Kenai Resources Ltd.: Update on the Drill Program at Sao Chico Gold Project, Brazil
October 03 2011 - 10:07AM
Marketwired
Kenai Resources Ltd. ("Kenai") (TSX VENTURE:KAI) is pleased to
provide the following update on the Sao Chico gold project in north
central Brazil.
Drilling Update
The first three diamond drillholes (11-SC-001 to 003, to
downhole depths of 86.2 meters, 80.5 meters and 111.9 meters
respectively) have now been completed. In the third hole, a 300mm
wide quartz vein with massive abundant pyrite was intersected at 92
meters downhole depth, flanked by smaller veins with massive
observed pyrite and some galena. The third hole is located close to
the western end of the Waldimiro Vein from which high grade
underground sample assays were reported by Kenai on August
31st.
The drilling program commenced with one shift per day and has
now been increased to two shifts per day. A second Minexplor rig is
planned to be at the site by the second week of October, and is
expected to be operating by approximately October 12th.
The drill holes are targeting vein structures near the Waldimiro
Vein down dip, beneath the high grade eastern end of the existing
underground drive. Assay results are expected from these first
holes in November.
Settlement of Landowner Agreements
KAI has been instrumental in negotiating settlement of a
landowner dispute on the Sao Chico project. On 23rd September the
disputing parties entered into agreements that extinguish all
litigation between them. Application has now been made with the
authorities to have AP12836 transferred into the Gold Aura Brazils
name, the company Kenai has an option over which will hold the Sao
Chico project.
About Sao Chico
The project is more completely described in Kenai's NI 43-101
Technical Report on the project, details of which were contained in
Kenai's news release of January 20, 2011. It has since been filed
on SEDAR and on Kenai's website at www.kenairesources.com.
Sao Chico is located within the Tapajos region in Brazil, the
site of one of the biggest gold rushes in recent history. In the
late 1970's and 1980s, approximately 500,000 garimpeiros rushed to
the region to exploit extensive areas of newly discovered alluvial
gold, producing approximately 20-30 million ounces of gold before
the easily won alluvial gold deposits were largely depleted.
Despite the gold rush, little modern exploration has been conducted
over the region to date, with excellent potential to expand gold
operations at Sao Chico. The Sao Chico project team has extensive
experience and expertise of operating within the region, which will
provide a focussed and systematic effort to gold production and
exploration at Sao Chico.
As previously advised, Gold Anomaly via a wholly owned
subsidiary will receive all cash flow generated by GOAB at Sao
Chico until Kenai exercises its options to acquire 50% and then 75%
equity in the Sao Chico mineral rights to the Sao Chico project.
The options expire at end-September 2012.
About Kenai Resources
Kenai is a Canadian company focused on precious mineral project
exploration and development, towards early significant gold
production. In addition to the Sao Chico gold project in Brazil,
Kenai is also involved in exploration of the wholly-owned Quartz
Mountain and Hope Butte epithermal gold projects in South-Eastern
Oregon, both located in Malheur County, close to the Oregon border
with Idaho. Kenai's current indicated and historical gold resources
from the two Oregon projects are summarized as follows:
Ounces
Project Tonnes Grade AuEq Status/Classification
Quartz Indicated Resources
Mountain 15,050,200 0.80 g/t Au 352,667 NI43-101 compliant
Hope Historical, not
Butte 5,000,000 0.91 g/t Au 146,300 NI 43-101 compliant
Footnotes:
1. For Quartz Mountain, resources above a 0.34 g/t cutoff with silver
converted to gold equivalent using a ratio of 49.5:1 silver to gold.
Metallurgical recoveries were not considered. Indicated resources are as
reported in an independent November 2006 NI 43-101 report, posted on
SEDAR at that time.
2. The Hope Butte resources are considered historic in nature, do not
comply with current NI 43-101 standards, have not been verified by the
Company and therefore should not be relied upon. It is uncertain if
further exploration will result in the discovery of an economic mineral
resource.
On behalf of the Board of Directors of Kenai Resources Ltd.
Greg Starr, President and CEO
Forward-Looking Statements: Statements in this release that are
forward-looking statements are subject to various risks and
uncertainties concerning the specific factors disclosed and
elsewhere in the company's periodic filings with Canadian
securities regulators. The economic viabilities of the resources
estimates discussed in the release have not been established and
may not be. Such information contained herein represents
management's best judgment as of the date hereof based on
information currently available. The company does not assume the
obligation to update any forward-looking statement.
The technical content of this news release has been reviewed by
Kenai's Vice President Technical Services, Neil Cole, who has
sufficient experience which is relevant to the style of
mineralization under consideration and to the activity which is
being undertaken and planned to qualify as a Qualified Person under
NI 43-101.
Shares Outstanding: 62,406,734
Neither the TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
Contacts: Kenai Resources Ltd. Greg Starr President and CEO
604-669-5753 604-688-9895
(FAX)info@kenairesources.comwww.kenairesources.com
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