GJV Exploration Update

RNS Number : 1575B

Solomon Gold PLC

14 February 2011

 



            14 February 2011

Solomon Gold Plc

("Solomon Gold" or the "Company")

Exploration Update: Drilling underway and high grade rock chip samples from the Mbetilonga Project.

Guadalcanal Joint Venture to spend US$6million in 2011 in Guadalcanal, Solomon Islands.

Solomon Gold (AIM Code: SOLG), the gold and copper explorer active in Solomon Islands and Australia, is pleased to announce that rock chip samples taken from the Mbetilonga Project have returned high grade copper and gold results.  NVL Solomon Islands Limited, a subsidiary of Newmont Mining Corporation (NYSE:NEM) ("Newmont"),  Solomon Gold's partner in Guadalcanal, has advised of the 2011 work program for the Guadalcanal Joint Venture, spending US$6.03million on a program including 5,600m of drilling.

HIGHLIGHTS

Mbetilonga Project

·    Rock chip samples in the Kolokepi and Ngalimane Prospects, eastern Mbetilonga:

-           0.26% copper and 159g/t gold.

-           13.45% copper, 3.43g/t gold, 129g/t silver and 2,510ppm molybdenum.

-           40.70% copper, 0.89g/t gold and 1,190g/t silver.

·    Drilling commences on the Vuanimaho porphyry Prospect, eastern Mbetilonga.

Chikora Prospect:

·    Diamond drill hole CK003 returned, 152m @ 0.25% copper from 85.1m (including 9m @ 0.30% copper from 85.1m, 25m @ 0.29% copper from 117m, and 58m @ 0.37% copper from 255m).

·    Diamond drill hole CK004, 135m @ 0.25% copper from 152m (including 30m @ 0.36% copper from 177m).

·    Reinterpretation of the Chikora geological model suggests a porphyry system causing the mineralisation at surface and in drill holes at depth.

2011 Work Program, Guadalcanal Joint Venture

·    NVL Solomon Islands Limited has proposed an extensive work program budgeted at US$6million on Mbetilonga, Sutakiki, Kuma and Central during 2011, including a planned 5,600m (3,500m at Mbetilonga and 2,100m at Sutakiki) drilling program.

Commenting on the recent results from the Guadalcanal Joint Venture, Nicholas Mather, Chief Executive of Solomon Gold plc said: "Solomon Gold is pleased to report that rock chip sampling at Kolokepi and Ngalimane Prospects, within the eastern Mbetilonga Project returned high copper, silver, gold and molybdenum grades.  The best copper result was 40.7%, the best gold result was 159g/t and the best silver result was 1,190g/t (38oz/t).  2,510ppm molybdenum was found in one sample.  The mineralisation and alteration observed indicate a variety of possible vein and altered limestone hosted or skarn targets.  There is also evidence of porphyry copper-gold mineralisation.

Newmont has commenced drill testing of the Vuanimaho porphyry targets.

The Vuanimaho, Kolokepi and Ngalimane Prospects lie in the eastern corridor, a 3km long zone of highly altered and mineralised rocks on the eastern side of Mbetilonga.  Previous results in the area include, 114m @ 0.35% copper to the end of the hole, drilled by UTAH Development at nearby Vuralangomma.  Further work is required and is planned in this year's work program.  The Mbetilonga Project is highly regarded and exhibits numerous areas of very high copper and gold mineralisation coincident with porphyry style magnetic signatures.

Four additional diamond holes have been drilled at the Chikora Prospect in the Koloula Valley by the Joint Venture in addition to the two drilled by Solomon Gold in 2007 and 2008.  The results from the first two drill holes, from the drilling campaign which commenced in August last year, include 152m @ 0.25% copper from 85.1m in CK003 and 135m @ 0.25% copper from 152m in CK004.  The result from these two holes has resulted in an amended geological interpretation.  The Chikora mineralised system now appears to be defined laterally with the causative porphyry intrusion postulated at depth based on alteration and mineralisation trends.  The further work program for Chikora has not yet been finalised.

The 2011 work program presented by Newmont, the managers of the Guadalcanal Joint Venture, will be focussed on drill testing the porphyry and epithermal copper gold targets at Mbetilonga, and the porphyry and skarn targets at Sutakiki.  Field work will be conducted to advance the Kuma Projects and a prospectivity assessment of the Central Project will be made by reconnaissance BLEG sampling.  In addition, interpretation of the Chikora/Levisivisi data will be finalised and a minor field mapping program may be undertaken at the Mbina Prospect.  5,600 metres (3,500m at Mbetilonga and 2,100m at Sutakiki) of drilling and a budget of US$6million is proposed by Newmont." he added.

Mbetilonga Project

Significant copper and gold rock chip samples have been collected from the Kolokepi and Ngalimane Areas, within the eastern Mbetilonga Project (see Figure 1 in the Appendix to this announcement in the 'Latest News' section on the website, www.solomongold.com).

These results include:

Sample SN1537638 : 0.26% copper, 159g/t gold.

Sample SN1537668 : 13.45% copper, 3.43g/t gold, 129g/t silver, 2,510ppm Molybdenum.

Sample SN1537619 : 40.7% copper, 0.89g/t gold, 1,190g/t silver.

Figure 2, in the Appendix to this announcement in the 'Latest News' section on the website, www.solomongold.com shows the location of the rock chip samples taken during 2010 and gold grades taken over the Mbetilonga Project.

Figures 3, 4 and 5 in the Appendix to this announcement in the 'Latest News' section on the website, www.solomongold.com are photographs of the significant samples collected.

Mineralisation and alteration observed in the Kolokepi and Ngalimane prospect areas indicate possible intermediate sulphidation vein, high sulphidation and skarn mineralisation targets.  Porphyry copper-gold mineralisation is also possible and targeted.

During January 2011, Newmont commenced drilling the Mbetilonga Project area with the first hole into the Vuanimaho Prospect (see Figure 6 in the Appendix to this announcement in the 'Latest News' section on the website, www.solomongold.com).  This drill hole is approximately 400m deep down hole at the date of this report.  The Vuanimaho porphyry targets lie near the northern end of the Eastern Mbetilonga Corridor.  In November 2010, Newmont modelled the magnetic data over the Vuanimaho area and identified three persistent magnetic features which exhibit porphyry style signatures.  Copper, gold and base metal results from rock chip samples in the area also support the rationale for drill testing.

Chikora Prospect

Drilling commenced at the Chikora Prospect (Koloula Project area, see Figure 1 in the Appendix to this announcement in the 'Latest News' section on the website, www.solomongold.com) on 19th August 2010, the start of a planned 3,000m drilling campaign which was completed at the end of 2010.  The exploration program was testing the Kolotalaka copper mineralisation previously identified by Solomon Gold.

Five holes were drilled by NVL Solomon Islands Limited, Solomon Gold's partner, at the Chikora Prospect, CK003, CK004, CK005, and CK005A.  Hole CK005A was abandoned, with no assay results due to drilling problems.  Results have been received for CK003 and CK004.  Results are pending for hole CK005.  Another hole, CK006 was drilled at the Levisivisi Prospect and the drilling results are also pending.  Table 1 in the Appendix to this announcement in the 'Latest News' section on the website, www.solomongold.com summarises the Chikora and Levisivisi hole parameters.  Levisivisi was the location of high grade copper mineralisation discovered by the joint venture in mid-2009 at Chikora.

Solomon Gold drilled two diamond drill holes CK001 and CK002, between October 2007 and April 2008.  The assay results (as previously reported) were; CK001 222m @ 0.17% copper and in CK002 114m @ 0.18% copper.

CK003 was completed to 609m.  The hole intersected weakly mineralised porphyry with typically less than 1% disseminated and vein related chalcopyrite.  Mineralisation is variable, but associated with diagnostic potassic alteration.  The assays reported are 152m @ 0.25% copper from 85.1m (including 9m @ 0.30% copper from 85.1m, 25m @ 0.29% copper from 117m, and 58m @ 0.37% copper from 255m).

CK004 was completed to 630.5m and was collared at same location as CK003.  The hole was designed to target the interpreted northern margin of the Chikora tonalite porphyry and the previously drilled hole by UTAH Development.  The best UTAH Development result from this area was 114m @ 0.35% copper to the end of the hole.  The hole intersected fractured and mineralised host porphyry with increasing potassic alteration down hole (see Figures 7, 8 and 9 in the Appendix to this announcement in the 'Latest News' section on the website, www.solomongold.com).  The assay results are 135m @ 0.25% copper from 152m (including 30m @ 0.36% copper from 177m).

The data from holes CK003 and CK004, together with the data from CK001 and CK002, has resulted in a change to the previous geological interpretation.  The new interpretation is shown in Figures 10, 11 and 12 in the Appendix to this announcement in the 'Latest News' section on the website, www.solomongold.com.  The Chikora mineralised system now appears constrained laterally, with causative intrusion postulated at depth based on alteration and mineralisation trends.

Future work

The Work Program proposed for the 2011 field season on the Guadalcanal JV Tenements, namely: Koloula, Mbetilonga, Kuma, Central and Sutakiki will be focussed on drill testing the porphyry / epithermal targets at Mbetilonga, and porphyry / skarn targets at Sutakiki as they become drill ready.  Field work will also be conducted to advance the Kuma Projects and a prospectivity assessment of the Central Project will be made by reconnaissance BLEG sampling.  In addition, interpretation of the Chikora / Levisivisi data will be finalised and a field mapping program may be undertaken at the Mbina Prospect.

Data integration, interpretation and drill target delineation at Mbetilonga will be conducted.  A ground pole-dipole IP program will be conducted over selected areas to identify chargeability anomalies, particularly at the Vuanimaho and Kolokepi Prospects.  Mapping will be extended from the 2010 work towards the Hambusimuloso Prospect and trench sampling will be conducted to expose and sample basement where possible.  Additional work will involve Advanced Spectral Device ("ASD") clay alteration mapping, an important tool in directing exploration effort to the core of mineralised porphyry.  Diamond drilling will test high ranking targets.

At Kuma, geological mapping will be conducted and will be supported by ASD analysis, BLEG, soil and trench/channel sampling.

Exploration within the Sutakiki Project is planned to include a technical review of the Tabarora / Valehailala mineralised systems, development of the 3-D geological model and drill testing of high ranking targets.  Previously, Sutakiki yielded a long composite epithermal porphyry intersection in SK001 of 309m @ 0.13% copper and 0.6g/t gold and a high grade skarn in SK011 of 32m @ 9.45g/t gold, for Solomon Gold in 2007 - 2008

The Central Project Work Program will involve completion of the 2009 BLEG stream sediment program in order to complete a first pass assessment of the geological potential.

Exploration in Koloula will be limited to finalising 2010 data interpretation.  Time permitting; a review of the Mbina Prospect supported by a field mapping campaign may be conducted.

Table 2, in the Appendix to this announcement in the 'Latest News' section on the website, www.solomongold.com summaries the proposed exploration activities by Project and Activity.

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 Karl Schlobohm                                                                           Tel: [phone]

Solomon Gold Plc (Company Secretary)

[e-mail]

Mr Ewan Leggat                                                                                Tel: [phone]

Fairfax I.S. PLC (Broker)

[e-mail]

Mr Stephen Weir                                                                               Tel: [phone]

RFC Corporate Finance (Nominated Advisor)

[e-mail]

Mr Dominic Barretto                                                                         Tel: [phone]

Yellow Jersey PR (PR & IR)

[e-mail]

NOTES TO EDITORS

Solomon Gold Plc's original and core gold exploration projects are located on the Solomon Islands and are the major focus of the Company.  The discovery in September 2010 of extensive and rich gold mineralisation on Fauro Island, just south east of Bougainville Island in neighbouring Papua New Guinea, presents Solomon Gold with potential for a world class gold and copper-gold-molybdenum discovery on the south west Pacific Rim of Fire.  The region is one of the world's most strongly endowed gold and copper provinces, hosting Grasberg, Lihir, Panguna and Ok Tedi, each with in excess of 40Moz gold equivalent metal endowment.  The Company also holds a comprehensive and extensive tenement position on the main island of Guadalcanal where its JV partner, NVL Solomon Islands Limited (a subsidiary of NYSE-listed Newmont Mining Corporation) can earn a 51% interest in the project by expending US$6million by 1 April 2012, and may elect to expend a further US$6million (total US$12million) to earn a further 19% to a total 70% by 1 April 2014.  The Guadalcanal Joint Venture has outlined high priority gold-copper porphyry targets at Chikora, Mbetilonga, and Kuma.

Solomon Gold has also extended its strategy to include becoming an integrated gold explorer, developer and miner with projects in lower risk theatres as well as the Solomon Islands.

Solomon Gold's projects in Queensland include Rannes, Mt Perry and Normanby.  At Rannes, the Company has outlined a 22km long prospective zone in a 200km long trend on the eastern edge of Queensland's Bowen Basin in the same geological setting as Newcrest's 100,000 ounce per year Cracow Gold Mine.  This extensive exploration licence position hosts three mineralised projects at Cooper, Rannes Central and Police Camp.  The exploration area is believed to host mineral systems which are geologically similar to the Carlin trend in Nevada USA.  At Rannes Central, the Company has encountered potentially economic mineralisation in five different prospects targeted to yield at least 1 Moz.  A maiden 200,000 ounces has been defined to date at the Crunchie Prospect.

At Mt Perry, the Company is investigating an area of approximately 1,500km² hosting over 50 historic mines and workings near Newcrest's Mt Rawdon Gold Mine.  Mt Perry has yielded potentially economic drill intersections on nine of the ten prospects tested to date.

Solomon Gold's Board includes accomplished professionals with strong track records in the areas of exploration, mine development in Australia and Melanesia, investment, finance and law.  Board and Management have significantly vested interests in the Company holding approximately 15.91% of its issued share capital following the proposed placing announced on 22 October 2010.

Solomon Gold is based in Brisbane, Queensland, Australia.  The Company listed on London's Alternative Investment Market in 2006.  Further details concerning the Company's key projects and personnel can be found at www.solomongold.com

 

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