Archer Exploration Limited (ASX:AXE) Advise Substantial Ground Gravity Anomaly Over Wildhorse Plains Iron Targets

Adelaide, Feb 22, 2011 AEST (ABN Newswire) - Preliminary interpretation of a ground gravity survey completed by Archer Exploration Limited (ASX:AXE) at Wildhorse Plains located on Eyre Peninsula in South Australia, has identified a substantial gravity anomaly that may indicate the presence of hematite at both Campoona Syncline and Mt Desperate.

The Eyre Peninsula is the most prominent area for South Australia's iron deposits.

Previous work by Archer on the USA (ASX:USA) JV tenements has identified significant hematite rich rocks (>66% Fe) at the surface in cropping paddocks.

Archer adopted a geological model for hematite mineralisation similar to that of the Middleback Iron Deposits worked by OneSteel (ASX:OST). In addition to surface mapping and rock chip sampling, a gravity survey was conducted to determine if a gravity anomaly was present to support the geological model. Initial results indicate the presence of a substantial +4km gravity anomaly occurs within the hinge of the Campoona Syncline.

Figure 3 (see link at the bottom of the release) shows residual gravity after applying a gravity correction of 2.6g/cc to eliminate the presence of Banded Iron Formation. The resultant gravity anomaly highlights those areas with rock mass in excess of 2.6g/cc that may indicate the presence of hematite.

Additional gravity highs can also be observed to the NW and to the east of the syncline.

Topography decreasing to the north further supports the iron potential of the area. Decreasing topography means that there is less mass in the northern area to contribute to the anomalous gravity readings giving further weight to the anomalous gravity results.

A similar ground gravity survey was conducted over Mt Desperate. Preliminary interpretation of Mt Desperate gravity data is shown below in figure 4 (see link at the bottom of the release). As with figure 3 (see link at the bottom of the release), the BIF unit is shown as the light blue shaded area.

Summary

Although at a preliminary stage, modelling the gravity data on Wildhorse Plains appears to validate the hematite model and has enabled Archer to target drilling to test for the presence of hematite.

Should drilling confirm that the gravity anomaly reflects the development of hematite then considerable strike length is available for follow-up drilling. This potential can be seen in figure 5 (see link at the bottom of the release), where the north-east strike extension of the BIF has remained untested.

The location of the gravity anomaly at Campoona is in line with the hematite model prediction, indicating potential for a large dense body buried within the hinge of the syncline. The mineralisation being targeted is similar to that of the Middleback iron deposits where pods of hematite between 500 to 1000m long occur discontinuously adjacent to the Middleback jaspilite, within the hinge zones of synclines.

A Reverse Circulation (RC) drill program to confirm the hematite potential of the area will be conducted in late March - early April 2011. Landowner approval for drilling the gravity anomaly has been received. Drilling will commence upon PIRSA approval of the Subsequent EL, expected in late March 2011.

The drilling for hematite will be part of a larger drill program at Wildhorse Plains that will target both the Salt Creek manganese prospect (3km outcrop with widths to 30m and grades to 30% Mn) and the Emu Creek copper anomaly (historic oxide intercepts of >7% Cu over widths to 5m).

For the complete Archer Exploration Limited announcement including figures, please refer to the following link:
http://www.abnnewswire.net/media/en/docs/66110-ASX-AXE-181957.pdf

Contact

Mr Greg English Chairman Archer Exploration Limited Tel: +61-8-8272-3288 Mr Gerard Anderson Managing Director Archer Exploration Limited Tel: +61-8-8272-3288 Email: info@archerexploration.com.au http://www.archerexploration.com.au