iron ore rights secured positive drill results

ASX Release 15 February 2008
IRON ORE RIGHTS SECURED AT GOLDSWORTHY
FOLLOWING POSITIVE DRILLING RESULT
• Agreement finalised to purchase 100% of the iron ore rights to the Goldsworthy
Project tenements, East Pilbara (WA).
• Independence Group NL to become Brumby’s largest shareholder (~11% stake) as a
result of this transaction.
• Brumby’s first RC drill hole intersects significant widths of iron ore mineralisation,
supporting historical results from Rio Tinto drilling.
• Best intersection of 30m @ 29% Fe from 96m with the hole ending in magnetite ore
(EOH).
• Two hematite-rich horizons also encountered.
Diversified explorer Brumby Resources Limited (ASX: BMY – “Brumby”) is pleased to advise that it
has completed an agreement with its joint venture partners, Independence Group NL (IGO) and
Western Australian Resources Limited (WAR), to purchase the iron ore rights to the Goldsworthy
Project, located approximately 70 kilometres east of Port Hedland in the world-class East Pilbara
Region of Western Australia (see Figure 1 attached).
The Goldsworthy Project comprises two granted Exploration Licences E45/2538 and E45/2539
covering an area of approximately 450km² and is located close to quality infrastructure including
major roads, rail lines and port facilities; complementing Brumby’s other large strategic land
holdings in the area including its nearby Pardoo East Iron Ore Project.
The acquisition – which will result in Independence Group becoming Brumby’s largest shareholder
with an 11% stake – follows encouraging results received from a first-pass Reverse Circulation
(RC) drilling programme completed by Brumby on the Goldsworthy Project.
Historic drilling in the Project area by Rio Tinto had delineated magnetite-bearing banded iron
formation and ultramafic rock. Two of the Rio Tinto holes intercepted multiple widths of magnetite
mineralisation, returning 54m @ 29.1% Fe from 76m and 64m @ 29.7% Fe from 142m in hole
97DG006, and 134m @ 24.7% Fe from 36m and 27m @ 32% Fe from 208m to 235m (EOH) in
hole 97DG003 (see Figure 2 attached).
The intersections received from Brumby’s recent drilling – which was targeting a prominent ground
magnetic-ground gravity anomaly and following up an anomalous platinum-copper-gold
intersection – have continued to enhance the potential of the Goldsworthy tenements for iron ore
mineralization.
RC Drill Results
The results (see table below and Fig. 2), from the first hole completed on tenement E45/2539,
included an encouraging intersection of 30 metres (96m-126m EOH) of magnetite
mineralisation grading 29% Fe. The hole also intersected two hematite-rich horizons with grades
of 28.9% and 25.2% Fe.
Table 1 – Goldsworthy Project, Initial RC Drilling Results
Hole ID Northing Easting Dip
(degs)
From To Width
(m)
Fe
(%)
SiO2
(%)
Al2O3
(%)
P
(%)
LOI
(%)
DGRC021
7765960
736934
60
44
69
25*
28.9
52.1
2.6
0.03
3.7
80
93
13*
25.2
58.4
0.8
0.44
4.3
96
126
30
29.0
50.9
1.4
0.049
0.7
*Indicates hematitic rich horizon
Brumby regards the discovery of both hematite and magnetite mineralization under cover from the
very first hole of the programme as highly encouraging. Hematite and magnetite mineralization
frequently occur in close association in the East Pilbara region, as evidenced by other major
deposits currently being explored and developed in the region such as Atlas Iron’s nearby Pardoo
Project.
Drill hole DGRC021 was located in proximity to the previously completed IGO and Rio Tinto drill
holes and was designed to follow up the anomalous platinum-copper-gold intersection reported
previously by the IGO/WAR Joint Venture of 30m @ 220ppb PGE+Au and 0.15% Cu from 60-90m
beneath 60 metres of cover.
Under the terms of Option/Joint Venture Agreement between Brumby, IGO and WAR completed in
August 2007, Brumby was completing its first phase of drilling to better test the PGE anomaly. Assay
results from this first hole did not indicate anomalous platinum-copper-gold values.
Acquisition of Iron Rights
Brumby initially had an earn-in position on the two Goldsworthy Project tenements, under the August
2007 Option/Joint Venture Agreement. This agreement did not include the iron ore rights which
Brumby will now acquire after entering into an acquisition agreement with the Joint Venture partners
for 100% of the iron ore rights on both granted exploration licences.
In consideration for the acquisition, Brumby will issue 4 million shares to IGO with both IGO and
WAR each retaining a 1% gross sales royalty on any iron ore that is extracted from the tenements.
As a result of this transaction, IGO will become Brumby’s largest shareholder with approximately
11% of the issued shares in the Company. Brumby has also agreed to grant IGO a first right of
refusal on Brumby’s other iron ore prospective tenements in Western Australia.
Brumby will also exercise the existing option with IGO and WAR to enter into a Joint Venture
Agreement over the Project tenements.
Brumby’s Managing Director, Mr Geoff Jones, said the acquisition of the iron ore rights on the
Goldsworthy Project represented a significant development for the Company as it continued to build
a substantial iron ore portfolio in the East Pilbara region.
“The intersections of both hematite and magnetite mineralization represent an important
development, and in conjunction with the Rio Tinto results, highlight the potential for the occurrence
of iron ore deposits below the cover sequence across our broader Pilbara land holdings,” he said.
“We are particularly pleased that hematite mineralization is present at this very early stage in our
exploration programme.
“The prospectivity of this region for both styles of iron ore mineralization is well established, and we
believe there is excellent potential to make additional discoveries and define both hematite and
magnetite resources within our tenements,” Mr Jones added.
"Together with the large iron ore targets identified at the nearby Pardoo East Project in November
last year, the Goldsworthy Project adds a significant string to our bow in the East Pilbara region and
represents an exciting new exploration target for the Company in continuing to advance towards our
goal of developing a major iron ore project in the East Pilbara region,” he added.
Mr Jones also said he was pleased to welcome leading mid-tier mining company Independence
Group as a major shareholder of Brumby. “The fact that Independence has agreed to take a major
equity position in our Company shows the confidence that such a large and well respected mining
group has in our Pilbara assets and the Brumby team,” he said.
The Company plans to accelerate further drill testing of the two identified magnetic-gravity anomalies
on the Goldsworthy tenements once an appropriate drill rig has been contracted.
Geoff M Jones
Managing Director
For further inquiries, contact:
Geoff Jones, Telephone: (08) 9486 8333
Competent Person’s Statement
The information in this report that relates to the Exploration Results is based on information reviewed by Mr Christopher Bonwick
who is a full-time employee of Independence Group NL and is a member of the AusIMM. Mr. Bonwick has sufficient experience
which is relevant to the style of mineralisation and to the activity under consideration to qualify as a Competent Person as defined in
the December 2004 edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves
(JORC Code). Mr. Bonwick consents to the inclusion in the report of the matters based on his review in the form and content in
which it appears.
About Brumby
Brumby Resources Limited is a diversified Perth-based exploration and resources company with a multi-commodity
portfolio. Brumby listed on the Australian Securities Exchange (ASX) in 2006 and has made significant progress with
projects in commodities including manganese, iron ore, base metals and gold.
The Company has assembled extensive and high quality ground holdings in Western Australia and the Northern
Territory. Brumby’s strategic approach is to refine targets, explore and evaluate the Company’s projects in a cost
effective and timely manner, and to identify and develop new mineral deposits with the potential to significantly
enhance shareholder value.
Brumby is managed by a highly experienced team of mining individuals with expertise in mineral exploration,
development, financing and operations.
For further information please refer to our website www.brumbyresources.com.au or contact:
Mr Geoffrey M Jones Telephone: 61 8 9486 8333
Managing Director Facsimile: 61 8 9322 5123
Brumby Resources Limited
Unit 3 PO Box 231
49 Ord Street West Perth WA 6872
West Perth WA 6005
www.brumbyresources.com.au
ASX Code - BMY