GBG Joint Venture Update

RNS Number : 4968L

Shanta Gold Limited

05 September 2012

 



5 September 2012

Shanta Gold Limited

("Shanta Gold" or the "Company")

Encouraging Exploration Results from Shanta Gold-GBG Joint Venture

Shanta Gold, the East African focused gold mining company, is pleased to announce encouraging early stage exploration results achieved from tenements in the Shanta Gold-Great Basin Gold Joint Venture ("JV") portfolio of properties.

The Company entered into a JV agreement with Great Basin Gold (TSX/NYSE/JSE: GBG) in 2011, thus enabling Shanta Gold exploration crews to conduct reconnaissance and exploration activities over a large consolidated permit holding in the Lupa Goldfields, the second largest goldfields in Tanzania. Great Basin Gold, through subsidiary Tanzanian registered companies, holds the majority of exploration tenements in the Lupa Goldfields in south western Tanzania.

The JV agreement provides for Shanta Gold earning up to 80% of discovered resources, subject to conditions set out in the agreement which are outlined in the Shanta Gold announcements dated 1 June 2011 and 13 October 2011. Under the agreement, Shanta Gold is committed to expenditure of no less than $12 million on exploration activities in the Joint Venture portfolio of properties before 31 December 2014.

Highlights

·      Nine new mineralised prospect areas identified by means of grab sampling and trenching

·      Encouraging gold values achieved with both grab and trench channel sampling

·      Three of the newly identified prospect areas have been targeted with first-pass Reverse Circulation ("RC") drilling, and encouraging mineralised intersections have been achieved at depth

Exploration Statistics to 30 June 2012

·      1,075 Grab samples collected and analysed

·      Grab sampling assays suggest that a total mineralised strike length of 3.59km has thus far been identified

·      61 Exploration trenches totalling 1,270m of linear trenching have been completed

·      A total of 64 RC drillholes totalling 4,476m of drilling have been completed at three mineralised prospects

Results

Reconnaissance grab samples collected at numerous mineralised prospects located to the north, northeast and northwest of Shanta Gold's New Luika Gold Mine yielded very encouraging results, with gold values of up to 50 g/t achieved. The grab sampling information enabled Company field crews to prioritise the exploration at certain mineralised prospects.

Exploration trenches excavated at several of the mineralised prospects confirm the presence of in-situ mineralised structural deformational features identified by means of grab sampling. Table 1 contains some of the trench channel sampling values achieved.

Table 1: Significant trench channel sampling - Shanta Gold-GBG JV

Big Vein 1 Prospect

Trench ID	From	To	Width	Sample Nr.	Au/ppm	Total Width	Au g/t
BV1T001	7.3	7.6	0.3	261005	20.2	2.55	4.74
BV1T001	7.6	8	0.4	261006	1.9
BV1T001	8	8.6	0.6	261007	1.48
BV1T001	8.6	9.2	0.6	261008	7.13
BV1T001	9.2	9.85	0.65	261009	0.16
BV1T005	4.6	5.05	0.45	261153	35.2	0.45	35.3

Big Vein 2 Prospect

Trench ID	From	To	Width	Sample Nr.	Au/ppm	Total Width	Au g/t
BV2T005	14.3	14.85	0.55	260413	1.04	0.55	1.04
BV2T006	3.45	4	0.55	260542	2.15	0.55	2.15

Tanganyika Prospect

Trench ID	From	To	Width	Sample Nr.	Au/ppm	Total Width	Au g/t
TT002	1.6	2.6	1	260331	2.96	1.7	2.36
TT002	2.6	3.3	0.7	260332	1.5

Tanganyika South Prospect

Trench ID	From	To	Width	Sample Nr.	Au/ppm	Total Width	Au g/t
TST003	7.95	8.25	0.3	260049	2.94	0.3	2.94

Mbuga Prospect

Trench ID	From	To	Width	Sample Nr.	Au/ppm	Total Width	Au g/t
MT002	0	1	1	260598	2.11	1	2.11
MT002	4	5	1	260602	4.75	1	4.75
MT004	11.6	12.3	0.7	260616	7.89	1.3	4.52
MT004	12.3	12.9	0.6	260617	0.59
MT004	13.6	14.3	0.7	260619	1.06	0.7	1.06

Reverse circulation drilling commissioned at three prospects located in the direct vicinity of the New Luika Gold Mine site intersected encouraging gold mineralisation at depth. This bodes well for the delineation and development of near surface ore resources, pending more drilling.  A summary of significant intersections attained is provided in Table 2:

Table 2: Significant Mineralised Intersections - RC Drilling - Shanta Gold-GBG JV

Big Vein 2 Prospect

BH I.D.	From	To	Width	Sample Nr.	Au/ppm	Total Width	Au g/t
SGR002	32	33	1	287886	12.2	4	35.44
SGR002	33	34	1	287887	49.6
SGR002	34	35	1	287888	79.3
SGR002	35	36	1	287889	0.67
SGR002	44	45	1	287898	0.64	1	0.64
SGR003	53	54	1	287977	1.13	5	4.53
SGR003	54	55	1	287978	10.2
SGR003	55	56	1	287979	0.32
SGR003	56	57	1	287980	10
SGR003	57	58	1	287981	1.01
SGR003	78	79	1	288005	3.01	4	1.45
SGR003	79	80	1	288006	0.7
SGR003	80	81	1	288007	0.15
SGR003	81	82	1	288008	1.93
SGR003	83	84	1	288010	0.81	4	16.16
SGR003	84	85	1	288011	46
SGR003	85	86	1	288012	17.2
SGR003	86	87	1	288013	0.62
SGR003	94	95	1	288021	2.31	1	2.31
SGR007	17	18	1	288240	1.19	3	0.94
SGR007	18	19	1	288241	0.03
SGR007	19	20	1	288242	1.6
SGR007	25	26	1	288248	7.55	1	7.55

Dave's Mile Prospect

BHID	From	To	Width	Sample Nr.	Au/ppm	Total Width	Au g/t
SGR015	28	29	1	288813	0.74	2	1.04
SGR015	29	30	1	288814	1.33
SGR015	31	32	1	288817	0.59	2	0.52
SGR015	32	33	1	288818	0.45
SGR016	26	27	1	288880	3.08	1	3.08
SGR024	44	45	1	289476	1.45	1	1.45
SGR024	46	47	1	289478	1.29	4	2.994
SGR024	47	48	1	289479	1.4
SGR024	48	49	1	289480	1.23
SGR024	49	50	1	289482	8.05
SGR030	57	58	1	289864	1.04	1	1.04
SGR030	64	65	1	289871	4.36	1	4.36
SGR032	57	58	1	290040	0.81	5	2.634
SGR032	58	59	1	290042	6.53
SGR032	59	60	1	290043	1.01
SGR032	60	61	1	290044	3.83
SGR032	61	62	1	290045	0.98
SGR032	71	72	1	290055	5.1	1	5.1
SGR063	43	44	1	292607	9.08	2	5.25
SGR063	44	45	1	292608	1.41

Mgomba Prospect

Trench BHID	From	To	Width	Sample Nr.	Au/ppm	Total Width		Au g/t
SGR041	41	42	1	290976	0.79	7		12.10
SGR041	42	43	1	290977	1.32
SGR041	43	44	1	290978	39.6
SGR041	44	45	1	290979	34.4
SGR041	45	46	1	290980	6.24
SGR041	46	47	1	290981	0.43
SGR041	47	48	1	290982	1.97
SGR046	13	14	1	291308	3.24	2		2.35
SGR046	14	15	1	291309	1.46
SGR046	18	19	1	291313	0.66	4		1.21
SGR046	19	20	1	291314	1.77
SGR046	20	21	1	291315	1.05
SGR046	21	22	1	291316	1.35
SGR046	42	43	1	291340	4.55	2		4.25
SGR046	43	44	1	291341	3.95
SGR047	12	13	1	291414	2.85	1		2.85
SGR047	26	27	1	291430	0.53	3		6.31
SGR047	27	28	1	291431	4.49
SGR047	28	29	1	291432	13.9
SGR049	31	32	1	291580	10.1		2	7.85
SGR049	32	33	1	291581	5.59
SGR053	31	32	1	291854	0.92		2	1.76
SGR053	32	33	1	291855	2.6
SGR053	37	38	1	291861	3.58		3	1.66
SGR053	38	39	1	291862	0.54
SGR053	39	40	1	291863	0.87

Exploration Strategy

Shanta Gold and Great Basin Gold have agreed to implement a phased approach to the exploration of the >2500km² Lupa Goldfields. It is envisaged that the area falling into a 20km radius around the New Luika Gold Mine will initially be prioritised for exploration, while low-key reconnaissance activities will be commissioned in areas further afield.

With the above in mind, Shanta Gold-GBG have commissioned and completed a detailed LiDAR survey of a block comprising approximately 400km². Data from this survey has been received and is being processed. In addition to the above, the Company is currently considering the commissioning of a Heli-borne magnetic and radiometric survey covering the same area - approximately 400km².

Exploration trenching at known gold occurrences is ongoing with the view to commission a new drilling programme during the course of Q4 2012.  

Walton Imrie, Executive Chairman of Shanta Gold, commented:

"We are encouraged by the early stage exploration results achieved from tenements in the Shanta Gold-Great Basin Gold JV.  The JV has agreed to implement a phased approach to the exploration of the over 2,500km² of tenement area within the historic Lupa Goldfields, which hosted numerous shallow, high-grade gold mines during the colonial era.  The JV represents significant exploration upside potential for Shanta Gold as the tenements are in very close proximity to the Company's existing operations at New Luika."

Competent Persons Statement

Braam (J.A.C.) Jankowitz, M.Sc., Pr.Nat.Sci. (400127/93), Shanta's General  Manager at New Luika Gold Mine is a qualified person as defined in the Guidance Note for Mining, Oil and Gas Companies, June 2009, of the London Stock Exchange, and has reviewed and approved the technical information contained in this announcement.

Enquiries:

Shanta Gold Limited	Tel: [phone]
Walton Imrie / Gareth Taylor
Nominated Adviser and Broker
Liberum Capital Limited	Tel: + 44 (0)20 3100 2000
Michael Rawlinson / Clayton Bush / Christopher Kololian
Financial Public Relations
FTI Consulting	Tel: [phone]
Billy Clegg / Oliver Winters

About Shanta Gold Limited

Shanta Gold is an East African focused gold mining company. It currently has defined ore resources on the New Luika, Singida and Mgusu projects and holds exploration licences over a number of additional properties. The Company's flagship New Luika Gold Mine commenced production and achieved first gold pour in August 2012. The Company is admitted to trading on AIM and has approximately 319 million shares in issue.

For further information visit the Company's website: www.shantagold.com.

 

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