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From: Biniam Tekle (biniamt@dehai.org)
Date: Mon May 09 2011 - 08:09:57 EDT
May 09, 2011 07:00 ET
Chalice Gold Mines Limited: Major New Near-Mine Drilling Campaign to
Commence at Zara Project
8-10,000m of diamond drilling to test newly defined targets along strike
from 840,000oz resource
HIGHLIGHTS
- Numerous Koka-like resistivity signatures identified by a recently
completed deep penetration 3D IP survey over the Koka-Konate corridor
- Strong IP resistivity anomalies identified below and along strike from the
Koka Deposit provide targets for immediate drill testing
- IP resistivity targets have been identified beneath soil gold anomalies
within the 6km long Koka-Konate-Fah "mine corridor"
- Boart Longyear currently mobilising drill rig to Zara.
PERTH, WESTERN AUSTRALIA--(Marketwire - May 9, 2011) - Chalice Gold Mines
("The Company") (TSX:CXN)(ASX:CHN) is pleased to announce that a major new
program of diamond drilling is scheduled to commence in the next few days to
test a series of newly defined near-mine targets at its flagship Zara Gold
Project* in Eritrea, East Africa.
The new drilling program, comprising 8-10,000m of diamonddrilling, will
focus on a series of resistivity anomalies which have been identified from a
recently completed Induced Polarisation (IP) survey covering an area of
24km2 within the highly prospective 7.5km long Koka-Konate-Fah corridor.
(See Link to Appendix A here:
http://media3.marketwire.com/docs/695164_appendix.pdf).
The resistivity anomalies are similar to that associated with the
mineralisation at the Koka deposit (Indicated Resource of 840,000oz @ 5.3g/t
gold) and considered to be highly prospective to host repeats of the Koka
mineralisation.
The survey has previously yielded some attractive targets (see ASX
announcement of November 10, 2010), however the full extent of this
anomalism has now become evident following completion of the survey and
receipt of the final interpretation, which has resulted in the
identification of several new high-priority targets being identified.
* The Eritrean Government has a right to acquire, at a fair value; a 30%
contributing interest in the Zara Project in addition to a statutory 10%
carried interest.
Many of the interpreted resistivity anomalies also underlie strong
gold-in-soil anomalies identified from geochemical sampling undertaken in
conjunction with the IP survey (See Link to Figure 2 here:
http://media3.marketwire.com/docs/695164_fig2.pdf).
Analysis of data from the survey, undertaken by Southern Geoscience
Consultants, has identified six primary resistivity anomalies that have been
selected for priority drill testing including a new anomaly between Konate
and Fah (See Link Figure 1 & 2 here:
http://media3.marketwire.com/docs/695164_fig1.pdf,
http://media3.marketwire.com/docs/695164_fig2.pdf).
Boart Longyear Ltd has been contracted to undertake a first pass diamond
drilling program of ~ 8,000 to 10,000 metres, which is expected to commence
in early May.
The first area to be drilled will be the cluster of resistivity anomalies
beneath the Koka (Indicated Resource of 840,000 oz at 5.3 g/t gold) and Koka
East zones (See Link to Figure 3 here:
http://media3.marketwire.com/docs/695164_fig3.pdf). Strongly resistive
bodies 350 and 500 metres beneath the Koka and Koka East Zones will be
tested by the forthcoming drilling program (See Linkto Figure 3 here:
http://media3.marketwire.com/docs/695164_fig3.pdf).
Another high-priority target lies about 700m to the east of the Konate
prospect, which was initially drilled in mid-2010, and the Fah prospect,
which is located in the south of the surveyed area (See Link to Figure 4
here: http://media3.marketwire.com/docs/695164_fig4.pdf).
Geological mapping and drilling information indicate that a highly altered,
east-dipping granite body with intense quartz stockwork development
underlies this area. The modelled IP data supports this interpretation and a
strong surface gold anomaly provides further encouragement for the drilling
of this target (See Link to Figure 4 here:
http://media3.marketwire.com/docs/695164_fig4.pdf).
The Company is planning to progressively test the prioritised targets
identified in the IP program and is seeking an additional drill rig to
expedite this work.
DOUG JONES, Managing Director
About Chalice
Chalice Gold Limited is a gold exploration company which owns the high
grade, open-pittable Koka Gold Deposit and a substantial, largely
unexplored, land package in Eritrea. The Koka Gold Deposit consists of an
"in-pit" JORC and NI 43-101 compliant Indicated Resource of 5.0 million
tonnes of ore with a grade of 5.3 grams of gold per tonne, containing
840,000 ounces of gold including a Probable Reserve of 4.6 million tonnes of
ore with a grade of 5.1 grams of gold per tonne, containing 760,000 ounces
of gold. Chalice's interest in the project is subject to the State of
Eritrea's 10% carried interest, and Eritrea's right to purchase, at fair
value, a further 30% ownership in the deposit. The Company is focused on
developing the Koka Gold Deposit into a low cost gold mine which is expected
to produce 104,000 ounces of gold per year over a 7 year mine life at an
average cash cost of US$ 338/oz gold. Chalice also holds a substantial
strategic ground position of 1,437 km2 consisting of licenses along strike
of the Koka Gold Deposit, and proximal to Nevsun's Bisha Mine. These
exploration concessions host numerous, high potential, early and advanced
stage gold and base metal exploration targets. Chalice is undertaking a
systematic exploration effort on these exploration concessions with the aim
of discovering significant new deposits.
Competent Persons and Qualified Person Statement
The information in this report that relates to Exploration Results is based
on information compiled by Dr Doug Jones, a full-time employee and Director
of Chalice Gold Mines Limited, who is a Member of the Australasian Institute
of Mining and Metallurgy and is a Chartered Professional Geologist. Dr Jones
has sufficient experience in the field of activity being reported to qualify
as a Competent Person as defined in the 2004 edition of the Australasian
Code for Reporting of Exploration Results, Minerals Resources and Ore
Reserves, and is a Qualified Person under National Instrument 43-101 –
'Standards of Disclosure for Mineral Projects'. The Qualified Person has
verified the data disclosed in this release, including sampling, analytical
and test data underlying the information contained in this release. Dr Jones
consents to the release of information in the form and context in which it
appears here.
The Mineral Resource estimate was prepared by Mr. John Tyrrell who is a
Member of the Australasian Institute of Mining and Metallurgy. Mr. Tyrrell
is a full time employee of AMC and has sufficient experience in gold
resource estimation to act as Competent Person as defined in the 2004
Edition of the 'Australasian Code for Reporting of Exploration Results,
Mineral Resources and Ore Reserves (the JORC Code)' and is a Qualified
Person under National Instrument 43-101 – 'Standards of Disclosure for
Mineral Projects'. Mr Tyrrell consents to the inclusion of this information
in the form and context in which it appears.
The information in this statement of Ore Reserves is based on information
compiled by Mr David Lee who is a Member of the Australasian Institute of
Mining and Metallurgy and a full time employee of AMC. Mr Lee has sufficient
relevant experience to be a Competent Person as defined in the JORC Code and
is a Qualified Person under National Instrument 43-101 – 'Standards of
Disclosure for Mineral Projects'. Mr Lee consents to the inclusion of this
information in the form and context in which it appears.
Forward Looking Statements
This document may contain forward-looking information within the meaning of
Canadian securities legislation and forward-looking statements within the
meaning of the United States Private Securities Litigation Reform Act of
1995 (collectively, forward-looking statements). These forward-looking
statements are made as of the date of this document and Chalice Gold Mines
Limited (the Company) does not intend, and does not assume any obligation,
to update these forward-looking statements.
Forward-looking statements relate to future events or future performance and
reflect Company management's expectations or beliefs regarding future events
and include, but are not limited to, statements with respect to the
estimation of mineral reserves and mineral resources, the realization of
mineral reserve estimates, the likelihood of exploration success, the timing
and amount of estimated future production, costs of production, capital
expenditures, success of mining operations, environmental risks,
unanticipated reclamation expenses, title disputes or claims and limitations
on insurance coverage. In certain cases, forward-looking statements can be
identified by the use of words such as plans, expects or does not expect, is
expected, budget, scheduled, estimates, forecasts, intends, anticipates or
does not anticipate, or believes, or variations of such words and phrases or
statements that certain actions, events or results may, could, would, might
or will be taken, occur or be achieved or the negative of these terms or
comparable terminology. By their very nature forward-looking statements
involve known and unknown risks, uncertainties and other factors which may
cause the actual results, performance or achievements of the Company to be
materially different from any future results, performance or achievements
expressed or implied by the forward-looking statements. Such factors
include, among others, risks related to actual results of current
exploration activities; changes in project parameters as plans continue to
be refined; future prices of mineral resources; possible variations in ore
reserves, grade or recovery rates; accidents, labour disputes and other
risks of the mining industry; delays in obtaining governmental approvals or
financing or in the completion of development or construction activities; as
well as those factors detailed from time to time in the Company's interim
and annual financial statements and management's discussion and analysis of
those statements, all of which are filed and available for review on SEDAR
at sedar.com. Although the Company has attempted to identify important
factors that could cause actual actions, events or results to differ
materially from those described in forward-looking statements, there may be
other factors that cause actions, events or results not to be as
anticipated, estimated or intended. There can be no assurance that
forward-looking statements will prove to be accurate, as actual results and
future events could differ materially from those anticipated in such
statements.
Accordingly, readers should not place undue reliance on forward-looking
statements.
Shares outstanding: 218 million
Fully diluted: 225 million
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