Firstenergy Corp. (FE)

[Tackler]

Northland drills 36.5 m of 40.1% Fe at Hannukainen

2006-09-13 10:11 ET - News Release

Mr. Buck Morrow reports

NORTHLAND CUTS SIGNIFICANT IRON-COPPER-GOLD MINERALIZATION AT THE HANNUKAINEN PROJECT, FINLAND

Northland Resources Inc. is releasing results from its first-stage drill program at the 100-per-cent-owned Hannukainen iron-oxide-copper-gold (IOCG) project in northern Finland. Thirteen broad-spaced holes were drilled, testing the flat-lying Laurinoja magnetite body at Hannukainen. Results confirm the presence of significant copper-gold mineralization associated with the magnetite body.

Results from the drilling are tabled below. The copper-gold values are also presented as gold equivalent grades, calculated for each mineralized interval using prices of $500 (U.S.) per ounce for gold and $2.50 (U.S.) per pound for copper. This calculation does not incorporate any value for the iron grades present in the interval.

All intervals are believed to be true thicknesses as the mineralized body ranges in dip from flat lying to a maximum of 15 degrees from the horizontal. A drill collar plan is available on Northland's website.

 
  
                            Interval                            Au (i)  
 Hole No.  From (m)   To (m)      (m)   Fe %    Cu %   Au g/t Eq. g/t 
  
 HAN06001    123.4    156.5     33.1    37.7    0.77     0.33    3.09 
 HAN06002    129.8    153.0     23.2    41.8    0.32     0.09    1.24 
 HAN06003    127.0    152.3     25.3    33.6    0.20     0.15    0.87 
 HAN06004    113.9    128.5     14.6    42.1    0.20     0.00    0.72 
 HAN06005    148.0    177.0     29.1    39.7    0.81     0.75    3.66 
 HAN06006    144.4    172.0     27.6    34.1    0.29     0.00    1.04 
 HAN06007    132.3    153.8     21.6    43.8    0.20     0.00    0.72 
 HAN06008    101.2    110.8     9.6     46.9    1.11     0.99    4.97 
 HAN06009    142.0    178.5     36.5    40.1    0.41     0.18    1.65 
 HAN06010    147.1    175.8     28.8    41.2    0.52     0.40    2.27 
 HAN06011    155.4    185.5     30.1    39.1    0.25     0.00    0.90 
 HAN06012    140.0    169.0     29.0    37.9    0.43     0.91    2.45 
 HAN06013    105.3    126.0     20.7    38.8    0.74     0.73    3.38 
 

(i) Au price assumed equals $500 (U.S.) per ounce, Cu price assumed
equals $2.50 (U.S.) per pound

The weighted average interval and grade for mineralized intercepts in the 13 holes are 25.3 metres at 39.2 per cent iron (Fe), 0.46 per cent copper (Cu) and 0.33 gram per tonne (g/t) gold (Au).

Northland's previous work at Hannukainen included relogging and reassaying a number of historic bore holes stored in the government core archives. Part of the Hannukainen deposit was mined from 1982 to 1988 from the Laurinoja open pit. Approximately 4.5 million tons of magnetite ore were mined from Laurinoja at a grade of 43 per cent Fe, 0.88 per cent Cu and one gram per tonne Au.

Approximately 175 holes were relogged and over 100 holes were reassayed. Copper-gold grade thickness maps were produced which define a 1,000-metre-by-400-metre, northeast-trending copper-gold zone within the magnetite body at Laurinoja extending through and beyond the historic pit area. The results of this work were published in Stockwatch news Nov. 7, 2005.

Although no historic production records are available for specifically for the Laurinoja open pit other than some basic tonnage and grade figures, historic production records have been obtained for the nearby Rautuvaara underground mine which processed a blend of material mined from the Laurinoja open pit and material from the underground Rautuvaara mine. The blended ore was crushed and magnetic separation recovered 99.4 per cent of the magnetite feed. The iron grade of this concentrate was 66.9 per cent indicating a high yield. The tails of the magnetic separation were processed using flotation which recovered 94.7 per cent of the copper and 75 per cent of the gold in the tails with no apparent metallurgical complications. Copper-in-concentrate grade was reported to be 23.7 per cent, and the gold-in-concentrate grade was 11.7 g/t Au. The reader is cautioned that Northland has not yet performed the metallurgical testwork required to independently verify the Cu and Au recoveries quoted in the historic Rautuvaara production records.

Planned work at Hannukainen

Two core rigs are being mobilized to the property and drilling is expected to recommence at Hannukainen before the end of September. The drill program will have the following objectives:


to confirm the historic 66-million-ton iron-copper-gold resource and allow recalculation of the resource to National Instrument 43-101 standards (the existing resource estimate was prepared prior to the implementation of National Instrument 43-101 and does not use the resource categories stipulated in Section 1.3 of National Instrument 43-101, which are inferred mineral resource, indicated mineral resource and measured mineral resource. The company believes that term resources is used differently from the use of that term in NI 43-101. The company does not have -- and is not aware of -- any more recent resource estimates which conform to the standards laid out in NI 43-101 and the historical estimate should not be relied upon);
to expand this historic resource along the linear trend established by the relogging program; and
to evaluate the adjacent iron-oxide-copper-gold targets in the Hannukainen belt and -- where warranted -- to advance these targets to the resource category.

Laurinoja is one of five known iron-copper-gold occurrences in the Hannukainen area. The other prospects, Lauku, Kuervaara, Vuopio and Kivivuopio, all exhibit the potential to host similar mineralized bodies to Laurinoja.

The Hannukainen area itself represents only one of a number of known iron-oxide-copper-gold-type magnetite occurrences in the Kolari district, Finland, that are currently being evaluated by Northland. The company controls the mineral rights to a 50-kilometre strike of the Pajala shear zone, the major structural feature that appears to localize the emplacement of these magnetite bodies. The belt straddles the border between Finland and Sweden. On the Swedish side, at the Stora Sahavara prospect, which is roughly 25 km from the Laurinojo open pit, the company has defined a significant NI 43-101-compliant iron resource with Cu credits (see Stockwatch news May 18, 2006).

NI 43-101 statement

Vance Thornsberry, PGeol, vice-president of exploration for Northland, is the qualified person as defined in NI 43-101, responsible for the design and execution of the Hannukainen drill program and reassay program, and has verified that the drill intersections contained in this release are an accurate summary of the assay data received by the company. Mr. Thornsberry has also verified that the historic information presented in this release has been accurately summarized from the reports quoted.

The core was cut at Northland's core facility in Kolari, Finland. A one-half split of the core was sent for preparation and analysis to the Geological Survey of Finland's Analytical Laboratory in Rovaniemi which is accredited according to the SFS-EN ISO/IEC 17025 and in compliance with the requirements of the Standards Council of Canada (CAN-P-1579), "Guidelines for Accreditation of Mineral Analysis Testing Laboratories." The entire sample, representing approximately three kilograms, was crushed and pulverized and a 150-gram split was submitted for analysis.

Iron and copper analyses were performed using sodium peroxide fusion multielement analysis with ICP-AES technique, method 720P, and gold analysis was performed by lead fire assay preconcentration with ICP-AES technique, method 704P. In addition to the GTK internal sample preparation and assay quality-control protocol, Northland maintains a rigorous quality-assurance/quality-control program consisting of inserting blanks, duplicates and certified standards to the analytical process.