Diamond drilling intersects in excess of 300 metres of massive magnetite mineralization grading 51.6% iron.
Cardero Resource Corp. (the "Company" or "Cardero") is pleased to announce the results for the final three drill holes of the Phase I diamond drill program on its 8,000 hectare Pampa de Pongo property. The property, located in the coastal region of southern Peru approximately 400 km south of Lima, is situated some 35 km southeast of the Marcona Iron Mine (approximate resource of 1.4Bt @ 54% iron) and the Mina Justa copper deposit (inferred resource of 218Mt @ 0.8% copper). A deep-sea port facility is located 42 km to the northwest at Puerto San Nicolas.
Pampa de Pongo was discovered by Rio Tinto Mining and Exploration Ltd. ("RT") in the mid-1990s as part of a regional exploration program targeting iron oxide-copper-gold (IOCG-type) mineralization. Wide-spaced reconnaissance drilling by RT (a total of 15 boreholes) identified widespread mineralization along a structural corridor approximately 1 km wide and in excess of 6 km long (Figure 1). Highlights of the Rio Tinto drilling include borehole RT DDH001, which intersected 368 metres (true width) of massive magnetite mineralization averaging 45.3% Fe from 395-763 metres and borehole RT DDH009, which intersected a 82.6 metre interval between 259.4-342.0 metres that averaged 56% Fe, 0.24% Cu and 0.35 g/t Au in two main deposits referred to as the Central and South Zones (Figure 1).
RT concluded that, at Pampa de Pongo, "Wide-spaced drilling suggests a potential resource of 1,000Mt comprising approximately 75% magnetite." Pure magnetite has a theoretical iron content of 72.4%, but typically ranges from 60 to 68% iron. Furthermore, preliminary metallurgical test work carried out by RT indicated that a simple low intensity magnetic separation could produce a saleable concentrate grading 66 to 69% iron.
Cardero's Work Program
Work to date by Cardero (between March 2004 and February 2005) has included surface mapping, an electromagnetic survey (TEM), detailed high-resolution ground magnetic surveys and magnetic data processing (3D inversion models) and 4,596.6 metres of diamond drilling in 14 holes.
The resultant drill program took a two stage approach: the first seven boreholes, for a total of 1847 metres (DDH04 - 10 to 16), were designed to test TEM geophysical anomalies interpreted to represent potential copper mineralization adjacent to previously defined airborne magnetic anomalies (Figure 1). Although copper-gold intersections were encountered, the initial data has yet to identify a major target. However, Cardero believes that significant copper-gold potential exists in the area and will continue investigations designed to locate such occurrences. In the short term, further work will concentrate on following up on the outstanding drill results from the second stage of drilling which explored the potential of the property to host a significant iron ore deposit (see below).
The second stage of the drilling (2749.6 metres in seven boreholes, DDH04-17 to 21 and KA-001) was designed to explore for extensions of iron (magnetite) mineralization utilizing the 3D magnetic model in the South (DDH04-19) and Central (DDH04-20, 20A and 21) deposits, respectively, in addition to the Kampana target (Figure 1). Highlights of this drilling include:
In summary, the mineralization is semi-concordant and appears to have been controlled by a number of factors including host rock lithologies, primary porosity and secondary porosity related to fracturing and brecciation. Alteration minerals include serpentine, talc, epidote, chlorite, magnesite, dolomite, calcite, actinolite, albite, tourmaline, garnet, phlogopite, biotite, sericite and K-spar. Several phases of alteration-mineralization are apparent.
Based on the available data, results and utilizing all the available data the Central Zone is interpreted to consist of a flat-lying, semi-massive to massive replacement lens up to 370 metres thick and a minimum of 620 metres across. Mineralization appears to be consistent, averaging about 62% magnetite with sections of +80% magnetite (Figures 2 and 3).
Based on the available data, the South Zone consists of semi-massive to massive magnetite-sulphide within a horizon that has a thickness of up to 120 metres and has been traced over a minimum distance of approximately 900 metres. The top part of the deposit has been eroded and is covered by a thick section of Quaternary to Recent sand and gravel. The base of the deposit appears to be conformable with bedding, which has an apparent dip of about 25_ east.
Both deposits remain open: Central Zone remains open at depth and in all directions while the South Zone remains open at depth and to the East.
Estimates by industry executives conclude that the world is facing an iron ore supply gap of approximately 40 million metric tonnes a year, which is unlikely to be met before 2008. Recently announced iron ore contract price increases by major producers include 71.5% for non-agglomerated ore (i.e. Rio Tinto's Hamersley Iron - fine US$61.71 per dry metric tonne unit and lump US$78.77 per dry metric tonne unit) and 86% for pellets (i.e. Nibrasco - pellet US$108.57 per dry metric tonne unit).
Mr. Henk Van Alphen, President of Cardero, stated: "Given the current strong demand for iron ore products and the bullish long-term outlook for the iron industry, the Company is very optimistic about the future of Pampa de Pongo in light of the very encouraging iron assay results to date and the apparent size of the magnetite deposit, and looks forward to continued progress on this excellent project".
EurGeol Mark D. Cruise, Cardero's Vice President-Exploration, a qualified person as defined by National Instrument 43-101, supervised the preparation of the information contained in this news release.
The work program at Pampa de Pongo is supervised by Gary D. Belik, P. Geo. who is responsible for all aspects of the work, including the quality control/quality assurance program. On-site personnel at the project photograph each individual borehole prior to preparing the split core which is sealed and shipped to ALS Chemex Peru for assay. ALS Chemex's quality system complies with the requirements for the International Standards ISO 9001:2000 and ISO 17025: 1999. Analytical accuracy and precision are monitored by the analysis of reagent blanks, reference material and replicate samples. Quality control is further assured by the use of international and in-house standards. Finally representative blind duplicate samples will be forwarded to ALS Chemex and an ISO compliant third party laboratory for additional quality control.
The Company is well financed with over $18 million in the treasury and well positioned to continue to explore its projects in Mexico, Peru, and Argentina. The common shares of the Company are currently listed on the TSX Venture Exchange (symbol CDU), the American Stock Exchange (symbol CDY) and the Frankfurt Stock Exchange (symbol CR5). The Company is actively evaluating gold, silver, copper and iron ore-copper-gold (IOCG) projects, which will ensure the recognition of Cardero as a world-class exploration and development company.
On Behalf of the Board of Directors of
CARDERO RESOURCE CORP.
"Henk Van Alphen, President" (signed)
Hendrik van Alphen, President
Quentin Mai, Manager - Corporate Communications & Investor Relations
Phone: (604) 408-7488 / Fax: (604) 408-7499
The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of the content of this news release, which has been prepared by management.
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act and Section 27E of the Exchange Act. Such statements include, without limitation, statements regarding future anticipated exploration program results, the discovery and delineation of mineral resources/reserves, business and financing plans, business trends and future operating revenues. Although the Company believes that such statements are reasonable, it can give no assurance that such expectations will prove to be correct. Forward-looking statements are typically identified by words such as: believe, expect, anticipate, intend estimate, postulate and similar expressions, or which by their nature refer to future events. The Company cautions investors that any forward-looking statements by the Company are not guarantees of future performance, and that actual results may differ materially from those in forward looking statements as a result of various factors, including, but not limited to, the Company's ability to produce minerals from its properties successfully or profitably, to continue its projected growth, to raise the necessary capital or to be fully able to implement its business strategies.
All of the Company's public disclosure filings may be accessed via www.sedar.com and readers are urged to review these materials, including the technical reports filed with respect to the Company's mineral properties. This press release contains information with respect to adjacent or similar mineral properties in respect of which the Company has no interest or rights to explore or mine. The Company advises US investors that the US Securities and Exchange Commission's mining guidelines strictly prohibit information of this type in documents filed with the SEC. Readers are cautioned that the Company has no interest in or right to acquire any interest in any such properties, and that mineral deposits on adjacent or similar properties are not indicative of mineral deposits on the Company's properties.
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