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Baobab Resources plc (LON:BAO) Provides a Drilling Update for The South Zone Prospect
Baobab Resources plc (LON:BAO) Provides a Drilling Update for The South Zone Prospect
London, Sep 2, 2010 AEST (ABN Newswire) - obab Resources plc (LON:BAO), the iron ore, base and precious metals explorer with a portfolio of mineral projects in Mozambique, is pleased to present an update on the exploration activities currently underway at the Tete iron/vanadium/titanium project.


- Step-out reverse circulation (RC) drilling is progressing steadily at the South Zone prospect with 869m completed at time of writing. Substantial widths of magnetite-ilmenite mineralisation have been intersected in seven of eight holes drilled to date.

- Analytical results have been returned for three of the six 2010 South Zone scout diamond drill holes. Selected significant mineralised intercepts reported concentrate grades of:

TDH0019 - five significant intercepts, totalling 98.5m, including:
65.5m @ 59.48% Fe, 0.61% V2O5 and 34.7% mass recovery from 46m

TDH0045 - seven significant intercepts, totalling 192m, including:
51.0m @ 60.5% Fe, 0.63% V2O5 and 33.0% mass recovery from 77.5m

TDH0047 - three significant intercepts, totalling 87.5m, including:
43.5m @ 58.9% Fe, 0.59% V2O5 and 31.3% mass recovery from 95m

- The South Zone results characterise a distinct, higher mass recovery, ore domain to that encountered in the Chitongue Grande resource area and a detailed metallurgical study has been commissioned to determine how to optimise the mineral processing of the various domains.

- Samples from the remaining three 2010 South zone scout drill holes and the first five RC drill holes are being prepared for despatch to the laboratory in Australia with analytical results expected to be available in early October.

Commenting today, Ben James, Baobab's Managing Director, said: "The South Zone RC programme is intersecting encouraging widths of mineralisation that is able to be correlated between drill traverses. The diamond drill results published today characterise a distinct ore domain to that modelled in the Chitongue Grande resource and we look forward to working with Coffey Mining to construct mineral processing flow sheets that will not only optimise the potential of these domains, but also take into consideration the project's unique and strategic access to infrastructure and complementary resources."

Step-out RC Drilling Programme - South Zone Prospect (Massamba Group)

Due to the significant widths and interpreted lateral continuity of mineralisation at South Zone, the prospect has been prioritised for step-out reverse circulation (RC) drilling. The programme is systematically assessing a sequence of six mineralised zones over a strike length of some 2km, drilling on traverses spaced 100m apart.

A total of 35 RC drill holes have been planned for a combined meterage of 7,000m. To date eight holes have been completed for an aggregate total of 869m. Substantial widths of magnetite-ilmenite mineralisation have been intersected in all but one hole. Samples from the first five drill holes have been despatched to the laboratory in Tete for sample preparation.

It is the Company's intention to combine the results of the scout diamond drilling and RC programmes to estimate a global resource for the South Zone prospect.

Commencement of Metallurgical Studies

Internationally respected industry consultants, Coffey Mining Pty Ltd, have been commissioned to complete a detailed metallurgical review of the magnetite-ilmenite mineralisation. The primary objective of the study is to determine optimum flow sheets to process the various ore domains present in the project area. The study will focus on the styles of mineralisation underlying the Chitongue Grande resource area and the South Zone prospect.

An initial phase of statistical analysis is currently underway with the objective of identifying and targeting ore domains for metallurgical drilling. The drilling is intended to commence in October 2010 with drill core being despatched to Perth, Western Australia, for test work.

Scout Drilling Programme - Chimbala & South Zone Prospects (Massamba Group)

A scout drilling programme, designed to assess the Chimbala and South zone prospects of the Massamba Group trend, has been completed for an aggregate total of approximately 7,500m. The purpose of the campaign has been two-fold: to improve confidence in the Company's Exploration Target and to clarify geological domains for continued metallurgical test-work.

South Zone Scout Drilling

The South Zone prospect was first recognised by the Company during its 2008 high resolution aeromagnetic survey, as a 2.5km long north-south zone of high magnetic response immediately south of the known Massamba Group prospects. The primary iron, vanadium and titanium mineralisation occurs as cumulate sequences within the gabbro / anorthosite suite. A secondary phase of mineralisation, in the form of a vertical massive magnetite-ilmenite intrusive dyke, outcrops as a chain of small ridges along the western margin of the magnetic anomaly. The dyke has an apparent thickness in excess of 20m and appears to crosscut the primary mineralisation. Post-mineralisation tectonics has segregated the prospect into at least 5 discrete fault blocks.

Three diamond drill holes were completed at the South Zone prospect in 2009 prior to the onset of the wet season (as announced on 1 February and 19 February 2010). A further six diamond holes have been completed this year bringing the total metres drilled at the prospect to 2,127m. Drill holes targeted magnetite-ilmenite outcrops and linear trends of strong magnetic response. All holes have intersected substantial widths of mineralisation of between 20 and 100m (true width).

Analytical results from the first three of the six 2010 holes have been returned with significant intercepts tabled below. Sample preparation at 1m composite intervals was completed by ACT-UIS laboratories in Tete, Mozambique prior to despatch to ALS Chemex laboratories in Perth, Western Australia for further compositing (maximum composite length of 4m), Davis Tube Recovery (DTR) and X-ray Fluorescence Spectrometry XRF analysis.

Samples from the remaining three holes are currently at the preparation facility in Tete prior to despatch to Perth, with results expected to be available in early October.

Chimbala Scout Drilling

The Chimbala prospect comprises the central portion of the Massamba Group trend and is underlain by a 3km long zone of strong aeromagnetic response. Limited historical exploration has taken place in the prospect area. Baobab commenced drilling operations at the Chimbala prospect on 10 March 2010 and has completed 25 diamond drill holes for an aggregate total of 5,378m. The drilling programme was designed to test zones of strong magnetic response over an area of 3km2. The drilling has intersected packages of both cumulate and intrusive style magnetite-ilmenite mineralisation intercalated with gabbroic and anorthositic country rock.

Analytical results from the first twenty three Chimbala diamond drill holes (TDH0020 to 42) were announced on 17 May, 11 June, 15 July and 12 August 2010. Holes TDH0025 and 37 returned no significant intercepts and have not been reported. TDH0043 and 44 remain to be analysed.

Tete Project - Overview

The Tete Project, covering an area of 632km2, is located immediately north of the provincial capital of Tete and shares licence boundaries with Vale and Riversdale's mega coal projects. The project is strategically located to access abundant, low tariff hydro-electric power from existing and developing schemes on the Zambezi River. The ports of Beira and Nacala are being refurbished, as are the rail corridors through to Tete.

The project contains two areas of magnetite-ilmenite mineralisation:

- The Singore area to the south; and

- The Massamba Group trend in the north. The 8km long Massamba Group trend is composed of a series of five prospects (Chitongue Grande, Pequeno, Caangua, Chimbala and South Zone) that have experienced little or no historical exploration.

The Company commenced exploration initiatives in mid 2008 and has focused its efforts to date on the Massamba Group area. The Singore area remains largely untested, but highly prospective (refer to announcement dated 28 January 2010 for results to date).

Work completed by the Company during 2009 culminated in the estimation of a 47.7mt maiden Inferred Mineral Resource over a 500m portion of the Chitongue Grande prospect and a 400mt to 700mt Exploration Target over the broader Massamba Group area.

Independent scoping metallurgical studies and financial modelling indicate positive project economics in the production of high quality magnetite (iron and vanadium) and ilmenite (titanium) concentrate commodities (refer to announcements dated 24 September 2009, 29 September 2009 and 8 October 2009).

Baobab has entered into a strategic partnership with International Finance Corporation (IFC), the commercial arm of the World Bank, at both the corporate and project equity levels.

For the complete Baobab Resources announcement, please refer to the following link below:

About Baobab Resources plc

Baobab Resources plc (LON:BAO)Baobab Resources plc (LON:BAO) is a Mozambican-focused explorer with a large landholding in the central north of the country. The company's flagship project is the Tete iron ore deposit.



Ben James
Managing Director
Baobab Resources plc
Tel: +61-8-9430-7151

Jeremy Dowler
Baobab Resources plc
Tel: +44-13-7245-0529

Strand Hanson
James Harris / Angela Peace
Tel: +44-20-7409-3494

Astaire Securities
Charles Vaughan
Tel: +44-20-7492-4763

Related Companies

Coffey International Limited         
Baobab Resources plc        

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