Miscellaneous
July 22 2010 - 2:00AM
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TIDMMML
MEDUSA MINING LIMITED
ABN: 60 099 377 849
Unit 7, 11 Preston Street
Como WA 6152
PO Box 860
Canning Bridge WA 6153
Telephone: +618-9367 0601
Facsimile: +618-9367 0602
Email:
admin@medusamining.com.au
Internet:www.medusamining.com.au
ANNOUNCEMENT
22 July 2010
Co-O MINE MINERAL RESOURCE ESTIMATE & CONCEPTUAL TARGET SIZE UPDATE
Medusa Mining Limited (ASX & AIM: MML; TSX: MLL) ("Medusa" or the "Company"),
through its Philippines operating company, Philsaga Mining Corporation
("Philsaga"), advises that it has increased the Indicated Resource by 4% to
603,000 ounces and increased the Inferred Resource by 36% to 898,000 ounces
(excluding production since 9 December 2009). The grade of both categories has
also increased.
The Company also announces additional information which supports the
announcement dated 18 January 2010 containing estimates of the conceptual
potential target sizes** for the Co-O Mine using various parameters which
indicate a range of 3,000,000 ounces in 9,300,000 tonnes to 7,000,000 ounces in
22,000,000 tonnes using a grade range of 9 to 11 g/t gold with a preferred
average grade of 10 g/t gold.
Table I. Mineral resource estimate at 21 June 2010
+-----------+--------------------------------+
| Category | > 0 g/t gold |
| +-----------+----------+---------+
| | tonnes | g/t gold | ounces |
+-----------+-----------+----------+---------+
| Indicated | 1,418,000 | 13.2 | 603,000 |
+-----------+-----------+----------+---------+
| Inferred | 2,905,000 | 9.6 | 898,000 |
+-----------+-----------+----------+---------+
Geoff Davis, Managing Director of Medusa, commented:
"The Company is pleased with the new resource estimate which continues to grow.
The intent is to maintain the total resources for the mine at the current level
primarily by underground drilling.
Concurrently the Company will continue surface drilling to seek extensional
mineralisation outside the current mine limits.
The compilation of drill hole intersections below the current bottom of the
mine strongly supports the Co-O Mine conceptual potential target size** of 3 to
7 million ounces of gold."
** The potential target size and grade is conceptual in nature, and there has
been insuffiicient exploration to define a mineral resource, and it is uncertain
if further exploration will result in the target being defined as a mineral
resource.
MINERAL RESOURCE MODEL
Discussion
Surface and underground diamond drilling has continued since the last resource
model update based on data as at 9 December 2009 and announced on 18 January
2010 and has focused on infilling some data deficient areas and on extending the
Co-O vein system along the northern side of the mine. A total of 20 drill holes
have been completed (as announced on 30 June 2010) since the previous resource
estimation and considered for inclusion in the current resource model update in
conjunction with available underground sampling data, and excluding mined
material.
A total of 45 veins of varying sizes have now been modelled, many of which have
the potential to become larger with more drilling and development.
It should be noted that a number of drill holes in a number of areas as
indicated on Figure 2 (please see the link at the end of this announcement) are
still to be included in resource estimates, and underground drilling will become
more focused in some of these areas, and in some cases, in combination with
development.
It is intended that future resource estimates will be undertaken annually in
June-July.
Figure 1 (please see the link at the end of this announcement) shows the updated
3D resource model. The veins are open at depth and currently only limited by the
depth and density of drilling.
Figure 2 (please see the link at the end of this announcement) is the composite
map of the Co-O Mine area showing the projection of veins onto Level 5. This
also shows areas where additional drilling and/or development is required to
complete the definition/extension of known veins and to increase definition
around existing drill hole intersections which are not yet included in the
model.
Figure 3 (please see the link at the end of this announcement) shows all the
current development in the Co-O Mine and Table II is a summary of the major
veins.
Table II. Co-O Mine mineral resource estimates for the major veins at 21 June
2010
+------------------+-----------+-----------------------------------------+
| Vein name | Category | > 0 g/t gold |
| | +-----------+----------+------------------+
| | | tonnes | g/t gold | contained ounces |
+------------------+-----------+-----------+----------+------------------+
| Central | Indicated | 363,000 | 9.4 | 109,00 |
| | | | | |
| | Inferred | 267,000 | 3.3 | 28,000 |
+------------------+-----------+-----------+----------+------------------+
| Jereme | Indicated | 104,000 | 12.6 | 42,000 |
| | | | | |
| | Inferred | 135,000 | 7.7 | 34,000 |
+------------------+-----------+-----------+----------+------------------+
| Jereme Footwall | Indicated | 93,000 | 16.3 | 49,000 |
| | | | | |
| | Inferred | 72,000 | 11.3 | 26,000 |
+------------------+-----------+-----------+----------+------------------+
| Great Hamish | Indicated | 239,000 | 23.9 | 184,000 |
| | | | | |
| | Inferred | 432,000 | 15.3 | 212,000 |
+------------------+-----------+-----------+----------+------------------+
| Great Hamish FW | Indicated | 22,000 | 15.8 | 11,000 |
| | | | | |
| | Inferred | 226,000 | 9.7 | 70,000 |
+------------------+-----------+-----------+----------+------------------+
| Roysan | Indicated | 101,000 | 24.5 | 80,000 |
| | | | | |
| | Inferred | 107,000 | 23.6 | 81,000 |
+------------------+-----------+-----------+----------+------------------+
| Catto 1 | Indicated | 60,000 | 18.3 | 35,000 |
| | | | | |
| | Inferred | 57,000 | 20.0 | 37,000 |
+------------------+-----------+-----------+----------+------------------+
| EA4 | Inferred | 239,000 | 12.0 | 92,000 |
+------------------+-----------+-----------+----------+------------------+
| Other veins | Indicated | 436,000 | 6.6 | 93,000 |
| | | | | |
| | Inferred | 1,370,000 | 7.2 | 318,000 |
+------------------+-----------+-----------+----------+------------------+
| Total Indicated | 1,418,000 | 13.2 | 603,000 |
+------------------------------+-----------+----------+------------------+
| Total Inferred | 2,905,000 | 9.6 | 898,000 |
+------------------------------+-----------+----------+------------------+
Notes:
* A lower cut-off of 0 g/t gold has been applied
* Variable upper cuts up to 200 g/t gold has been applied to different
veins
* Resources are inclusive of reserves
* Rounding to the nearest 1,000 may result in some slight discrepancies in
totals.
Specific gravity
A programme of over 1,000 specific gravity ("SG") measurements has been
completed on vein samples from drill core and rock samples. An SG of 2.62 is now
used compared to 2.45 in previous resource estimates. The effect is that
previous resource numbers have been under-estimated by approximately 7%.
Vein modelling
Cube Consulting Pty Ltd of Perth, Western Australia was contracted to undertake
the resource estimations. A wireframe model of the vein system and the mine
depletions were based on all available information as at 21 June 2010. A 2D
longitudinal modelling approach was used and is based on an accumulation
variable incorporating mineralised vein horizontal width and intercept grade.
Variography was used to analyse the spatial continuity of the horizontal width
and accumulation variables within the mineralised veins and to determine
appropriate estimation inputs to the interpolation process. The accumulation
variables were interpolated into blocks using Ordinary Kriging. High grade
limits were applied to gold prior to the calculation of the accumulation
variable. Mineral resources have been reported in accordance with The 2004
Australasian Code for Reporting of Mineral Resources and Ore Reserves (JORC
Code) and Canadian National Instrument 43-101.
Co-O MINE CONCEPTUAL TARGET SIZE **
As announced on 18 January 2010, a conceptual target size** for the Co-O Mine
was estimated at between 3,000,000 ounces in 9,300,000 tonnes and 7,000,000
ounces in 22,000,000 tonnes at a preferred grade of 10g/t gold. Further details
are provided and tabulated in the 18 January 2010 announcement.
Figure 4 (please see the link at the end of this announcement) shows a composite
longitudinal projection of all the drill hole intersection grades reported up to
the announcement dated 30 June 2010 below Level 6 (250 metres below Level 1).
This strongly supports the concept that mineralisation extends to a depth of
500 metres below Level 1, and shows that mineralisation occurs below the 500
metre level.
It should be noted that the conceptual target size** includes the current
resource estimate. The total production from the mine to 30 June 2010 was
approximately 290,000 ounces.
** The potential target size and grade is conceptual in nature, and there has
been insuffiicient exploration to define a mineral resource, and it is uncertain
if further exploration will result in the target being defined as a mineral
resource.
Information in this report relating to Exploration Results has been reviewed and
is based on information compiled by Mr Geoff Davis, who is a member of The
Australian Institute of Geoscientists. Mr Davis is the Managing Director of
Medusa Mining Limited and has sufficient experience which is relevant to the
style of mineralisation and type of 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" and is a "Qualified Person" as
defined in "National Instrument 43-101" of the Canadian Securities
Administrators. Mr Davis consents to the inclusion in the report of the matters
based on his information in the form and context in which it appears.
Information in this report relating to Mineral Resources has been estimated and
compiled by Mark Zammit of Cube Consulting Pty Ltd of Perth, Western Australia.
Mr Zammit is a member of The Australasian Institute of Mining & Metallurgy and
has sufficient experience that is relevant to the style of mineralisation and
type of deposit 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" and is a "Qualified Person" as defined in "National Instrument
43-101" of the Canadian Securities Administrators. Mr Zammit consents to the
inclusion in the report of the matters based on his information in the form and
context in which it appears.
A revised Technical Report will be lodged with Sedar within 45 days of this
announcement.
For further information please contact:
Australia
Medusa Mining Limited +61 8 9367 0601
Geoffrey Davis, Managing Director
Roy Daniel, Finance Director
United Kingdom
Fairfax I.S. PLC +44 (0)20 7598 5368
Nominated Adviser and Broker
Ewan Leggat/Laura Littley
Lothbury Financial Services Limited +44 (0)20 7868 2010
Michael Padley/Libby Moss
Canada
Nicholas Sayce, Investor Relations +1 416 822 4404
[HUG#1433308]
Co-O Mine Mineral Resource Estimate & Conceptual Target Size Update Accompanying Images: http://hugin.info/138050/R/1433308/379168.pdf
This announcement is distributed by Thomson Reuters on behalf of
Thomson Reuters clients. The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and
other applicable laws; and
(ii) they are solely responsible for the content, accuracy and
originality of the information contained therein.
Source: Medusa Mining Ltd via Thomson Reuters ONE
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