Ferensola Gold Project - Final IP Survey Results

RNS Number : 4135N

Sula Iron & Gold PLC

26 October 2016

 

26 October 2016

Sula Iron & Gold plc

("Sula" or the "Company")

Ferensola Gold Project - Final IP Survey Results

26 October, 2016, London. Sula (AIM: SULA), a multi-commodity exploration company focused on Sierra Leone, is pleased to announce that, based on additional geophysical work recently completed, the Board believes that the Company's wholly owned flagship Ferensola Gold Project, located in central Sierra Leone, has greater potential than the Company's currently defined Exploration Target.

Further to the Company's announcement of 1 June 2016, the final results from an induced polarisation (IP) survey conducted over a portion of the Ferensola license area, confirm that the licence has larger scale gold prospectivity than previously announced, which could potentially lead to a material increase in the Company's current JORC-compliant Exploration Target of 0.8 to 1.5Moz (derived from 5-7Mt at 4-8g/t gold).

Roger Murphy, Sula's CEO designate, commented: "I am delighted with these results, which support our belief that Ferensola could host a significant gold resource. The IP survey further highlights the growing confidence in our activities with every new phase of work, corroborating our technical understanding of the project and supports the mineralisation potential within areas previously sampled by Sula."

Sula completed a maiden drilling campaign in November 2015, which targeted historic high grade intersections on the Sanama Hill prospect within the 153km² Ferensola licence and confirmed that the mineralisation is associated with the magnetic and IP anomalies. The new IP results are significantly stronger and more continuous beyond the original drilling programme and Exploration Target.

Commenting further, Mr Murphy said: "This suggests that other areas may be at least as prospective as Sanama Hill, which hosts the current Exploration Target.  The IP results, particularly in the identification of significantly stronger anomalies to those recorded over the November 2015 drill programme, will provide the framework for a forthcoming drilling campaign.  Subject to funding, we plan to continue with additional IP survey work over the larger licence area in due course."

"The survey indicates a significant potential mineralisation footprint and it is clear that multiple targets exist within the Ferensola licence. It is apparent from this survey that these targets highlighted in the final IP data, are larger than our existing Sanama Hill prospect on which the existing Exploration Target is based.  The results confirm our belief that the Sanama Hill prospect was simply the most logical part of the licence to drill first, but not the most prospective part." 

Highlights:

·   The IP survey highlights the larger scale potential of the Ferensola Gold Project outside the Company's currently defined Exploration Target, thereby indicating significant upside potential to this Exploration Target.

·   A total of 8.5km strike lengths recorded from the various high chargeability zones interpreted to be associated with potentially mineralised sulphides.

·   The IP results are significantly stronger and more continuous beyond the Sanama Hill November 2015 drill site (the results of which were announced on 14 December 2015), which suggests that other areas may be more prospective than Sanama Hill which hosts the current 0.8 to 1.5Moz Exploration Target.

·   IP data corresponds with areas of high grade gold samples, regional magnetic data and extensive artisanal mining localities.

·   Area surveyed dominated by the 3.5km strike length Eastern Target with six initial targets identified.

For more detailed information, see "Sula Exploration Programme" below.

The information contained within this announcement is deemed by the Company to constitute inside information under the Market Abuse Regulation (EU) No. 596/2014.

For further information, please contact:

Sula Iron & Gold plc
Roger Murphy / Nick Warrell / Matt Wood / Howard Baker	[phone]
Strand Hanson Limited (Financial and Nominated Adviser)
James Harris / Mathew Chandler / James Dance	[phone]
VSA Capital Limited (Broker)
Andrew Raca	[phone]

Notes:

Sula Iron & Gold plc is a multi-commodity exploration company focused on West Africa. The Company's main objective is to explore and advance its 153km² Ferensola Project in Northern Sierra Leone, which is highly prospective for gold, iron ore and coltan. In December 2014, the Company achieved a corporate milestone in delivering its JORC MRE for the BIF 1 iron ore project. A total resource of 514.5Mt @ 31.8% Fe was identified and total oxide resource of 55.5Mt @ 45.39% Fe.

The information in this release that relates to Exploration Results has been reviewed by Mr Howard Baker, Non-Executive Technical Director of Sula Iron and Gold plc. Mr Baker is a Chartered Professional Fellow of the Australasian Institute of Mining and Metallurgy (Membership Number 224239) and a Competent Person as defined by the rules of International Reporting Codes that are aligned with CRIRSCO.

Howard Baker has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity being undertaken to qualify as a Competent Person as defined in the 2012 Edition of the 'Australasian Code for Reporting of Exploration targets, Exploration Results, Mineral Resources and Ore Reserves', also known as the JORC Code. The JORC code is a national reporting organisation that is aligned with CRIRSCO. Howard Baker consents to the inclusion in the announcement of the matters based on his information in the form and context in which they appear.

Sula Exploration Programme

Sula completed a maiden drilling campaign in November 2015 (the results of which were announced on 14 December 2015) which targeted historic, high grade intersections on the Sanama Hill prospect, within the Company's flagship 153km² Ferensola licence. Sula's drilling campaign, which totalled 10 drillholes for 1,556m of diamond core, resulted in multiple strands of sub parallel mineralisation that averaged 4.21 grammes per tonne ("g/t") gold ("Au") over a strike length of 480m. Eight out of ten drillholes intersected mineralisation which, along with regional sample results, is believed to be related to a fold belt identified through the interpretation of the regional ground magnetic survey.

The drill programme showed that gold mineralisation is predominantly hosted by shear zone related brecciated quartz-pyrite that has resulted in magnetite alteration of the host rock and which provides the source of the regional magnetic anomaly.

The IP survey was commissioned firstly to test the chargeability of the previously identified sulphide mineralisation at the Sanama Hill prospect and, secondly, to examine other selected targets across the licence. A total of 80 line kilometres were planned over select regions of the licence, enabling a comparison of results to the known Sanama Hill mineralisation.

SEMS Exploration Services Limited ("SEMS") completed 56.2 line kilometres of the planned 80 line kilometres, at a dominant spacing of 200m with the results corroborating the potential for a significant mineralised system within the licence, well beyond the limits of the Sanama Hill prospect and the previously defined SRK Consulting (UK) Ltd ("SRK") independent JORC compliant Exploration Target (the "Exploration Target"). The currently defined Exploration Target centres on Sanama Hill, with a tonnage range of between 5 and 7 million tonnes ("Mt"), grading at between 4 and 8 g/t Au, which equates to between 0.8 and 1.5 million ounces ("Moz") Au. The Exploration Target was restricted to a 2km strike length segment of the regional fold belt.

IP Survey Results

The results from the final IP data are summarised in Figure 1 through to Figure 7. Sula will present the data in an updated corporate video to be posted on the Company's website, at www.sulaironandgold.com, in the coming weeks.

Figure 1 shows the six main anomalies interpreted by SEMS to host potentially substantive sulphide mineralisation. As shown, the anomalies are coincident with the regional magnetic anomalies which are believed to be derived from the magnetite alteration of the host rocks associated with the shear zones. The dashed rectangle represents the approximate location of the currently defined Exploration Target.

Figure 1: SEMS target zones interpreted from the IP data

http://www.rns-pdf.londonstockexchange.com/rns/4135N_-2016-10-25.pdf

Figure 2 shows a 700m strike section covering the November 2015 Sanama Hill drill site. The previously reported drill intersections are shown along with the interpreted strands of mineralisation and the regional grab sample results. The drilled zones averaged 4.21g/t Au with an average true thickness of 1.5m over a strike length of 480m. Figure 2 shows that the IP signature increases in strength to the east of the modelled intersections with two clear anomalies evident. Figure 3 shows the stacked chargeability and resistivity results for line 38 which cuts through the drilled area. As shown the mineralisation modelled is associated with chargeability levels of approximately 20 to 25mV/V with an associated resistive high. Also of note, is the significant resistive low on the footwall side of the mineralisation being potentially indicative of a porous shear zone, as identified by the November 2015 drilling campaign. It should be noted that, due to the anomalies outside of the drilled area showing higher chargeability values, the results for line 38 and line 39 are displayed using a legend of increased resolution.

Figure 2: Sanama Hill November 2015 drill area and associated IP anomaly

http://www.rns-pdf.londonstockexchange.com/rns/4135N_1-2016-10-25.pdf

Figure 3: Line 38 stacked chargeability and resistivity results

http://www.rns-pdf.londonstockexchange.com/rns/4135N_2-2016-10-25.pdf

Figure 4 and Figure 5 show a large anomaly previously termed the Eastern Target. Here, the IP survey has highlighted numerous anomalies with an IP signature consistently above 40mV/V and often over 70mV/V. The individual anomalies observed within the Eastern Target cumulatively cover a strike length in excess of 6km. These anomalies are supported not only by the magnetic anomaly but also the regional grab samples previously reported and where high grade Au is associated with fresh quartz-pyrite and "goldstones" which are the oxidised version of the host sulphides and one of the targets for the local artisanal miners.

Figure 4: Showing 2.7km of the 3.5km total strike length Eastern Target

http://www.rns-pdf.londonstockexchange.com/rns/4135N_3-2016-10-25.pdf

Figure 5: Location of previously reported high grade grab samples

http://www.rns-pdf.londonstockexchange.com/rns/4135N_4-2016-10-25.pdf

Figure 6 shows the northern targets and a wide spaced extension to the Eastern Target. As shown, the Eastern Target IP anomaly is observed to the final section (line 59) where the anomaly remains consistent with that observed to the south.

Figure 6: Northern IP targets and Eastern Target extension

http://www.rns-pdf.londonstockexchange.com/rns/4135N_5-2016-10-25.pdf

Figure 7 shows an example of the IP chargeability data and associated IP resistivity data from the south of the Eastern Target. As shown, the high chargeability / high resistivity zone is accompanied by a strong decrease in the resistivity, being on the footwall side of the IP anomaly. This suggests a zone of porosity, common in vuggy sulphide rich shear zones. This is further verified by observations made during the November 2015 drilling campaign.

Figure 7: Example of high chargeability / high resistivity target zone and associated low resistivity shear zone" (line 13)

http://www.rns-pdf.londonstockexchange.com/rns/4135N_6-2016-10-25.pdf

In summary, the IP survey indicates a potentially significant mineralisation footprint well beyond the currently defined Exploration Target and it is clear that multiple targets exist within the Ferensola licence. Whilst the IP survey is, by itself, no measure of the exploration potential of the targets, it is apparent that the Sanama Hill prospect is smaller than other targets now identified and, in collaboration with the results from the IP survey, confirms Sula's belief that the Sanama Hill prospect was simply the most logical part of the licence to drill first, rather than being the most prospective part of the licence.

Sanama Hill was chosen as the initial drill site to confirm the geometry of the mineralisation in terms of dip and strike, as well as to confirm the nature of the mineralisation and the geological controls at play. All those objectives were met, which enables the Company to target other zones with confidence. Subject to funding, the Company plans to continue with additional IP survey work over the larger licence area in due course.

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