TIDMKGLD
RNS Number : 2361F
Kolar Gold Limited
13 June 2012
Kolar Gold Limited
("KGL" or the "Company")
Maiden Resource Statement
220 per cent. Increase in JORC Compliant Resource to 195,000 oz
Gold at Mallappakonda Deposit, South Kolar Licence Area (GP13)
Kolar Gold Limited ("KGL or the "Company"), the Indian focussed
gold exploration and development company, today announces an
upgrade of the JORC compliant gold resource at its Mallappakonda
deposit in the South Kolar licence area (GP 13) in India from
61,527 to 195,000 ounces of gold. The new resource is derived from
a combination of historic underground channel samples, historic
Mineral Exploration Corporation Limited ("MECL") drilling and new
validation drilling by KGL as part of a 8,000m drill programme
completed over the South Kolar licence area since Kolar was
admitted to AIM last year.
Highlights
-- New JORC compliant gold resource for Mallappakonda of 3.46
million tonnes at an average grade of 1.76 g/t gold containing
195,000 oz of gold independently compiled by Mining Associates
Ltd
-- An increase of 220 per cent. of the previous resource estimate
-- Drilling at Mallappakonda has validated historic MECL data;
-- Sample results at KGL validation diamond drill hole KMK-02
include a 21.5m wide mineralised zone averaging 5.5 g/t gold
(previously reported);
-- East and south of the main zones are several sub-parallel
lodes that require further drill testing.
Commenting today, Richard Johnson, Chief Operating Officer, of
Kolar Gold Limited, said:
"I am very pleased to announce Kolar's maiden resource statement
at our Mallappakonda deposit since the Company was admitted to AIM
last year. The historic gold resource of 61,527 oz gold defined by
the MECL in 1984 has been more than trebled to 195,000 oz gold.
There remains considerable scope to add additional ounces to the
Mallappakonda deposit and resource drilling will continue as part
of the Company's new 160 hole drill programme at South Kolar. We
look forward to providing investors with further operational
updates once additional assay results are received."
Mallappakonda Deposit Gold Resource
The Mallappakonda deposit ("Mallappakonda") was first identified
during regional exploration conducted by the Geological Survey of
India to the south of Kolar Gold Fields in 1975-79. Mineralisation
occurs over 800m of strike length at the end of the prominent
Mallappakonda Hill with only 150m having been evaluated with
drilling and three levels of exploration development.
Mineralisation at Mallapakonda dips steeply to the west and is
located on the western side of an upright, regional anticline. The
anticlinal axis is marked by a prominent north-south trending ridge
with locally steep slopes. Gold occurs within multiple, en-echelon
sulphidic zones associated with beds of banded iron formation
within mafic units.
Several substantial ancient workings are seen at surface. The
underground exploratory work by MECL and Bharat Gold Mines Limited
included two adits, three levels of drives, limited rise
development and approximately 380m of underground diamond drilling.
The historical data was sourced from the original documents by
Mining Associates Ltd ("MA" or "Mining Associates") and entered
into a Gemcom Surpac resource and mining data set with drill and
channel sample database, scanned surface and level plans, digitised
mine workings, interpreted resource domains and resource estimation
block model. Higher grade zones are defined as over 2.5 g/t Au and
located in tight parasitic folds with a vertical plunge within a
well mineralised zone of an area 150m long, 30m wide and to a depth
in excess of 300m. There is associated silver at slightly higher
values than the gold.
The Mallappakonda gold resource, which was calculated from
recent and historical drill data, is 3.46 million tonnes of ore at
an average grade of 1.76 g/t gold, containing 195,000 ounces of
gold. The revised resource estimate has been compiled by the
Company's Competent Person, Mr Andrew J Vigar of Mining Associates
and all work has been conducted under JORC guidelines.
Further work is proposed at Mallapakonda deposit via an
underground programme of resource drilling from the two existing
adits. Clearing work has been undertaken and approvals have been
sought to reopen the adits in preparation for underground
drilling.
http://www.rns-pdf.londonstockexchange.com/rns/2361F_-2012-6-12.pdf
Figure 1: Mallappakonda Mine - 3D resource models and drilling,
looking north
Table 1. Mallappakonda Deposit - Historic Resources Estimated by
MECL 1984
JORC Equivalent Category Resource (Mt) Au (g/t) Au (oz)
-------------------------- -------------- --------- --------
Measured 0.141 2.73 12,376
-------------------------- -------------- --------- --------
Indicated 0.206 2.21 14,637
-------------------------- -------------- --------- --------
Inferred 0.426 2.52 34,514
-------------------------- -------------- --------- --------
Total Resource 0.773 2.48 61,527
-------------------------- -------------- --------- --------
Table 2. Mallappakonda Deposit - Resource Statement - June
2012
Resource Category Resource (Mt) Au (g/t) Au (oz)
------------------- -------------- --------- --------
Measured 0.534 1.95 33,000
------------------- -------------- --------- --------
Indicated 1.486 1.74 83,000
------------------- -------------- --------- --------
Total Measured &
Indicated 2.021 1.80 117,000
------------------- -------------- --------- --------
Inferred 1.436 1.72 79,000
------------------- -------------- --------- --------
Total Resource 3.457 1.76 195,000
------------------- -------------- --------- --------
Note - Reported tonnage and grade figures have been rounded off
from raw estimates to the appropriate number of significant figures
to reflect the order of accuracy of the estimate. Minor variations
may occur during the addition of rounded numbers.
Notes to Accompany the Mineral Resource Estimate
-- Geological model was developed using level and sectional
interpretation for 3D wireframes, mineralised (>1.0 g/t Au) and
a core high (>2.5 g/t Au) separately.
-- Underground test work by MECL, and BGML included 4,153m of
adit, level, sub-level and rise development, 380m of underground
diamond drilling, 6861 assay samples.
-- Data base consisting of 757 channels for 3568.83m and 40 historical drill holes for 4937.2m
-- Three confirmation holes drilled by KGL totalling 646.5m and
intersecting all lodes (except e5).
-- All drills composite down-hole to 2m within domains to give
informing samples of hg (411), lg (650), e3 (45), e4(16) and e5(5).
Each composite only used for one domain.
-- Missing samples or intervals not used.
-- Top cap of 30 g/tAu applied to informing samples.
-- Total number of informing samples (composites) is 72 drills and 787 channels
-- Estimates made using Ordinary Kriging with validation via
Nearest Neighbour (3D polygonal) and Inverse Distance Squared
estimates.
-- Block size of ; 4 m(E) by 25m(N) by 25 m(RL) and sub-blocks
for volume 1 m(E) by 6.25m(N) by 6.25 m(RL).
-- Directional anisotropy varied by domain.
-- Maximum search 200m all categories
-- Inferred resource category - minimum of 3 informing samples.
-- Indicated resource category - at least 20 informing samples
at an average distance of no more than 125m for hg and 100m for all
other domains.
-- Measured resource category - was calculated for the domains
hg and lg with at least 20 informing samples, within an average
distance of no more than 50m and an elevation range of 790 to 870
mRL.
-- Underground voids factored for each block
-- Removed all blocks within 20m of the surface, to allow for Ancient Workings.
-- Bulk Density of 3.0.
-- No mining dilution or loss, or metallurgical factors applied.
-- Cut-off grade used for resource reporting 1 g/tAu
Competent Person
The summary review of geology and drilling results was conducted
by Mr Andrew J Vigar who has sufficient experience which is
relevant to the Archaean gold style of mineralisation and deposits
under consideration and to the activity which he is undertaking to
qualify as a Competent Person as defined in the 2004 Edition of the
'Australasian Code for Reporting of Exploration Results, Mineral
Resources and Ore Reserves' (Australia) and is a Qualified Person
as defined in NI43-101 (Canada). He is a Fellow of The Australasian
Institute of Mining and Metallurgy (Melbourne) and a Member of the
Society of Economic Geologists (Denver). Mr Vigar is employed by
Mining Associates Limited of Hong Kong. Mr Vigar conducted a site
visit to the Kolar Gold Projects and adjacent properties from 28
June to 2 July 2010 and February 2012. Mr Vigar does not have any
interest (current or past) in any of the assets covered by this
report.
About Kolar Gold Limited
Kolar Gold Limited is an Indian gold exploration and development
company, listed on the AIM market (KGLD), which has an experienced
international board and strong local partners. KGL has rights to
explore and develop one prospecting licence and 13 further licence
applications in the Kolar Gold Belt, an 80 kilometre long Archaean
Greenstone Belt, in Southern India. The Kolar Gold Belt is one of
the most prospective underdeveloped Archaean Greenstone Belts in
the world and is regarded by Mr Andrew J Vigar of Mining Associates
Limited, the Competent Person, as comparable to the Archaean
Greenstone Belts of South Africa, Canada and Western Australia
which have similar geology, structure and style of mineralisation.
This project area includes 32 known mineralised prospects and
covers 568 square kilometres in the southern states of Andhra
Pradesh, Karnataka and Tamil Nadu. KGL commenced exploration on the
first Prospecting Licence in South Kolar in February 2011. KGL is
also jointly pursuing, with the mine employee unions, the
acquisition and revival of the neighbouring historic Kolar Gold
Fields which has produced 25 million ounces of gold at 15.9 grams
per tonne over 120 years until closure in 2001.
For further information please contact:
Kolar Gold Limited
---------------------------- -----------------
Nick Spencer +617 3846 0211
---------------------------- -----------------
Singer Capital Markets
---------------------------- -----------------
Nomad and Joint Broker
---------------------------- -----------------
James Maxwell/Jenny Wyllie +44 20 3205 7500
---------------------------- -----------------
Ocean Equities Limited
---------------------------- -----------------
Joint Broker
---------------------------- -----------------
Will Slack +44 20 7786 4370
---------------------------- -----------------
Tavistock Communications
---------------------------- -----------------
Ed Portman/Lydia Eades +44 20 7920 3150
---------------------------- -----------------
This information is provided by RNS
The company news service from the London Stock Exchange
END
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