AFFERRO MINING INC. - Putu Resource Increases by 36% to 3.24 Billion Tonnes with 58% as Indicated status

Jul. 11, 2011 (Canada NewsWire Group) --

NOT FOR DISTRIBUTION IN THE UNITED STATES OR FOR DISSEMINATION TO US NEWS WIRE SERVICES

TSX-V: AFF
AIM: AFF

LONDON, UK, July 11, 2011 /CNW/ - Afferro Mining Inc. ("Afferro" or the "Company"), the TSX-V / AIM listed exploration and development company with iron ore projects in Cameroon and Liberia, is pleased to announce an upgrade to its independent National Instrument 43-101 compliant Mineral Resource Estimate at its 38.5% owned Putu iron ore project in Liberia.

• Total Putu resource grows by 36% to 3.24Bt at 34.3% Fe
• 1.89 Billion tonnes of itabirite banded iron formation (BIF), representing 58% of the resource, promoted to indicated category
• Prefeasibility study accelerated to complete in 6-8 months, Q1 2012
• Definitive feasibility study now expected Q1 2013
• Four diamond drill rigs operating since June
• 2011 drilling campaign target now 48,500m with 28,000m completed
• Current resource based on 47,713m of drilling, of which 36,630m has been assayed

Luis da Silva, Chief Executive of Afferro, commented:
"This is another fantastic result for the Company and our JV partner, Severstal Resources.  Afferro now has close to 2.7 billion tonnes of attributable iron ore equating to more than 900 million tonnes of contained iron in the ground. With this tonnage justifying the base case investment outlined by the two shareholders, the JV is now in a position to concentrate on the exploration of the oxide cap during the prefeasibility study."

Mineral Resource Estimate
This Putu Mineral Resource estimate, issued by independent engineers SRK Consulting (UK) Ltd ("SRK") has been prepared for the Company and made compliant with Canadian National Instrument 43-101 (NI43-101).

The report serves as an independent report prepared by a Qualified Person as defined by the Canadian National Instrument 43-101 and the companion policy 43-101CP. The definitions of Measured, Indicated and Inferred Resources, as well as reserves as used by the author, conform to the definitions and guidelines of the CIM (Canadian Institute of Mining, Metallurgy and Petroleum) reporting codes. Three sites visits have been conducted by SRK during the course of the project and a further visit to site will take place within the 45 day reporting period for the NI 43-101 report.

Table 1: Putu Project, Mineral Resource Estimate

Notes:

(1) Mineral Resources which are not Mineral Reserves have not demonstrated economic viability

(2) The effective date of the Mineral Resource is 7 July 2011

(3) The Mineral Resource Estimate for the Nkout deposit was constrained within lithological and grade based solids and within a Lerchs-Grossman optimised pit shell defined by the following assumptions; metal price of USD1.40/dmtu; slope angles of 44º in the oxide and fresh material; a mining recovery of 97.5%; a mining dilution of 2.5%; a base case mining cost of USD1.40/t and an incremental mine operating costs of USD0.05/t/10 m below the 100 m reference RL and USD0.05/t/10 m above the 100 m reference RL; process operating costs of USD2.68/t crushed in the oxide zone and  USD5.67/t crushed BIF ore; and G&A costs of USD 2.921/t crushed ore.

In total, SRK has estimated for the Putu Project an Indicated Mineral Resource of 1.89 billion tonnes ("Bt") grading 33.9% Fe, 44.5% SiO₂, 0.98% Al₂O₃ and 0.07% P and an additional Inferred Mineral Resource of 1.36 Bt grading 34.7% Fe, 43.3% SiO₂, 1.37% Al₂O₃ and 0.07% P. Of this, 224 million tonnes ("Mt") grading 36.8% Fe lies within surface oxidized zone, 1.13 Bt grading 34.3% Fe lies within the fresh magnetite itabirite zone.

Putu Resource Potential
The Putu model is open at depth and SRK recognises that there is potential to increase the Mineral Resource Statement by targeting material that falls below the optimised pit shell but remains potentially economic. This material, based on a metal price of USD1.40/dmtu is considered by SRK to be potentially economic, should sufficient exploration data be collected that confirms the geometry and continuation of the mineralisation and that enables a classified resource to be estimated.

SRK has identified that an additional 0.5 to 1.0 Bt lies below the optimised pit shell used for constraining the Inferred Mineral Resources. The potential quantity of tonnes is conceptual in nature as there has been insufficient exploration or demonstration of economic viability to report these in the Inferred Mineral Resource category at the current time. It is uncertain if further exploration will result in these targets being defined and reported in a future Mineral Resource Estimate. These potential tonnages reflect a range of material within SRK's wireframe solid models outlining the interpreted down dip extent of mineralisation.

Database Validation
The QA/QC program for Company's Putu project consists of alternating the insertion of a blank and duplicate sample on a regular basis within the sample train. All samples have been assayed at the accredited SGS Johannesburg laboratory in South Africa. SRK found that the results of the above described QA/QC program indicate that the Company's Putu assay databases were appropriate for Mineral Resource Estimation.

Data Verification
Howard Baker completed the verification of data on which the Putu Resource Estimate was based. This verification included an assessment of QA/QC data, sample preparation and assay methodologies, density data, data inputs and survey data used in the estimate. Data was validated by using field checks, statistical methods and evaluating the Company's protocols.

Geological Modelling, Resource Estimation Assumptions, Parameters and Methods
Putu can be divided into two main areas, Montroh and Jideh. The former is east-west trending, and the latter is north-northeast/south-southwest trending. Both areas are compromised of magnetite Banded Iron Formation ("BIF") with oxidized caps of dominantly haematite mineralisation. SRK created a geological model based on the lithological logging and magnetic susceptibility data enabling a dominant antiform structure, to be modelled and a three dimensional solid to be created. A statistical review of the validated drill hole data enabled a domain to be created within the oxidized cap. Internal waste domains were created within the BIF being based on lithology logging, magnetic susceptibility data and Fe assay grades.

A 5 m composite file was used in a geostatistical study (variography and Quantitative Kriging Neighbourhood Analysis, "QKNA") that enabled Ordinary Kriging ("OK") to be used as the main grade interpolation method. The interpolation used an elliptical search and data unfolding techniques to follow the predominant dip and dip direction of the geological domains. The results of the variography and the QKNA were utilised to determine the most appropriate search and estimation parameters.

The interpolated block model was validated through visual checks and a comparison of the mean input composite and output model grades. SRK is confident that the interpolated block grades are a reasonable reflection of the available sample data.

Putu Metallurgical Test Work
As previously announced, metallurgical test work was conducted on five samples from each of the main mineralisation units - magnetite itabirite, epidote-chlorite magnetite itabirite, haematite itabirite, transitional magnetite itabirite, and weathered (predominantly haematite) itabirite. The test work was undertaken by Amdel Mineral Laboratories in Australia.

The test work results indicate that the unweathered magnetite itabirite should be amenable to conventional magnetite processing, that is, using several stages of Wet Low Intensity Magnetic Separation.

Given the high (60%) recovery achieved for the transitional itabirite sample in the Davis Tube tests, despite the low magnetite content of this material according to the Satmagan measurement, this material may be amenable to the same flow sheet as the unweathered magnetite itabirite, albeit with a lower recovery. The suitability of this material to such a flow sheet may also depend on the relative proportions of this material to unweathered magnetite itabirite in the resource.

For the weathered itabirite and haematite itabirite samples, a process route possibly consisting of a combination of gravity separation, magnetic separation and flotation is indicated. In all cases, further test work is required in order to firm up potential process flow sheets and optimise the conditions under which to achieve a combination of acceptable product quality and recovery.

Putu Mineral Resource Classification
The Putu project has been classified as containing Indicated and Inferred Mineral Resources in the unweathered itabirite domain with the quantity of assay results and the quality of the estimated model being sufficient to support the Indicated category and Inferred Mineral resources being limited to deeper intersections with limited sample data and wider spaced drill sections. The oxidised domain has been limited to Inferred Mineral Resources due to the limited assay data that is currently available.

Cautionary Statement
The effective date of the Putu Mineral Resource Estimate is July 7, 2011. The Fe % presented in the above table is not meant to imply recoverable product. Mineral Resources for the Putu iron ore Project have been classified according to the "CIM Standards on Mineral Resources and Reserves: Definitions and Guidelines (December 2005) by Dr John Arthur (CEng, MiMMM) an Independent Qualified Person as defined by National Instrument 43-101.

Mineral Resources were estimated in conformity with generally accepted CIM "Estimation and Mineral Resource and Mineral Reserve Best Practices Guidelines". SRK is not aware of any known environmental, permitting, legal, title, taxation, socio-economic, marketing or other relevant issues that could potentially affect the estimate of Mineral Resources. The Mineral Resource may be affected by further exploration drilling which may increase or decrease the estimate. The Mineral Resource may also be affected by subsequent assessments of mining, environmental, processing, permitting, taxation, socio-economic and other factors. There is insufficient information at this stage to assess the extent to which the Mineral Resource will be affected by these factors that are more fully assessed in a feasibility study.

Mineral Resources are not Mineral Reserves and do not have demonstrated economic viability. Mineral Reserves can only be estimated based on the results of an economic evaluation as part of a preliminary feasibility or feasibility study. No Mineral Reserves have been estimated by SRK as part of the current assignment. There is no certainty that all or any part of the Mineral Resource will be converted to a Mineral Reserve.

The quantity and grade of reported Inferred Mineral Resource in this estimate are uncertain in nature and there has been insufficient exploration to define these Inferred Mineral Resources as an Indicated or Measured Mineral Resource; and it is uncertain if further exploration will result in upgrading them to an Indicated or Measured Mineral Resource category.

Qualified Person
The technical information contained in this press release and relating to the Putu Project has been prepared by Mr Howard Baker, an employee of SRK and Dr John Arthur, an employee of SRK and a "qualified person" within the meaning of the National Instrument 43-101 ("NI 43-101"). The 43-101 technical report describing the work undertaken in generating the Mineral Resource Statement will be made available under Afferro Mining's SEDAR profile at www.sedar.com or at www.afferro-mining.com within 45 days of the press release.

Howard Baker has ten plus years experience in the exploration, definition and mining of iron ore Mineral Resources.

Dr John Arthur has seventeen years experience in the exploration, definition and mining of Mineral Resources. Mr. Arthur has sufficient experience which is relevant to the style of mineralization and type of deposit under consideration, and to the type of activity which he is undertaking to qualify as a "qualified person" under NI 43-101 and a Competent Person as defined in the June 2009 Edition of the AIM Note for Mining and Oil & Gas Companies. Dr John Arthur consents to the inclusion in this press release of the matters relating to iron ore in the form and context in which they appear and confirms that the information is accurate and not false or misleading.

About Afferro Mining Inc.
Afferro Mining is an established exploration and development company listed on the TSX-V (AFF) and London's AIM (AFF). Afferro Mining's portfolio includes a 100% interest in the Nkout iron ore project (the "Nkout Project"), which has an estimated Indicated Mineral Resource of 701 million tonnes grading 32.4% Fe, 45.8% SiO₂, 2.4% Al₂O₃ and 0.05% P, Inferred Mineral Resource of approximately 716.5 million tonnes grading 34.8% Fe, 41.6% SiO₂ and 3.2% AL₂O₃ and 0.05% P, and surrounding iron targets in Cameroon which is subject to a resource expansion drilling programme targeting 4Bt. Afferro Mining also has a 38.5% interest in the Putu iron ore project in Liberia (the "Putu Project"), which has an estimated Indicated Mineral Resource of 1.89 Bt grading at 33.9% Fe, 44.5% SiO₂, 0.98% Al₂O₃ and 0.07% P, Inferred Mineral Resource of 1.36 Bt grading at 34.7% Fe, 43.3% SiO₂, 1.37% Al₂O₃ and 0.07% P including 224 Mt at 36.8% Fe in the oxide layer. The Putu Project is subject to a resource expansion drilling programme and is moving through pre-feasibility managed by joint venture partner Severstal Resources (the mining division of London and Moscow listed OAO Severstal). In September 2010, Putu was granted a 25 year renewable Mineral Development Agreement by the Government of Liberia.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accept responsibility for the adequacy or accuracy of this release.

Afferro Mining Inc.
Luis da Silva, President & CEO
Tel: +44 (0) 20 7257 2930

Evolution Securities Limited
Nominated Adviser: Jeremy Ellis / Neil Elliot
Corporate Broker: Tim Redfern / Jonathan Wynn
Tel: +44 (0) 20 7071 4300

RBC Capital Markets
Joint Broker: Martin Eales / Richard Hughes
Tel: +44 (0) 20 7653 4000

Pelham Bell Pottinger
Charles Vivian / James MacFarlane
Tel: +44 (0) 20 7861 3232