Cascabel Exploration Update
14 February, 2017
SolGold plc
("SolGold" or the "Company")
Cascabel Exploration Update
Alpala Deposit Continues to Grow
Hole 19 Assays Received
The Board of SolGold (AIM code: SOLG) is pleased to announce assay results from Hole 19 at the Alpala deposit at the Company's Cascabel copper-gold porphyry project in Ecuador.
HIGHLIGHTS:
Ø Drill Hole 19 (CSD-16-019) returned a broad mineralised zone of 1132m grading 0.50% copper and 0.33 g/t gold from 268m depth, across an interpreted true width of approximately 500m to date (further assays to come), at the growing Alpala deposit.
Ø This long intersection includes 802m grading 0.63% copper, and 0.43 g/t gold from 572m depth, and 516m grading 0.75% copper, and 0.50 g/t gold from 838m, across true widths of approximately 360m and 230m respectively.
Ø The Hole 19 assay results reflect intersections significantly richer in bornite, (a copper rich sulphide mineral containing approximately 63% copper) than in previous drillholes, representing the southernmost and shallowest high grade mineralisation discovered at Alpala to date.
Ø Drilling focus moving from Alpala Central to Hematite Hill, towards Alpala Southeast, where strong bornite mineralisation and high temperature advanced argillic alteration are mapped at surface.
Ø Hole 20R continuing at 1342.4m.
Ø Holes 21 & 22 entering increasingly strong mineralization, and at current depths of 750.4m and 702.2m respectively.
Ø Two additional rigs to mobilise in February, increasing to seven drill rigs by year's end.
Ø Additional exploration targets selected throughout Ecuador, using SolGold's successful and efficient template for discovery.
Commenting on the result, SolGold CEO Nick Mather said:
"Hole 19 has returned another long and well endowed intersection at Alpala. Clearly, this result is endorsing the status of Alpala as not only very big, but with a rich core."
Technical services Manager Mr Benn Whistler said: "The widening of the Alpala deposit at shallower levels is giving Alpala some real growth in the upper portion of the deposit, which is proving excitingly rich, with relatively strong bornite mineralisation occurring in Holes 17, 19 and now 22. We believe that drilling results may get better as we head south east. None of us, including our chief advisor Dr Steve Garwin, believes that we've hit the core of the system yet. So the best may be yet to come in our professional opinion. The lower extensions of Alpala have still not been tested and we are excited to continue tracking down what we believe will be Alpala's rich heart."
FURTHER INFORMATION:
The Cascabel Project is located on the gold-rich northern section of the prolific Andean Copper belt renowned as the production base for nearly half of the world's copper, (Figure 1). The project area hosts mineralisation of Eocene age, the same age as numerous Tier 1 deposits along the Andean Copper Belt in Chile and Peru to the south. The project base is located at Rocafuerte, in northern Ecuador, approximately 3 hours drive north of Quito, close to water, power supply and Pacific ports (Figure 2). SolGold holds an 85% interest in ENSA (Exploraciones Novomining S.A.) which holds 100% of the Cascabel tenement.
Fourteen individual targets have been defined at Cascabel and only one of these, the Alpala Deposit, has been drilled to date (Figure 3). The deposit at Alpala continues to grow with each new drill hole. Drilling continues to focus on defining the geometry of the growing Alpala deposit, which is open in virtually all directions. Over 29,000m of drilling has been completed to date (Figure 4).
Drill Hole CSD-16-019 ("Hole 19") was terminated at a depth of 1632.52m, on the 20th of January 2017. Assay results from 0m to 1400m have been received for Hole 19, with results for the last 232.52m from 1400m to end of hole pending.
Hole 19 was designed to test the trend and tenor of mineralisation approximately 150m above holes 12 and 16 and was drilled in the direction of 211 degrees true north at a declination of -80 Degrees.
Hole 19 is the most southerly of the drill holes at Alpala and the increased presence of bornite (a copper rich mineral containing 63% copper) in comparison to other holes at Alpala, endorses SolGold's south easterly extension targets.
Hole 19 intersected relatively bornite rich mineralisation in an outstanding high grade 516m long interval from 838m to 1354m, and represents the southernmost and shallowest high grade intersection discovered at Alpala to date. Hole 19 exemplifies the growing potential for increasingly shallow intersections in high grade bornite rich mineralisation at the Alpala deposit.
The mineralisation intersected in Hole 19 remains open to the southeast, where relatively strong bornite mineralisation and high temperature advanced argillic alteration are mapped at surface. Hole 19 is interpreted to have drilled into a late stage lower grade "intra-mineral" dyke from approximately 1343.3m depth.
Highlights from the assay results received from Hole 19 are shown below in Table 1. Drilling results to date at Alpala are summarised in Table 2.
Table 1: Selected Drilling Results from Hole 18 (CSD-16-018) at Alpala.
(A lower cut-off grade has been used for the long interval exceeding a kilometre, which was continuously mineralised at anomalous levels.)
The confirmation of shallow relatively bornite rich mineralisation in Hole 19, bodes well for the extension of the deposit to the southeast, where relatively strong bornite mineralisation and high temperature advanced argillic alteration are mapped at surface, covering a further 750m of strike, or double the existing strike of the Alpala zone (Figure 5).
At Alpala, higher portions of the system appear rich in bornite (Image 1), whilst deeper portions of the known system are rich in chalcopyrite (Image 2).
The SolGold geology team believe the highest grade and deepest portion of the copper-gold system at Alpala has not yet been discovered by drilling, and a very high grade bornite-magnetite or magnetite-chalcopyrite rich zone exists at the core of the Alpala mineralised system, (like the anatomically similar Golpu deposit (Newcrest-Harmony) in Papua New Guinea, and Grasberg Deposit (Freeport McMoRan) in Irian Jaya) is being targeted in future drilling programs, aimed at defining both the shallowing and south eastern extents of the growing Alpala Deposit as well as revealing the prognosed high grade bornite-magnetite or chalcopyrite rich heart of the system.
Drilling with Rig 1 continues with Hole 22, which is at a current depth of 702.2m, and intersecting increasing visible copper mineralisation from 253.8m (Image 3). Hole 22 is testing for shallower extensions above recent high grade mineralisation encountered in Hole 19.
Rig 2 was moved to the Hematite Hill drill site for Hole 21, which is at a current depth of 750.4m, and also intersecting increasing visible copper mineralisation from 685.2m (Image 4). Hole 21 is testing southeast extensions of the Alpala deposit. The high-grade core of the Alpala deposit is open southeast and below Hole 16, which returned an encouraging 856 metres grading at 0.80% copper and 1.04 g/t gold.
Rig 3 continues deepening Hole 20R, which is at a current depth of 1342.4m, having intersected strongly mineralised clasts of mineralised porphyry from approximately 900m, hosted within hydrothermal breccia (Image 5). Technical drilling challenges have delayed the recent advance of this hole, however, drilling rates are expected to improve in the near future.
SolGold is awaiting the arrival of two additional man portable rigs within the next month to focus on defining the extent of the Alpala system, prior to completion of an optimised maiden resource statement, as part of an increase in drilling activities to seven rigs by year's end, facilitating the drill testing of other targets including the promising Trivinio, Tandayama/America and Aguinaga targets.
New Areas
SolGold has reviewed the geology and prospectivity of Ecuador and identified a number of additional opportunities on which the Company is seeking tenure.
"Using SolGold's blueprinted exploration and appraisal strategies, our well established operating capability and constructive approach to community, we are confident SolGold has the capability to replicate the success at Alpala many times over" said Jason Ward, SolGold's exploration Manager and in country Chief.
Qualified Person:
Information in this report relating to the exploration results is based on data reviewed by Mr Nicholas Mather (B.Sc. Hons Geol.), the Chief Executive Officer of the Company. Mr Mather is a Fellow of the Australasian Institute of Mining and Metallurgy who has in excess of 25 years' experience in mineral exploration and is a Qualified Person under the AIM Rules. Mr Mather consents to the inclusion of the information in the form and context in which it appears.
By order of the Board
Karl Schlobohm
Company Secretary
CONTACTS
Mr Nicholas Mather Tel: +61 (0) 7 3303 0665
SolGold Plc (Executive Director) +61 (0) 417 880 448
Mr Karl Schlobohm Tel: +61 (0) 7 3303 0661
SolGold Plc (Company Secretary)
Mr Ewan Leggat / Mr Richard Morrison Tel: +44 (0) 20 3470 0470
SP Angel Corporate Finance LLP (NOMAD and Broker)
Follow us on twitter @SolGold_plc
NOTES TO EDITORS
SolGold is a Brisbane, Australia based, AIM‐listed (SOLG) copper gold exploration and future development company with assets in Ecuador, Solomon Islands and Australia. SolGold's primary objective is to discover and define world‐class copper‐gold deposits. The Board and Management Team have substantial vested interests in the success of the Company as shareholders as well as strong track records in the areas of exploration, mine appraisal and development, investment, finance and law. SolGold's experience is augmented by state of the art geophysical and modelling techniques and the guidance of Newmont trained porphyry expert Dr Steve Garwin.
SolGold was shortlisted as a nominee for the Mining Journal Explorer Achievement Award for 2016. The Company announced USD54m in capital raisings in September 2016 involving Maxit Capital LP, Newcrest International Ltd and DGR Global Ltd, all undertaken at substantial premiums to previous raisings and SolGold has at February 2017 USD40 million in available cash to continue the exploration and development of its flagship Cascabel Project until September October 2017.
Coincident with those capital raisings, Mr Scott Caldwell (CEO of TSX-listed Guyana Goldfields Inc) joined the SolGold Board on 9 September 2016. Mr Caldwell is a mining engineer with over 30 years of experience building and operating gold and base metal mines worldwide, including USA, Canada, Russia, Zimbabwe, Chile and Indonesia and was in 2016 recognised as CEO of the year for South-American resource companies.
Cascabel, SolGold's 85% owned world class flagship copper‐gold porphyry project, is located in northern Ecuador on the under‐explored northern section of the richly endowed Andean Copper Belt. SolGold owns 85% of Exploraciones Novomining S.A. ("ENSA") and approximately 11% of TSX‐V‐listed Cornerstone Capital Resources ("Cornerstone"), which holds the remaining 15% of ENSA, the Ecuadorian registered company which holds 100% of the Cascabel concession.
The investment by Newcrest into 10% of SolGold, and investment into SolGold by Guyana Goldfields, Maxit Capital and its clients, endorses Ecuador as a mining destination, the management team at SolGold, the dimension, size and scale of Alpala, the general prospectivity of Cascabel and its multiple targets. The gold endowment, location, infrastructure, logistics are important competitive advantages offered by the project.
To date SolGold has expended approximately USD39m, completing geological mapping and soil sampling over 25km2, along with an additional 9km2 of Induced Polarisation and 14km2 Magnetotelluric "Orion" surveys over the Alpala cluster and Aguinaga targets. SolGold has to date completed approximately 29,000m of drilling and expended over USD 39M on the program, corporate costs and investments into Cornerstone. This has been completed without lost time injury or environmental incident, employing a workforce of up to 176 Ecuadoreans workers and geoscientists and 6 expatriate Australian geoscientists. The results of 21 holes drilled (including redrilled holes) and assayed to date are outlined in the appended Table. Intensive diamond drilling is planned for the next 12 months with multiple drill rigs.
Cascabel is characterised by fourteen (14) identified targets, world class drilling intersections over 1km in length at potentially economic grades, and high copper and gold grades in richer sections, as well as logistic advantages in location, elevation, water supply, proximity to roads, port and power services; and a progressive legislative approach to resource development in Ecuador. To date, SolGold has drill tested only one of the 14 targets, being Alpala.
The Alpala deposit is open at depth and in the upper extensions, as well as to the north, north-east, south-east and south-west. The mineralised zones at Alpala, and Moran some 700m to the north, and Aguinaga some 2km north east, are closely modelled by magnetic signatures and currently encompass over 10Bt of magnetic rock anticipated, on the basis of a strong relationship between copper sulphides and magnetite, to be mineralised with copper and gold.
SolGold is focussing on extending the dimensions of Alpala before completing a resource statement and drill testing of the other key targets within the Cascabel concession at Alpala South East, Aguinaga, Trivinio, Moran, Alpala Northwest, Hematite Hill, Cristal, Parambas, Carmen, Tandayama-America and Chinambicito. The Company is planning further metallurgical testing and completion of a conceptual early stage mine and plant design and a scoping study for an economic development at Cascabel. SolGold is investigating both high tonnage / low-medium grade open cut and underground block caving operations, and a high grade / low tonnage initial underground development.
Drill hole intercepts are calculated using a data aggregation method, defined by copper equivalent cut-off grades and reported with up to 10m internal dilution, excluding bridging to a single sample. Copper equivalent grades are calculated using a gold conversion factor of 0.89, determined using a copper price of USD2.20/pound and a gold price of USD1350/ounce.
Following a comprehensive review of the geology and prospectivity of Ecuador, SolGold and its subsidiaries have also applied for additional exploration licences in Ecuador over a number of promising porphyry copper gold targets elsewhere in the Country. SolGold is negotiating external funding options which could provide the Company with the ability to have some of these projects fully funded by a third party while focussing on Cascabel.
In Queensland, Australia the Company is evaluating the future exploration plans for the Mt Perry, Rannes and Normanby projects. Joint venture agreements are being investigated for a joint venture partner to commit funds and carry out exploration to earn an interest in the tenements.
SolGold retains interests in its original theatre of operations, Solomon Islands in the South West Pacific, where the 100% owned, but as yet undrilled, Kuma prospect on the island of Guadalcanal exhibits surface geological characteristics which are traditionally indicative of a large metal rich copper gold intrusive porphyry system. SolGold intends in the future to apply intellectual property and experience developed in Ecuador to target additional world class copper gold porphyries at Kuma and other targets in Ecuador and Argentina.
SolGold is based in Brisbane, Queensland, Australia. The Company listed on London's AIM Market in 2006, under the AIM code 'SOLG' and currently has a total of 1,431,166,605 ordinary shares issued, together with 33,975,884 options exercisable at 28p and 12,875,884 options exercisable at 14p.
CAUTIONARY NOTICE
This news release may contain certain statements and expressions of belief, expectation or opinion which are forward looking statements, and which relate, inter alia, to the Company's proposed strategy, plans and objectives or to the expectations or intentions of the Company's directors. Such forward-looking statements involve known and unknown risks, uncertainties and other important factors beyond the control of the Company that could cause the actual performance or achievements of the Company to be materially different from such forward-looking statements. Accordingly, you should not rely on any forward-looking statements and save as required by the AIM Rules for Companies or by law, the Company does not accept any obligation to disseminate any updates or revisions to such forward-looking statements.
http://www.rns-pdf.londonstockexchange.com/rns/8056W_1-2017-2-14.pdf
Figure 1: Regional Setting of the Cascabel Project, in the under-explored Ecuadorian portion of the Andean Copper Belt.
Figure 2: Location of Cascabel project in northern Ecuador, highlighting the significant capital advantages held by the project, with proximity to ports, road infrastructure, hydro-electric power stations and the trans-continental power grid.
http://www.rns-pdf.londonstockexchange.com/rns/8056W_1-2017-2-14.pdf
Figure 3: Cascabel tenement area showing 14 porphyry targets recognised to date through compilation of multiple geophysical, geochemical and geological datasets. Eight high priority target areas have been identified at Alpala, Alpala East, Alpala Southeast, Cristal, Trivinio, Moran, Aguinaga, and Tandayama-America.
http://www.rns-pdf.londonstockexchange.com/rns/8056W_1-2017-2-14.pdfFigure 4: Drill hole location plan, showing existing drill holes (with colour coded copper equivalent grades), as well as current holes 21, 22, and 20R (with current depths in black and remaining planned hole path in red).
http://www.rns-pdf.londonstockexchange.com/rns/8056W_1-2017-2-14.pdf
Figure 5: The confirmation of shallow bornite rich mineralisation in Hole 19, bodes well for the extension of the deposit to the southeast, where strong bornite mineralisation and high temperature advanced argillic alteration are mapped at surface, covering a further 750m of strike, or double the existing strike of the Alpala zone.. Long-section A-B is detailed in Figure 6.
http://www.rns-pdf.londonstockexchange.com/rns/8056W_1-2017-2-14.pdf
Figure 6: Long-section A-B, showing priority target extension of the deposit to the southeast, showing existing drill holes (with colour coded copper equivalent grades), and planned drill holes for the coming quarter shown in red.
http://www.rns-pdf.londonstockexchange.com/rns/8056W_1-2017-2-14.pdf
Table 2: Drill hole results to date at Alpala.
http://www.rns-pdf.londonstockexchange.com/rns/8056W_1-2017-2-14.pdf
Image 1: Bornite-rich mineralisation characteristic of shallower portions of the known deposit at Alpala, here exampled in Hole 19.
http://www.rns-pdf.londonstockexchange.com/rns/8056W_1-2017-2-14.pdf
Image 2: Chalcopyrite-rich mineralisation characteristic of deeper portions of the known deposit at Alpala, here exampled in Hole 16.
http://www.rns-pdf.londonstockexchange.com/rns/8056W_1-2017-2-14.pdf
Image 3: Example of mineralisation being encountered in Hole 22.
http://www.rns-pdf.londonstockexchange.com/rns/8056W_1-2017-2-14.pdf
Image 4: Example of mineralisation being encountered in Hole 21.
http://www.rns-pdf.londonstockexchange.com/rns/8056W_1-2017-2-14.pdf
Image 5: Example of mineralised clasts of mineralised porphyry, hosted within hydrothermal breccia in Hole 20R.
This information is provided by RNS
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