Champion Minerals Provides Activity Update - Nine Diamond Drills Currently Delineating Resources at Fermont Iron Ore Holdings

Thursday, 11 August 2011 12:22

Fire Lake North – drilling final hole of 26,000 m program initiated after the last Mineral Resource Estimate (Nov 2010);
O’Keefe-Purdy – 3 drills added in mid-July to commence a Phase 1 program totalling 10,000 m;
Oil Can – 2 drills recently commenced an 8,000 m Phase 1 program;
Midway – 1 drill recently started a Phase 1 program set for 3,000 m, 2nd drill to commence after finishing at Fire Lake North
MoireLake– 2 drills working to complete an expanded program totalling 9,600 m;

CHAMPION MINERALS INC. (TSX: CHM; FSE: P02) provide an update of drilling activities at the Company’s Fermont Property Holdings in northeastern Quebec.

Fire Lake North
Champion has a total of nine drill rigs operating on its Fermont Projects. At the flagship Fire Lake North Project, the final drillhole of the current program is in-progress. The program comprised 57 holes, totalling 26,000 m and has been ongoing since the November 2010 Mineral Resource Estimate and Preliminary Economic Assessment (PEA). Resource modelling and estimation is in-progress for the “Don Lake” and “East” areas, while the Company awaits remaining assay results from the recently completed “West Area” drillholes.

Based on preliminary in-house modelling of the new drilling results from Fire Lake North, Champion expects to realize a significant increase to the Project’s National Instrument (“NI”) 43-101 Inferred Mineral Resource Estimate, currently estimated as 388 Million Tonnes (MT) grading 28.9% Total Iron (FeT), as well as a reclassification of some Inferred resources to the Indicated category. Early best-estimates point to increased in-pit resources, reduced strip ratios for the East Area and West Area designed pits, and to the potential feasibility of an open pit at Don Lake. An updated Mineral Resource Estimate is scheduled for completion in Q3 to be followed shortly thereafter by an update of the PEA.

O’Keefe-Purdy
In July, three additional drills were commissioned to start a 10,000 metre diamond-drilling program at the Company’s O’Keefe-Purdy Project. This Phase 1 drilling program is designed to validate and expand upon the Historical Mineral Resource* estimate of 51 MT grading 37% FeT (MRNFQ Assessment File GM31090, 1975). Results from Champion’s airborne magnetic and gravimetric surveys, rare bedrock exposures, and historic drilling results, indicate that the O’Keefe-Purdy property is underlain by a convoluted, locally thickened iron formation having an overall strike length of nearly 20 km. Two drills have commenced validation-drilling on the historic O’Keefe Lake Iron Occurrence while the third drill has begun exploration elsewhere on the property. Iron formation intersections in the new drill core have been dominantly specular hematite-rich, with lesser amounts of magnetite. Should NI 43-101 compliant iron resources be identified at O’Keefe-Purdy, it could provide suitable satellite feed to the Fire Lake North Project and potentially enhance the economics of development.

Oil Can
Three of four drills originally at Fire Lake North have completed their scheduled drilling. Two of these drills were deployed to the Oil Can Project to commence a Phase 1 drill program totalling 8,000 m. Drill logs from four historic drill holes on the property document iron formation comprised of specular-hematite and magnetite (see Assessment Report GM005486-B:http://sigeom.mrnf.gouv.qc.ca). Magnetic responses, outlined by the Company’s two recent airborne geophysical surveys, show the iron formation to be complexly folded with structurally thickened zones having potentially favourable geometries for open pit exploitation. The initial 5,000 m of drilling will evaluate the Project’s mineral potential at widely spaced intervals, and will be followed by 3,000 m of in-fill and down-dip drilling to provide a better understanding of geometry.

Midway
The third drill from Fire Lake North was most recently deployed to the Midway Project, as will be the fourth drill upon completion of the final hole at the Fire Lake North West Area. The Phase 1 diamond-drilling program at Midway is scheduled for 3,000 m; however, as at Oil Can, the initial holes totalling 1,800 m, will be widely spaced and will be followed by 1,200 m of in-fill and down-dip drilling to provide a better understanding of the sub-surface geometry.

All of Champion’s Fermont Cluster 2 properties – namely, Fire Lake North, Bellechasse, Harvey-Tuttle, O’Keefe-Purdy, Midway, Oil Can, Hope Lake, Claire Lake and Cassé Lake – are within a reasonable distance to the Fire Lake North Project to enable potential development of satellite resources that might be conveyed to a centralized production complex developed at Fire Lake North. It is for this reason that Champion remains dedicated to exploring the Cluster 2 properties in order to identify which of them have the potential for coarse grained specular-hematite mineralization and prioritize the delineation of these more valued resources for sinter feed. Champion will continue to further delineate the magnetite-rich resources at other Cluster 2 projects for potential development as sinter / pellet feed source.

MoireLake(Cluster 1)
At the Company’s Moire Lake Project, two drills are working towards completing an increased drill program totalling 9,600 m. The initial 5,000 m program was increased to 7,600 m as a result of favourable results obtained while validating the Historic Mineral Resources* (102 MT grading 31% FeT).at the Moire Lake Occurrence (MRNFQ Assessment File GM13035, 1963). The initial drill program included 2 holes to test a separate zone of iron formation on the east side of the property, where recent prospecting encountered outcrops containing specular-hematite and magnetite iron formation in zones up to 40 m wide. An additional 2,000 m of drilling has been scheduled to delineate the extent of iron formation along this Eastern Trend at Moire Lake. The Company expects to provide an update of assay results for recently completed drill holes at Moire Lake shortly.

The Fermont Iron Holdings

Champion’s Fermont Holdings comprise seventeen properties, three of which - Fire Lake North, Bellechasse and Harvey-Tuttle - host a combined NI 43-101 compliant Inferred Mineral Resources currently estimated at 1.55 Billion Tonnes grading 25.4 % FeT, at a 15% cut-off. The Company recently announced positive results from drilling at the Moire Lake Project adjacent to the east of ArcelorMittal’s Mont Wright Mine property. A Mineral Resource estimate for the Moire Lake Project is anticipated in Q3-2011. Seven of Champion’s remaining fourteen Fermont properties contain combined Historical Mineral Resource Estimates* totalling 620 MT grading 31% Total Iron.

An ongoing, fully-funded, 60,000+ m diamond-drilling program that will investigate nine of Champion’s Fermont properties is scheduled for completion in 2011-2012.

About Champion Minerals Inc.

Champion Minerals is an exploration and development company focused on discovering and developing significant iron ore resources, particularly in the provinces of Quebec and Newfoundland & Labrador. The Company’s projects include: the Fermont Holdings in Quebec, jointly held by Champion (82.5% interest) and Fancamp Exploration Ltd. (17.5% interest); the Attikamagen Iron Property in Quebec and Labrador, and the Powderhorn / Gullbridge base-metal Project in central Newfoundland.

* Historical Mineral Resources are from Paquet, 1963 (MRNFQ Assessment File GM 13035) (see press release date February 15, 2011). All Historical Mineral Resources outlined in the text are non-compliant to NI 43-101 Mineral Resources and Mineral Reserves standards, and should therefore not be relied upon. AQualified Person has not done sufficient work to upgrade or classify these Historical Mineral Resources as current NI 43-101 compliant Mineral resources. The current Mineral Resource estimates were calculated using the Canadian Institute of Mining, Metallurgy and Petroleum (CIM), CIM Standards on Mineral Resources and Reserves, Definitions and Guidelines prepared by the CIM Standing Committee on Reserve Definitions and adopted by CIM Council December 11, 2005.

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