Exploration Update - Cascabel Hole 7 & 8

RNS Number : 9692P

SolGold PLC

26 August 2014

 

26 August, 2014

SolGold plc

("SolGold" or the "Company")

Cascabel Exploration Update

Hole 7 Assays Received to End of Hole

Hole 8 at 375 metres

The Board of SolGold (AIM code: SOLG) is pleased to provide the following exploration update for the Company's Cascabel copper-gold porphyry project in Ecuador.

HIGHLIGHTS:

Ø Assays received for drill hole CSD-14-007 ("Hole 7") from 1251.26m to 1672.76m;

Ø From 654m to 1612m, 958m @ 0.40% copper (Cu) and 0.17g/t gold (Au);

         Including the following intersections:

         From 1056m to 1294m, 238m @ 0.65% Cu and 0.35g/t Au;

         From 1160m to 1294m, 134m @ 0.75% Cu and 0.50g/t Au;

         From 1200m to 1294m, 94m @ 0.84% Cu and 0.62g/t Au;

Ø Hole CSD-14-008 ("Hole 8") commenced on 15 August;

Ø Orion 3D "Deep Earth Imaging" IP geophysical survey has completed the acquisition of raw data from the Alpala grid;

Ø The Orion IP survey will move to the Aguinaga grid area for data collection;

Ø Geological mapping project initiated over the Rio Cachaco drainage divide;

Ø Metallurgical testwork on Hole 5 samples well advanced; and

Ø Independent geological review confirms both size and high grade potential at Alpala.

Commenting on today's update, SolGold CEO and Managing Director, Alan Martin said:

"The results for Hole 7 and the detailed magnetic and geological model fit very well and give us confidence about the location of the main mineralised "Central" zone. Holes 5 and 7 appear to have intersected the southwest edge of the Central zone and we are targeting higher grades to the northeast. The Central zone looks to be very extensive and we are anticipating that IP results will  confirm this."

References to figures and /or tables relate to the version of this release on the Company's website (www.solgold.com.au) or visible in PDF format by clicking the link below:

http://www.rns-pdf.londonstockexchange.com/rns/9692P_-2014-8-26.pdf 

FURTHER INFORMATION

Hole 7

Hole 7 on the Cascabel concession was drilled at the Alpala porphyry Cu-Au prospect (Figure 1).

Hole 7 was terminated on 25 July at a depth of 1672.76 metres (end of hole) and drilled along the southwest margin of a large magnetic body that was recently defined by Magnetic Vector Inversion (MVI) modelling which is one of the most advanced and sophisticated modelling techniques available (Figures 1 and 2).

Extensive intersections of copper and gold mineralisation were encountered in Hole 7, and these intersections are set out in Table 1 below.

The bulked intersection of 958m grading 0.40% copper and 0.17g/t gold is interpreted to reflect mineralisation located along the margins of the recently modelled Central Magnetic Feature (Central Zone) whose lateral dimensions are around 1100m long by 500m wide at a depth of 800m below surface (Figure 1), and extending vertically for approximately 800m from this depth.

The 958m intersection is a very long intersection of continuous mineralisation located along the margin of the MVI anomaly, and bodes very well for lateral extension of copper and gold mineralisation to the northeast, as well as to the north, east and southeast. The lower grades encountered from 1612m to the end of hole at 1672.76m are interpreted to reflect the drill hole exiting the mineralised system on its southwest side (Figure 2).

Hole 8

Hole 8 is located on the same drill pad as Hole 5 and is being drilled with an 85 degree inclination towards UTM (Universal Transverse Mercator) north. Drilling commenced on 15 August and as at 25 August was at a depth of 375 metres.

The hole is targeted to intersect the MVI anomaly at a point that is approximately 100m north-northeast of the upper contact of the high-grade zone in Hole 5, and at a point approximately 170m north-northeast of the lower contact to the high-grade copper-gold intersection in Hole 5 (Figure 1). The hole will aim to generate a copper-gold intersection at the third apex of a triangle, with Holes 5 and 7 lying along the structurally controlled southwest margin of the MVI anomaly.  Hole 8 is targeted to deliver an intersection within the anomaly 100m to 170m northeast of Hole 5. 

IP Survey and Magnetic Modelling

The Orion 3D IP surveying of the Alpala grid commenced on 3 August.  In early August an additional 3 Quantec personnel arrived on site to supplement the 13 personnel on site.  The additional personnel were flown in to Ecuador by Quantec to optimise survey productivity at Cascabel.  

Chargeability, conductivity and resistivity measurements have now been completed for the Alpala grid and this data will now be processed to deliver preliminary "inversion" models.

The Orion IP crew are presently mobilising equipment from the Alpala grid area to the Aguinaga grid.

The IP survey over the Aguinaga grid covers an area of approximately 4 square kilometres.

Metallurgical Testwork

Preliminary testwork by Inspectorate in Vancouver is well advanced and results are expected before the end of Q3 2014.

Rio Cachaco Mapping and Sampling Program

Preliminary geological inspection over the southern drainage divide of the  Rio Cachaco catchment is underway, and will be followed by geological mapping and soil sampling. The soil sampling survey will extend the current soil sample coverage westward over strong magnetic anomalies that lie under the topographic divide south of Rio Cachaco and 2 kilometres west-northwest of Central Alpala.

Independent Geological Review

Dr Steve Garwin, a well regarded porphyry expert, carried out an independent review of the Alpala Prospect over a week in late July. This review included a site visit to the Alpala region and a detailed review of the drill core from Alpala, particularly Holes 1, 5 and 7. While the technical team at SolGold is still reviewing the report, the conclusions of the geological review confirm both the world-class size and high-grade potential of the Alpala target at Cascabel. The other four porphyry copper (+/- gold) targets within the Cascabel concession: Aguinaga, Moran, Tandayama/America and Chinambicito, were not part of this review (see Figure 1 for location of these targets).

About Cascabel

SolGold owns 21.1m shares (approximately 11%) in TSX-V-listed Cornerstone Capital Resources (Cornerstone), and 85% of Exploraciones Novomining S.A. ("ENSA").  ENSA is an Ecuadorean registered company, which holds 100% of the Cascabel concession in northern Ecuador.  Cornerstone holds the remaining 15% of ENSA.

The Cascabel project is located in northwestern Ecuador in an under-explored northern section of the richly endowed Andean Copper Belt.  World class deposits located within this belt include the 982 million tonnes at 0.89% Cu Junin copper project located some 60km to the southwest of Cascabel, the 3.3 billion tonnes at 0.36% Cu Cobre Panama deposit located to the north in Panama and the 905 million tonnes at 0.92 g/t Au La Colosa porphyry deposit located to the north in Colombia, containing 26 million ounces of gold.  The Alpala Prospect exhibits surface mineralisation and alteration patterns indicative of a porphyry copper gold system and has a similar footprint to large porphyry systems around the world.

Qualified Person:

Information in this report relating to the exploration results is based on data reviewed by Dr Bruce Rohrlach (BSc (Hons), PhD,), the GM Exploration of the Company. Dr Rohrlach is a Member of the Australasian Institute of Mining and Metallurgy who has in excess of 26 years' experience in mineral exploration and is a Qualified Person under the AIM Rules.  Dr Rohrlach 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 Alan Martin

SolGold Plc (CEO and Managing Director)                                                    Tel: [phone]

[e-mail]

Mr Nicholas Mather                                                                                         Tel: [phone]

SolGold Plc (Executive Director)

[e-mail] 

Mr Karl Schlobohm                                                                                         Tel: [phone]

SolGold Plc (Company Secretary)

[e-mail]  

Mr Ewan Leggat/Ms Katy Birkin                                                                 Tel: [phone]

SP Angel Corporate Finance LLP (NOMAD and Broker)

[e-mail]  

Mr Dominic Barretto / Ms Anna Legge                                                     Tel: [phone]

Yellow Jersey PR Limited (Financial PR)

[e-mail]  

NOTES TO EDITORS

SolGold's exploration projects are located in northern Ecuador, Australia, and the Solomon Islands. In Ecuador, they consist of a joint venture with Cornerstone Capital Resources Inc. on the Cascabel copper-gold project.  In Australia, SolGold holds 100% of the Rannes, Mt Perry, Cracow West and Normanby Projects, all in southeast Queensland. In the Solomon Islands they comprise the Fauro Project (located on Fauro Island), and the Lower Koloula, Malukuna and Kuma licenses, which are located on Guadalcanal. 

The Cascabel copper-gold project is located approximately 180 km by sealed road north of Ecuador's capital, Quito, 20 km south of the Colombian border, and 75 km inland from the coastal city of San Lorenzo. At the Rannes project SolGold has announced indicated and inferred resources of 18.7 million tonnes at 0.9 g/t gold equivalent (gold + silver) for 550,146 ounces of gold equivalent (296,657 ounces of gold and 10,137,736 ounces of silver; see announcement dated 23 May 2012 for details of the resource statement and gold equivalent ratios).  The Rannes project is currently under review.

In the Solomon Islands, a soil geochemical survey and 3D modelling of magnetic data has been approved at Kuma.

SolGold's objective is to create substantial shareholder value by discovering and defining world-class copper-gold deposits.

SolGold's Board includes accomplished professionals with strong track records in the areas of exploration, mine development, investment, finance and law.  Board and Management have significantly vested interests in the Company, holding approximately 14% of its issued share capital.

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 652,153,202 fully paid ordinary shares, 12,820,000 options exercisable at 50p, 12,730,000 options exercisable at 28p and 9,730,000 options exercisable at 14p.

CAUTIONARY NOTICE

The 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.

 

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