13 April 2012
FORTUNE OIL PLC
("Fortune Oil" or the "Company")
Armenia Iron Ore investment - Update
Fortune Oil (LSE: FTO.L) focuses on oil, natural gas and resource supply operations and investments, primarily in China. Fortune Oil is listed on the Main Market of the London Stock Exchange.Fortune Oil today announces its maiden JORC Mineral Resource Statement reported in accordance with the terms and definitions of the JORC code for its Hrazdan Iron Ore Project ("HIOP") located 50km north east of Yerevan, the capital city of the Republic of Armenia and also an increased effective interest in its three Armenian iron ore mines.
Highlights
Mineral Resources totalling 21.4 Million tonnes grading
26.7%FeT (Total Iron),
7.1%Al2O3
(Alumina), 30.0%SiO2 (Silica) and 0.039%P
(Phosphorus);
Exploration drilling (completed from June to November 2011)
totalling 45 diamond drillholes for a total of 6,590 metres
of which 37 drillholes were sampled for a total of 2,880
metres;
Plans to build and operate a 2.5 Million tonnes per annum
concentrate facility, providing a foundation for a profitable
resource business in Armenia;
Fortune Oil has renegotiated various Joint Venture agreements
and has increased its effective interest in its three mines
to 73.34% for the same consideration of US$16 million.
Mr Tee Kiam Poon, Chief Executive of Fortune Oil,
commented:
"Today's announcement is further evidence of Fortune Oil's
commitment towards creating a
profitable and sustainable resource business capable of
delivering long term shareholder value.
Achieving our maiden JORC Mineral Resource Statement
represents a significant milestone in progressing the
development and realising the value of the project. As a
result of this Mineral Resource Statement we have commenced
planning to build and operate the mine and processing plant
at Hrazdan. We have also gained greater control over our
investment and the development process in Armenia. With our
staff on the ground we are making significant progress and we
are excited about the potential of our resource business
making a material contribution to the Group."
Hrazdan Iron Ore Project
HIOP comprises mining license HA-L-14/453 with a term of 25
years commencing 26 January
2007 and with an area of 2.4 km2 which is in the
name of Fortune Resources LLC. To advance
the technical studies for HIOP, Fortune Oil has also
established offices and a local technical team in Armenia to
co-ordinate the activities of local approvals and external
consultants as well as to progress the development of the
project.
Mineral Resource Declaration
SRK Consulting (UK) Limited ("SRK") was appointed to prepare
a JORC Mineral Resource Statement for HIOP which is reported
in accordance with the terms and definitions of the JORC Code
(as defined below). This declaration follows the completion
(from June to November
2011) of exploration drilling (managed by SRK and SRK
Exploration Services Limited) totalling 45 diamond drill
holes for a total of 6,590 metres of which 37 drill holes
were sampled for a total of 2,880 metres.
The total Mineral Resources reported by SRK, further details
of which are set out in the table below, is 21.4 Million
tonnes grading 26.7%FeT,
7.1%Al2O3, 30.0%SiO2
and 0.039%P which comprises: