Virgin Metals Inc.
TSX : VGM

Virgin Metals Inc.

September 05, 2007 08:30 ET

High Molybdenum Grades Intersected at Cuatro Hermanos

TORONTO, ONTARIO--(Marketwire - Sept. 5, 2007) - Virgin Metals Inc. (TSX:VGM) ("Virgin Metals" or the "Company") presents assay results for the first four drill holes at the Company's 100% owned Cuatro Hermanos Copper-Molybdenum porphyry property located 145 km southeast of Hermosillo in Sonora, northern Mexico. The holes represented by these results are part of a 6,000 m program aimed at achieving exploration objectives outlined in the Company's August 8th 2007 news release. The Hermosillo-based subsidiary of U.S. drill contractor Layne Christensen has been contracted to complete the work using a track-mounted MPD-1500 reverse circulation drill rig.

The first four drill holes in the Cuatro Hermanos drilling campaign lie within a 500 m long x 350 m wide area located along the north side of the known porphyry, an area historically called the Sulfate Zone. Most of the holes drilled previously in the Sulfate Zone were put down to depths of only 20 to 60 meters, however two of the old drill holes were completed to depths of 162.5 and 260.0 meters, cutting substantial thicknesses of mineralization. Current drilling has targeted 300 m depth but some holes were stopped short of this depth due to mechanical, water or geotechnical issues. A summary of Virgin Metal's drill holes is provided in Table 1 below:



Table 1. Reverse Circulation Drilling - Cuatro Hermanos Project

-------------------------------------------------------------------------
Hole No. Inclination Total From To Intercept
-------------------------------------------------------------------------
(degrees) Depth (meters) (meters) (meters)
(meters)
-------------------------------------------------------------------------
-------------------------------------------------------------------------
CHRC0I-07 -90/vertical 182.9 15.2 182.9 167.7
-------------------------------------------------------------------------
-------------------------------------------------------------------------
CHRC02-07 -90/vertical 251.5 4.6 126.5 121.9
-------------------------------------------------------------------------
-------------------------------------------------------------------------
CHRC03-07 -90/vertical 166.1 35.0 166.1 131.1
-------------------------------------------------------------------------
-------------------------------------------------------------------------
CHRC04-07 -70 248.4 164.6 221.0 56.4
-------------------------------------------------------------------------
-------------------------------------------------------------------------
INCLUDING 164.6 195.1 30.5
-------------------------------------------------------------------------
-------------------------------------------------------------------------
-------------------------------------------------------------------------


-------------------------------------------------------------------------
True
Thickness Mo Cu
-------------------------------------------------------------------------
(meters) % %
-------------------------------------------------------------------------
-------------------------------------------------------------------------
CHRC0I-07 167.7 0.032 0.197
-------------------------------------------------------------------------
-------------------------------------------------------------------------
CHRC02-07 121.9 0.042 0.255
-------------------------------------------------------------------------
-------------------------------------------------------------------------
CHRC03-07 131.1 0.011 0.200
-------------------------------------------------------------------------
-------------------------------------------------------------------------
CHRC04-07 45.5 0.114 0.288
-------------------------------------------------------------------------
-------------------------------------------------------------------------
INCLUDING 28.0 0.195 0.389
-------------------------------------------------------------------------
-------------------------------------------------------------------------
-------------------------------------------------------------------------


Vertical hole CHRC01-07 was drilled to a depth of 182.9 m and returned a 167.7 m intercept from 15.2 to 182.9 m which averages 0.197% Cu and 0.032% Mo. The drill hole is nearly a "twin" of Occidental Petroleum's core hole OXY-3, which was completed in 1969 to a depth of 162.5 m from a site located about 12 m to the northwest of CHRC01-07. A comparable interval of OXY-3 returned 144.6 m grading 0.179% Cu and 0.034% Mo from 17.9 to 162.5 m. CHRC01-07 cuts a substantial thickness of phyllically altered diorite and quartz diorite containing pyrite-chalcocite-chalcopyrite-molybdenite as disseminations and lesser veinlets. The bottom 12.2 m of CHRC01-07 (from 170.7 to 182.9 m) assayed 0.18% Cu and 0.020% Mo, and had it not been for technical difficulties, drilling would have continued to greater depth.

CHRC02-07 is located 125 m north of CHRC01-07 and was drilled vertically to a depth of 251.5 m cutting 121.9 m of mineralization (from 4.6 to 126.5 m) which averaged 0.255% Cu and 0.042% Mo. As in CHRC01-07, the hole cuts a substantial thickness of variably quartz-sericite-pyrite phyllically altered diorite and quartz diorite containing significant quantities of pyrite-chalcocite-chalcopyrite-molybdenite as disseminations and lesser veinlets. Grade distribution appears relatively uniform throughout the interval, and there is also a deeper lower grade Cu-Mo intercept containing local "kicks" of greater than 0.2% Cu and 0.020% Mo.

Vertical drill hole CHRC03-07 lies approximately 175 m northwest of CHRC02-07, and was drilled to a depth of 166.1 m, cutting a 131.1 m thick interval of low grade mineralization (from 35.0 to 166.1 m) grading 0.200% Cu and 0.011% Mo. The drill hole bottoms in mineralization (0.109% Cu), and although Mo values for the CHRC03-07 are overall quite low, they are buoyed up by a 3.05 m interval (from 54.85 to 57.90 m) grading 0.266% Mo. As in the previous two drill holes, pyrite with varying quantities of chalcocite-chalcopyrite-molybdenite are localized as disseminations and lesser veinlets in variably quartz-sericite altered diorite and quartz diorite intrusive rocks. Possible intervals of hydrothermally-altered volcanic stratigraphy noted by our geologists suggest we are nearing the northern limit of the porphyry, close to the contact with the Cretaceous wall rock.

CHRC04-07 is located approximately 460 m northeast of drill hole CHRC01-07 and was angled to the south at -70 degrees to undercut BHP Mineral's 1997 vertical RC hole CHM-4. Virgin Metal's drill hole returned a 56.4 m intercept grading 0.288% Cu and 0.114% Mo from 164.6 to 221.0 m. The top of this interval contains a higher grade zone which averages 0.195% Mo and 0.389% Cu across 30.4 meters. Although much of the drill hole cuts phyllically and propylitically-altered diorite, the Mo-Cu-bearing intervals appear to coincide with a set of silicified quartz-diorite dikes. Virgin's step-out hole (which was collared about 75 m north of CHM-4) returned considerably better grades than the original BHP intercept of 39 m grading 0.106% Mo and 0.20% Cu from 179 to 218 m. Taken together, the relations for the two drill holes suggest a northeast-dipping tabular or wedge-shaped body of high-grade Mo mineralization, which may correlate with the Mo intercept cut (from 54.85 to 57.90 m) in the upper portion of CHRC03-07.

Virgin Metals CEO Chris Davie stated "These results confirm high molybdenum values at what appears to be the northern extremity of the intrusion. When combined with ubiquitous moderate grade copper along with significant molybdenum over broad areas and to considerable depths within the porphyry itself, we believe the current campaign will outline substantial tonnages of mineralization even though at present we are testing only a small part of a what is believed to be a much larger mineralizing system."

The Cuatro Hermanos property is underlain by Cretaceous andesitic volcanic rocks which have been intruded by a composite lower Tertiary pluton ranging in composition from granodiorite to quartz diorite and diorite, with lesser aplitic phases. More recent uplift, erosion, and block faulting have led to a complex geologic setting. Cerro San Felipe, the principal topographic promontory on the property, stands out as a zone of strong iron oxide-staining (due to the oxidation of pyrite and other sulfides) with a central core of quartz-sericite-pyrite phyllic alteration and silicification which is flanked by an outer shell of propylitized intrusive and volcanic rocks. Except for an apron of talus which flanks the mountain, there is no post-mineral cover concealing mineralization.

Exploration campaigns carried out intermittently over the past forty years, for which varying amounts of documentation survive, have provided sufficient data to outline a Cu-Mo porphyry system of substantial size, at least 4.5 square kilometers in extent, and open in most directions. Virgin Metals believes that it will be able to establish a substantial resource through infill and step-out drilling, and by drilling deeper into the mineralizing system. The previous drill holes are widely spaced (commonly 300 to 500 m apart, or more), with many of them bottoming in mineralization. Nearly all of the holes were drilled vertically, even though there appears to be a preferred orientation to some of the mineralized veinlet swarms, which would be better tested with angle drill holes. The Company's management believes that Cuatro Hermanos has the potential to yield substantially higher Cu-Mo grades at depth, in (postulated) potassically altered intrusive rocks located beneath the phyllic alteration shell.

To date, Virgin Metals' drill program at Cuatro Hermanos has demonstrated that the historic information for the property appears reliable, and that Cu-Mo mineralization is more widespread and extends to greater depth than previously recognized. The mineralizing system contains a very large metal content characterized in drill holes by long intervals of relatively low grade porphyry-style Cu-Mo mineralization, supplemented by higher grade Mo formed near the margin of the intrusive. Depending on the level of erosion, the vertical range for porphyry environments is frequently greater than 1.5 km. Taking into account that the drilling to date has been relatively shallow and that the available alteration mapping suggests we are still relatively high in the mineralizing system, the management at Virgin Metals believes that there is ample room to expand the size of the deposit, and at the same time improve the overall grade of the resource.

The drill rig has been moved approximately 700 m south of the Sulfate Zone to an area historically known as the Main Zone. Through continued drilling it is the Company's objective to demonstrate continuity between the two zones and table a 43-101 compliant resource for the two areas. In time, Virgin Metals plans also to focus on another porphyry target located 2.5 km west of the Main Zone, in an area historically called the West Zone.

An additional four reverse circulation drill holes have been completed (CHRC05-07 to CHRC08-07) at Cuatro Hermanos; samples for which have been shipped off for laboratory analyses, and a ninth drill hole is in progress. A map showing the location of the drill holes completed to date, along with the historic drilling, is available with other information about the company and its projects at: www.virginmetals.com.

Samples of drill cuttings at Cuatro Hermanos are being collected at 5ft (1.52) m intervals, and reduced in size whenever necessary to (ideally) 3 to 4 kg using a Jones riffle splitter. Plastic sample bags are immediately sealed on-site using pre-numbered security tags. The samples are stored for a short time at the Company's field office near the project, until they can be transported by Company personnel to ALS Chemex's sample preparation facility in Hermosillo. A duplicate pulp and the reject material for all samples are being securely stored for possible future use. All assay work is being carried out at ALS Chemex's ISO 9001-2000 certified laboratory in Vancouver, Canada. Virgin Metals has incorporated quality control measures for the analytical work including the insertion of standards, blanks, and duplicate samples, details for which will be made available in a future news release.

The company is also preparing to complete induced polarization and resistivity geophysical surveys over select portions of the Cuatro Hermanos property, to assist in identifying areas of porphyry-style mineralization and silicification at depth. Bids are currently being received from select contractors. It is likely that the geophysical surveys will overlap with the current drill program. Results for the geophysics will be used to help refine targets for a deep diamond drilling program which is scheduled to begin in early 2008.

The Cuatro Hermanos exploration project is being supervised by Consulting Geologist, John C. Spurney, M.Sc. Mr. Spurney, a qualified person as defined under the terms of National Instrument 43-101, has reviewed the contents of this press release.

About Virgin Metals

Virgin Metals is a junior exploration and development company; its projects include two copper-molybdenum porphyry properties in Sonora, northern Mexico. One of these, Los Verdes, is undergoing a feasibility study and is expected to evolve rapidly towards production while the other, Cuatro Hermanos, is presently the focus of an intense exploration effort.

FORWARD-LOOKING STATEMENTS

This press release includes certain "forward-looking information" within the meaning of the Securities Act (Ontario), including, but not limited to, statements as to timing and extent of exploration programs and the availability of exploration results. As such, forward-looking information addresses future events and conditions and so involves inherent risks and uncertainties, as disclosed under the heading "Risk Factors" and elsewhere in Virgin Metals documents filed from time to time with the Ontario Securities Commission and other regulatory authorities. Actual results could differ significantly from those currently projected as a result of, among those factors, adverse weather, regulatory changes, delays in receiving permits, accidents and delays in completing exploration activities not all of which are in the control of Virgin Metals. The forward-looking information contained herein is Virgin Metal's reasonable estimate today of future events and conditions, but no assurance can be given that such events or conditions will occur.

Shares Outstanding: 78,401,885

Contact Information