PLANET METALS LTD - ASX: PMQ

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Description

Planet Metals (ASX Code: PMQ) is a Brisbane-based ASX-listed mining and exploration company with a focus on tungsten, molybdenum, copper and gold.

Key operations include the Wolfram Camp tungsten-molybdenum project (85% owned) and the Mount Cannindah copper-gold project (100% owned) - both located in Queensland. The Wolfram Camp project (situated west of Cairns) has a full scale commercial processing plant and equipment under care and maintenance. Planet Metals continues to evaluate the project with a view to returning it to production. Mount Cannindah (near Gladstone) is a large gold bearing porphyry copper system with a significant resource already delineated.

The company's major shareholder is Metallica Minerals Limted (ASX Code: MLM) with a 76% shareholding. As at 31 December 2010, Planet Metals had 59.7 million shares on issue and $907,000 in cash (effectively no debt).

Mount Cannindah Copper-Gold Project (PMQ 100%)

Located approximately 100km south of Gladstone, Mount Cannindah is a large gold bearing porphyry copper system with numerous highly prospective exploration targets. First discovered in 1895, it has been estimated that some 1,000 tonnes of copper and 30,000 ounces of gold have historically been worked from the fields.

Planet Metals holds 9 Mining Leases (covering 5.7km2) and 2 Exploration Permits (100km2) with the MLs valid until 2023. The following resource estimate was undertaken by independent consultants, Golder Associates Pty Ltd based on results from a 42 hole drilling program conducted by Planet Metals:

Measured Resources - 5.57Mt @ 0.95% Cu, 0.41g/t Au and 16g/t Ag
Inferred Resources - 1.9Mt @ 1.0% Cu, 0.3g/t Au and 14g/t Ag
Total - 7.47Mt @ 0.97% Cu, 0.38g/t Au and 15g/t Ag

This resource estimate is appropriate for an open pit mining scenario with processing for flotation (possibly with an upfront gravity circuit for gold recovery) with a conventional rougher-cleaner circuit. Recent findings and geological interpretations have identified a new model for the development of mineralisation at Mount Cannindah and, as such, has opened up a significant new exploration target. Encouraging similarities to Newcrest Mining’s Ridgeway deposit at Cadia, near Orange (NSW) has focused attention on the depth potential of Mount Cannindah’s mineralisation.

Wolfram Camp Tungsten-Molybdenum Project (85%)

Located 90km west of Cairns, Wolfram Camp was first discovered in 1894 with cumulative production estimated at over 10,000 tonnes of wolframite, molybdenite, bismuth and mixed concentrates.

Since becoming involved with the project in 2004, Planet Metals has aggressively explored the central portion of the prospective near surface mineralisation, targeting the halo ore around the previously mined higher grade areas. The objective was to establish an economically viable open-cut operation as quickly as possible in order to take advantage of the strong commodity prices at the time.

Sufficient funds were raised to build a 150,000tpa processing plant which comprised a combination of flotation and gravity techniques. Onsite construction work commenced in November 2007 when the mining leases were granted and the completed plant was handed over by the contractor in July 2008.

The process plant operated intermittently for less than three months but unfortunately a combination of technical difficulties and a shortage of working capital, compounded by the global financial crisis, resulted in a suspension of operations in November 2008. During operations, a small amount of wolframite and molybdenite concentrate was produced.

Care and maintenance activities continue as the Company evaluates the project with a view to returning it to production. A total of 4,745m of drilling was completed in late 2009, early 2010. Assay results were forwarded to Golder Associates who prepared a revised independent resource estimate. Total resources now stand at 1.42 million tonnes and 0.60% WO3 and 0.12% Mo.

Investigations have also commenced on run of mine ore pre-concentration via X-Ray Ore Sorting in order to enhance the Wolfram and Molybdenum mill feed grade. Initial testwork on specific size fractions indicated that a high proportion of barren material could be rejected with minimum loss of valuable minerals. It has been estimated that an increase in mill feed grade of 250% could be achievable. An assessment of the technology in terms of project economics is still in progress.

Bamford Hill Tungsten-Molybdenum-Tin-Gold Project (PMQ earning 85%)

Located approximately 30km south-west of Wolfram Camp, Bamford Hill has previously been the subject of small-scale historical mining activities, with a focus on tungsten, molybdenum, tin and gold.

Follow-up stream sediment and rock chip survey was conducted in the north-eastern portion of the EPM in early 2008. This confirmed anomalous results from previous fieldwork. A large anomaly occurs around the old Bamford Hill tungsten-molybdenum mine and the Eight Mile tungsten mine. Also, the western side of the target area adjoins the former Dover Castle tin mines which are outside the EPM.

The potential for the discovery of additional tungsten-molybdenum resources at Bamford Hill would bode well for the future recommissioning of the Wolfram Camp processing plant.

Mine For

molybdenum, gold, silver, copper, tungsten

Location of operation(s)

Queensland

Address

71 Lytton Road
EAST BRISBANE, QLD, Australia

Phone

(61 7) 3249 3080

Email

Website

http://www.planetmetals.com.au/

Last Updated

2/3/2011