Vatukoula Gold Mines plc – Surface Drilling Update and 2011 Gold Exploration Programme
Vatukoula Gold Mines Plc, the AIM listed (AIM:VGM) gold producer, is pleased to announce the commencement of the 2011 gold exploration and drilling programme at the Company’s 100% owned Vatukoula Gold Mine in Fiji.
- Three exploration campaigns planned for 2011, with a planned drilling total of 35,000m
- The Programme is targeting;
extension to existing as well as new surface oxide mineralisation,
underground high grade ore bodies adjacent to existing resources and
previously drilled exploration targets on the Company’s Special Prospecting Licenses
- Surface oxide drilling has commenced with 773m from 8 holes completed as of 13th January 2011
- Exploration activity on these deeper U/G targets is due to start mid- February 2011. The drill and associated back up equipment arrived in Fiji on 17th January 2011.
- First drill results expected in calendar Q2 2011
David Paxton, CEO of Vatukoula Gold Mines, commented:
"The new exploration programme is an essential part of our growth strategy at the Vatukoula Gold Mine. The exploration results will guide us in regards to the potential for expansion of the current operations and will also provide the mine geologists with valuable information on the Vatukoula orebody.
The combination of extensive historical mining data, minimal exploration over the last 20 years, and modern exploration techniques provides an exceptional opportunity for Vatukoula to make another discovery of economic mineralisation in the Tavua Caldera.
Exploration will be undertaken in an area adjacent to our world class mine in an area that has historically shown exciting potential. I remain up-beat with our future exploration programme and look forward to updating the market in due course.”
As announced on 20 September 2010, several exploration targets had been identified from the re-assessment of historical data coupled with recent surface mapping and sampling activities. (For a graphic representation of the exploration targets follow the link: here ).
Based on these targets the Company has designed three drilling programmes to run simultaneously across our 100% owned Mining and Special Prospecting Licenses (“SPL”).
1. Surface Oxide Exploration
The objective of the near surface exploration programme is to identify ore both within the mining lease and on the SPLs that may be suitable for open pit mining operations and milling using an oxide circuit.
The programme initially consists of targeting two areas within the current mining lease and one within the SPLs. These targets will be drilled at 100m spacing at an average depth of 80 - 90 metres. Dependant on the results from the initial programme further drilling will be carried out on 50m then 25 m spacing. We aim to drill up to 15,000m in 2011.
The Reverse Circulation (RC) exploration drilling program commenced in December 2010. As of 13th January 2011, 8 holes had been completed for a total of 773m with maximum depth being 100m. The first drill results for these holes are expected in the second calendar quarter of 2011.
Should the Company be successful in identifying sufficient mineral reserves from this drilling programme, it will look to supplement its target production of 100,000 ounces of gold per annum with material from these deposits.
2. Mine Envelope Exploration
Underground exploration will be undertaken to investigate mineralisation along strike and down dip of existing ore bodies. A number of exploration targets have been identified within the mine envelope that may have the potential to:
a) increase resources;
b) convert resources to reserves;
c) identify high grade areas; and
d) identify new economic structures.
The main targets of this drilling programme will be the Prince William and Prince Dolphin ore bodies (20.7 g/t Au, 9.1 g/t Au measured resource grades (August 2009), respectively) and the Matanagata ore body which has a measured resource grade (August 2009) of 21g/t.
The Company anticipates that this year the programme will involve up to 10,000m of drilling, which will be carried out by utilising currently owned rigs. Some surface exploration drilling will be considered at a later date.
3. Special Prospecting Licence Exploration
A number of exploration targets have been identified from previous exploration within the Prospecting leases. An area approximately 4 km north of the current Vatukoula mine has been targeted initially based on previous exploration drilling, and shallow mining in the 1940’s. Previous exploration in the area in the early 1990’s saw results including intercepts of 1m at 95.4 g/t and 17m at 30.08 g/t. In the 1960’s an exploration hole was drilled in this area and intersected three separate quartz horizons with significant gold mineralisation at depths of 525, 533, and 547 meters.
The initial drilling programme will focus on these targets and will be drilled by a surface diamond drill rig purchased for this programme. The Company expects that the initial programme will consist of 12 to 14 holes of approximately 700m to 800m in depth.
The diamond drilling rig and associated equipment has now arrived in Fiji and is expected to commence drilling in February 2011.
Qualified Person Kiran Morzaria B.Eng. (ACSM), MBA, has reviewed and approved the information contained in this announcement. Kiran holds a Bachelor of Engineering (Industrial Geology) from the Camborne School of Mines and an MBA (Finance) from CASS Business School. Kiran is the Finance Director of VGM.