Amara Mining Regulatory News (AMA)

27 Nov 2008 16:03



Cluff Gold plc

("Cluff" or the "Company")

Baomahun Resource Update

CLUFF GOLD INCREASES MEASURED/INDICATED MINERAL RESOURCES AT BAOMAHUN, SIERRA LEONE, BY 21% TO OVER 1,000,000 OUNCES OF GOLD; TOTAL MINERAL RESOURCES INCLUDING INFERRED INCREASE TO 1,460,000 OUNCES OF GOLD

Cluff Gold (AIM - "CLF"), the West African Gold Mining Company, is pleased to announce the following updated JORC compliant Mineral Resource estimates at its Baomahun Gold Project in Sierra Leone:

Measured and Indicated Mineral Resources have increased by 21% to more than one million ounces of gold (10.50 million tonnes grading 3.1 g/t Au) 

Total Measured, Indicated and Inferred Mineral Resources have increased to 1,460,000 ounces of gold (14,640,000 tonnes grading 3.1 g/t Au)

Due to the encouraging higher grade deeper drilling results, a combined open pit and underground scoping study is to be undertaken

Longer mine life expected from the planned larger combined open pit and underground operation 

Metallurgical testwork now completed to feasibility stage level, indicates high gold recoveries using conventional milling processes with no adverse characteristics 

This increase in the Mineral Resources at Baomahun results from analysis of an additional 55 diamond drill core holes that has been completed since the previous Baomahun mineral resource determination (see the Company's press release dated 25 June 2008). 

Commenting on these results, Mr. Douglas Chikohora, Technical Director of Cluff Gold plc said, "We are encouraged with the progress at Baomahun. The higher confidence Measured and Indicated Resource categories have increased by 21% and now account for over 70% of the total resources. The higher grade mineralisation intersected at depth in holes such as DDH 228A which intersected 48 metres grading at 5.52 g/t Au from a vertical depth from surface of about 350m which was announced on 17th July 2008 have given an underground dimension to Baomahun. We have therefore decided to evaluate the potential of a combined open pit and underground operation with a much longer life. "

Table I below summarises the current Mineral Resource estimates at Baomahun, using a 1g/t Au cut off:

Baomahun Gold Project JORC Resource, November 2008

(Using a 1.0 g/t Au cut-off.

Tonnes and Ounces rounded to the nearest '000 )

Metallurgical testwork, which included recovery and comminution tests, has now been completed to feasibility stage level. Results obtained from these tests have confirmed preliminary earlier findings that high gold recoveries can be achieved using a conventional direct cyanidation processing method. Comminution test results show that the mineralised material at Baomahun to require conventional milling with only medium energy requirements.  

The Baomahun Gold Project covers an area of about 137 km sq and is located 180 kilometres east of Freetown, in the Southern Province of Sierra Leone. The Baomahun licence area covers more than 12 kilometres of prospective strike along the Kangari Hills which is composed of Archaean greenstone belt terrain consisting of banded iron formation (BIF)  Gold mineralisation in the drilled areas is intimately associated with the BIF and other lithologies in close proximity to the BIF. Accordingly, future exploration and drilling will continue to use the BIF as a marker horizon for auriferous zones along the belt.

Gold grades were estimated using ordinary kriging. The mineralisation models were constrained within the wireframe with primary block dimensions of 10 metres along the strike and cross structure directions, and 10 metres in the vertical direction. Higher-grade values have been statistically capped to between 20 g/t Au and 40 g/t Au based on the mineralized domain. The improved geological knowledge, coupled with the increased data density, the continuity of the mineralisation and the increased reliability of the database, have allowed resources to be classified with higher confidence. Tonnages and grades are reported using a 1.0 g/t Au cut-off. 

Drill cores used for assaying were sampled at a maximum of one metre intervals and were cut with a diamond saw with one-half of the core placed in sealed bags and sent to Alex Stuart preparation facility in Baomahun, Sierra Leone. The core samples were then crushed with half the sample then being pulverised down to minus 75 microns. A portion of the pulverised sample was then shipped to the SGS Laboratory (which is independent of the Company) in Guenea where the samples were analysed for gold by fire assay using a 50 g sample. As part of the Company's QA/QC procedures, internationally recognized standards, duplicates and blanks were inserted into the sample batches.

The Mineral Resource estimates disclosed in this announcement have been prepared in accordance with the 2004 edition of the "Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (JORC Code)" and have been carried out on behalf of the Company by Andrew Owusu Asante who is a Member of Australian Institute of Mining and Metallurgy (AusIMM). Mr Asante has reviewed and approved the contents of this announcement.

Douglas D Chikohora has reviewed and approved the information contained in this announcement. Douglas D Chikohora, Msc, (MIMMM, CEng) is Technical Director of the Company.

For further information, please contact:

 Cluff Gold plc 

 J.G. Cluff/Douglas Chikohora

 Tel: +44 (0) 20 7340 9790

W H Ireland

David Youngman/Katy Mitchell

Tel: +44 (0) 161 832 6644

Farm Street Communications

Simon Robinson / Ana Ribeiro

Tel: +44 (0) 7887985671 / +44 (0) 07980 321505

Notes to Editors:

About Cluff Gold

Cluff Gold plc is focused on the identification, acquisition and development of gold deposits in West Africa that are amenable to open-pit mining and low cost production techniques.

The Company has made significant progress since its admission to AIM in December 2004, increasing gold resources across its projects, expanding the project portfolio and broadening the investor base to an increasingly international audience.

BAOMAHUN, SIERRA LEONE

The Baomahun Gold Project covers an area of about 137 km2 and is located about 180 kilometres east of Freetown, in the Southern Province of Sierra Leone. The geological setting is similar to the Lake Victoria goldfields in Tanzania.

The Baomahun licence area covers more than 12 kilometres of prospective strike along the Kangari Hills which is composed of Archaean greenstone belt terrain consisting of banded iron formation (BIF) Gold mineralisation in the drilled areas is intimately associated with the BIF and other lithologies in close proximity to the BIF. Accordingly, future exploration and drilling will continue to use the BIF as a marker horizon for auriferous zones along the belt.

A measured and indicated JORC compliant mineral resource of 867,000 ounces of gold (8,933,000 tonnes grading 2.9 g/t Au) and inferred JORC compliant mineral resource of 486,000 ounces of gold (5,083,000 tonnes grading 3.0 g/t Au). A total JORC compliant mineral resource (measured, indicated and inferred) of 1,353,000 ounces of gold (14,016,000 tonnes grading 3.0 g/t Au) has so far been delineated.

On 17 July 2008, the Company announced that the Government of Sierra Leone had granted Baomahun Gold Limited, a 100 per cent owned subsidiary of the Company, a Mining Lease for 25 years over an area of 59.85sq kilometres.

Cluff Gold now holds 100 per cent of the Baomahun Gold Project. Cluff Gold announced on 4 August 2008 that it had acquired the outstanding 40 per cent interest in the project for US$21.8 million which was satisfied by the issue of 12,390,909 ordinary shares in the Company. 

Mt. Yaoure, Cote d'Ivoire

The Mt. Yaoure permit is located 40km northwest of Yamoussoukro, the political capital of Cote d'Ivoire, and covers a surface area of 417km(2) including a 50

km2 mining permit. The licence area includes the Angovia gold mine which operated between 1998 and 2003. The mine reportedly produced over 180,000 ounces of gold during this period by heap leaching some 2 million tonnes of oxide material. The infrastructure in the area is good and includes a hydroelectric dam six kilometres from the Angovia mine site. A measured and indicated JORC resource of 451 000 ounces and an inferred JORC resource of 44 000 ounces has so far been delineated.

Recently, the company announced the commencement of gold production at Angovia at an annualized rate of 40 000 ounces of gold by the end of this year.

Kalsaka, Burkina Faso

Kalsaka is located approximately 150km north west of Ouagadougou, the capital of Burkina Faso. A measured and indicated JORC resource of 634 000 ounces and inferred JORC resource of 157 000 ounces has been delineated so far. The resource has been demonstrated, by a feasibility study, to be technically amenable to open-pit mining and processing via heap leaching. Water, environmental and mining permits for the project have been granted. The mining permit is valid for twenty years.

Recently, the company announced the commencement of gold production at Kalsaka at an annualized rate of 60 000 ounces of gold by the end of this year.