Zinc

[Lone Clone]

Phoenix Matachewan Mines Inc.: Zinc in Steel River Core
Mon Jul 30, 11:46 AM

http://ca.news.finance.yahoo.com/s/30072007/28/link-finance-news-phoenix-matachewan-mines-inc-zinc-s...

OTTAWA, ONTARIO--(CCNMatthews - July 30, 2007) - Phoenix Matachewan Mines Inc. ("Phoenix") (TSX VENTURE: PMM.V) announced today the results of an ongoing and widespread diamond drilling program at its extensive Steel River property on the north shore of Lake Superior in the Terrace Bay area of Northwestern Ontario.

Strongly anomalous zinc mineralization, assaying greater than 1000pm zinc, has been encountered in six of the eleven short holes drilled on the property to date. Holes PSR07-3 and 4 are particularly noteworthy, with anomalous results over 8.5 and 9 m respectively, grading up to 0.95% Zn.

Results to date

The current set of short holes is designed to test a series of airborne geophysical (VTEM) anomalies. These numerous strong and prospective anomalies occur in conjunction with other geophysical and geochemical responses along a 34km prospective horizon of cherty exhalite. Longer holes testing to a greater depth are planned as a follow-up to the current drilling. Hole locations are in Table 1, and the data are in Table 2 for those intersections where greater than0.1% Zn was observed. Anomalous zinc contents ( greater than300ppm) were recorded in all holes except PSR07-09 (which did not reach its target).

The most northerly holes (PSR07-3, -4, -5 and -7) were drilled to intersect the prospective "Main Exhalite" that extends the entire width of the property and is a known site of base metal mineralization. Holes PSR07-6, -8 and -9 were drilled in more southerly part of the same exhalite unit (150m to the south) and holes 10 through 13 are 800m south of the Main Exhalite units, drilled on a geophysical anomaly at a contact between mafic and sedimentary strata.

Holes PSR07-03 and -04, which are over 100m apart are particularly noteworthy, as not only do they contain anomalous zinc over 8.5 and 9m respectively, (PSR07-03 has 1.5 m containing 0.95% Zn) but these zones are formed of massive pyrite that is underlain by strongly altered (chloritized) felsic volcanic rocks that provide evidence of proximity to a hydrothermal discharge zone. In many other VMS districts similar alteration occurs close to deposits.

Holes 12 and 13, drilled in the southern tier of anomalies in Prairie West zone are enriched in Zn and Cu. All of the highest zinc contents came from massive pyrite sections in the exhalite unit; the potential along strike for this unit has not been tested, and is targeted for additional drilling this summer. Some surface samples from its eastern extension contain up to 700ppm Zn.

Management Observations

- The results are encouraging for early stage drilling, as they indicate that Phoenix is on the right track; the exhalite units are distinctly zinc-rich, and provide a well-defined target for further work.

- More and deeper drilling will be required at Prairie West.

- Prairie West is only one of eleven target areas, each area with multiple horizons to test, with the 1055 m only part of an estimated 8-10,000 m plus programme.

- Phoenix is presently drilling other target areas.

- Phoenix expects to be drilling at Steel River for the next 8-12 months, and has sufficient funds to do so.

- Large land packages, like Steel River at 137 sq km., take 3-5 years of exploration to find the right combination of factors to vector in on a major discovery. Phoenix is only at the early drilling stage.

Background, Current and Planned Activities

In 2003 PMM acquired its Steel River property, almost 155sq. km of greenstone belt situated in the western Wawa-Abitibi belt of the Canadian Shield. The area was chosen because it is midway between two important past-producing volcanogenic massive sulfide (VMS) base metal camps in this belt, the Manitouwadge camp 75 km to the ENE (65Mt; av. 1.2%Cu, 0.12%Pb, 3.7%Zn, 40g/t Ag), and Winston Lake district, 45 km W (7Mt; av. 1.0 %Cu, 16.8% Zn, 33g/t Ag). In 2004 the company conducted initial prospecting of the area, and in 2005 it undertook a preliminary diamond drill program, based on historic anomalies and geophysical surveys. This resulted in identifying several prospective targets, including one hole that contained intersections peaking at 16.5% zinc over 5m at shallow depths (PMM PR - 16 September-05).

The area is comprised of a bimodal greenstone assemblage that has been complexly folded into a broad anticline. PMM's initial intersection of zinc-bearing strata was determined to be remobilized sphalerite in the nose of a tight secondary fold on the north limb of this anticline. The core of the antiform consists of felsic epiclastic, pyroclastic and flow units, including major explosive breccia and block and ash flow strata. This unit is capped by a 34km-long, 5-20m thick horizon of exhalite, consisting of chert, graphitic shale and locally semi-massive to massive pyrite and pyrrhotite. This is overlain by predominantly mafic strata that also contain semi-continuous units of sulfidic exhalite. The exhalite units are the principal exploration targets, as they closely resemble similar ore-controlling strata in the Noranda, Matagami Lake, Bathurst, and many other districts.

Following the initial drilling in 2005 PMM determined that the geological mapping and geophysical surveying in the area were an inadequate base for an effective program, and that access into the area, previously undertaken using helicopter support, could be improved by building a series of trails to facilitate sampling and drilling access. By November, 2006 a new high resolution VTEM electromagnetic survey was completed by GeoTech Ltd, and these data were subject to advanced processing by Condor Geophysics Ltd. This confirmed the exact location of the previously described eleven target areas. A new trail building and outcrop cleaning program was initiated during the summer and fall of 2006, and detailed geological mapping and surface lithogeochemical sampling of the Prairie West and Prairie East anomalies was completed by Blackburn Geologic Ltd. The property boundaries were adjusted to include only the high priority target areas, reducing the area to 137 sq km. All stream crossings were formally permitted during the first half of 2007.

The mapping and geochemical surveys confirmed several key aspects of the geology that provide new focus on some parts of the area. This includes the extension of the large-scale depletion of sodium and calcium in the footwall, and local concentrations of magnesian chlorite, manganiferous garnets, and stringer-type pyrite and pyrrhotite in discreet zones along the stratigraphic footwall to the exhalite horizon. The latter are coincident with strong airborne and ground geophysical anomalies. Mapping and outcrop sampling are ongoing.

In February 2007, PMM engaged Mr. Wayne Richards to commence a diamond drilling program in the area. Mr. Richards was also responsible for constructing road access, and managed various other aspects of the technical program. Given the very difficult access into the area, drilling is restricted to one shift, resulting in about one hole per week being drilled. To date, 16 holes have been completed (PSR 07-03 to PSR 07-17, and assay data have been returned on 11 of these (Table 1). Much of the effort thus far has focused on only one anomalous area, the Prairie West block which consists of three discreet conductive horizons.

All holes have been sampled for major and trace element analyses, to determine the strength and orientation of footwall alteration as well as to determine vectors within the exhalite unit that may point to the centre of hydrothermal discharge.

PMM is continuing its program of anomaly testing. Each geophysical anomaly will be mapped and further sampled. Of particular interest are the Prospect Lake and Eastern Bozema Lake anomalous areas, where coincident soil geochemical and VTEM geophysical anomalies indicate VMS potential. Bozema will be drilled this summer, and Prospect in the fall or winter, when access is easier. Also, all of the anomalous areas along the southern limb of the anticline will be drilled over the next few months.

Drill holes in the Prairie West anomaly is available at the following address:

http://www.ccnmatthews.com/docs/Hole.doc

In addition to the Steel River Project PMM has optioned the Swanson gold project in near Val d'Or, Quebec to Agnico-Eagle Mines Ltd, which is currently undertaking a technical assessment of the property, following its extensive drill program in 2006, as part of Agnico's $400,000 commitment towards bringing the Swanson gold ore body to production. PMM also has the Barville base metal project adjacent to Swanson as well as the very prospective Bottle Creek gold-silver project in Nevada.

Dr. J. M. Franklin, P. Geo, FRSC, is a director of the Company and is a Qualified Person as defined by National Instrument 43-101. For further information, please go to www.phoenixmatachewan.com.

"The statements in this Press Release may contain forward looking statements that involve a number of risks and uncertainties. Actual events or results could differ materially from the Company's expectations and projections. The TSX Venture Exchange has not approved or disapproved of the information contained in this Press Release."

Contacts

1-888-834-7708
Robin Dow
[e-mail]

Gus Garisto
BAY STREET CONNECT
1-416-607-6023
[e-mail]