28 April 2008

ASX Announcement

INITIAL RESOURCE of 16,000 NICKEL TONNES AT GOODYEAR

Australian Mines Limited (ASX: AUZ) is pleased to announce its maiden Inferred Resource for the highly prospective Goodyear project near its Blair Mine of 387,000 tonnes at 4.13% for 16,000 contained nickel tonnes.

A diamond drilling programme is set to commence in order to upgrade the resource.

Introduction
In May 2007, Australian Mines acquired the minerals rights to East Location 45 and two adjoining mining leases, thereby adding 86 square kilometres of highly prospective ground to the company’s exploration portfolio adjoining the Blair tenements near Kalgoorlie in WA.

As well as large areas of unexplored ultramafics. the tenements contain nickel resources at the Mt Martin and Goodyear projects, which are both within 15 kilometres of the company’s 100%- owned and operated Blair Nickel Mine. To date, the company has focussed on the highly ranked Goodyear Project due to more historical data being available.

Resource Modelling
Following a detailed review of the project which included re-interpretation of the historical drilling and subsequent resource block modelling, the company is pleased to announce the following Inferred Mineral Resource for Goodyear:
 
ORE ZONE TONNES GRADE (%NI) NICKEL TONNES
Contact 1 33,000 1.35%Ni 450
Contact 2 82,000 4.36% Ni 3,570
Contact 3 224,000 4.22% Ni 9,450
Contact 4 48,000 5.25% Ni 2,530
Total Inferred 387,000 4.13% 16,000

Notes:
1. Cut-off grade is 1% Ni
2. Specific gravity used was by regression curve derived for Blair Nickel Mine
3. Resource abuts boundary with M26/47. Figures in table relate only to resources on East Location 45.


Goodyear – plan view of the resource model with current drilling and ore potential


Diamond Drilling and Down Hole Electromagnetic (DHEM) surveys to commence

The Goodyear ore shoots on Location 45 have been intersected by previous explorers with a total of 9 surface RC holes and 15 surface diamond holes. Australian Mines has taken a conservative approach in categorising the resource as ‘Inferred’, and will expedite an exploration programme focussed on moving Inferred resource into the ‘Indicated’ category, whilst also testing for extensions to the existing resource. The programme incorporates:
  • diamond drilling to test for extensions to the existing resource.
  • down hole gyro surveys to be conducted on historical holes that are in need of improved survey control; and
  • down Hole Electro Magnetic (DHEM) surveys to be completed on strategic holes so as to better define the ore system at Goodyear.

Australian Mines’ Chief Operating Officer, Mr Brett Young said, “The company is very excited by the potential of the Goodyear Project which is clearly open at depth.

“Given Goodyear’s proximity to the company’s existing underground operation at the Blair Nickel Mine, there will be synergies in sharing of equipment and manpower which will result in real efficiencies and cost savings.”
 

Goodyear – long sectional view of the resource model with current drillholes and ore potential

For further information contact:
Brett Young
Chief Operating Officer
Australian Mines Limited
Tel: 08 9481 5811

For media enquiries contact:
Robert Williams
Farrington National
Tel: 02 9332 4448

The information in this report that relates to Exploration Results and Mineral Resources is based on information compiled by Mr E Poole who is a Member of The Australasian Institute of Mining and Metallurgy. Mr Poole is employed by Australian Mines Limited. Mr Poole has sufficient experience which is relevant to the style of mineralisation and type of deposits under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves.’
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