Indico Resources Ltd.

Indico Resources Ltd.

October 04, 2011 12:55 ET

Indico Announces Discovery of Copper-Gold-Molybdenum Porphyry

Phase I Drilling Intersects Strong Pervasive Mineralization Southern Peru Copper Belt

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Oct. 4, 2011) - Indico Resources Ltd. (TSX VENTURE:IDI)(OTCQX:IDIFF) -

Highlights include:

Hole-001: 44m grading 0.73% copper, 0.03 g/t gold, 105ppm molybdenum

Hole-003: 171m grading 0.33% copper, 0.19 g/t gold, 111ppm molybdenum

Indico Resources Ltd. ("Indico" or the "Company") announces receipt of positive results from its Phase I drill program at the Ocaña Copper Project.

The Ocaña porphyry project covers 110 km2 located on the northwest extension of the Southern Peru Porphyry Copper Belt (Figure 1). The Toquepala, Quellaveco, Cuajone, and Cerro Verde Mines are on regional trend to the southeast. Recent exploration in the belt has also resulted in discovery of the Zafranal copper – molybdenum - gold porphyry deposit (NI 43-101 compliant Measured & Indicated resources of 301MT of 0.47% Cu, 0.08g/t Au), located approximately 75km to the southeast of the Ocaña Project. The project is accessible by an 85km graded dirt road, an extension of the paved Pan American Highway. The geology and mineralization at Ocaña is similar to that at the Zafranal.

Results are summarized in Table 1.

The first three drill holes contain strong mineralization over significant thicknesses. Five drill holes have been completed in Phase I, totaling 2,195 metres (Figure 2). Results from drill holes 4 and 5 are pending.

Table 1: Detailed Drill Results

Hole From (m) To (m) Interval CuEq (%)* Cu
Mo (ppm) Au (g/t) Ag (g/t) Zone
2 46 44 0.824 0.734 105 0.032 1.3 oxide supergene
46 192 146 0.308 0.232 97 0.022 1.1 hypogene
192 447 255 0.217 0.153 98 0.014 0.6 hypogene
447 697.8 250.8 0.126 0.094 44 0.009 0.4 hypogene
4 24 20 0.776 0.183 742 0.254 3.6 oxide
24 38 14 1.607 1.290 511 0.057 1.9 supergene
38 150 112 0.334 0.209 136 0.057 1.5 hypogene
150 406.3 256.3 0.211 0.154 71 0.015 0.9 hypogene
120°/-70° including
2 150 148 0.285 0.134 98 0.132 0.6 hypogene
150 321 171 0.536 0.322 111 0.187 2.2 hypogene
219 270 51 0.706 0.424 187 0.206 3.8 hypogene
321 403.3 82.3 0.219 0.125 145 0.020 0.7 hypogene

*Copper equivalent calculations represent the total metal value for each metal, multiplied by the conversion factor, summed and expressed in equivalent copper percentage. These results are exploration results only and no allowance is made from recovery losses that may occur should mining eventually result. These equivalent grades should not be interpreted as actual grades since the conversion rations vary with the volatile prices of Cu and Mo and the economic recoveries of Cu and Mo can vary significantly in actual extraction and processing. However, it is the company's opinion that elements considered here have a reasonable potential to be recovered. The three-year, moving-average metal prices used for the purposes of the equivalency calculations are copper $US3/pound, gold $US1200/ounce, molybdenum $US15/pound and silver $US21/ounce.

Porphyry copper-gold-molybdenum mineralization was intersected at surface and continues to depths of 400 metres or greater from surface. The upper, high-grade portion of Hole OKA-001 grades 0.734% copper from 2 metres to 46 metres, hosted within an upper weathered zone, where mineralization mostly occurs as copper oxides. Underlying the weathered zone, hypogene copper mineralization occurs as disseminated and blebby matrix-filling chalcopyrite within potassic-altered, phreatic breccias and adjacent dacite porphyry. Mineralization is less intense within phyllic-altered zones.

The higher grade breccia system trends west-northwest and is continuous for more than 1 kilometre, over a width of at least 200 metres within the concession, and extending for about another 200 metres to the north off the property. Indico is preparing an infill drilling program to test this primary breccia target.

"We are delighted to have discovered such a strongly mineralized porphyry system with the first three drill holes at Ocaña," stated Gary Freeman, President & CEO of Indico, "It is exceptional to make a discovery of this nature with the first holes drilled in the area. Our near-term focus is on the breccia-system discovery."

To view Figures 1-7 please visit the following link:

Qualified Person

EurGeol Keith J. Henderson, P.Geo., Indico's Chief Scientific Officer, a Director, and a qualified person as defined by National Instrument 43-101, has reviewed and takes responsibility for the scientific and technical information that forms the basis for this news release. Mr. Henderson is not independent of the Company as he is an officer and a shareholder.

Diamond Drilling and Sampling Procedures

The diamond drilling was completed using an HQ and NQ core size. Core recovery was estimated to be greater than 95%. After cutting with a diamond saw, one half of the core was collected for sample preparation and analysis and the other half is retained for future reference. Samples were collected on a 2.0m and 3.0m sample interval. Sample preparation and analyses was completed by ALS-Chemex ("ALS") Lima, Peru.

The geochemical results were reviewed by Tansy O'Connor-Parsons, Senior Geochemist. Indico on-site personnel rigorously collect and track samples which are then security sealed and shipped to ALS, Lima, Peru for assay. Analytical accuracy and precision are monitored by the analysis of reagent blanks, reference material and replicate samples. Quality control is further assured by the use of international and in-house standards. Blind certified reference material is inserted at regular intervals into the sample sequence by field personnel in order to independently assess analytical accuracy. In addition, representative blind duplicate samples are routinely forwarded to ALS and an ISO-compliant third party laboratory for additional quality control. Multi-elements were assayed using the ALS's ME-ICP61 package which includes 4-acid digestion and ICP-ES finish. Lower detection limits are as follows: Cu >0.001%, Mo >0.001%, Ag >0.5g/t. Gold is assayed by the Au-AA23 fire assay package - fusion of a 30-gram followed by AA finish; with a lower detection limit of 0.005 g/t. ALS has an 9001:2008 and 17025 International Standard Organization rating.

New Company Website & Investor Relations

The Company is pleased to announce the launch of its new website found at "Although this website is merely a window on what we do, considerable thought has gone into the design of our web presence such that investors and prospective investors can find information on the Company without being inundated with technical information," stated Gary Freeman, Chief Executive Officer of Indico Resources.

In addition, the Company has strengthened its corporate team by retaining the services of Michael Pound to head Investor Relations. Mr. Pound brings 16 years of marketing, finance and client management experience to the team. He most recently served as Investor Relations for Platinum Group Metals and currently manages Investor Relations for Dorato Resources Inc. (TSX:DRI). He will oversee development of the Company's investor relations strategy and will focus on increasing the Company's exposure in the financial community.

Mr. Pound will be retained on an ongoing basis and will be paid a fee of $6,000 per month for providing investor relations services to the Company. Mr. Pound currently holds 31,500 common shares of the Company and has been granted incentive stock options to purchase up to 100,000 shares of the Company at a price of $0.53 per share, exercisable until March 7, 2013.

About Indico Resources Ltd.

Indico Resources Ltd. is a resource exploration company focused in the discovery and exploration of porphyry copper-gold deposits in South America. The Ocaña Porphyry Project is the Company's primary exploration project and is currently the main focus of exploration activities. In addition, the Company has reviewed multiple additional porphyry exploration projects and is in negotiation to acquire interests in additional porphyry exploration projects. The company's senior technical staff has a cumulative 40 years of porphyry exploration and resource definition experience.

On behalf of Indico Resources Ltd.

Gary Freeman, President and Chief Executive Officer

Cautionary Statement

This press release contains "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995 and "forward looking information" within the meaning of the British Columbia Securities Act and the Alberta Securities Act. Generally, the words "expect", "intend", "estimate", "will" and similar expressions identify forward-looking information. By their very nature, forward-looking statements are subject to known and unknown risks and uncertainties that may cause our actual results, performance or achievements, or that of our industry, to differ materially from those expressed or implied in any of our forward looking information. Statements in this press release regarding Indico's business or proposed business, which are not historical facts, are forward-looking information that involve risks and uncertainties, such as estimates and statements that describe Indico's future plans, objectives or goals, including words to the effect that Indico or management expects a stated condition or result to occur. Since forward-looking statements address events and conditions, by their very nature, they involve inherent risks and uncertainties. Actual results in each case could differ materially from those currently anticipated in such statements. Investors are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date they are made. All of the Company's Canadian public disclosure filings may be accessed via and readers are urged to review these materials, including the technical reports filed with respect to the Company's mineral properties. The foregoing commentary is based on the beliefs, expectations and opinions of management on the date the statements are made. The Company disclaims any intention or obligation to update or revise forward-looking information, whether as a result of new information, future events or otherwise.

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 release.

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