jorc resource for old konongo tailings dam

JORC RESOURCE FOR OLD
KONONGO TAILINGS DAM
The Company is very pleased to announce the JORC resource for the
Old Konongo Tailings Dam, contained within the Konongo Gold
Project in the world class Ashanti Gold Belt of Ghana. The resource
is 1.75 million tonnes at a grade of 1.09g/t gold for approximately
61,150 ounces of contained gold classified as follows:
Class Tonnes Grade (g/t) Ounces Au
Indicated 1,177,000 1.19 45,050
Inferred 575,000 0.87 16,100
Total 1,752,000 1.09 61,150
Significantly this resource includes a high grade area of
448,500 tonnes at 1.66g/t
for almost 24,000 ounces of contained gold.
The Old Konongo Tailings Dam contains residual material from
processing at the historic Konongo Mine, which was operational
between 1918 and 1986. Records show that approximately 2.8 million
tonnes of ore was processed at a head grade of 15.7g/t recovering
approximately 1.4 million ounces.
The JORC resource for the Old Konongo Tailings Dam is based on
aircore drilling carried out in late 2009. 131 aircore holes were drilled
across the dam at spacings of 50 metres by 25 metres and 25 metres
by 25 metres for a total of 2,376 metres. Drilling identified high grade
areas within the dam where intersections were consistently greater
than 1.5g/t gold (Figure 1).
The Old Konongo Tailings Dam is one of a number of surface
stockpiles/dumps which the company is evaluating to determine if
they can provide feed for the existing 350ktpa CIL plant. The cost of
reclaiming these stockpiles will be less than that of mining new ore
making them potentially viable sources of millfeed. The option of
blending tailings material with oxide ore is also being assessed as part
of the optimisation of the mining schedule. Note that the high grade
portion of the Old Konongo Tailings Dam resource could provide
sufficient material to run the CIL plant for the first year of operation.
Preliminary metallurgical testwork indicates that recoveries of over
60% are achievable from this material, with recoveries as high as 80%
being achieved. Further work is underway to confirm these results.
The total resource for the project is now 19.6 million tonnes at a
grade of 2.02g/t gold for 1.27 million ounces of contained gold and
is classified as follows:
Class Tonnes Grade (g/t) Ounces Au
Indicated 8,804,500 2.01 568,235
Inferred 10,814,000 2.03 704,395
Total 19,618,500 2.02 1,272,630
Details of the resource contained in individual deposits are given in
Table 1. The Company reminds investors that the second tranche of
shares to Mwana Africa PLC is only required after delineation of 1
million ounces in the Measured and Indicated categories.
The Company is entering an important phase in the development of
the Konongo Gold Project with the mining study and plant assessment
nearing completion.