Magellan Minerals Ltd.

Magellan Minerals Ltd.

September 20, 2011 06:00 ET

Magellan Drills 27m @ 6.94 g/t Gold 600m South East of Central at Cuiu Cuiu Project, Brazil

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Sept. 20, 2011) - Magellan Minerals Ltd. (TSX VENTURE:MNM) ("Magellan") is pleased to announce the results of seven additional step-out and exploration holes at the Cuiu Cuiu project including 27m @ 6.94 g/t gold located 600m South East of the Central zone.

Highlights include:-

  • 27m @ 6.94 g/t gold in hole 138 located 600m south east of the Central zone and 400m SE of hole 121 (7.8m @ 8.44g/t gold) represents another new zone of gold mineralization which has been named Central South East
  • 25m @ 0.49 g/t gold in hole 137 at Jerimum Baixo which is located between Central and Moreira Gomes. Gold mineralization at Jerimum Baixo has now been traced consistently over an area of 350 x 35m and remains open in several directions
  • 19m @ 0.48 g/t gold in hole 140 located close to the western margin of the Moreira Gomes zone

Central SE

Hole 138 was drilled 600m SE of the Central zone in the Central SE gold-in soil anomaly and intersected 27.0m @ 6.94 g/t gold from 20.0 to 47.0m depth in saprolitic granite (see map on website), including 2m @ 84.3g/t gold. The hole was drilled 400m SE of hole 121 which intersected 7.8m @ 8.44g/t gold (see press release dated 21st July 2011) and may be the same mineralized structure. Holes 132 and 134 failed to intersect significant mineralization.

The identification of a second high grade drill intersection in the Central SE gold-in-soil anomaly suggests the presence of a potentially significant new mineralized zone at Cuiu Cuiu immediately SE of the Central zone. Significant gold mineralization has been intersected in two out of three holes along strike and extends over a distance of at least 400m. These results come after the recent announcement of a new mineralized zone at Central North which is located a minimum of 360m north of the Central body (see press release dated 8th September 2011). Further drilling at both Central SE and Central North is in progress.

Alan Carter, President & CEO of Magellan, commented, "Hole 138 is a significant intersection by any measure and is important because it is located 600m south of the Central zone which contains an Inferred resource of 500,000 oz and an Indicated resource of 100,000 oz of gold. These results come on the heels of the recent announcement regarding the discovery of a new zone at Central North and supports our strategy of drilling step-out and exploration holes beyond the existing resources. This drilling is aimed at identifying additional mineralized zones at Cuiu Cuiu".

Drill hole intersections discussed in the text are summarized in the following table:

Hole ID From (m ) To (m ) Width* (m ) Gold (g/t )
Central South East
DDH 138 20.0 47.0 27.0 6.94
incl. 24.0 26.0 2.0 84.3
DDH 132 No significant results
DDH 134 No significant results
Jerimum Baixo
DDH 137 0 7.0 7.0 0.76
29.6 31.6 2.0 0.69
41.6 66.6 25.0 0.49
73.6 132.6 59.0 0.28
DDH 139 No significant results
Moreira Gomes Zone
DDH 136 No significant results
DDH 140 64.0 83.0 19.0 0.48
* All holes were drilled at -50°. Dips of the intersected structures are not known, and intersection widths are not necessarily true widths.

Jerimum Baixo

Results were received on two exploration holes from Jerimum Baixo, which is located between the Central and Moreira Gomes deposits and is not currently part of the resource at Cuiu Ciuu. Previous reconnaissance drilling on this anomaly has returned results up to 105.2m @ 0.6 g/t including 41m @ 1.3g/t gold.

Hole 137 was drilled 50m west of hole 135 and intersected 7m @ 0.76g/t from 0 to 7m, 2m @ 0.69g/t gold from 29.6 to 31.6m, 25m @ 0.49g/t gold from 41.6 to 66.6m and 59m @ 0.28g/t gold from 73.6 to 132.6m depth (see map on website). The mineralized zones intersected in hole 137 are almost certainly the same zones recently reported from hole 135 (see press release dated 8th September 2011). Hole 139 was drilled 110m W of hole 137 and cut no values of interest.

Results have now been received on four holes at Jerimum Baixo during 2011 bringing the total number of holes drilled in this zone to twelve. Gold mineralization at Jerimum Baixo is now known to be continuous over an area of at least 350m x 35m and trends in an ESE – WNW direction. The mineralized zone remains open, particularly to the south and results are currently pending on three additional step-out holes.

Moreira Gomes

Results have been returned on two additional holes from the western part of the Moreira Gomes zone which contains an inferred resource of 700,000 oz of gold (14Mt @ 1.5 g/t gold) (see map on website). Hole 140 was drilled between holes 62 and 49 and cut 19m @ 0.48g/t gold from 64 - 83m depth demonstrating the continuity of gold mineralization over the western part of Moreira Gomes.

Hole 136 cut no values of interest and was drilled as an 80m step-out hole west of hole 133 which was the most westerly drill hole at Moreira Gomes.

Magellan currently has three drill rigs operating at Cuiu Cuiu, with drilling expected to continue at least until the end of 2011. Results are currently pending on additional step-out and exploration drill holes from Central North, Central SE and Jerimum Baixo, all of which are targeting areas outside the current resources.

Current resources at Cuiu Cuiu total 1.2Moz (31Mt @ 1.2 g/t) of gold in the inferred category and 0.1Moz (3.4Mt @ 1.0g/t) of gold in the indicated category.

Holes were drilled at 50 degrees from horizontal. All core samples (HQ diameter) were cut with a diamond saw and one-half of the core placed in bags, numbered and sealed then sent via a secure transport agency to the Company's office in Itaituba before shipping via secure transport to ACME preparation laboratory in Itaituba for sample preparation. Core samples were crushed down to 2 mm and a 1 kg split was pulverized to better than 85% minus 200 mesh. From Itaituba, ACME sent the pulp samples to Santiago, Chile for assaying. Gold analyses were conducted on 30g representative sample cuts using fire assay with an atomic absorption finish. Other sample cuts were subjected to a 4 acid digestion and analysed for silver and an additional 35 elements using inductively coupled plasma mass spectrometry (ICP-MS). ACME is an ISO 9001 registered laboratory and has a quality control program in place which includes the insertion of standard, blank, and duplicate samples, as well as conducting repeat analyses.

Magellan's QA/QC program also includes the insertion of standards, field duplicates and blank material in the sample sequence with the normal core samples to monitor sampling variances, laboratory precision and accuracy.

This press release was reviewed by Dennis Moore, B.Sc., M.Eng., a member of AIG, AUSIMM, and the SEG, a qualified person in compliance with National Instrument 43-101.

Magellan Minerals Ltd. (TSX VENTURE:MNM) is a TSX Venture Exchange listed exploration company with a number of gold exploration properties in the Tapajos region of northern Brazil and is focused on the Cuiu Cuiu and Coringa projects where drilling is currently in progress.

This news release may contain forward-looking statements including but not limited to comments regarding the timing and content of upcoming work programs, geological interpretations, receipt of property titles, potential mineral recovery processes, etc. Forward-looking statements address future events and conditions and therefore, involve inherent risks and uncertainties. Actual results may differ materially from those currently anticipated in such statements.

News release #2011-24

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.

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