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ANNOUNCEMENT

ARCHIPELAGO RESOURCES PLC

DRILLING RESULTS

TOKA  TINDUNG  GOLD  PROJECT

Archipelago Resources Plc ('Archipelago' or the 'Company') is pleased to announce that in preparation for mining at the Company's 85% owned Toka Tindung Gold Project ('Project'), a program of shallow, close spaced reverse circulation drill holes has been carried out over a portion of the Toka Tindung deposit where mining will first commence.  The drilling was planned to confirm the near surface distribution of ore and waste in undulating ground that will have to be excavated to develop broad, level mining benches.  In total, 361 holes were drilled to an average depth of 14m for a total of 4,956m with the following results:-

• 32% of the holes encountered mineralized intersections with greater than 10 gram*meters of gold, mostly starting within a few meters of surface.  

• The 116 mineralized intersections have an average down hole width of 6.0m and an average grade of 8.7g/t gold.  

• 16% of the intersections have widths greater than 10m.

•  29% of the intersections have average grades in excess of 10g/t gold.  

• The best intersection is 14m @ 39g/t gold starting from surface, however several other intersections have higher grades or widths.  

• 42% of the intersections, including the best intersection, finish in mineralization.

The Company is very encouraged by these intersections, all of which are within 15m of the surface, as they demonstrate firstly that high grade mineralization previously defined in deeper drilling extends to surface, but most importantly they also confirm a strong 67% correlation of quartz with gold mineralization, compared to 10% with waste. It is this last important observation that the Company is confident will contribute to good in-pit grade control practices and outcomes, the key to good mining and process plant management and production results.

The Project contains a JORC compliant resource of 1.75m ounces of gold equivalent of which 1.1m ounces is initially mineable by a series of open pits feeding a central processing plant. Production is targeted to commence in 2010 at an average annual production rate of 160,000 ounces for the first 6 years of the current 8½ year Project life.  However, Archipelago is confident of increasing the resource base in view of the highly prospective nature of the ground surrounding the known deposits.  The Company is awaiting the support of the Governor of North Sulawesi to enable it to obtain financing necessary to complete construction of the Project. 

 

Archipelago is a mining company listed on the AIM market of the London Stock Exchange.  The Company's principal activities are gold mining and exploration in Indonesia (as 85% owner of the Toka Tindung Gold Project in Sulawesi), Vietnam (as majority party in the Pac Lang and Cam Thuy/Ba Thuoc joint ventures with VINACOMIN a Vietnamese Government mining company) and the Philippines (as option holder over a 100% interest in the Corplex tenements).

 

http://www.rns-pdf.londonstockexchange.com/rns/9026S_-2009-5-27.pdf

 

Further Info:    Colin Loosemore, Managing Director, Archipelago Resources Plc.

                          Tel:    00-618-9364-8301

 

                         Richard Chase, Ambrian Partners Ltd

                        Tel:    020-7634-4700

 

                       Ron Marshman / John Greenhalgh, Lothbury Financial

                      Tel:    020-7011-9411

 

                    Gerry Beaney / Fiona Kindness, Grant Thornton UK LLP

                    Tel:     020 7383 5100

 

www.archipelagoresources.com.au

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