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Go ahead given for further gold exploration in Falklands

Wednesday, December 22nd 2004 - 20:00 UTC
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Permission was granted during last Thursday's meeting of the Falkland Islands Executive Council to Falklands Gold and Minerals Ltd. to begin a programme of exploratory drilling.

The permission to drill clears the way for a second stage of exploration for minerals in the Islands by Falklands Gold and Minerals Ltd. and follows an extensive airborne magnetic and radiometric survey of the Islands they commissioned, which was carried out between March and May 2004 by Fugro Airborne Surveys.N.V., a geophysical consulting company, based in Brazil.

In the words of the Company's Annual report, "The survey identified a number of magnetic anomalies and initial discrete targets, some of which are supported by existing geochemical data and coincident stream particle gold." Explaining the need for the drilling programme, the report goes on: "From the exploration work conducted to date, the Directors believe that the geological evidence available suggests that economic mineralisation exists and that the final proof, or otherwise, cannot be established without such drilling."

Early geological evidence and samples were provided by Australian geologist, Derek Reeves, who is a director in the Company and its Operations Manager. Derek has been working on the exploration of the licensing area since 1999, including two years spent as a resident in the Falklands, where he will again be based for the next phase of exploration.

During his time in the Islands, Mr. Reeves was actively engaged in the field, gathering geological samples and panning for minerals in streams. According to the Company's Report, "This work has established the presence of alluvial gold in several drainage systems as well as establishing the presence of diamond indicator minerals and titanium rich gravel. Initial analysis of this gravel provides a grade of some 79 per cent titanium oxides which is well in excess of the 55-60 per cent that is normally found in this type of deposit. The Directors believe other samples from elsewhere in the Licensing Area contain indicators of minerals including Rare Earth Elements and Platinum Group Metals."

Stage II of the company's programme will center round seven locations in the East Falklands, mainly in the area to the South of the Wickham Heights, though during this further exploratory phase, which is set to last until 2007, the drilling programme will be conducted on what the Directors have called "a flexible basis". This will prioritise the exploration work in response to drilling results as they become available. The principal target assets for the drilling programme during this phase are said to be gold and other minerals.

In an interview for the Falkland Islands Broadcasting Service, recorded before his recent departure for Europe, Falklands Governor, Mr. Howard Pearce, CVO said that his understanding was that the drilling programme would have very little environmental impact, though he hazarded a guess that as the process continued it was likely to become "a little more invasive and intrusive". He confirmed that the environmental aspects of the project had been looked at extremely closely by the Falkland Islands Government.

Senior Stanley Director of the Falkland Islands Company, Roger Spink, confirmed today that the drilling operation, which is scheduled to begin on January 15th, will involve only a single drill mounted upon a trailer and small enough to be towed by a Landrover.

Mr.Spink also made the point that during the first phase of land-based investigations, Mr. Reeves had worked closely with landowners and farmers. As the local management of FGM now had several years of acquired local knowledge and was well versed in what the Report describes as "local philosophy and logistics" no lead-in time would be required before the start of the planned second phase of exploration.

Falklands Gold and Minerals Ltd was incorporated in the Falklands in February 2004, at which time Falkland Islands Holdings plc, the parent company of the Falkland Islands Company (FIC) owned 21.2% of the share capital. Falkland Islands Holdings plc is also a major shareholder of Falkland Islands Oil and Gas, which has recently begun seismic exploration for oil in an area to the South of the Falkland Islands. Shares in both Falklands Gold and Minerals Ltd. and Falkland Islands Oil and Gas are listed on AIM, the British Alternative Investment Market.

John Fowler (MP) Stanley

Categories: Falkland Islands.

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