VANCOUVER, Dec. 6 /CNW/ - Kimber Resources Inc. (TSX:KBR)
Carotare Resource Estimate
The most important event of the month was the announcement on November 8
of the first resource estimate on the Carotare target. Because it is the first
major exploration target beyond the Carmen to be established as a gold-silver
deposit, this resource estimate represents a milestone in the exploration
program. Only 28 holes were sufficient to define nearly a quarter of a million
resource ounces(1). The deposit is open in all directions. At this stage we
believe the Carotare to have similar potential to the Carmen deposit. Much
drilling remains to be done.
Carmen Drilling
Along with numerous other intersections in 14 drill holes, the news
release on November 28 pointed to 22 metres of over 11 g/t gold-equivalent at
a depth of about 150 metres. In addition to adding to the resources which we
expect to be mined by open pit, the grade and width of this intercept adds
further support to the expectation there will be both underground and open pit
mining on the Carmen deposit, where over 100 drill samples have exceeded
10 g/t gold-equivalent.
There are three images referenced in the text of this newsletter. To view
the images and entire text, click here:
http://www.kimberresources.com/newsletter.html?id(equal sign)136
Exploration drilling
By month-end drilling had begun on the El Orito Norte, the second
exploration target to be identified since exploration became a priority. As
shown (http://www.kimberresources.com/newsletter.html?id(equal sign)136) this
epithermal system and exploration target provides a geographic link between
the Carmen and the Carotare. Together these two deposits and one exploration
target form a belt of alteration and mineralization over three kilometres
long.
An east-west section through the belt shows the portions tested by
drilling and the extensive area yet to be tested. We believe, along with
independent geologists who have visited the site, that the three epithermal
systems (which may or may not be one large system) have a good chance of
developing three million gold-equivalent resource ounces. Having already
demonstrated 1.6 million gold equivalent resource ounces(1&2), most of them in
the Measured & Indicated categories, on the Monterde property, we are well on
our way to this objective.
Drilling Rate
As mentioned in the October newsletter, we began running the single
reverse circulation drill with two shifts after the second machine had been
sent for repair and upgrade. Although we maintained almost the same rate of
drilling, we were not able to drill on more than one target. Accordingly most
of the November drilling was on the Carmen deposit. By month-end the first two
holes had been drilled on the El Orito Norte. The second rig is expected back
on the property in time for the December program. One of the rigs will
continue to be run with two shifts.
Success Rate
Kimber's practice with both development and exploration drilling is to
step out limited distances from the previous drill hole, in most cases no more
than 25 metres. This approach has allowed us to achieve an enviable success
rate. Over 96% of the 315 RC holes drilled on the Monterde property to August,
2005 (the date of the published database) have cut intercepts of potential
economic interest.
Share price
Despite gold piercing the $500 level and Kimber chalking up an additional
240,000 gold-equivalent ounces(1) in November, our share price, to the
frustration of both shareholders and management, has remained unresponsive.
Prior to that announcement we were reporting 1.38 million gold-equivalent
resource ounces(2) and the share price was +/- $ 1.55. Simple arithmetic
suggests that the additional resource should have added 27 cents to the price.
But it didn't. Looking back to June and July the story has been much the same.
Since February 2005, when the share price was over $2.00, we have added over
half a million resource ounces(3) (an increase of 45%). See image.
During this time the share price declined. Although it is the ultimate
measure of success, share price is not always a good indicator of corporate
health while assets are being built. We will continue working to increase our
mineral resources because the gold and silver we are adding will eventually be
reflected in the value of the Company's shares.
The Market in General
Kimber is not alone in finding the current market less than responsive to
new mineral resources. As usual, the San Francisco Gold Conference
(November 27 & 28) provided a good opportunity to gauge the mood of our
industry. The retail investors were noticeably absent and the professional
funds were not well represented. Most of the junior companies had the same
refrain "no recognition and low share prices". Such observations are supported
by the "decoupling" between the price of gold and the average market
capitalization per ounce documented in Canaccord's Junior Mining Weekly of
Nov 28. We expect these two measures to return to their normal relationship.
Annual General Meeting
Kimber's AGM, to which all are welcome, will be held on December 7, 2005
at 1:30 pm in the Metropolitan Hotel in Vancouver, B.C. The business meeting
will be followed by two presentations. The first will cover the year and
review plans for the future. The second by Jim Puplava is titled "The Future
of Junior Gold Companies".
Next Newsletter
There will be no newsletter for the month of December. The next will
cover December and January.
All of us at the Kimber office wish our shareholders and those who follow
Kimber's progress a very happy Christmas holiday and a prosperous new year.
Notes
(1) News release dated November 8, 2005: 101,000 gold-equivalent
ounces in Measured & Indicated, (62,600 Measured, 38,400
Indicated), 139,000 ounces in Inferred.
(2) News release, September 6, 2005: 1,017,800 gold-equivalent ounces
in Measured & Indicated, 362,000 ounces in Inferred.
(3) The difference (417,100 in Measured & Indicated and 89,900
Inferred) between resources reported in the two recent news
releases (September 6, 2005, November 8, 2005) and the previous
resource report in news release of November 30, 2004
Explanatory Note on Resources & Reserves
The Mineral Resource categories, Measured, Indicated, and
Inferred, represent different levels of confidence which can be
placed on resource estimates. Only the most certain categories,
Measured and Indicated, can be advanced to Reserves. Not until a
pre-feasibility or feasibility study has been completed can
Resources be advanced to Reserve status. Mineral Resources, which
are not Mineral Reserves, do not have demonstrated economic
viability. U.S. jurisdictions recognise only Reserves, not
Resources.
Robert Longe, P.Eng.
President & CEO
About Kimber
Kimber Resources Inc., which holds a 100% interest in the Monterde
property in the Sierra Madre of northern Mexico, is advancing the Carmen
gold-silver deposit towards feasibility, while drilling neighbouring
epithermal systems for additional resources. The Carmen deposit, an
underground mine in the 1930's, is a typical epithermal system: low
sulphidation, oxidized, and believed to be suitable for open pit mining. The
Company is reporting 1.12 million gold equivalent resource ounces of Measured
& Indicated and 499,000 ounces of Inferred. The adjacent epithermal systems
now being drilled, appear to be similar. For more information on the company
please visit SEDAR or our website at www.kimberresources.com.
Cautionary Statement
Statements in this release may be viewed as forward-looking statements.
Such statements involve risks and uncertainties that could cause actual
results to differ materially from those projected. There are no assurances the
Company can fulfil such forward-looking statements and the Company undertakes
no obligation to update such statements. Such forward-looking statements are
only predictions; actual events or results may differ materially as a result
of risks facing the Company, some of which are beyond the Company's control.
