Ovoca Bio Regulatory News (OVB)

8 Feb 2007 07:30

Ovoca Gold PLC08 February 2007 Ovoca Gold Plc ("Ovoca") Ovoca Announces Positive Initial Phase of Bankable Feasibility Study Results onthe Goltsovoye Silver Project Ovoca Gold Plc (AIM: OVG; IEX:OVX) announces positive results of the BankableFeasibility Study Phase 1 Report, completed by Wardell Armstrong International(WAI) on the Goltsovoye Silver Deposit in Russia. Ovoca also announces theresults of the Goltsovoye diamond Drilling Programme which was part of the WAIReport. The Report includes a resource calculation in accordance with the JORC Code(2004), an initial mine plan and results of metallurgical testwork, processplant design alternatives, infrastructure design and environmental studies. Commenting on the Report, Leonid Skoptsov, CEO of Ovoca Gold said "We aredelighted with the results of Wardell Armstrong's work, which clearlydemonstrates that Goltsovoye is a truly world class asset with over seventymillion ounces of JORC classified silver resources at excellent grades. Giventhe current interest in the Russian silver mining sector and, as the Goltsovoyedeposit now moves towards the finalisation of the bankable feasibility study, itis easy to see the opportunity for Ovoca to be re-rated in the market as anear-term major silver producer." Silver Resources In total there are six known zones of silver mineralisation at Goltsovoye. In2005 a Russian C1+C2 classified resource was completed on two of these zonesusing a 150g/t silver cut-off grade and based on diamond drilling andunderground exploration development on 3 levels. WAI was commissioned to complete the Phase 1 of the Goltsovoye BankableFeasibility Study ("BFS") in June 2006, a major part of which was to calculateresources to JORC Code (2004) sufficient for the Phase 2 BFS. A twenty fivedrill hole programme to confirm and compliment the previous work has beencompleted and the results from all of these holes have been included in the JORCResource calculation. Goltsovoye Project - JORC (2004) Classified Resources - February 2007 Category Tonnage Silver Grade Lead Grade Silver Metal Silver Equiv g/t % Ounces OuncesZone 1 Measured 334,000 1,293.4 2.55 13,891,000 15,112,000 Indicated 1,027,000 927.0 2.83 30,611,000 34,775,000 Inferred 128,000 601.6 4.69 2,476,000 3,336,000Zone 2 Indicated 116,000 715.5 2.60 2,669,000 3,102,000 Inferred 792,000 760.1 2.24 19,357,000 21,899,000Total 2,397,000 895.3 2.69 69,004,000 78,224,000 Source: WAI Resources Calculated using lead price $0.65/lb and silver $10/oz These results compare favourably with the 2005 C1+C2 resource, using the same150 g/t cut-off grade. Category Tonnage Silver Grade Lead Grade Silver Metal g/t % Ounces C1+C2 2,480,000 934 3.16 74,300,320 WAI state that an analysis of the assay data from diamond drilling and fromunderground development would indicate that silver values may have beenunderstated in the drill holes due to silver losses in the drill core andfurther, that an increase in the resource grade of 20% to 25% is possible duringmining. In addition to the resources in Zones 1 and 2, WAI include inferred resources indump material from the underground exploration development and a furtherunaudited Russian P1 resource in four other zones at Goltsovoye. These aresummarised below. Goltsovoye Project - Other Inferred Resources Category Tonnage Silver Grade (g/t) Silver Metal (ozs) Dumps Inferred 64,500 238.0 493,700 4 other zones Russian P1 1,600,000 440.0 22,634,000 The Mine The initial mine design is based on the measured and indicated resources in Zone1 only. Mine access is envisaged by adits because the majority of Zone 1resources are above the valley floor. All primary development will be tracklessusing 6 main haulage levels at 60 metre intervals and all ore will exit the minevia adits on the 900m and 810m elevations and trucked directly to the processplant. The majority of the ore will be extracted in 8 metre wide stope panelsand ore recovery is expected to be 85% and dilution 5%. The Process Plant After crushing and grinding the process plant design consist of an initialsilver/lead concentrate from a gravity circuit followed by flotation and thecyanidation of the tailings. Metallurgical testwork indicates that 73.4% of thesilver and 77% of the lead can be recovered in the concentrate with aconcentrate grade of 35% lead and 12,093 g/t silver. Leaching the flotationtailings shows a further recovery of 17% of the silver with total silverrecovery of 90.06%. The mill site has been selected and a system of drytailings disposal is proposed. Infrastructure Power will supplied either by building a 35 kilometre power line or from on-sitegeneration. A mine camp will accommodate 300 people working on 2-week rotation 7-days aweek. A single building will house the mine offices, mine change house,maintenance workshops, warehouse and administration block. The assay office,boiler room and power station will be located within the process plant building. Environment WAI has been working alongside the local Ecological Contractors in Magadan inthe preparation of the environmental impact assessment (EIA) for the BFS and forthe preparation of a similar report for State requirements known as OVOS. Oncethe final engineering design is complete in Phase 2 of the BFS the EIA can becompleted and submitted for approval. Phase 2: BFS Ovoca is currently assessing quotations for the completion of the Phase 2 BFSReport and will be working to make up the delay in completing the Phase 1 Reportduring the course of the projects development. Drilling Results The following table contains the final results from the previously announceddrilling programme at Goltsovoye, which was completed in December 2006. Borehole Interval Length Silver Zone 1 From (metres) To Grammes Ounces per (metres) (metres) per tonne tonne GDA-12 56.8 61.1 4.3 284 9.13 Including ** 56.8 58.8 2 493 15.85 GDA-12 143.4 149 5.6 219 7.04 GDA-11 200.7 202.8 2.1 149 4.79 GDA-10 ** 81.5 83.3 1.8 874 28.10 Including ** 82.6 83.3 0.7 1,891 60.79 GDA-10 90 94.6 4.6 946 30.41 Including ** 91.5 92.5 1 3,942 126.74 GDA-10 ** 139.3 140.5 1.2 731 23.50 GDA-9 26.6 35.6 9 741 23.82 Including ** 26.6 27.6 1 1,609 51.73 Including ** 29.6 30.6 1 2,152 69.19 Including ** 31.8 32.6 0.8 1,201 38.61 GDA-9 ** 39.6 43.6 4 2,857 91.85 Including ** 39.6 40.6 1 10,031 322.50 GDA-9 55.8 56.8 1 847 27.23 GDA-9 ** 65.5 66.5 1 1,335 42.92 GDA-9 73.6 74.6 1 194 6.24 GDA-8 ** 102.5 105.35 2.85 2,972 95.55 Including ** 102.5 104 1.5 1,622 52.15 Including ** 104.95 105.35 0.4 15,057 484.09 GDA-13 ** 78 79 1 851 27.36 GDA-13 ** 120 122 2 1,684 54.12 GDA-13 ** 125 129.5 4.5 1,408 45.26 Including ** 126.3 127.3 1 3,710 119.28 Including ** 128.5 129.5 1 1,230 39.54 GDA-1 71.5 72.6 1.1 374 12.02 GDA-1 88 90 2 300 9.63 GDA-1 ** 100 100.5 0.5 1,022 32.86 GDA-6A 51.5 52.6 1.1 889 28.58 GDA-6A 102.6 103.1 0.5 1,096 35.24 GDA-7 14 14.5 0.5 653 20.99 GDA-7 22.2 22.8 0.6 715 22.99 GDA-7 36.5 39 2.5 355 11.41 Including 38.5 39 0.5 1,063 34.18 GDA-7 40.8 41.5 0.7 916 29.45 GDA-4 64 65 1 639 20.54 GDA-3 38.3 38.8 0.5 1,804 58.00 GDA-3 120 121 1 1,442 46.36 GDA-3 137.4 139 1.6 831 26.72 Including 137.4 138 0.6 1,990 63.98 GDA-2 71.4 73.7 2.3 306 9.84 GDA-2 107 108 1 194 6.24 Total Zone 1* 62.85 948 30.48 Borehole Interval Length Silver Zone 2 From (metres) To Grammes Ounces per (metres) (metres) per tonne tonne GDB-5 111.5 113.5 2 1,601 51.48 Including 113 113.5 0.5 5,364 172.45 GDB-4 150 153.5 3.5 568 18.25 Including 152 152.8 0.8 1,710 54.98 GDB-6 213 213.6 0.6 231 7.43 GDB-7 145 145.5 0.5 673 21.64 GDB-8 75.4 76 0.6 160 5.14 GDB-11 57.1 57.6 0.5 275 8.84 GDB-9 45.4 46 0.6 315 10.13 GDB-9 220.4 221 0.6 4,520 145.32 GDB-12 48.7 52.5 3.8 312 10.02 Including 50 50.5 0.5 937 30.12 Total Zone 2* 12.7 786 25.27 Total Deposit* 75.55 921 29.61 * Silver grade - weighted average** Result previously reported The above information has been reviewed and verified by Roger Turner, Director and Chairman of Ovoca, for the purposes of the Guidance Note for Mining, Oil and Gas Companies issued by the London Stock Exchange in March 2006. Mr. Turner, with 40 years of mining engineering, management and consulting experience, graduated as a mining engineer from the Camborne School of Mines, has an MSc degree in Economic Geology from Leicester University and is a member in good standing with the Institute of Materials, Mining and Metallurgy and a UK Chartered Engineer. Glossary:Adit A tunnel usually close to horizontal and driven into a hillside from surface for the purpose of access to an ore body. Stope The area of an ore body that is actively being mined or has been mined and the ore removed. Interval Measured length of core from top of hole along the length of the hole Ovoca Gold Plc is an international exploration company quoted in London (OVG.L) and Dublin (OVX.IR), exploring for precious and base metals in Russia, Sweden and Ireland For further information please visit www.ovocagold.com or contact: Simon Beardsmore, Commercial Manager - Nick Bias / Alex Buck - Buck Bias (UK PR)Ovoca Gold Plc Tel: +44 (0)7887 920 530 / +44 (0)7932 740 452Tel: +44 (0)207 397 8159 Email: nick@buckbias.com / alex@buckbias.comEmail: simon.beardsmore@ovocagold.com John Frain - Davy Richard Chase- Ambrian (AIM Broker) Tel: +353 (0)1 679 6363 +44 (0)207 776 6461 Email: john.frain@davy.ie Email: richard.chase@ambrian.com This information is provided by RNS The company news service from the London Stock Exchange