Canal+ Regulatory News (CAN)

30 Jul 2007 07:01

Central African Gold PLC30 July 2007 Central African Gold Plc / Ticker: CAN / Market: AIM / Sub-sector: Gold Mining 30th July 2007 Central African Gold Plc ("CAG" or the "Company") Underground mineral resource estimate at Bibiani Main Zone increased by 288% to 2.68 million oz Au; total global mineral resources increased by 300% to 3.23 million oz Au Central African Gold Plc, the AIM traded gold mining and exploration company, ispleased to announce an increased revised mineral resource estimate followingdrilling and further evaluation at its Bibiani gold mine, Ghana. Highlights: • Bibiani main zone mineral resource estimate increases to 31.30 million tons ("Mt") at 2.66 g/t Au for 2.68 million oz Au at a cut off grade of 1.50 g/t Au (JORC compliant) • Within this mineral resource, Measured and Indicated Resources totalling 14.39Mt at 3.38 g/t Au for 1.56 million oz Au at a cut-off grade of 2.00 g/t Au have been estimated (JORC compliant) • The underground mineral resource upgrade represents a 300% increase on those stated in February 2007 (899 koz), inclusive of a 288% increase in Measured and Indicated (546 koz). • Structural modelling of the Main Zone orebody has established two principle structures controlling the gold mineralising structures • First phase of infill Diamond Core Drilling ("DD") from surface is in progress - to a depth of 350m below surface • Initial intersections from infill drilling have returned significant widths - up to 21m true width at grades up to 24 g/t Au • Mineralisation is open-ended along strike in both directions and down dip • The Reverse Circulation ("RC") drilling programme has been completed on satellite pits and other oxide targets on both the mining lease and Bibiani North prospecting licence, which will be reported in a separate announcement shortly • Surface exploration has identified five targets which have been prioritised for follow-up resource delineation Greg Hunter, CEO of CAG, commented, "This threefold increase in our undergroundresource estimate for the Bibiani orebody marks a great step in the developmentof the Bibiani gold mine and its value to the Company. The updated estimateconfirms our assessment during the due diligence period that the Main Zoneorebody will sustain a multi-million ounce deposit. The global undergroundresource estimate in excess of 2.5 million oz of gold grading 2.66 g/t Au,provides a good indication of the strong basis for sustainable mineral resourceto ore reserve conversion and increases our confidence in the potential for thedevelopment of an economically viable long-life underground mining operation.Future deeper drilling is planned, and we envisage a commensurate increase inIndicated mineral resources over the next six months. Additionally, our surfaceexploration activities are gathering momentum, and we have prioritised fivetargets for further mineral resource delineation drilling. There is no doubtthat the Bibiani properties will continue to provide new zones for exploitation,outside the main orebody, which clearly substantiates a significant goldmineralising system. "In essence Bibiani is well on its way to fulfilling its potential in providingus with a multi million oz gold resource. Our strategy of becoming a leadingmid-tier African gold producer with world class exploration and productionassets is, I believe, already becoming a reality." Background: The Bibiani gold mine has historically produced approximately four million oz Aufrom a combination of high-grade underground (1902-1967) and opencast(1997-2005) mining. The historic underground mining exploited various narrow(1-5metres) zones of mineralisation via three vertical shafts, and using acut-off grade of 7 g/t Au extracted approximately two million oz Au at anaverage recovered grade of nine g/t Au. The more recent opencast operationmined the broader mineralised "halo" (widths up to 100metres, but generally15-25metres) at an average recovered grade of 3.5 g/t Au. Approximately 1.7 moz Au were recovered from the Bibiani main pit with a number of smallersatellite pits and a tailings re-treatment operation further contributing to atotal of two million oz from the more recent operations. CAG is currently developing a mechanised long-hole open stoping operation belowthe main Bibiani open pit, initially through the extension of an existingdecline to Level 9. During Q3 2008 CAG will commission a 2.8km decline from therun of mine ("ROM") pad which will allow for both the conveyance of ore as wellas access for man and materials. The conveyor decline will have a design tonnagecapacity of 200,000 tons per month ("tpm"). CAG has contracted a small selectteam of experienced Australian and South African mining and engineeringpersonnel to spearhead the initial development phase of the mine. Certain bulkmining equipment is being commissioned underground at present. Initialunderground development has commenced, with stope cleanup planned for August2007 and initial stoping in September 2007. The Bibiani process plant (Lycopodium 1997) has a throughput capacity of 225,000tpm. Underground production is phased to achieve 100,000 tpm during Q3 2008. Thefavourable geology and drilling results are providing impetus to assessexpanding planned output to over 150,000 tpm. Surface exploration drilling Since CAG took over management of Bibiani in January 2007, a RC and DD programmehas progressed, testing extensions to the Main Zone Bibiani orebody andsatellite oxide pits. The satellite target drilling is still being fullyassessed and integrated with existing data, and results will be included in aseparate announcement. The infill drilling of the Main Zone Bibiani orebodycurrently in progress is providing positive results, which have beenincorporated into the revised mineral resource estimate. Summary intersectionsof four of five boreholes completed so far are given below, with down holeintersections corrected to true widths. Hole -ID From To Metres Act Metres Au g/tMPD 2 253.80 261.00 7.20 4.1 1.09 293.50 296.50 3.00 1.7 22.18 302.40 315.70 13.30 1.71 324.10 327.60 3.50 1.42 Stopped in stope MPD 26 300.00 340.60 40.60 21.0 8.31 Including 7.70 4.0 24.21 Including 19.80 10.2 5.28 MPD 31 377.30 395.40 18.10 9.7 2.35 Including 4.3 3.78 424.80 427.80 3.00 1.9 2.64 Stopped in stope MPD 32 341.90 358.00 16.10 8.9 2.64 Revised Mineral Resource estimation Snowden Mining Consultants ("Snowdens") have been retained by CAG to audit goldmineral resource estimations and where applicable ore reserves for input intothe Bibiani mine valuation model. The current resource statement work follows onfrom previous internal estimates undertaken by CAG using Surpac software. Underground Mineral Resources CAG has continued to refine first principle geologic modelling and mineralresource estimation on the main Bibiani ore body. The current resourceestimation is based on all available surface and underground boreholes as wellas over 570 metres of underground channel sampling. Modelling of the geologicalzones was achieved by sectional digitising of geological units and alterationzones, especially silicification, brecciation and sulphidation. The block modelestimation on this mineralised envelope was run using 1 metre down hole drillhole sample composites (total of 60,938 sample composites, minimum 0.0 andmaximum uncut 218.0 g/t Au). A top cut of 35 g/t Au has been applied to theresource data prior to estimation. Gold grades for the reported underground resource model have been determinedusing Ordinary Kriging ("OK") with grades interpolated into parent blocks withdimensions of five metres east by 15 metres north by 15 metres elevation. Thegold content estimation was constrained within a statistically derived wireframeimplying the 50% percentile probability of the grade being > 0.1 g/t Au. The recoverable resource estimates within each block have been classifiedaccording to the distribution of sampling in the OK neighbourhood, utilising acombination of the normalised variance, sample density and spatial continuity (>92.5% confidence Measured, 70-92.5% confidence Indicated, < 70% confidenceInferred). This classification scheme takes into account the uncertainty in theestimates related to the proximity and distribution of the informing composites.The revised estimation method also reflects more accurately the extent ofprevious workings (to 720 metres below surface) and a number of boreholeintersections around 800 metres below surface. For the purposes of this Mineral Resource statement (30 June 2007) theunderground mineral resources shown in the table below have been calculated frombelow the topographic surface and the pit shell to -600 metres vertical belowdatum (approximately 820 metres). The Measured and Indicated mineral resourcesare reported based on a 2 g/t Au cut-off grade. Inferred mineral resources arebased on the global resource at 1.5 g/t Au cut-off less the Measured andIndicated resources. BibianiUG Mineral Resources 2.00g/t cut off Kt Au g/t Au kozMeasured 4 343 3.33 465Indicated 10 046 3.40 1 097 14 389 3.38 1 562Inferred 1.50 g/t cut-offDiff Global - M&I 16 913 2.05 1 113Total 31 302 2.66 2 675 The underground mineral resources represent a 300% increase on those stated inFebruary 2007 (899 koz), inclusive of a 288% increase in Measured and Indicated(546 koz). The Measured and Indicated estimates are considered recoverable bymining, and Snowdens and Ukwasi Mining recommend application of ore loss anddilution factors in quantifying ore reserves. Surface Mineral Resources During 2007 CAG has continued to treat tailings. These mineral resources havebeen adjusted for depletion up to 30 June 2007. Certain inferred satellite pitresources stated in February 2007 remain unchanged. The combined surface mineralresources now total 18.22 Mt tons at 0.67 g/t Au for 393 koz Au. BIBIANI MINESURFACE MINERAL RESOURCES Kt Au g/t Au KozMeasuredSurf - Tailings (#1 & 2) 1 577 1.00 51Subtotal 1 577 1.00 51IndicatedSurf - Tailings (levee 1-6) 1 302 0.76 32Surf - Tailings New 15 000 0.57 275 0 0.00 0Subtotal 16 302 0.58 307TOTAL M & I 17 879 0.62 357InferredSurf - Sat opencast 339 3.24 35Subtotal 339 3.24 35TOTAL RESOURCES 18 218 0.67 392 Total Mineral Resources Mineral resources, including surface and underground, now total 50.80Mt tons at1.98 g/t Au for 3.23 million oz Au. TOTAL MINERAL RESOURCES Kt Au g/t Au KozMeasured 5 919 2.71 516Indicated 26 349 1.66 1404TOTAL M & I 32 268 1.85 1 920Inferred 18 537 2.19 1 307TOTAL RESOURCES 50 805 1.98 3 227 The resource estimates were undertaken internally by CAG, with guidance bySnowdens. Messrs Dale Richards, Frans Dooge and Phil Bentley (SACNASPaffiliated) who have more than 70 years combined experience in the geologicalmodelling of ore bodies and the use of geostatistics for the estimation ofrecoverable resources in gold deposits. For the purpose of reporting under theJORC code Phil Bentley, (CAG Head of Geology), is regarded as the CompetentPerson. Ore Reserves Ukwasi Mining is currently retained by CAG to carry out mine planning andscheduling based on the revised geological and resource model developed by CAG.This mining study is currently being finalised, and an Ore Reserve statement isanticipated during early August, which will include the modification of certainof the mineral resources to Ore Reserve category. * * ENDS * * For further information please contact or visit www.centralafricangold.com orcontact: Central African Gold Plc Greg Hunter Tel: +27 (0)82 882 4222 In London: St Brides Media & Finance LtdHugo de Salis/ Felicity Edwards Tel: +44 (0)20 7242 4477 Strand Partners LimitedSimon Raggett/Braden Saunders Tel: +44 (0)20 7409 3494 In South Africa:Central African GoldNicole Broome Tel: +27 11 676 2500 Mob: +27 83 601 1702 Russell and AssociatesCharmane Russell Tel: + 27 11 880 3924 Mob: + 27 82 372 5816 Notes to Editors: Central African Gold Plc, admitted to AIM in April 2004, was established toacquire gold assets with a geographical focus on Africa. The Company hasestablished a sound portfolio with projects in Ghana, Mali, Zimbabwe andBotswana. It has a highly experienced management team, which has worked togetherfor four years managing six underground greenstone gold mining operations andbuilding exploration portfolios. CAG's portfolio includes the producing Bibiani gold mine and prospectinglicences in Ghana, which it acquired from AngloGold Ashanti Limited, two jointventures in Mali covering 23 prospective permits and licences in Botswanacovering the extension of the Kraaipan greenstone belt from South Africa. CAGrecently acquired five mines and extensive exploration properties in Zimbabwe.The directors are evaluating additional prospects in Africa to establish CAG asa leading mid-tier African gold producer with world class exploration andproduction assets. This information is provided by RNS The company news service from the London Stock Exchange