Sherwood Copper Corporation
TSX VENTURE : SWC

Sherwood Copper Corporation

February 26, 2007 07:00 ET

Sherwood Announces Resource Estimate for Area 2 Deposit at Minto Project, Yukon

Significant Increase in High Grade Resources Prepares the way for Preliminary Feasibility Study for Area 2

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Feb. 26, 2007) - Sherwood Copper Corporation (TSX VENTURE:SWC) today announced the results of an independent, National Instrument 43-101 compliant, Mineral Resource estimate for the high grade Area 2 copper-gold deposit at the Minto Project, Yukon. The measured and indicated resource for Area 2 comprises 3.8 million tonnes at an average grade of 1.80% copper and 0.74g/t gold at a 1.0% copper cut-off within a larger measured and indicated resource of 7.6 million tonnes at an average grade of 1.26% copper and 0.48g/t gold using a 0.5% copper cut-off grade. This estimate incorporates the results of 92 drill holes; 79 completed by Sherwood in 2006 and 13 completed by previous operators. The Area 2 resource remains open to further expansion. This resource estimate will form the basis of a Preliminary Feasibility Study (PFS) for Area 2 to be completed by SRK Consulting (Canada) Inc. ("SRK") of Vancouver, BC. Both the main Minto deposit and the Area 2 resource are located within 500m of the mill currently under construction and now approximately 60% complete.

"This initial resource estimate for Area 2 represents a very significant addition to the resource base at the high grade Minto copper-gold project, and has gone from discovery to a significant measured and indicated resource in less than 12 months," said Stephen Quin, Sherwood's President & CEO. "With this estimate in hand, SRK Consulting can proceed to complete a preliminary feasibility study to assess the economics of mining these resources and processing them at the nearby Minto mill, currently nearing completion. Should Area 2 prove economically feasible, it has the potential to add several years of mine life to the Minto project and, if a reserve is defined that is sufficiently large, may justify a further mill expansion beyond the currently contemplated 2400 metric tonne per day throughput. In addition, Area 2 remains open to expansion in a number of directions, offering further potential beyond that defined to date."

All the mineral resources reported herein will be considered for inclusion in the PFS. For the purpose of discussion all resources located at similar depths to the adjacent Minto Deposit are termed the "Shallow Resource" (including previously reported intervals J, K, L, M & N) while resources below that level are termed the "Deeper Resource" (previously referred to as intervals O, P, Q & R).

Minto Resource Estimate

The total contained metal in the Measured and Indicated Resource estimate is 210.7 million pounds of copper and 117,000oz of gold at a 0.5% copper cut-off, representing a 61% increase in contained copper and a 75% increase in contained gold versus the resource estimate for the main Minto deposit. An additional Inferred Resource at that same cut-off contains a further 30.7 million pounds of copper and 15,000oz of gold. The following table summarizes the Mineral Resource for the Area 2 Deposit at a 0.5% copper cut-off grade, while additional estimates at different cut-offs and depths are discussed below.



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Contained
Tonnes Copper Contained
Cut-off (000's) Copper Gold (000's lbs) Gold
Classification (% Copper) (i) (%) (g/t) (i) (oz)(i)
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Measured (M) 0.5% 3,578 1.56 0.62 123,287 71,000
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Indicated (I) 0.5% 4,018 0.99 0.36 87,458 46,000
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Sub-total
(M + I)(ii) 0.5% 7,596 1.26 0.48 210,742 117,000
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Additional
Inferred 0.5% 1,381 1.01 0.33 30,720 15,000
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(i)Rounded to the nearest thousand
(ii)Totals may not add exactly due to rounding


This includes a higher grade measured and indicated resource of 153.5 million pounds of copper and 92,000oz of gold at a 1.0% copper cut-off or 3.86 million tonnes at a grade of 1.80% copper and 0.74g/t gold. This compares to 5.59 million tonnes at a grade of 2.35% copper and 0.75g/t in the measured and indicated category for the main Minto deposit at a 1.0% copper cut-off grade.

Shallow Resource

For all mineralized horizons from surface down to Interval N (inclusive) the Measured and Indicated Resource estimate at a 0.5% copper cut-off is 5.32 million tonnes at a grade of 1.41% Cu and 0.54g/t Au for a total contained metal of 165.3 million pounds of copper and 92,660oz of gold. An additional Inferred Resource contains 0.22 million tonnes at a grade of 0.98% Cu and 0.33g/t Au or 4.9 million pounds of copper and 2,390oz of gold.

The Measured and Indicated Resource estimate for the shallow resource at a 1.0% copper cut-off is 3.3 million tonnes at 1.84% Cu and 0.76g/t Au for a total contained metal of 133.9 million pounds of copper and 81,200oz of gold. An additional Inferred Resource contains 0.09 million tonnes at 1.50% Cu and 0.62g/t Au or 3 million pounds of copper and 1,800oz of gold.

Deeper Resource

For all mineralized horizons below Interval N the Measured and Indicated Resource estimate at a 0.5% copper cut-off is 2.27 million tonnes at 0.91% Cu and 0.33g/t Au for a total contained metal of 45.4 million pounds of copper and 24,250oz of gold. An additional Inferred Resource contains 1.16 million tonnes at 1.01% Cu and 0.33g/t Au or 25.9 million pounds of copper and 12,420oz of gold.

At a higher cut-off of 1% copper the Deep Resource estimate is 0.56 million tonnes at 1.59% Cu and 0.61g/t Au for a total contained metal of 19.6 million pounds of copper and 10,890oz of gold. An additional Inferred Resource contains 0.39 million tonnes at 1.68% Cu and 0.62g/t Au or 14.5 million pounds of copper and 7,860oz of gold.

The attached cross section, http://www.ccnmatthews.com/docs/0226swc.jpg, illustrates Sherwood's preliminary geological interpretation and the exploration opportunity both between the main Minto Deposit and Area 2 as well as under the main Minto deposit. A drill program is planned to commence shortly to test the potential to link these zones of similar, but currently separated mineralization, as well as to gain a broader geological perspective in the area of the main Minto deposit.

A drill hole location map along with an overview of Sherwood's priority exploration targets can be viewed at http://www.ccnmatthews.com/docs/0226swc1.jpg

Resource Estimation Methodology

The mineral resources for the Area 2 Deposit were estimated by Lions Gate Geological Consulting Inc. (LGGC) of North Vancouver, BC. Ali Shahkar, P. Eng. of LGGC is the Qualified Person under National Instrument 43-101 responsible for the estimate. SRK Consulting of Vancouver BC audited the mineral resource estimate provided by LGGC. Andrew Ham, PhD, MAusIMM, MAIG of SRK is the Qualified Person under National Instrument 43-101 responsible for the SRK audit.

Mineralization was interpreted in 5 domains (in some cases sub-domained into separate lenses) and statistical analysis for each metal carried out for each zone. Wireframes of these zones were created and used to inform a 15m by 15m by 3m (vertical) block model for resource estimation. Assays were then composited into 3.0m intervals and statistical analysis completed for each metal and variography estimated for the mineralized domains. Ordinary kriging was used to interpolate grades for copper and gold into the block model. Bulk density measurements collected during core logging were interpolated into the using Inverse Distance method. Blocks were then classified into Measured, Indicated and Inferred categories based on the number of drill holes and the average distance of the composites used to estimate each block. The grades and tonnages reported in this resource estimate represent the material contained within the mineralized portion of the classified blocks.

The results for the global resource are presented as grade-tonnage tables for 0.5%, 1.0% and 1.5% copper cut-off grades to show how sensitive tonnage is to increasing cut-off grade. A current economic cut-off for the Area 2 deposit has not been established. The 0.5% copper cut-off has been reported here to allow direct comparison to the Minto Deposit Mineral Resource estimate which was also calculated using a 0.5% Cu cut-off and was the basis for the 2006 BFS conducted by Macquarie Bank. The 0.5% copper cut-off estimate is presented above and the 1.0% and 1.5% copper cut-off estimates are attached hereto.

These Mineral Resource estimates will be used as the basis for calculating a mineral reserve for the Area 2 deposit as part of the pre-feasibility study being prepared by SRK Consulting, which is targeted for completion in June 2007.

Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability. Mineral Resource estimates do not account for mineability, selectivity, mining loss and dilution. These Mineral Resource estimates include Inferred Mineral Resources that are normally considered too speculative geologically to have economic considerations applied to them that would enable them to be categorized as mineral reserves. There is also no certainty that these Inferred Mineral Resources will be converted to Measured and Indicated categories through further drilling, or into Mineral Reserves once economic considerations are applied.

Minto Project

The Minto Project is a high-grade copper-gold deposit located in the Yukon Territory, Canada. As announced August 28, 2006, the feasibility study indicates production averaging 41 million pounds of copper and 17,295oz of gold per year at cash costs of US$0.57 per pound over the first six years of operations. Mine construction is substantially advanced and Construction Manager JDS Energy & Mining is supervising development activities, with Hatch providing engineering and procurement services. Clark Builders has been retained as general contractors and is constructing the process and related facilities, Pelly Construction is completing the contract mining and numerous other contractors have been engaged for specialized areas of activities. Development activities at the Minto Project are proceeding rapidly and production is forecast mid-2007, with an accelerated schedule targeting start up in Q2, 2007. Project financing and forward sales agreements for a significant portion of the first four years of production were announced October 26, 2006.

Sherwood Copper

Sherwood's successful consolidation of the ownership of the Minto Project provides a unique investment opportunity - participation in an already permitted, partially constructed, high-grade, open pit copper-gold project located in Canada with developed infrastructure and substantial exploration potential within the current property.

Quality Assurance

The technical information in this news release has been prepared in accordance with Canadian regulatory requirements set out in National Instrument 43-101 and reviewed by Stephen P. Quin, P. Geo., President & CEO for Sherwood Copper Corporation and Gord Doerksen, P. Eng., Principal Consultant of SRK, Vancouver. Both are Qualified Persons under National Instrument 43-101 and have reviewed the content of this press release. The exploration activities at the Minto project site are carried out under the supervision of Brad Mercer, P. Geol., Exploration Manager with Sherwood. The mineral resources for the Area 2 Deposit were estimated by Lions Gate Geological Consulting Inc. (LGGC) of North Vancouver, BC. Ali Shahkar, P. Eng. of LGGC is the Qualified Person under National Instrument 43-101 responsible for the estimate. SRK Consulting of Vancouver audited the mineral resource estimate provided by LGGC Andrew Ham, PhD, MAusIMM, MAIG is the person responsible for this audit.

The analytical method for the copper, gold and silver analyses is multistage acid digestion of the samples followed by atomic absorption spectroscopy for copper and fire assay with atomic absorption spectroscopy finish for gold and silver carried out by ALS Chemex in North Vancouver. When visible gold is noted in drill core samples or regular fire assay values appear abnormally high, the pulp and screen metallic assay method is used to determine the total gold content and gold contents of different size fractions. This is considered industry best practice when dealing with coarse gold mineralization where a nugget effect is suspected. This determination is accepted as the most representative value and is used in the assay database for resource calculations. Blank and standard samples are used for quality assurance and quality control, and any check samples that assay outside the expected ranges results in the entire batch being re-assayed. After the completion of planned drill programs at Minto, random check assays will be carried out by Acme Analytical of Vancouver.

Additional Information

Additional information on Sherwood and its Minto Project can be obtained on Sherwood's website at http://www.sherwoodcopper.com.

On behalf of the board of directors

SHERWOOD COPPER CORPORATION

Stephen P. Quin, President & CEO

This news release may contain forward looking statements which are not historical facts, such as ore reserve estimates, anticipated production or results, sales, revenues, costs, or discussions of goals and exploration results, and involves a number of risks and uncertainties that could cause actual results to differ materially from those projected. These risks and uncertainties include, but are not limited to, metal price volatility, volatility of metals production, project development, ore reserve estimates, future anticipated reserves and cost engineering estimate risks, geological factors and exploration results. See the Company's filings for a more detailed discussion of factors that may impact expected results.



Details of Mineral Resource Estimates at 1.0% Cu & 1.5% Cu cut-offs
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To accompany Sherwood Copper News Release Dated February 26, 2007

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Contained Contained
Cut-off Tonnes Copper Gold Copper Gold
Classification (% Cu) (000's) (%) (g/t) (lbs) (oz)
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Measured (M) 1.0% 2,491 1.94 0.82 106,356,900 65,300
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Indicated (I) 1.0% 1,372 1.56 0.61 47,151,100 26,800
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Sub-total
(M + I)(i) 1.0% 3,863 1.80 0.74 153,512,300 92,200
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Additional
Inferred 1.0% 483 1.65 0.62 17,559,100 9,700
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Contained Contained
Cut-off Tonnes Copper Gold Copper Gold
Classification (% Cu) (000's) (%) (g/t) (lbs) (oz)
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Measured (M) 1.5% Cu 1,830 2.18 0.95 87,853,300 55,700
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Indicated (I) 1.5% Cu 588 2.01 0.79 26,098,500 14,900
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Sub-total
(M + I)(i) 1.5% Cu 2,418 2.14 0.91 113,950,900 70,700
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Additional
Inferred 1.5% Cu 217 2.13 0.80 10,176,000 5,500
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(i)Totals may not add exactly due to rounding


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

Contact Information

  • Sherwood Copper Corporation
    Stephen Quin
    President
    (604) 687-7545 or (888) 338-2200
    or
    Sherwood Copper Corporation
    Brad Kopp
    (604) 687-7545 or (888) 338-2200
    or
    Sherwood Copper Corporation
    Kristy Reynolds
    (604) 687-7545 or (888) 338-2200
    (604) 689-5041 (FAX)
    Website: www.sherwoodcopper.com