Red Crescent Resources Limited
TSX : RCB

Red Crescent Resources Limited

February 24, 2011 11:40 ET

Red Crescent Resources Announces Maiden Resource for Its Hakkari Zinc Project

TORONTO, ONTARIO--(Marketwire - Feb. 24, 2011) -

(NOT FOR DISSEMINATION IN THE UNITED STATES OF AMERICA)

Red Crescent Resources Limited (TSX:RCB) ("RCR" or the "Company") a mineral exploration and development company focused on base metals, is pleased to announce an initial independent National Instrument 43-101 compliant Mineral Resource Estimate for it's Hakkari Zinc Project ("HZP") in South East Turkey.

  • Management targeting potential mineralisation of between 80 and 100 million tonnes at a grade of between 20% and 30% Zinc/Lead/Silver (Zn equivalent) at Hakkari within its almost 80km strike (>52 000 Ha) of contiguous and adjacent tenements

  • The reported estimate covers only 1% of the area of known Zinc mineralisation held under licence by RCR and drilled in a short season with use of existing & restricted access

  • Metallurgical test work on the mineralised samples harvested proves high grade concentrate can be produced and first 20tph Concentrator to be commissioned in July 2011

  • Historical direct shipping of ore ("DSO") at >25% Zn, approximately 500 000t over 4 years 2004 to 2008, and similar mineable areas identified for early mining in second half 2011

  • 2011 Drilling campaign planned to start on 1st April and expected to total 7500m to 9000m for expanding resource estimate to >10 million tonnes on Licence 5

Alan M Clegg Pr.Eng Pr.CPM PMP FSAIMM, Chairman and Chief Executive of RCR, commented:

"With the new resource at HZP, the preliminary economic assessment and positive metallurgical test work for concentrator commissioning and cash flow generation in second half 2011 and the unfolding potentially massive Sivas Copper project, the value opportunity in RCR is now becoming increasingly visible and the rationale for the commodity based corporate structure with separate Zinc, Copper, Manganese, etc, companies even more compelling."

The Mineral Resource Estimate

The headline potential quantity and grade targeted, although conceptual in nature and insufficient detailed exploration has been completed to define a mineral resource and it is not certain that further exploration will delineate the full target as a mineral resource. However there is sufficient critical mass within the land holdings and sufficient historical mining evidence across the contiguous and adjacent tenements when aligned with the results of the Mineral Resource estimate reported hereunder to justify the above stated target being made.

The HZP Mineral Resource Estimate issued by independent exploration and resource geologists MSA Geoservices (Pty) Ltd ("MSA") has been prepared for the company and made compliant with Canadian National Instrument 43-101 (NI43-101).

The report serves as an independent report prepared by a Qualified Person as defined by the NI43-101 and the companion policy 43-101CP. The definitions of Measured Indicated and Inferred Resources, as well as reserves as used by the author, conform to the definitions and guidelines of the CIM (Canadian Institute of Mining, Metallurgy and Petroleum) reporting codes.

MSA CP Mike Robertson made several site visits during the drilling season, assisted in the drill hole planning and trench positioning to generate the Inferred Mineral resources for the HZP asset. The estimate consists of two parts, Licence No.5 and the Pentagon Area mineralised zones. All of the resources reported are in the Inferred Category as a result of lack of sufficient dip extension from the drilling program executed and hence inability to execute any detailed variography at this stage.

The Pentagon Area

Table 1 and Graph 1 attached hereto as appendices illustrate the Pentagon Inferred Zinc, Lead, and Silver Mineralisation and related grade tonnage curves respectively.

The modelled mineralisation at the Pentagon project comprises a single, steeply-dipping zone, intersected by eight of the ten boreholes drilled. The down-dip continuity is largely reliant on the interpretation that the lower-most mineralised zone intersected in borehole PENDD10 is the Main Mineralised Zone. Intersections from the shallower boreholes were extrapolated to five metres below the end depth of borehole PENDD10.

The mineralised envelope was modelled using a 0.5% Zn cut off, as intersected in the boreholes. The upper-most 5m of the resultant block model was deducted to represent the loss due to recent mining, which obliterated the borehole collar positions. No variography was attempted due to the limited strike length and down-dip dimensions of the initially-explored area. Grade estimation was undertaken using Inverse-distance squared at this stage. Grade variation in the Resource across the full range of cut-offs is 10.5% to 18% Zn, 1.1% to 2.6% Pb and 14.7 to 19.2 g/t Ag.

There are two isolated 1-2 m thick intersections of what may be an upper mineralised zone (as at License 5) but these were not modelled due to their lack of continuity along-strike.

The lack of a reliable topographic surface, low confidence in the correlation between boreholes and the lack of accurate collar surveys for the boreholes has limited the current resource classification to the Inferred category but are considered non-code compliant in the absence of a reliable topographic surface. This will be rectified with check surveys once access is restored post the winter snows having melted.

The in-situ Mineral Resources for the main mineralisation at the Pentagon project are tabulated in detail, without discount for geological loss and provided in the attached Appendices to this release. At 0.5% Zinc cut off the Inferred Resources currently defined for Zinc/Lead/Silver are 198 000 tonnes @ 10.5% Zn, 1.1% Pb and 14.7 g/t (0.47 Oz/t) Ag.

The Licence No. 5 Area

Tables 2 to 4 and Graphs 2 to 4 attached hereto as appendices illustrate the Licence 5 Inferred Zinc, Lead, and Silver Mineralisation and related grade tonnage curves respectively.

Two wireframes were modelled: Lower, or Main mineralisation and Upper mineralisation.

Both were constrained by the outer limits of an envelope encompassing a 0.5% Zn cut-off in the trenches and boreholes. The sectional interpretations were extended 70 m west from the last sample point, being half the distance between trench outcrop and the line of Drillholes along the axis of the antiform.

Variography was undertaken on each separate mineralised zone. There are 201 samples within the Main mineralised zone but only 25 in the Upper zone. The spatial arrangement of the samples in both zones is dominantly along-strike, with only a small across-strike component. As such, no reliable variographic modelling was achieved.

Grade estimation was therefore limited to Inverse-distance-squared at this stage. In the absence of measurable variographic continuity and the relatively sparse data quantity, the resultant resources are limited to the Inferred category. Grade variation in the Resource across the full range of cut-offs is 1.7% to 15.4% Zn, 0.5% to 1.2% Pb and 1.6 to 3.2 g/t Ag.

The in-situ, NI 43-101-compliant Mineral Resources at the License 5 Project are reported in detail in the attached Appendices, without geological discount, by Zn grade cut-off, for those intervals above 10,000 tonnes. At 0.5% Zinc cut off the Inferred Resources currently defined for Zinc/Lead/Silver are 2 400 000 tonnes @ 1.92% Zn, 0.5% Pb and 1.7 g/t Ag.

It is important to note and merge herewith the details and guidance contained within the earlier press releases of December 20th, 2010 and February 1st 2011;

  • The reported inferred resources are in the first instance found within an area extent covering less than 1% of the HZP properties under exploration;

  • The drilling works completed and that produced the reported results above was adversely affected by the late availability of required capital from delayed fund raising pre-listing and a significantly shortened drilling season resulted. 

  • Further, access constraints to already available roads confined drilling largely to the lower grade highly oxidized shallow dipping mineralised zones on Licence No.5 and to a relatively confined yet accessible steeply dipping high grade mineralised zone in the Pentagon area. These constraints are now removed and will not hamper future operations or execution of programs planned.

  • Very important structural and mineralogical data and information has resulted from the drilling program and which is contributing solidly to the improvement of RCR understanding of the control and hosting of these extensive mineralised areas under exploration. 

  • The 2010 exploration work has extensively informed the 2011 exploration drilling program for Licence No.5 which now expands down dip and into the known (from historic and current Mining) high grade (>20% Zn) steeper dipping Southern and Northern Mineralised zones of the Licence area.

  • The resources are significantly and easily amenable to gravity upgrading and are an important source of mineralised material for optimizing resource usage for generating the best economics of return on investment in operations;

  • more importantly in the short term they are the key source for lower grade blending with the identified very high grade early mining areas (reported February 1st, 2011) to generate an optimum blended grade of circa 10% Zn as feed material for the Mobile Concentrators being deployed from the second half 2011.

A full resource report is under construction by MSA and this will be informing the updated NI43-101 technical report which will be filed on Sedar www.sedar.com within the next 45 days.

Alan Clegg, a Qualified Person as defined by National Instrument 43-101, has reviewed and verified the technical information contained in this news release.

The statements made in this press release may contain forward-looking statements that may involve a number of risks and uncertainties. Actual events or results could differ materially from the Company's expectations and projections.

To view, "Resources Data for the Hakkari Zinc Deposit," please visit the following link: http://media3.marketwire.com/docs/red224.pdf.

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