Largo Resources Ltd.
TSX VENTURE : LGO

Largo Resources Ltd.

September 27, 2010 08:58 ET

Largo Undertakes New Drill Program at Northern Dancer Tungsten-Molybdenum Project, Yukon

- Further testing of the higher-grade tungsten and molybdenum zones outlined during the 2006, 2007 & 2008 drill programs

- Initial drilling of Marilyn Creek - an untested exploration target immediately north of Northern Dancer Deposit

- Company makes good progress on Preliminary Economic Assessment (PEA)

TORONTO, ONTARIO--(Marketwire - Sept. 27, 2010) - Largo Resources Ltd. (TSX VENTURE:LGO) announces that two drill rigs have begun a 9-hole, 2,500-metre diamond drill program on the Company's 1,500 hectare Northern Dancer Tungsten-Molybdenum property which straddles the Yukon-British Columbia border 290 kilometres east of Whitehorse.

The 9-hole diamond drill program will further test the higher-grade tungsten and molybdenum zones intersected in the 2006, 2007 and 2008 programs. This will be done through a series of angled drill holes across the deposit to test the higher-grade zones. This higher grade zone is estimated to contain a Measured and Indicated resource of 60.3 million tonnes grading 0.137% WO3 and 0.045% Mo (WO3 equiv 0.215%) and Inferred mineral resource of 5.4 million tonnes grading 0.134% WO3 and 0.047% Mo (WO3 equiv 0.214%) at a 0.17% WO3 equivalent cut-off grade (for details of resource estimate see Press Releases dated May 31, 2010 and March 12, 2009).

Also, exploration drilling of the Marilyn Creek showing, an untested exploration target, is currently underway. Marilyn Creek lies 500 to 1,000 metres north-northwest of the Northern Dancer deposit. It was discovered during a mapping and sampling program in summer of 2007. This program is expected to take four to six weeks to complete with results from the first holes anticipated to be received in about four weeks.

The Preliminary Economic Assessment (PEA) for the Northern Dancer Project currently underway (see Press Release dated May 31, 2010) is making good progress. Completion of the PEA is anticipated by the end of the year. It is currently assessing various mining methods to establish the most cost effective method to exploit the previously identified higher grade zone, although no firm conclusions have yet been drawn.

As part of further metallurgical testwork program, Largo has also successfully completed an investigation into ore sorting techniques using Dual Energy X-Ray Transmission (DEXRT) techniques to improve the economics of the project. Currently, Largo is targeting a rejection of 35% of the crusher feed, whilst recovering 95% of the tungsten and 90% of the molybdenum feed contents. The proposed flowsheet is projected to produce a molybdenum sulphide flotation concentrate, and gravity and flotation tungsten concentrates that will be readily marketable.

Northern Dancer hosts widespread tungsten-molybdenum porphyry style mineralization, the core of which has been partially delineated by 134 diamond drill holes and 496 metres of underground workings. This work was done by AMAX Minerals Exploration from 1977 to 1980 including 51 holes and by Largo, which completed 17 holes in 2006, 26 holes in 2007 and 38 holes in 2008. In March 2009, Largo announced an updated NI 43-101 compliant resource (see press release March 12, 2009).

This resource consists of: Measured resources of 30.8 million tonnes grading 0.114% WO3 and 0.030% Mo, and Indicated resources of 192.6 million tonnes grading 0.100% WO3 and 0.029% Mo. The Measured and Indicated mineral resource estimate contains 500.1 million pounds of WO3 (226.9 k tonnes) and 143.8 million pounds of Mo (65.2 k tonnes). Inferred resources were estimated to be 201.2 million tonnes grading 0.089% WO3 and 0.024% Mo containing 393.1 million pounds of WO3 (178.3 k tonnes) and 107.7 million pounds of Mo (48.9 k tonnes) (for details of resource estimate see Press Releases dated May 31, 2010 and March 12, 2009).

The Northern Dancer deposit is one of the world's largest known tungsten-molybdenum porphyry systems. Tungsten and molybdenum mineralization are concentrated in two zones which partially overlap. The mineralization is hosted in fractures, veinlets and veins associated with a northeast-trending sheeted vein structure hosted in calc-silicate (skarn) rocks and spatially related to a felsic intrusion (quartz-feldspar porphyry). The deposit, which has been tested by drilling for 1.2 kilometres along strike, 500 metres vertically and 600 metres in width, remains open along strike to both the northeast and southwest as well as at depth. In the core of the deposit, there is a higher grade molybdenum zone where molybdenite occurs within and adjacent to the felsic intrusion. Surrounding and partially overlapping the molybdenum zone is a much more extensive tungsten zone where scheelite occurs in the northeast-trending sheeted quartz veins structure. 

Mr. Andy Campbell, P.Geo. is the Qualified Person as defined under National Instrument 43-101 responsible for the scientific and technical work on the program.

About Largo

Largo Resources Ltd. is a Canadian natural resource development and exploration company with two advanced stage projects: the Maracas Vanadium-PGM deposit in Brazil and the Northern Dancer Tungsten-Molybdenum deposit in the Yukon. The Company also owns the Campo Alegre de Lourdes Vanadium exploration project in Brazil. The company is listed on the TSX Venture Exchange under the symbol LGO.

For more information please refer to Largo's website: www.largoresources.com.

Disclaimer

This press release contains forward-looking statements under Canadian securities legislation. Forward-looking statements include, but are not limited to, statements with respect to the impact and timing of the drill program, PEA and metallurgical testwork program, on the Company, ; Largo's development potential and timetable of the Maracas and Northern Dancer projects; Largo's ability to raise additional funds necessary; the future price of ferrovanadium and vanadium pentoxide; the estimation of mineral reserves and mineral resources; conclusions of economic evaluation; the realization of mineral reserve estimates; the timing and amount of estimated future production, development and exploration; costs of future activities; capital and operating expenditures; success of exploration activities; mining or processing issues; currency exchange rates; government regulation of mining operations; and environmental risks. Generally, forward-looking statements can be identified by the use of forward-looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or statements that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved".

Forward-looking statements are based on the opinions and estimates of management as of the date such statements are made. Forward-looking statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of the Largo to be materially different from those expressed or implied by such forward-looking statements, including but not limited to risks related to: timing and availability of external financing on acceptable terms; unexpected events and delays during construction, expansion and start-up; variations in ore grade and recovery rates; receipt and revocation of government approvals; actual results of current exploration activities; changes in project parameters as plans continue to be refined; future prices of ferrovanadium; failure of plant, equipment or processes to operate as anticipated; accidents, labour disputes and other risks of the mining industry. Although management of the Largo has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. The Largo does not undertake to update any forward-looking statements, except in accordance with applicable securities laws.

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