Nautilus Minerals Inc.
AIM : NUS
TSX : NUS

Nautilus Minerals Inc.

May 13, 2009 10:30 ET

Nautilus Minerals Inc.: Drilling Discovers New High Grade Zones Near Solwara 1 Resource

TORONTO, ONTARIO--(Marketwire - May 13, 2009) - Nautilus Minerals Inc. (TSX:NUS)(AIM:NUS) (the "Company" or "Nautilus") announces it has discovered a new high-grade base and precious metal zone on its Solwara 1 Prospect in the territorial waters of Papua New Guinea ("PNG"). A review of recently completed assay work from its scout drilling program completed in late 2008 (the "Scout Drilling Program"), has revealed this new zone with significant base and precious metal grades. The newly discovered zone (North Zone) lies approximately 250 meters north of the Solwara 1 Resource and has returned top assay values in respect of each mineral of 30.1% Cu, 22.0% Zn, 26.2 g/t Au and 580 g/t Ag across holes drilled. The Scout Drilling Program also intersected a high-grade mineralisation at Solwara 5 (top values in respect of each mineral of 24.3% Cu, 10.35% Zn, 19.3 g/t Au and 299 g/t Ag across holes drilled). These prospects occur on Exploration License, EL1196 and are subject to Mining Lease Application, MLA154. They are open at depth and require further definition both laterally and vertically. Recoveries have been reduced from those achieved in the 2007 drilling campaign with an average 41% recovery across the program in 2008.

Nautilus is currently evaluating tenders for further drilling in these new areas and those parts of the deposit which remain open at depth. It is intended, subject to the availability of equipment with a minimum 40 metre depth capability, to carry out further drilling in 2010.

Stephen Rogers, Nautilus' CEO commented: "The discovery of new high-grade mineralisation on our EL1196, near the existing NI43-101 compliant resource at Solwara 1, is an important result. It further demonstrates the exploration potential on both MLA154 and our large tenement package in the Bismarck Sea, PNG. The Company continues to progress towards production, and we look forward to testing the depth potential of these newly discovered mineralised zones once we award a drilling contract at the conclusion of the current tender process."

2008 Drilling Program

Nautilus completed a 31 hole, 176.40 meter Scout Drilling Program over a 21-day period from November 12, to December 3, 2008. The program was on 100% Nautilus held tenements in the Bismarck Sea, within the territorial waters of PNG (Figure 1). Drilling was undertaken from MV Nor Sky vessel using a Perry Slingsby built T200 Remote Operated Vehicle ("ROV") mounted drill rig that was used in 2007 to successfully define the world's first NI43-101 compliant resource estimate for a Seafloor Massive Sulphide ("SMS") deposit at Solwara 1.

Of the 31 short holes completed, 22 were drilled on EL1196, including four holes at Solwara 5. An additional four holes were completed at Solwara 4 and 8, and five holes were completed at Solwara 10.

Overall core recovery in the 2008 Scout Drilling Program was 41% which is significantly lower than that achieved in the 2007 program (approximately 60% overall recovery). The reduced recovery is thought to have resulted from the large number of sites/systems tested, alternating very soft and hard material and the highly fractured nature of the near surface material. Operator inexperience has also contributed given the short nature of the program relative to 2007.

The 2008 drilling program was designed to provide a rapid and cost effective test of a number of relatively weak Electromagnetic ("EM") anomalies and/or sulphide outcrops identified by various dives in 2007 and 2008. Each dive of the drill program was generally designed to complete two short "scout holes", with around 8 to 9 meters of rods available for each hole if drilling/ground conditions allowed.

A ROV mounted EM detection system was developed in 2007 by Nautilus, Teck Cominco and Ocean Floor Geophysics to "map" shallow copper rich mineral systems (see press release number 46 dated November 19, 2007). The EM system successfully mapped the copper-rich Solwara 1 system. In 2008, the Company collected EM data over a number of other systems, including zinc-rich outcrops. The EM system has a depth penetration of around two to five meters in copper-rich systems, but does not respond to copper-poor systems.

Results

EL1196

A total of 22 short holes were completed on EL1196 (Figures 1, 2 and 3). At Solwara 1, 18 holes were completed to test a range of targets, all of these infilling within the previously defined Inferred Resource, and within additional weak EM anomalies outside the existing resource.

High-grade results were returned from the new North Zone at Solwara 1, Solwara 5 and from within the existing Inferred Resource.

Solwara 1 - North Zone: Three holes (SD 148, 149, and 162) drilled approximately 250 meters north of the central zone discovered a new zone of high-grade mineralisation (top values in respect of each mineral of 30.1% Cu, 22.0% Zn, 26.2 g/t Au and 580 g/t Ag across all holes) locally occurring beneath unaltered volcanic rock (Figure 3). The mineralisation is open at depth, and laterally. All three holes suffered from poor recovery, but ended in high-grade base and precious metal. Drill holes SD 160 and SD 163 drilled to the immediate north and south of the North Zone did not intersect sulphide mineralisation, but are not considered an adequate test of the lateral extent. Further work is required to define the lateral and vertical extent of this new zone of high-grade mineralisation. The drilling also indicates that high-grade mineralisation does exist, at least locally under volcanic rock as well as sediment cover.



Table 1: Solwara 1 North Zone - Significant Intersections.

---------------------------------------------------------------
Solwara 1 - North Zone
---------------------------------------------------------------
Interval Interval Interval Recovery for
Hole from (m) to (m) length (m) interval
---------------------------------------------------------------
SD148 1.45 2.01 0.56 100%
-----------------------------------------------
5.32 7.00 1.68 40%(i)
----------------------------------------------
open at depth (last core recovered at 7.00m)
---------------------------------------------------------------
SD149 1.12 2.05 0.93 100%
----------------------------------------------
3.96 4.08 0.12 100%
----------------------------------------------
open at depth (last core recovered at 4.08m)
---------------------------------------------------------------
SD162 7.12 8.39 1.27 100%
----------------------------------------------
open at depth (last core recovered at 8.39m)
---------------------------------------------------------------


----------------------------------------------------------------------
Significant Intersection
(weighted average grade) Lithology
----------------------------------------------------------------------
Cu Pb Zn Au Ag
Hole (%) (%) (%) (g/t) (g/t)
----------------------------------------------------------------------
SD148 1.16 1.54 17.00 19.49 380 Semi-massive sulphide
-----------------------------------------------------------
8.08 0.10 0.37 4.64 15 Massive sulphide
----------------------------------------------------------------------
SD149 12.88 0.16 4.36 20.56 121 Massive sulphide
-----------------------------------------------------------
11.95 0.04 0.21 3.87 22 Massive sulphide
----------------------------------------------------------------------
SD162 9.07 0.14 2.48 16.84 124 Massive sulphide
----------------------------------------------------------------------
(i) This intersection has a recovery less than 50% and may not represent
the grade of the entire intersection.


Solwara 1 - Holes drilled within and around the existing Inferred Resource: A number of short holes were drilled in the margins of the existing Inferred Resource to test the robustness of the existing resource model (SD 151, 152, 154, 155, 156, 157, 158, and 161) (Figure 3). Results support the existing resource model. At this time the resource model has not been re-estimated. Improved core recovery and significantly greater depth penetration are required to further test the extent of the existing resource model.



Table 2: Solwara 1 Resource Area - Significant Intersections.

---------------------------------------------------------------
Solwara 1 - Resource Area
---------------------------------------------------------------
Interval Interval Interval Recovery
Hole from (m) to (m) length (m) for interval
---------------------------------------------------------------
SD151 0.26 9.25 8.99 45%(i)
-----------------------------------------------
open at depth (last core recovered at 9.25m)
---------------------------------------------------------------
SD152 1.31 8.48 7.17 85%
-----------------------------------------------
open at depth (last core recovered at 8.48m)
---------------------------------------------------------------
SD154 1.37 5.24 3.87 54%
---------------------------------------------------------------
SD155 0.70 1.12 0.42 100%
---------------------------------------------------------------
SD156 1.05 2.05 1.00 100%
---------------------------------------------------------------
SD161 2.88 3.50 0.62 100%
---------------------------------------------------------------
open at depth (last core recovered at 3.5m)
---------------------------------------------------------------


------------------------------------------------------------------------
Significant Intersection
(weighted average grade) Lithology
------------------------------------------------------------------------
Cu Pb Zn Au Ag
Hole (%) (%) (%) (g/t) (g/t)
------------------------------------------------------------------------
SD151 3.35 0.05 0.07 3.64 19 Massive sulphide;
Semi-massive sulphide
------------------------------------------------------------------------
SD152 13.21 0.07 0.65 11.41 40 Massive sulphide;
Hydrothermally altered
clay-rich volcanic rock
------------------------------------------------------------------------
SD154 10.23 0.06 0.22 7.88 36 Massive sulphide
------------------------------------------------------------------------
SD155 22.80 0.02 0.07 5.25 45 Massive sulphide
------------------------------------------------------------------------
SD156 11.45 0.06 0.22 19.81 58 Massive sulphide
------------------------------------------------------------------------
SD161 12.60 0.37 0.80 12.50 34 Massive sulphide
------------------------------------------------------------------------
(i) This intersection has a recovery less than 50% and may not represent
the grade of the entire intersection.


Solwara 1 - Holes testing other weak EM anomalies: Drill holes SD 147, 150, 153, 159, and 164 attempted to test weak EM anomalies near the Inferred Resource (Figure 3). These holes, which are short and demonstrated low recoveries, failed to intersect any sulphide mineralisation or anomalous material.

Solwara 5: Four holes were drilled at Solwara 5, centred on a small EM anomaly co-incident with mapped chimneys (Figure 4). All four holes intersected high-grade mineralisation, even in the overlying sediment cover. Copper rich mineralisation was intersected in the vicinity of the EM "bull's eye", and more zinc and/or gold rich mineralisation appear peripheral to this in the "step out" holes that were drilled. Results at Solwara 5 are encouraging with top assay values in respect of each mineral of 24.3% Cu, 10.3% Zn and 19.3 g/t Au and 299 g/t Ag across all holes. Mineralisation is open both at depth and laterally.



Table 3: Solwara 5 - Significant Intersections.

---------------------------------------------------------------
Solwara 5
---------------------------------------------------------------
Interval Interval Interval Recovery
Hole from (m) to (m) length (m) for interval
---------------------------------------------------------------
SD_S5_001 1.22 1.71 0.49 100%
-----------------------------------------------
open at depth (last core recovered at 1.71m)
---------------------------------------------------------------
SD_S5_002 1.08 2.95 1.87 100%
-----------------------------------------------
8.87 9.02 0.15 100%
-----------------------------------------------
open at depth (last core recovered at 9.02)
---------------------------------------------------------------
SD_S5_003 0.71 2.31 1.60 100%
-----------------------------------------------
open at depth (last core recovered at 2.31m)
---------------------------------------------------------------
SD_S5_004 0.19 3.54 3.35 27%(i)
---------------------------------------------------------------


------------------------------------------------------------------------
Significant Intersection
(weighted average grade) Lithology
------------------------------------------------------------------------
Cu Pb Zn Au Ag
Hole (%) (%) (%) (g/t) (g/t)
------------------------------------------------------------------------
SD_S5_001 24.30 0.07 0.76 7.14 37 Massive sulphide
------------------------------------------------------------------------
SD_S5_002 20.25 0.08 0.95 7.38 56
-------------------------------------------------------------
7.42 0.02 0.05 1.27 14 Volcanic breccia with
sulphide matrix
------------------------------------------------------------------------
SD_S5_003 1.35 0.42 5.90 9.57 120 Clay; Lithified
clastic sediment
------------------------------------------------------------------------
SD_S5_004 3.92 0.32 3.76 14.47 157 Massive sulphide; Fresh
volcanic rock; Partly
altered volcanic rock
------------------------------------------------------------------------
(i) This intersection has a recovery less than 50% and may not represent
the grade of the entire intersection.


Solwara 10

Five short holes were completed at Solwara 10, where predominately zinc rich chimneys have been observed over a strike length of approximately 680 meters (Figure 5). The EM response over the prospect is generally weak and irregular. Four of the five holes intersected zones of zinc +/- silver, gold, copper mineralisation, with a best intersection of 56.5% Zn, 270 g/t Ag and 3.9 g/t Au being recorded over 0.70m interval. Further work is warranted in this area given its relatively early stage of exploration.



Table 4: Solwara 10 - Significant Intersections

---------------------------------------------------------------
Solwara 10
---------------------------------------------------------------
Interval Interval Interval Recovery
Hole from (m) to (m) length (m) for interval
---------------------------------------------------------------
SD_S10_001 0.33 1.65 1.32 100%
-----------------------------------------------
open at depth (last core recovered at 1.65m)
---------------------------------------------------------------
SD_S10_002 0.91 2.03 1.12 100%
-----------------------------------------------
3.91 4.21 0.30 100%
---------------------------------------------------------------
SD_S10_003 0.30 0.80 0.50 100%
---------------------------------------------------------------
SD_S10_005 0.73 1.22 0.49 100%
---------------------------------------------------------------


-------------------------------------------------------------------------
Significant Intersection
(weighted average grade) Lithology
-------------------------------------------------------------------------
Cu Pb Zn Au Ag
Hole (%) (%) (%) (g/t) (g/t)
-------------------------------------------------------------------------
SD_S10_001 1.68 0.15 49.81 3.21 209 Massive sulphide;
Semi-massive sulphide
-------------------------------------------------------------------------
SD_S10_002 1.54 0.16 29.20 2.77 166 Massive sulphide; Partly
altered volcanic rock
-------------------------------------------------------------
4.50 0.02 6.31 0.22 30 Hydrothermally altered
clay-rich volcanic rock
-------------------------------------------------------------------------
SD_S10_003 0.31 0.10 29.50 1.40 145 Massive sulphide
-------------------------------------------------------------------------
SD_S10_005 0.51 0.10 24.00 0.35 62 Volcanic breccia with
sulphide matrix; Altered
volcanic rock
-------------------------------------------------------------------------


The style of mineralisation present at Solwara 10 is significantly different from that defined to date at Solwara 1, being dominated in the drilling by zinc sulphides with relatively lesser copper sulphides. A portion of the intersected mineralisation occurs in veins and breccias, rather than massive sulphide.

Solwara 4 and 8

Four short holes were completed in the Solwara 4 and 8 area, where patchy low order EM anomalies were defined (Figure 6). Drilling returned mixed results, with top assay values in respect of each mineral of 25.2% Cu, 13.4% Zn and 27.0 g/t Au across all holes.



Table 5: Solwara 4 and 8 - Significant Intersections.

---------------------------------------------------------------
Solwara 4 and 8
---------------------------------------------------------------
Interval Interval Interval Recovery
Hole from (m) to (m) length (m) for interval
---------------------------------------------------------------
SD_S4_002 0.78 1.25 0.47 100%
---------------------------------------------------------------
SD_S4_003 2.14 4.10 1.96 33%(i)
---------------------------------------------------------------


-----------------------------------------------------------------
Significant Intersection
(weighted average grade) Lithology
-----------------------------------------------------------------
Cu Pb Zn Au Ag
Hole (%) (%) (%) (g/t) (g/t)
-----------------------------------------------------------------
SD_S4_002 25.20 0.11 1.70 5.19 45 Massive sulphide
-----------------------------------------------------------------
SD_S4_003 5.20 0.18 10.07 15.93 121 Massive sulphide
-----------------------------------------------------------------
(i) This intersection has a recovery less than 50% and may not represent
the grade of the entire intersection.


Significant Intersection Methodology

Significant Intersections are selected to enclose intervals of greater than 4% Cu (or grades of Cu, Zn, Au and Ag which, in combination or alone, may contribute a similar in situ metal value). Core loss bounded by mineralised intercepts, and interpreted from drilling data to be the result of poor drilling performance as opposed to a change in material type, is allocated the average grade of mineralised material above and below the core loss. If the recovery for the interval was greater than 50% the interval is considered a significant intersection and grades within the interval have been averaged by applying a length-weighting.

A full listing of all intersections and core recovery can be seen in Table 6.



Links

Figure 1: http://www.nautilusminerals.com/i/misc/Figure1_drill.pdf
Figure 2: http://www.nautilusminerals.com/i/misc/Figure2_drill.pdf
Figure 3: http://www.nautilusminerals.com/i/misc/Figure3_drill.pdf
Figure 4: http://www.nautilusminerals.com/i/misc/Figure4_drill.pdf
Figure 5: http://www.nautilusminerals.com/i/misc/Figure5_drill.pdf
Figure 6: http://www.nautilusminerals.com/i/misc/Figure6_drill.pdf
Table 6: http://www.nautilusminerals.com/i/misc/Table6_drill.pdf


Data Quality:

Logging

Core loss was a significant issue for the 2008 drilling program. During the 2007 drilling program, core loss was generally assigned conservatively to either the hanging wall or footwall of the mineralisation, thereby giving the thinnest "ore zone" interval. Core loss from within massive sulphide zones was assigned on a "best fit basis". During the 2008 program, an attempt was made to allocate core loss to intervals on the basis of drill parameters (water pressure, bit weight, penetration rate, etc). The poor core recovery made this work difficult and the conservative approach of 2007 was used if drill parameters were ambiguous.

Drilling and Sampling Procedures

Core drilling for the Nor Sky 2008 program was undertaken using one of the Perry Slingsby built ROV diamond drills that were used to successfully drill the Solwara 1 SMS deposit in 2007. All holes are drilled with less than a five degree variation from vertical. Core (NQ2 size) was photographed and summary logged on the vessel, then logged in detail, cut and sampled using a core saw in Rabaul. All sampling and logging were performed under the supervision of senior Nautilus personnel, and essentially followed procedures established in the 2007 program. Geotechnical logging was not extensive, given the "scout nature" of the drilling program, and poor core recovery.

Half core samples were despatched in numbered plastic vacuum sealed bags, in containers with numbered, tamper-proof seals to ALS in Brisbane. ALS maintains a full electronic chain of custody for samples under its care.

Laboratory Analysis

Sample preparation and assaying was completed by ALS Laboratory Group in Brisbane sample preparation, base metals and multi-elements) and Townsville (precious metals), Australia. ALS operates quality systems based on international standards ISO/IEC17025:1999 "General requirements for competence of calibration and testing laboratories" and ISO9001:2000 "Quality Management Systems - Requirements".

QA/QC

Nautilus QA/QC procedures were established during the 2007 drilling program, and require the regular addition of external certified reference material (CRM), secondary reference material (SRM), blanks and field duplicates at regular intervals.

External certified reference material was obtained from Geostats Pty Ltd, of Perth, Western Australia with known and statistically tested concentrations of the major base and precious metals. Assay results for CRM material were all within acceptable or generally acceptable limits.

Blanks and field duplicates were also generally within acceptable limits, with the exception of one blank which appears to have suffered contamination during sample preparation.

Data Reduction

Following QA/QC checks and assay data acceptance, all data was reviewed and mineralised intervals defined taking into account natural geological boundaries and applying a nominal 2% Cu "cut off". The start and end of mineralized massive sulphide intervals were outlined using the conservative approach defined above. Sulphide intervals of greater than 55% core loss have not been assigned weighted averages, but merely been reported "as recovered" in the summary tables. Sulphide intervals with better than 45% recovery have been given weighted averages, with the lost core intervals being assumed to have similar grade to the intervals above and below.

Complete results for all holes are presented Table six.

Qualified Person

The exploration results reported in this announcement have been compiled under the supervision of Michael Johnston, Vice President Strategic Development of Nautilus Minerals. Mr. Johnston is a member of the Australasian Institute of Mining and Metallurgy, has over 25 years experience in mining and exploration geology, and is a qualified person as defined by National Instrument 43 - 101. He consents to his name being used in this release.

Additional geological information in respect of the Company's Exploration License EL 1196 can be found in the report entitled Nautilus Minerals Inc., 2008 Exploration Program, Papua New Guinea, Tonga, Fiji, Solomon Islands and New Zealand dated December 31, 2008 prepared by SRK Consulting (Australasia) Pty. Ltd., a copy of which may be viewed at www.sedar.com.

About Nautilus Minerals Inc.

Nautilus is the first company to commercially explore the ocean floor for gold and copper seafloor massive sulphide deposits and is currently developing its first project. The Company's main focus is the Solwara 1 Project, which is located in the territorial waters of Papua New Guinea in the western Pacific Ocean. Nautilus is listed on the TSX and on AIM, and has among its largest shareholders two of the world's leading international resource companies, Teck (6.8%) and Anglo American (11.1%). Metalloinvest, one of the largest and fastest growing mining and metallurgical holding companies in Russia, beneficially owns 21.0% of its shares through Gazmetall Holding (Cypress) Limited.

Neither the TSX nor the London Stock Exchange accept responsibility for the adequacy or accuracy of this press release.

Contact Information

  • Nautilus Minerals Inc. (Toronto)
    Investor Relations
    +1 (416) 551 1100
    investor@nautilusminerals.com
    www.nautilusminerals.com
    or
    Nautilus Minerals Inc.
    Australian Project Office
    +61 (7) 3318 5555
    or
    Numis Securities Limited
    John Harrison
    Nominated adviser
    + 44(0) 20 7260 1000
    or
    Numis Securities Limited
    James Black
    Corporate broking
    + 44(0) 20 7260 1000