Magma Metals Limited
TSX : MMW
ASX : MMW

Magma Metals Limited

May 05, 2011 09:00 ET

Magma Metals Limited: Thunder Bay North-Exploration Update

Further Winter Drilling Results Show Strong Potential at East Beaver Lake and South Steepledge Lake

PERTH, WESTERN AUSTRALIA--(Marketwire - May 5, 2011) -Magma Metals Limited(TSX:MMW)(ASX:MMW)("Magma" or the "Company") is pleased to provide further drilling results from the winter drilling program at its Thunder Bay North platinum-palladium-copper-nickel (Pt-Pd-Cu-Ni) project in Ontario.

Highlights

  • Reconnaissance drilling to the southeast of the current mineral resource in the East Beaver Lake area intersected a number of zones of mineralization, confirming the potential to extend resources into this area, which appears to be open to the east for at least 2.5km.

  • A 14,000m summer drilling program will commence shortly to test a 600m strike length of the intrusive complex in this area.

  • Reconnaissance drilling in the southern part of the Steepledge Lake Intrusive Complex intersected thick zones of mineralization, providing strong encouragement for the resource potential of this area.

East Beaver Lake Drilling

Magma recently reported some results from reconnaissance drilling adjacent to the current mineral resource in the East Beaver Lake area (see ASX announcement dated March 29, 2011). Results have now been received for the remainder of the drilling in this area, which was located up to approximately 200m east of the current mineral resource (Figures 1 and 2). The results are detailed in Tables 1 and 2 and included:

B11-385:8m @ 1.16g/t Pt, 1.14g/t Pd (2.30g/t Pt+Pd), 0.43% Cu & 0.21% Ni
4m @ 1.32g/t Pt, 1.23g/t Pd (2.55g/t Pt+Pd), 0.26% Cu & 0.23% Ni
2m @ 1.36g/t Pt, 1.30g/t Pd (2.66g/t Pt+Pd), 0.31% Cu & 0.26% Ni
B11-387:6m @ 1.32g/t Pt, 1.21g/t Pd (2.53g/t Pt+Pd), 0.36% Cu & 0.24% Ni
including:3m @ 1.78g/t Pt, 1.62g/t Pd (3.40g/t Pt+Pd), 0.48% Cu & 0.30% Ni

These intersections were included within thick zones of lower grade material (Table 1). All the holes drilled in this area showed high levels of background platinum and palladium. Given the reconnaissance nature of this drilling, the results are very encouraging and confirm the potential to extend the current mineral resource into this area, which appears to be open to the east for at least 2.5km (Figure 2).

To view, "Figure 1, Intrusive complexes and the winter drilling program at Thunder Bay North," please visit the following link: http://media3.marketwire.com/docs/MMWfig1505.pdf

To view, "Figure 2, Summer drilling program in the Current Lake Intrusive Complex," please visit the following link: http://media3.marketwire.com/docs/MMWfig2505.pdf

Refer to Magma's announcement of February 7, 2011, for information on mineral resource estimates, including the calculation of platinum equivalents.

Magma recently announced an initial approximately 14,000m drilling program to test potential resource extensions over a 600m strike length of the intrusive complex in this area (see March quarterly report dated April 27, 2011). This drilling is due to commence shortly with two drill rigs (Figure 2).

South Steepledge Lake Drilling

In the southern part of the Steepledge Lake Intrusive Complex, two traverses of 20m-spaced holes have been drilled approximately 260m apart to follow up encouraging intersections of mineralization recorded in previous reconnaissance holes (Figures 1 and 3). A number of these holes intersected zones of disseminated sulphides. Assay results from this drilling recorded encouraging intersections of mineralization, detailed in Tables 1 and 2, including:

S11-60:39m @ 0.63g/t Pt, 0.72g/t Pd (1.35g/t Pt+Pd), 0.29% Cu & 0.16% Ni
including:23m @ 0.87g/t Pt, 0.99g/t Pd (1.86g/t Pt+Pd), 0.39% Cu & 0.21% Ni
including:2m @ 1.34g/t Pt, 1.59g/t Pd (2.93g/t Pt+Pd), 0.61% Cu & 0.30% Ni
and:3m @ 1.57g/t Pt, 1.75g/t Pd (3.32g/t Pt+Pd), 0.75% Cu & 0.29% Ni

Given the reconnaissance nature of this drilling, these results are very encouraging and indicate strong potential for defining mineral resources in the Steepledge Lake Intrusive Complex. Follow-up drilling is being planned.

One hole in this program remains to be drilled (Figure 3). Melting snow and ice in the area have made access to the drill site difficult, but conditions are improving and drilling is expected to resume shortly.

"The ongoing positive drilling results, together with supporting geological and geophysical information, continue to indicate strong potential for a large platinum-palladium-copper-nickel mineralized system at this project" said Dr Keith Watkins, Magma's Executive Chairman.

To view, "Figure 3, Drilling in the Southern part of the Steepledge Lake Intrusive Complex," please visit the following link: http://media3.marketwire.com/docs/MMWfig3505.pdf

The 14,000m program noted above is the first phase of approximately 25,000m of drilling that has been budgeted for the remainder of 2011 to identify extensions to the mineral resource. Resource extension drilling will focus on the 2.5km strike extent of the Current Lake Intrusive Complex immediately east of the mineral resource (Figure 2).

In addition, approximately 5,000m of drilling has been allocated to testing regional targets within the Thunder Bay North project. Much of this will be focused on the Steepledge Lake Intrusive Complex.

Table 1. Significant Drilling Results
Drill
Hole
From
(m)
To
(m)
Length
(m)
Pt
(g/t)
Pd
(g/t)
Pt+Pd
(g/t)
Cu
(%)
Ni
(%)
Cut-off
East Beaver Lake
BL11-383246.00248.002.000.630.581.210.130.191.0
254.00264.0010.000.740.611.350.140.191.0
306.00310.004.001.251.082.330.250.131.0
BL11-385210.80229.7518.950.710.661.370.290.150.5
including221.75229.758.001.161.142.300.430.211.0
315.00327.0012.000.840.791.630.180.200.5
including317.00321.004.001.321.232.550.260.231.0
and325.00327.002.001.361.302.660.310.261.0
333.00345.0012.000.690.631.320.150.211.0
BL11-387223.50225.502.000.560.531.090.140.181.0
340.60362.6022.000.600.561.160.180.200.5
including350.60360.6010.000.830.771.600.240.221.0
370.60376.606.001.321.212.530.360.240.5
including371.60374.603.001.781.623.400.480.303.0
South Steepledge Lake
SL11-55246.00254.008.000.310.320.630.150.150.5
including252.00254.002.000.710.731.440.380.231.0
SL11-57335.50348.0012.500.450.420.870.230.230.5
including335.50339.003.500.570.531.090.290.251.0
and342.00345.003.000.610.571.180.290.251.0
SL11-59295.50296.501.000.400.460.860.240.230.5
313.00315.002.000.430.460.890.230.210.5
345.00353.008.000.300.350.650.180.210.5
SL11-60231.35270.3539.000.630.721.350.290.160.3
including247.35270.3523.000.870.991.860.390.210.5
including250.35252.352.001.341.592.930.610.302.0
and265.35268.353.001.571.753.320.750.292.0
278.45281.453.000.830.891.720.470.271.0
Results are reported for intercepts >1.0 g/t Pt+Pd, for East Beaver Lake, and >0.5g/t Pt+Pd for South Steepledge Lake, at the lower cut-off grades shown in the right hand column of the table above; these may include intervals of up to 2m below the cut-off grade. Drill intercepts are down-hole thicknesses and may not represent true thicknesses.
Table 2. Drill Hole Collar and Depth Information
Drill
Hole
Easting
(m)
Northing
(m)
Azimuth
(Deg)
Dip
(Deg)
Depth
(m)
BL11-383358449540226159-89342
BL11-38535877554022100-90420
BL11-38735867554021700-90414
SL11-5535432954023370-90399
SL11-5735434954023370-90397
SL11-5935436954023370-90399
SL11-6035417854026000-90399

Technical Information

Additional information on Magma and its projects, including descriptions of its quality control and assurance procedures, is available on its website at www.magmametals.com.au and in technical reports filed under the Company's profile on the SEDAR website at www.sedar.com.

For information on Mineral Resources, please refer to the Company's announcement dated February 7, 2011, available on the Company's website at www.magmametals.com.au.

Drill-hole location and detailed assay data for drill-holes mentioned in this report but not provided herein have been provided in previous announcements. These are available on the Company's website at www.magmametals.com.au.

Assays were conducted at the ALS Laboratory Group facility in Vancouver, British Columbia, following sample preparation at the ALS facility in Thunder Bay, Ontario.

Competent & Qualified Persons Statement

The information in this report that relates to Exploration Results or Mineral Resources is based on information compiled, reviewed or prepared by Dr Keith Watkins and Dr William Stone, the Executive Chairman and Vice President Exploration - Canada of Magma Metals Limited, respectively, who are both Members of the Australasian Institute of Mining and Metallurgy, and each of whom is a "qualified person" as such term is defined in National Instrument 43-101 – Standards of Disclosure for Mineral Projects. Dr Watkins and Dr Stone have sufficient experience, which is relevant to the style of mineralization and type of deposit under consideration and to the activities undertaken to qualify as Competent Persons as defined in the 2004 Edition of the "Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves" (the JORC Code). Dr Watkins and Dr Stone consent to the inclusion in the report of the matters based on this information in the form and context in which they appear.

Cautionary Statement

Certain information contained in this report constitutes "forward-looking information" under Canadian securities legislation. Generally, forward-looking information can be identified by the use of forward-looking terminology such as "plans", "expects" , "is expected", "estimates", "intends", 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". Although management believes that the expectations expressed in such forward-looking information disclosed herein are based on reasonable assumptions, these statements are not guarantees of future performance. A number of factors could cause actual results, performance or achievements to differ materially from those in the forward-looking information. Such factors include future metal prices, exploration and evaluation results, future availability of capital and general economic, market or business conditions, government regulation of mining operations, failure of equipment or processes to operate as anticipated, risks inherent in mineral exploration and development including unusual or unexpected geological formations. Descriptions of these risks can be found in the Company's various statutory reports, including its Annual Information Form available on its website at www.magmametals.com.au and on the SEDAR website at www.sedar.com.

ABN 72 114 581 047

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