Drilling Update - Rannes Project

RNS Number : 7513F

SolGold PLC

20 June 2012

 

20 June 2012

SolGold Plc

("SolGold" or the "Company")

RANNES DRILLING UPDATE

Significant mineralisation beyond the resource block model

The Board of SolGold plc (AIM code: SOLG) is pleased to update the market on encouraging results from the current phase of drilling at the Company's 100% owned Rannes gold-silver Project in Queensland, Australia.

Key Points:

·      Hole KAU139 at Kauffmans intersected significant gold grades in three lodes - 2.2m at 2.36g/t Au, 2m at 3.03g/t Au and 2m at 3.84g/t Au.

·      High grade intervals defined in surface trench samples, including 1m at 6.12g/t gold and 12.3g/t silver in KTR3 at Kauffmans.

·      Drilling resumed at the Rannes Project on 2 April 2012.

·      Total of 3096.2m and 13 holes have been completed at Kauffmans Prospect to 18 June 2012.

·      All completed drill holes reported here are outside the resource block area and were aimed at increasing the resource, and identifying higher grade zones.

References to figures and 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/7513F_-2012-6-20.pdf

Drilling resumed on April 2, 2012 and 16 holes have now been completed with a majority of holes drilled at Kauffmans Prospect.  The drilling has been designed to target areas outside of the recently defined resource block model (see announcement dated 23 May 2012) with the aim of increasing the resource, and targeting the interpreted higher grade zones based on historical intercepts and the evolving geological model.

Commenting, Malcolm Norris, Chief Executive Officer of SolGold, said: "We are encouraged by the results from the recent drilling.  We are seeing some higher grade intersections, and we are seeing some good intersections in areas outside of the current resource block model.  We are optimistic that we can build on this success."

Drilling has comprised a combination of reverse circulation (RC) and diamond drilling.  Of the 16 holes completed to date, complete assay results have been returnedfor 13 holes.  Full details are included in the table in the PDF and website versions.

The drilling program has defined additional mineralisation outside of the current resource block model and has identified intervals of above average resource grade.

In addition a program of trenching has been completed.  Six trenches have been dug across the main area of the prospect.  The trenches have been dug to a depth of approximately 1m and have exposed bedrock.  Outcrop in the Kauffmans area is poor and the trenching program has provided valuable geological data to support development of the geological model. The trenches were sampled and assayed on 1m intervals and have returned results of:

41m at 0.45g/t gold and 5.3g/t silver, including 3m at 1.27g/t gold and 8.6g/t silver in KTR1

32m at 0.58g/t gold and 5.7g/t silver, including 3m at 1.7g/t gold and 13.8g/t silver in KTR2

8m at 1.48g/t gold and 12.1g/t silver, including 1m at 6.12g/t gold and 12.3g/t silver in KTR3

25m at 0.76g/t gold and 12.3g/t silver, including 1m at 2.39g/t gold and 90.0g/t silver in KTR4

The wider trench intercepts are consistent with the resource block model and geological model, and it is particularly encouraging to see higher grade intercepts being defined.

The Kauffman's drilling program in ongoing and further results will be provided as they are received and interpreted.

Planning for drilling at nearby prospects is in progress.

The 3-D IP survey at Rannes is well advanced and results of the survey to date, covering Kauffmans, Porcupine, and other prospects, are due to be interpreted in late June and will contribute to the immediate drill targeting program.

A systematic soil sampling program is also in progress and is focused on areas close to already identified mineralised prospects and will also contribute to the definition of new drill targets.

By order of the Board

Karl Schlobohm

Company Secretary

Qualified Person

Information in this report relating to the exploration results, gold:silver ratios and cut-off grades is based on data reviewed by Mr Malcolm Norris (B.Sc. Hons, MSc), the Chief Executive Officer of the Company.  Mr Norris 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 Norris consents to the inclusion of the information in the form and context in which it appears.

Contacts:

Mr Karl Schlobohm                                                                                                         Tel: [phone]

SolGold Plc (Company Secretary)

[e-mail] 

Mr Ewan Leggat                                                                                                                Tel: [phone]

Fairfax I.S. PLC (Broker)

[e-mail] 

Mr Stephen Weir                                                                                                            Tel: [phone]

RFC Ambrian Limited (Nominated Advisor)

[e-mail] 

Mr Dominic Barretto                                                                                                      Tel: [phone]

Yellow Jersey PR (PR &IR)

[e-mail] 

NOTES TO EDITORS

SolGold's exploration projects are located in northern Ecuador,Queensland, Australia, and the Solomon Islands. In Australia, they comprise the Rannes, Mt Perry, Cracow West and Normanby Projects. In the Solomon Islands they comprise the Fauro Project (located on Fauro Island), and the Guadalcanal Joint Venture with Newmont Mining Corporation, and in Ecuador a JV with Cornerstone Capital Resources on the Cascabel gold-copper project.

In April 2012, SolGold andCornerstone Capital Resources Inc. announced that they had signed a binding Letter of Intent whereby SolGold may acquire up to 85% of Cornerstone's 100% owned 5,000 hectare Cascabel gold-copper-silver property in northern Ecuador.

The Cascabel projectis located approximately 120 km north of Ecuador's capital, Quito, 20 km south of the Colombian border, and 75 km inland from the coastal city of San Lorenzo. The gold-copper porphyry project is located within the Andean western cordillera, host to numerous Tier 1 world classcopper-gold deposits through Chile, Peru, Ecuador and Colombia.

At the Rannes project SolGold has announced 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 2012 exploration program, including drilling to define new ore positions and grow the resource, is underway.

Exploration continues at Mt. Perry, Normanby and Cracow West.

In the Solomon Islands, the 2012 exploration program on the Fauro project has been delayed while a JV partner is sought to pursue drilling of gold-copper targets defined in the 2011 exploration program. The 2012 Guadalcanal Joint Venture exploration program with NVL Solomon Islands Limited (a subsidiary of NYSE-listed Newmont Mining Corporation) is underway and includes drilling on highly prospective gold-copper porphyry targets.

SolGold's strategy is to be an integrated gold and copper discoverer, developer and miner.

SolGold's Board includes accomplished professionals with strong track records in the areas of exploration, mine development in Australasia and Melanesia, investment, finance and law.  Board and Management have significantly vested interests in the Company, holding approximately 16.3% of its issued share capital.

SolGold is based in Brisbane, Queensland, Australia.  The Company listed on London's Alternative Investment Market in 2006, under the AIM Code 'SOLG' and currently has 313,381,934 shares on issue and 11,264,000 options exercisable at 50p on issue.  Further details concerning the Company's key projects and personnel can be found at www.solgold.com.au 

 

END

 

 

DRLSEWSLSFESEEM