Ecometals receives Pedra Branca licence

2009-12-18 13:35 ET - News Release

Ms. Fran Scola reports

ECOMETALS ANNOUNCES GRANTING OF PEDRA BRANCA GOLD LICENSE IN AMAPA, BRAZIL

Ecometals Ltd.'s Pedra Branca gold licence's approval was published by the Departamento Nacional de Producao Mineral (DNPM) in the Diario Oficial da Uniao No 236 (approval of Processo 858006/2009) in the Pedra Branca do Amapari municipality in northern Amapa. The Pedra Branca processo (tenement) is prospective for three important commodities: gold, manganese and iron, and is adjacent to the tenements covering the Amapa iron mine and the Amapari gold mine, and is along stratigraphic trend from the Serra do Navio Manganese mine.

Tenement

Publication of Processo 858006/2009 in the Diario Oficial grants an alvaras de pesquisa (exploration permit) for an initial three-year term, and is renewable on submission of regulatory reports and approval by DNPM. The Pedra Branca tenement covers an area of 8629.92 hectares in the Pedra Branca do Amapari municipality.

Good neighbourhood surrounded by mines

There are three large-scale mining operations in close proximity of the Pedra Branca tenement. The Pedra Branca licence directly adjoins the tenements of the Amapari gold mine and the Amapa iron mine.

The Amapari gold mine is located eight kilometres northeast of Pedra Branca, and is owned by Mineracao Pedra Branca do Amapari (a wholly owned subsidiary of New Gold Inc.), with published resources of 22.9 million tonnes at 1.5 grams per tonne gold measured and indicated, and 13.7 million tonnes at 2.37 g/t Au inferred (MQes, AMEC and NCL Brazil, 2008). The open-pit heap-leach operation produced some 190,000 ounces of gold over two years of operations before being put on care and maintenance in early 2009. Near-mine exploration continues on the property.

The Amapa iron mine is located nine kilometres northeast of Pedra Branca, and is operated by Anglo Ferrous Brazil (a division of Anglo American PLC), with published NI 43-101-compliant resources of 73.63 million tonnes at 39.59 per cent iron measured and indicated, and 104.54 million tonnes at 40.99 per cent Fe inferred (SRK, 2007).

The Serra do Navio manganese mine is located 14 kilometres northwest of Pedra Branca, and was operated by Industria e Comercio de Minieros SA (ICOMI) from 1957 until closure in 1997, producing a reported 34 million tonnes of commercialized products. Ecometals own 66.67 per cent and operate a joint venture company with ICOMI (now Alto Tocantins Mineracao Ltda.), which owns stockpiled manganese mineralized material at Serra do Navio.

ICOMI previously reported in situ (in ground) resources at Serra do Navio as 1.2 million tonnes oxide at 38.43 per cent manganese and 4.4 million tonnes carbonate type at 30.61 per cent Mn mineralized material (Costa, 1997). Stockpiles are estimated at 3.3 million tonnes manganese mineralized material, with grade ranges from grab samples from 28.3 per cent to 45.3 per cent Mn, but there has been insufficient work to determine the inherent inhomogeneity of the material, and the samples are not considered representative of the total volume of the stockpiles.

Neither the in situ resource nor the stockpiled mineralized material at Serra do Navio are considered current resources by the company according to CIMM or JORC definitions. Resource estimates quoted herein are indicative only and should not be relied upon as definitive. The company considers the mineralized material as an exploration target which needs further work to upgrade the confidence in the resource.

The company is planning to beneficiate the stockpiled manganese mineralized material from Serra do Navio and commercialize the upgraded mineral products in 2010.

Pedra Branca gold project

The Pedra Branca gold project is underlain by the Vila Nova group, a sequence of Lower Proterozoic metamorphosed volcanic and sedimentary rocks within the eastern part of the Guyana shield. The Guyana shield stretches from northern Brazil to Venezuela is host to several world-class gold deposits, including Las Cristinas with eight million ounces (Venezuela), Omai with four million ounces (Guyana) and Rosebel 3.2 million ounces (Suriname).

Serra do Navio formation in the Vila Nova is a metasedimentary sequence with sediments rich in manganese or iron. The sequence consists of quartz-biotite-garnet schist hosting the manganese deposits, lenses of carbonaceous schist (manganese protore) and subordinated quartzites.

In the Amapari gold mine area the metasedimentary sequence consists of BIF with magnetite, hosted by hornblende schist, para-amphibolites and quartz-sericite schist. Gold mineralization at Amapari is of hydrothermal origin and is hosted by magnetite-hematite BIF. The Amapa iron mineralization is the continuation of the same BIF stratigraphy.

Stratigraphic trends of the manganese-enriched horizons at Serra do Navio, and structural trends controlling the gold mineralization at Amapari both extend through the Pedra Branca tenement area.

The Pedra Branca tenement also covers gold anomalies in soil and stream sediments from a regional survey conducted by AngloGold in the mid-1990s which led to the original discovery of the Amapari gold deposit (SRK, 2008). The government MINDEP database of mapped mineral occurrences indicates several artisanal gold mining sites and other mineral occurrences within and nearby the tenement.

Planned exploration program

The exploration program planned for 2010 includes validation and focus on anomalous geochemical areas, aeromagnetics interpretation and detailed ground magnetics surveys.

Quality control on all surveys and geochemical analysis will follow industry standard protocols and be under the direct supervision of the in-house qualified person, S.R. McMullan, PGeo.

Further details and maps of the Pedra Branca gold project and other exploration and development projects can be obtained from the Ecometals website.

Chief executive officer Fran Scola said: "Ecometals strategy is to be a South American gold-focused exploration company. The Piedra Branca acquisition underlines this strategy and is underpinned by the skills of the company's personnel to find new and exciting opportunities. The Guyana shield is an exciting geological environment and Ecometals through its strong commitment to Amapa is well placed to seek and develop these opportunities."

Qualified person

Mr. McMullan, PGeo, vice-president of exploration for Ecometals, is a qualified person according to National Instrument 43-101 definition and has supervised the preparation of the technical information included in this news release.

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