivering this detailed plan, including the delineation of new mining resources, within sixty days."

Ongoing Exploration Programs

Since mid 2005, Apogee has completed approximately 10,500m of diamond drilling at the La Solucion, Pulacayo-Paca and Buena Vista projects. Very encouraging results have been received at all projects, as referenced below, and the current 33,500m program is designed to follow-up mineralized intersections obtained, and to progress each project to the resource definition stage before the end of 2006.

Of particular focus has been an accelerated program of resource definition drilling and regional target evaluation that commenced at the La Solucion Mine.

Apogee Vice President Exploration, Mr Doug Currie, currently in Bolivia to supervise the program, commented, "We have been successful in identifying well-mineralized targets on each of our projects over the past 12 months, all of which have the potential for delineation of mineral resources. We have added quality people to our staff and have worked exceptionally hard to achieve significant results. We have established logistical and geological systems to manage the large forward program and the substantial data it will generate. With 8 drills currently operational, it is our objective to complete this program and commence the calculation of mineral resources, where applicable, before the end of 2006."

The 33,500m drill program will be distributed approximately as follows:

La Solucion (9,000m)

The underground development and drilling program which commenced late February to evaluate the zone beneath and along strike from current and historical production zones within the La Solucion Mine is nearing completion.

Encouraging silver-lead-zinc mineralization was intersected in four drill holes completed on the extension of the Hampaturi Vein (Hampaturi Southwest), up to 100m below and 200m to the southwest of historical mining areas within the La Solucion Mine. Results included two particularly significant intersections (See Press Release January 12, 2006):

SH-03 5m @ 80g/t silver, 4.68% zinc, 3.10% lead and 0.43g/t gold
Including 1m @ 166g/t silver, 7.23% zinc, 8.17% lead

SH-04 8m @ 46g/t silver, 1.86% zinc, 1.59% lead
Including 4m @ 54g/t silver, 1.45% zinc, 1.68% lead
and 1.13g/t gold

Follow-up drilling will continue to evaluate this very prospective zone.

Apogee has also commenced regional exploration to evaluate the extensive system of mineralized veins on the La Solucion property and has identified several prospective drill targets, such as the Porfia and Antimonia prospect areas where anomalous channel samples with values to 606g/t silver, 28.7% zinc and 1.35g/t gold have been located (See Press Release May 24, 2006). Other targets have recently been identified which will also require drill evaluation. An IP geophysical survey has commenced this week to evaluate regional structural targets. There are currently four diamond drills on site and it is expected that further drill results from this program will be received shortly.

Pulacayo-Paca (19,500m)

Significant zones of high grade silver-lead-zinc mineralization have been intersected in Phase 1 drilling programs at both the Pulacayo and Paca prospects.

At Pulacayo, drilling has focused on the Tajo Vein system within the Pulacayo Mine, Bolivia's second largest historical silver producer ( greater than 600million ounces silver produced). Broad zones of silver, lead and zinc mineralization have been intersected. Within these zones are very high grade silver and zinc-rich intersections (See Press Release June 22 and September 7, 2006). Results include:

PUD-028 13m @ 153.31g/t silver, 1.54% zinc, 1.74% lead
Including 2m @ 386g/t silver, 3.08% zinc, 3.90% lead,
and 2m @ 560g/t silver, 1.82% zinc, 5.88% lead

PUD-032 42m @ 33.98g/t silver, 2.88% zinc, 0.48% lead
Including 10.0m @ 114.5g/t silver, 7.42% zinc, 1.07%

PUDU-001 30m @ 244g/t silver, 2.46% zinc and 1.7% lead
Including 2m @ 1331g/t silver, 6.29% zinc, and 2.49%

At the Paca prospect, located about 5km north of Pulacayo, high grade silver mineralization has also been intersected in several holes within broad zones of zinc and lead mineralization. Better results include (See Press Releases dated May 1, 2006 and July 31, 2006):

PND-031 32m @ 308g/t silver, .42% zinc, and .76% lead
Including 3m @ 644g/t silver, .22% zinc, and .64%

PND-035 52m @ 87.88g/t silver, 1.17% lead, 1.07% zinc
Including 2m @ 144g/t silver, 1.52% lead, 1.51% zinc

PND-041 56m @ 65g/t silver, 1.27% lead, 1.65% zinc
Including 7m @ 227.14g/t silver, 1.87% lead, 1.57%

And 40m @ 20.33g/t silver, 0.4% lead, 1.44% zinc

These results have confirmed results of historical drilling by joint venture partner Apex Silver Mines Limited (AMEX:SIL). Apogee plans to focus drilling at both projects to define mineral resources prior to the end of 2006. There are also other several new target areas which the Company will drill test. There are also four diamond drills at Pulacayo-Paca and further results are expected shortly.

Buena Vista (5,000m)

The drill program, which will consist of approximately 5,000m, has initially tested a 400m long extension to the southeast of the main target zone within the recently acquired Leoplan Concession where results of surface trenching, announced in Apogee Press Release dated May 8, 2006, included the following significant mineralized intervals:

TCH-1: 16m @ 0.55g/t gold; 30.7g/t silver; 0.32% zinc; and,
0.46% lead
TCH-12: 18m @ 0.88g/t gold; 95.7g/t silver; 0.60% zinc; and,
1.16% lead, and
TCH-13 12m @ 0.62g/t gold; 58.7g/t silver; 0.70% zinc; and,
0.91% lead

Infill, resource definition drilling will also be completed in the main San Pedro-San Pablo zone. Here, a 600m long zone of higher grade mineralization has been traced with surface trenching, sampling of historical underground workings and drilling over a strike length of approximately 900m (See also Press Releases June 23, 2005; August 25, 2005; November 14, 2005; and, May 8, 2006).

As indicated above, eight diamond drills are currently in the field, 4 at La Solucion, including 1 underground drill, and 4 at Pulacayo-Paca.

For complete details and the results of previous drill programs please refer to the press releases cited above.

Building A Premier Emerging Silver Producer

Apogee Minerals Ltd. is a Canadian producer of silver-zinc-lead and also carries out exploration and development activities. The company is listed on the TSX Venture Exchange under the symbol APE. Apogee is focused on advanced Silver-Zinc projects in South America that demonstrate the potential to receive capital investment and be rapidly developed to production. Currently all of its projects are located in the historic silver producing regions of central and southwest Bolivia.

The 100%-owned La Solucion Mine has a 14 year production history and hosts a 120 tonne per day flotation mill. The Pulacayo-Paca project is a Joint Venture with Apex Silver Mines Ltd. on the second-largest silver mine in the history of Bolivia with over 600 million ounces of past production. The Buena Vista Project is a high-grade gold-silver project with historic production dating back over 200 years.

Regulatory Footnotes:

Mr. Douglas A. Currie, MAusIMM, Apogee's Vice President-Exploration, is the Qualified Person as defined under National Instrument 43-101 responsible for the scientific and technical work on the exploration program and is responsible for reviewing the technical disclosure in this press release.

All analytical work has been completed by ALS Chemex of North Vancouver, BC, Canada; ALS Chemex is a respected international analytical service which is accredited with NATA and complies with standards of ISO 9001:2000 and ISO 17025:1999. They employ a variety of international standards for quality control purposes.

Samples are transported from field projects to the ALS Chemex sample preparation facility in Oruru, Bolivia, by Company personnel or a reputable commercial carrier. All analytical testing is performed utilizing a variety of industry standard analytical techniques, including: (i) ALS Analytical Code ME-MS41 - 50 element analysis using aquaregia digest and ICPAES analysis, (ii) ALS Analytical Code AA46 & AA62 - specific element analysis using aquaregia digest and AAS determination (Ag, Zn, Pb, Cu, As) and, (iii) Analytical Code Au-AA26 - Gold using a 50g Fire Assay-AAS finish.

All diamond drill core is geologically logged and sampled by Company geologists then is cut in half using a diamond saw and sampled in one(1) meter sample intervals; the archive portion of the sample is securely stored at each project site. The Company has initiated a QA/QC program consisting of utilizing standards, duplicate and blank samples and laboratory cross-checks and routinely repeats sample analysis.

Trench samples are chip-channel samples taken over a 5-10cm wide channel cut in the bottom of an excavated trench. Sample intervals are normally 2m composites in zones of alteration or mineralization and 5m composites through unaltered selvedges.

Statements in this release that are not historical facts are "forward-looking statements" within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Readers are cautioned that any such statements are not guarantees of future performance and that actual developments or results may vary materially from those in these "forward-looking statements".

To view a map of La Solucion Mine, please click on the following link: http://www.ccnmatthews.com/docs/mapape.pdf

Contact Information

  • Apogee Minerals Ltd.
    John Carlesso
    President & C.E.O.
    (416) 861-5881
    Apogee Minerals Ltd.
    Mark Feeney
    Director of Business Development
    (604) 786-2587