RC Drilling and Trenching program Commences at Charter Pacific's Mauritania Iron Ore Permit 792

  • RC Drilling results defining down hole thickness and grade.
  • Trenching results defining mineralization width and grade.
  • Targets for next phase resource drilling.
  • Targets for next phase diamond drilling and metallurgical sampling.

Investment company, Charter Pacific Corporation Limited (ASX:CHF) announces that SEMS Exploration (SEMS) commences today a RC drilling and trenching program at the iron ore Kaoua El Khadra Permit (Permit 792) in Mauritania.

The RC drilling and trenching program will consist of 1,000 meters of trenching and 2,000 metres of RC drilling over six target areas on Permit 792 and is expected to take 6 weeks to complete.

Being a "first pass" RC drilling program, it will determine the thickness and grade of the resource base at Permit 792 which has previously been identified as a potential exploration target for the magnetite-bearing Banded Iron Formations (BIF) up to 4.4 billion tonnes* - refer 10 September 2012 ASX Release.

This RC drilling and trenching program follows on from the Davis Tube Recovery (DTR)** tests on surface rock samples at Permit 792 which returned concentrate recoveries up to 56.1% - refer 29 November 2012 ASX Release.

The primary objectives of trenching at Permit 792 are to define the mineralisation width and grade. The RC drilling program will define down-hole thickness and grade of BIF, which will establish parameters for next phase of diamond drilling and metallurgical sampling.

Charter Pacific Managing Director Kevin Dart said: "The key to success for this project will be the low cost of production in Mauritania compared to other global players.  Studies of similar iron ore projects in West Africa support production costs of iron ore to be approximately a third of those in Australia."

"The long term view for iron ore remains strong, as demonstrated this week at the Mines and Money Conference in Hong Kong with major players forecasting that China's demand for iron ore is likely to keep rising for the next decade."

"France and Italy are the well-established biggest importers of iron ore from Mauritania. With China and India now investing in Mauritania, the market fundamentals for our venture are strong. The low cost of production in West Africa will keep our project competitive in a market where iron ore prices will continue to fluctuate."

"With established rail and port facilities already in place in Mauritania, and a new heavy-haulage road in close proximity to Permit 792, points to a low cost of production compared to other major iron suppliers globally."

"The Board remain confident that a marketable concentrate could potentially be produced from the Kaoua El Khadra Iron Ore project which is in line with our previous announcements."

Charter Pacific Corporation Projects in Mauritania

Sample Locations

Figure 1 below shows the overall location of the samples taken in the September/October campaign. The sample sites are overlaid on a landsat image and regional geology to show the sand dunes and structures.

Figure 1 - Kaoua El Khadra permit 792 showing Central and Eastern BIF clusters and 2012 sampling

Figures 2 and 3 below are close up locations of the Central and Eastern BIF clusters showing head grade iron grades (Fe%) and proposed trench and drilling areas.

Figure 2 - Central BIF cluster area showing proposed trench areas and rock chip Fe grades

Figure 3 - Eastern BIF cluster area showing proposed drilling areas and rock chip Fe grades

Figures 2 to 3 Notes:

  • Full results are listed in CHF announcement 29 November 2012.
  • Samples located by hand held GPS.
  • Interpreted BIF outlines are in Brown shading.

*       It should be noted that the potential tonnages and grades outlined by SEMS Exploration for the exploration target within the Kaoua El Khadra permit remain conceptual in nature as there has been insufficient exploration to define a Mineral Resource as defined in the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (the 2004 JORC Code). Furthermore, investors should be aware that based on the information currently available it remains uncertain whether further exploration will result in the determination of a Mineral Resource.

**     DTR - Davis Tube Recovery, a standard analytical technique for determining the grade of recoverable magnetic fractions in siliceous iron formations.

Contact:

Kevin Dart, Managing Director                                      David Selfe (MAusIMM), Director
Charter Pacific                                                    Charter Pacific
+61 7 5538 2558                                                    +61 439 030 921

Competent Persons Statement
The information in this report that relates to Exploration Results is based on information compiled by David Selfe, who is a Member of The Australasian Institute of Mining and Metallurgy (AusIMM). David Selfe is a Director of Charter Pacific Corporation Limited. Mr Selfe has sufficient experience which is relevant to the style of mineralisation and type of deposit 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'. Mr Selfe consents to the inclusion in this report of the matters based on his information in the form and context in which it appears.

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