Silver City Minerals Limited (ASX:SCI) Reported Multiple High Grade Base-Metal and Silver Intersections at Allendale Project, Near Broken Hill, NSW

Sydney, Sep 27, 2011 AEST (ABN Newswire) - Silver City Minerals Limited (ASX:SCI) is pleased to announce that it has intersected highly encouraging, high grade base-metal and silver in massive sulphide mineralisation at the multi-commodity Allendale project located in NSW, Australia. The Company considers this to be an excellent result from its first-pass, shallow drilling program with assays received from twenty drill holes. This drilling and historic diamond drill holes indicate mineralisation extends over a strike length of at least 300m and to depths of 200 metres.

Silver City drill results include:

- RCAN002 10 metres at 16.1% lead plus zinc and 29.0g/t silver from 15 metres.

Including 1 metre at 38.3% lead plus zinc and 80.1 g/t silver from 15 metres.

And 2 metres at 33.8% lead plus zinc and 43.3 g/t silver from 18 metres.

- RCAN010 7 metres at 4.8% lead plus zinc and 21g/t silver from 33 metres.

- RCAN011 2 metres at 19.9% lead plus zinc and 39.2g/t silver from 47 metres.

- RCAN016 9 metres at 5.6% lead plus zinc and 19.7 g/t silver from 111 metres.

Including 2 metres at 13.8% lead plus zinc and 51.2 g/t silver from 117 metres.

- RCAN017 2 metres at 6.5% lead plus zinc and 21.4 g/t silver from 86 metres..

- RCAN018 1 metre at 8.7% lead plus zinc and 37.9 g/t silver from 115 metres.

- RCAN019 2 metres at 11.8% lead plus zinc and 44.3 g/t silver from 53 metres.

And 3 metres at 13.2% lead plus zinc and 31.0 g/t silver from 78 metres.

- RCAN020 2 metres at 6.1% lead plus zinc and 13.1 g/t silver from 35 metres.

Comment

Managing Director Chris Torrey commented, "...it is excellent to see such encouraging high grade results so close to the surface in our first-pass drilling program at Allendale. To my knowledge these base metal-rich intersections are the most significant published from Broken Hill-type mineralisation in the district outside the Broken Hill "Line of Lode" since the announcement of the Stephens Trig drill data in 2004(1). While we are still waiting for completed assays, these results, along with indications from our visual logging and portable XRF analyses, suggest the presence of a number of well mineralised horizons. A significant portion of the mineralisation sits on the margin of a distinctive amphibolite rock which has been mapped extensively in the area, providing an excellent target for future exploration. Geological and structural modelling of this unit has commenced and will greatly assist in targeting holes for the next, important round of drilling that has the potential to locate near-surface, high grade base-metal and silver resources." (1) Sipa Resources announcement to ASX 7 April 2004.

Silver City has completed twenty one reverse circulation drill holes close to the old Allendale mine for a total of 1829 metres. Samples from the first twenty holes have been analysed by laboratory service provider ALS Global using conventional analytical methods. High grades correlate well with zones of massive and semi-massive sulphide mineralisation logged in drill chips. The final hole (RCAN028) has been assessed using a portable X-ray fluorescence (XRF) analyser while laboratory results are awaited. In this hole sulphide minerals including sphalerite (zinc sulphide), galena (lead sulphide), chalcopyrite (copper sulphide) and pyrite (iron sulphide) have been visually identified over two intervals; 61 to 63 metres and 85 to 90 metres. XRF analyses conducted in the field on samples within these intervals indicate ranges of values for samples within these intervals of between 0% and 5.3% lead and 1% to greater than 10% zinc.

Silver City Drilling

The purpose of the Silver City program at the Allendale mine was to test mineralisation down to a level of approximately 100 metres below surface. This has been undertaken by drilling a series of section lines over the strike length approximately 300m. The section lines are between 25 and 50 metres apart and drill holes are located between 25 and 75 metres apart along the lines. The mineralised lode rocks dip eastward and most drill holes have drilled towards the west.

Geological modeling of mineralised horizons has commenced. Preliminary geological assessment suggests that one important lode is hosted near the margin of an amphibolite rock. For example, on section 6503090N significant mineralisation can be traced down dip (to the east) for over 60m from surface along this contact.

In addition to the twenty one holes located near old mine workings, the company has also completed three holes at the Allendale South prospect and one at Steakhouse prospect located approximately 1-1.5 kilometres south of the mine, along with four at the Sinclair's prospect about 1.6 kilometres north of the mine. Results for these holes are pending.

Background

The Allendale Project is located 40 kilometres north of Broken Hill, New South Wales, Australia. The drilling has been designed to test beneath the historic Allendale mine and a number of prospects north and south of the mine. Geological records show that the mine is hosted in the Parnell Formation of the Broken Hill Group. The rock types include garnet-biotite gneiss, amphibolite and both pelitic and psammitic metamorphosed sediments. Late pegmatites locally cut through the host sequences. Base metal sulphide mineralisation is hosted in at least four distinctive "lode rock" horizons comprising bluish granular quartz and garnet quartzite. Prior to 1990 the mine produced approximately 20,000 tonnes of massive sulphide rock with grades similar to those recorded at the Broken Hill deposit (in the order of 10 to 20% combine lead and zinc, and 50 to 100 g/t silver).

Five widely-spaced diamond core holes were drilled between 1969 and 1990. Four of these encountered mineralisation with one of the best intersections being in hole DDHA1, which returned 2.7 metres at 8.0% lead, 4.7% zinc and 55 g/t silver from 67.5 metres.

For the complete Silver City Minerals announcement including figures and tables, please view the following link:
http://media.abnnewswire.net/media/en/docs/69759-ASX-SCI-650319.pdf

Contact

Christopher Torrey Managing Director Silver City Minerals Limited Ph: +61-2-9437-1737 Fax: +61-2-9906-5233 Email: info@silvercityminerals.com.au http://www.silvercityminerals.com.au