15th Jun 2009 09:47
For immediate release 15 June 2009
ALLIED GOLD LIMITED
("ALLIED" OR "THE COMPANY")
ALLIED GOLD ORE RESERVES EXCEED 1 MILLION OUNCES
AN INCREASE OF 437,000 OUNCES EXTENDS MINE LIFE TO 10 YEARS
Highlights
Simberi Ore Reserves increased by 437,000 contained ounces of gold including:
Sorowar oxide Ore Reserves have increased by 76,000 contained ounces of gold
Pigiput Ore Reserves have increased by 361,000 contained ounces of gold of which approximately 185,000 contained ounces occur in oxide and transitional material
The Ore Reserves has contributed approximately 2 additional year's production, resulting in a total remaining mine life of 10 years
GR Engineering Services has been appointed to undertake a study to increase plant throughput to 3 million tonnes per annum.
This Ore Reserve estimation at Pigiput resulted in the inclusion of sulphide ores, which are currently being infill drilled to expand the reserves as part of the sulphide development program.
Sorowar
Reverse circulation and diamond core drilling carried out in 2008 at the Sorowar deposit identified additional gold mineralisation to the north west, west and south east of the existing 2008 Ore Reserve pit. The results of this drilling were reported as a resource update in a release dated 24th October 2008. The drilling resulted in an increase in the Sorowar Measured, Indicated and Inferred Resources of 611,000 contained ounces of gold.
An updated Ore Reserve estimate for the Sorowar deposit has recently been completed by Golder Associates and resulted in an additional Proved and Probable Ore Reserves of 76,000 contained ounces of gold.
Additionally, in-pit Inferred Resources were estimated to be approximately 18koz of contained gold from 610kt at a grade of 0.92g/t.
Although the new Ore Reserves represent a modest increase, the expansion of the pit footprint will allow easier access for future near-pit exploration. Previous exploration drilling has been restricted by the very steep terrain at Sorowar and this has resulted in some areas being untested by drilling, including the North-West and South-East areas.
Pigiput
Reverse circulation and diamond drilling carried out at Pigiput in 2008 (and in particular in the area known as Pigiput East) resulted in an increase in Indicated and Inferred oxide Resources of 177,000 contained ounces of gold. This was previously reported in Allied Gold's March 2009 quarterly report, dated 29th April 2009.
Resource drilling at Pigiput has continued this year, targeting oxide and sulphide mineralisation. This drill programme is expected to be completed in the third quarter of 2009. The current drill programme has been accelerated by utilising a fleet of 5 drill rigs and with approximately 11,500 metres of drilling planned. This programme will provide sufficient sample density to convert a proportion of the Mineral Resources into Ore Reserves, with particular focus on the sulphides.
An interim Pigiput resource update was recently completed by Golder Associates, resulting in a significant increase in Mineral Resources, as reported in a previous release dated 20th May 2009. There has been a substantial increase in the Indicated and Inferred sulphide Resources as a result of deeper, down dip drilling, inclusion of additional sulphide intersections from holes drilled after 2004 and a change in the sulphide grade estimation methodology from the previous Distance Weighted method to Ordinary Kriging. Also the previous Inferred sulphide Resources were reported above a 1.6g/t gold cut-off grade, while the current resource estimates are reported above a 0.5g/t cut-off grade.
The Company has had Golder Associates complete an Ore Reserve estimate for the Pigiput deposit which included sulphide material, and the results are shown in the full ASX announcement included as a link to this announcement. Additionally, in-pit Inferred Resources were estimated to be 37Koz of contained gold from 690kt at a grade of 1.69g/t.
This is the first time that sulphide Ore Reserves have been reported for the Pigiput deposit. Previously, sulphide Resource estimates for Pigiput were all classed as Inferred Resources and therefore did not qualify for conversion to Ore Reserves, as per JORC code requirements. The current sulphide Ore Reserves have been restricted to Probable Reserve classification while investigation of sulphide treatment is still being refined.
Approximately 20% of the Indicated sulphide Resources has been converted into this initial Ore Reserve. The current Pigiput drill programme is focused on infill and down dip drilling and will increase the drill density in areas where the current resources are classified as Inferred. Metallurgical testwork currently being undertaken will assist in the appropriate process route being identified and costed. This will support further categorisation of Resources into Indicated and Measured.
Therefore, the additional Ore Reserves for Sorowar (includes oxide and minor transitional and sulphide ores) and the oxide and transitional Ore Reserves for Pigiput deposits, combined is approximately 261,000 contained gold ounces. Combined in-pit inferred mineral resources for Sorowar and Pigiput is approximately 55,000 contained gold ounces.
These additional oxide and transitional Ore Reserves and in-pit Mineral Resources has underpinned future expansion of the oxide process facility from the current 2Mtpa capacity to 3Mtpa throughput.
Perth engineering firm GR Engineering Services and metallurgical consultants Battery Limits, have been appointed to carry out a plant debottlenecking and expansion study to achieve nameplate throughput of 3Mtpa to ensure average annual gold production exceeds 100,000 ounces. The study will be completed in the third quarter 2009.
The full version of the ASX announcement is available from the Company's website, www.allied.com.au and as a link to the announcement:
http://www.rns-pdf.londonstockexchange.com/rns/8814T_-2009-6-15.pdf
For more information:
|
Mark Caruso Executive Chairman |
T:+61 7 93252 5911 |
|
Roland Cornish Beaumont Cornish Limited |
T: +44 (0) 20 7628 3396 |
Competent Persons
The information in this Stock Exchange Announcement that relates to project financial modelling, mining, exploration and metallurgical results, together with any related assessments and interpretations, has been approved for release by Mr. R. Hastings, MSc, BSc. M.Aus.I.M.M., a qualified geologist and full-time employee of the Company. Mr Hastings has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the "Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves". Mr Hastings consents to the inclusion of the information contained in this ASX release in the form and context in which it appears
The information in this Stock Exchange Announcement that relates to Ore Reserves has been compiled by Mr J Battista of Golder Associates who is a Member of the Australasian Institute of Mining and Metallurgy. Mr Battista has had sufficient experience in Ore Reserve estimation relevant to the style of mineralisation and type of deposit under consideration to qualify as a Competent Person as defined in the 2004 Edition of the "Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves". Mr Battista consents to the inclusion of the information contained in this ASX release in the form and context in which it appears.
Forward-Looking Statements
This press release contains forward-looking statements concerning the projects owned by Allied Gold. Statements concerning mineral reserves and resources may also be deemed to be forward-looking statements in that they involve estimates, based on certain assumptions, of the mineralisation that will be found if and when a deposit is developed and mined. Forward-looking statements are not statements of historical fact, and actual events or results may differ materially from those described in the forward-looking statements, as the result of a variety of risks, uncertainties and other factors, involved in the mining industry generally and the particular properties in which Allied has an interest, such as fluctuation in gold prices; uncertainties involved in interpreting drilling results and other tests; the uncertainty of financial projections and cost estimates; the possibility of cost overruns, accidents, strikes, delays and other problems in development projects, the uncertain availability of financing and uncertainties as to terms of any financings completed; uncertainties relating to environmental risks and government approvals, and possible political instability or changes in government policy in jurisdictions in which properties are located.
Forward-looking statements are based on management's beliefs, opinions and estimates as of the date they are made, and no obligation is assumed to update forward-looking statements if these beliefs, opinions or estimates should change or to reflect other future developments.
Not an offer of securities or solicitation of a proxy
This communication is not a solicitation of a proxy from any security holder of Allied Gold, nor is this communication an offer to purchase or a solicitation to sell securities. Any offer will be made only through an information circular or proxy statement or similar document. Investors and security holders are strongly advised to read such document regarding the proposed business combination referred to in this communication, if and when such document is filed and becomes available, because it will contain important information. Any such document would be filed by Allied Gold with the Australian Securities and Investments Commission, the Australian Stock Exchange and with the U.S. Securities and Exchange Commission (SEC).
The technical information in the Announcement was prepared under the "Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves" (JORC).
Glossary of terms used in the Announcement:
19. A 'Mineral Resource' is a concentration or occurrence of material of intrinsic economic interest in or on the Earth's crust in such form, quality and quantity that there are reasonable prospects for eventual economic extraction. The location, quantity, grade, geological characteristics and continuity of a Mineral Resource are known, estimated or interpreted from specific geological evidence and knowledge. Mineral Resources are sub-divided, in order of increasing geological confidence, into Inferred, Indicated and Measured categories.
20. An 'Inferred Mineral Resource' is that part of a Mineral Resource for which tonnage, grade and mineral content can be estimated with a low level of confidence. It is inferred from geological evidence and assumed but not verified geological and/or grade continuity. It is based on information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes which may be limited or of uncertain quality and reliability.
21. An 'Indicated Mineral Resource' is that part of a Mineral Resource for which tonnage, densities, shape, physical characteristics, grade and mineral content can be estimated with a reasonable level of confidence. It is based on exploration, sampling and testing information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes. The locations are too widely or inappropriately spaced to confirm geological and/or grade continuity but are spaced closely enough for continuity to be assumed.
22. A 'Measured Mineral Resource' is that part of a Mineral Resource for which tonnage, densities, shape, physical characteristics, grade and mineral content can be estimated with a high level of confidence. It is based on detailed and reliable exploration, sampling and testing information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes. The locations are spaced closely enough to confirm geological and grade continuity.
Tonnage - An expression of the amount of material of interest irrespective of the units of measurement (which should be stated when figures are reported)
Grade - Any physical or chemical measurement of the characteristics of the
Analysis (Value) material of interest in samples or product
Cut off grade - The lowest grade, or quality, of mineralised material that qualifies as economically mineable and available in a given deposit. May be defined on the basis of economic evaluation, or on physical or chemical attributes that define an acceptable product specification
Mineralisation - Any single mineral or combination of minerals occurring in a mass, or deposit, of economic interest
Others
Assay - The proportion of a particular metal (eg Au and Ag) in a sample derived by laboratory analytical techniques.
Analysis limits of detection for Au is
Simberi mineralisation types are:
Oxide - extremely weathered material (cyanide leach recoveries > 90%), 0.5 g/t Au cutoff
Transitional - distinctly weathered material (cyanide leach recoveries 50-90%), 0.5 g/t Au cutoff
Sulphide - Slightly weathered to fresh material (cyanide leach recoveries generally
Ounce - 1 troy ounce = 31.10348 grams
Tonnes - Are estimated on a dry basis and defined as a measurement of mass equal to 1000kg which is equivalent to 2204.622 pounds.
Mineral Resource estimate - An estimate of tonnage and grade (mineral content) of a deposit by a variety of techniques including geometrical classical methods and or geostatistical methods.
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