Azumah Resources Limited - March Quarter 2012 Operations Report
Resources Increased
New Mineralisation Discovered
A$20M Exploration Commitment
ASX Code - AZM
TSX Code - AZR
www.azumahresources.com.au
Investment Highlights:
-- NI 43-101 and JORC Code reportable 1.02Moz Measured &
Indicated and 0.66Moz Inferred Mineral Resource at Wa Gold
Project, NW Ghana
-- 100% of 3,100km2 licences hosting over 150km of prospective
Birimian greenstone belt. Less than 10% effectively explored
-- Feasibility Study nearly completed for multi-pit, +1.0Mtpa,
~100,000oz per year mining and gravity / CIL operation
-- Aggressive $20M, 2012 drilling programme focused on resource
discovery and increase
-- 17% strategic investment in neighbour, Castle Minerals Limited
-- Board and management team of successful explorers, mining and
corporate professionals
Issued Capital:
333.6M ordinary shares
9.5M unlisted options
2.0M performance rights
Directors & Management:
Chairman:
Michael Atkins
Managing Director:
Stephen Stone
Non-Executive Director:
Geoff M Jones
Company Secretary:
Dennis Wilkins
TORONTO, April 23, 2012 /CNW/ -
-- IncreasedMeasured and Indicated Resource by 57% to 1,016,000oz
Au and Inferred Resource by 27% to 659,000oz Au
-- Confirmedthat all key deposits include shallow, higher grade
mineralisation to support annual production head grades of
+/-2.0g/t Au
-- Successfully tested for mineralisation at 1.5km Aduane
anomalous gold trend between the Kunche and Bepkong flagship
deposits
-- Commenceddrilling to investigate mineralisation below current
Kunche and Bepkong resources
-- Advancedseveral new targets towards drill status
-- Committed$20M to 2012 resource discovery and expansion focused
exploration programme
-- Installedon-site sample prep laboratory to reduce assay
turnaround times
-- Advancedthe Wa Gold Project Feasibility Study
-- Increasedstrategic shareholding in neighbour, Castle Minerals
Limited, to 17%
-- CompletedC$20M capital raising
-- Cashand listed investments at end of Quarter of $30.2M
West African gold explorer and developer Azumah Resources Limited
is pleased to advise that excellent progress was made on several key fronts during the March 2012 Quarter at its Wa Gold Project, northwest Ghana.This included increases in the quantum of and confidence in JORC and NI 43-101 compliant gold Mineral Resources to over 1.0Moz Measured and Indicated and 0.7Moz Inferred, strong indications of the presence of mineralisation between its two adjacent flagship deposits and several new targets being advanced towards drill status.
Reserves are scheduled to be completed in the June Quarter ahead of the completion of Azumah's Feasibility Study for an initial ~100,000oz per year gold operation scheduled to be commissioned in early 2014.
Azumah has also installed and is about to commission an on-site sample preparation facility that will substantially reduce assay turnaround cycles that last year caused major delays in resource finalisation, exploration progress and feasibility schedules.
Resource increase at Wa Gold Project
The Mineral Resource update was the culmination of an extensive infill drilling programme in 2011 undertaken to provide greater confidence and understanding of material within and adjacent to planned pits.
The new resource provides a strong foundation for the estimation of reserves as part of the Feasibility Study for the Wa Gold Project.
The Mineral Resource increase (refer ASX release dated 12(th) March 2012) (Table 1) was due partly to exploration success during infill drilling that identified additional subsidiary lodes representing genuine new discoveries at all three key deposits, extensions to existing lodes and improved continuity.
The increase was also partly due to a reduction in cut-off grade to 0.5g/t Au. The previous cut-off grade was 1.0g/t Au for Kunche and Julie, and 0.8g/t Au for Bepkong.
2012 Resource Expansion Focus
Azumah has only effectively explored approximately 10% of its 3,100km² licence holdings that encompass over 150km of prospective Birimian greenstone terrain. The opportunity to increase resources is therefore considerable.
With completion of the infill drilling programme in late 2011, the focus of 2012 drilling has shifted almost entirely towards generating, defining and testing new resource targets and extending existing deposits.
The Company has committed $20 million to this new exploration focus and presently has five drill rigs in operation, including three multipurpose (diamond and RC) rigs that operate 24 hours a day. These are managed by 18 site geologists supported by over 100 technicians and other personnel operating from a fully serviced exploration headquarters established at Kalsegra plus satellite bases at Julie and Lawra.
Results from drilling testing a 1.5km gold-in-soil anomaly along the Aduane trend between the flagship Kunche and Bepkong deposits, that presently host 630,000oz gold (Measured and Indicated) and 395,000oz gold (Inferred), support the likelihood of Azumah delineating additional shallow, open-pitable resources close to the proposed location of the Wa Gold Project processing plant adjacent to Kunche (Refer ASX release dated 28(th) February 2012).
The current interpretation is that these deposits are most likely part of a larger system of interconnected mineralised structures. Intersections reported included:
-- 3m @ 9.17g/t Au from 27m (BRC321)
-- 10m @ 4.43g/t Au from 140m (BRC315)
-- 4m @ 4.43g/t Au from 43m (BRC317)
-- 8m @ 4.18g/t Au from 40m (BRC329)*
-- 6m @ 2.78g/t Au from 23m (BRC361)
-- 4m @ 10.33g/t Au from 47m (KRC593)
-- 14m @ 2.15g/t Au from 62m (KRC600)
-- 4m @ 9.34g/t Au from 20m (KRC648)*
(*4m composited samples)
A new phase of RC and diamond core drilling has commenced to evaluate the continuity of the mineralisation along the main 'Aduane trend'.
A series of deeper holes to ~200m vertical depth at Kunche and Bepkong and to 100m depth at Julie has just been completed. These were aimed at testing depth extensions of each deposit and to better understand the mineralisation geometry of high grade zones. Subject to results, an increase to the recent Mineral Resource update is considered likely. Results are awaited.
The shallow dipping Julie deposit has only been drill tested to an average depth of 55m with many areas of the 6km east-west trending Julie mineralised structure yet to be evaluated. Drilling has commenced to test for extensions of the deposit along strike and down dip.
Other targets being advanced for drill testing in the 100km north-south trending 'Kunche Corridor' include Basabli, Duri, Atikpi and Yagha (North and South). At Wa East targets at Collette, Kjersti and Josephine are being reviewed.
During the Quarter, the company completed 70,437m (1,128 holes) of drilling, including 22,829 m (280 holes) of RC, 4,851 m (20 holes) of diamond/RC core and 42,757 m (828 holes) of air core. A total of 23,481 samples were collected/prepared for assay submission and as at the end of the reporting period, a total of 10,611 assays remained outstanding.
Mineral Reserves, Feasibility Study and Project Development
Azumah continues to fast track the development of the Wa Gold Project that it is currently scheduling to come on stream in early 2014.
During the March Quarter, the Feasibility Study for the development and financing of the Wa Gold Project was advanced in several key areas. Its completion will follow finalisation of the Mineral Reserves and several other inputs.
Coffey Mining Pty Ltd, Perth, was appointed to undertake Mineral Reserve estimates based on the new resources model and Mineral Resource update released in March. The estimate of Mineral Reserves is expected to be completed in the June Quarter 2012.
Progress was also made in negotiations for the supply and installation of high voltage power lines to the vicinity of the project site.
Azumah has also commenced processes for the granting of mining licences and environmental approvals.
A number of alternatives for financing the project are being evaluated and preliminary discussions with several groups providing a range of facilities have commenced.
Completion of C$20m capital raising
Azumah is well positioned to meet its funding commitments with cash and listed investments of $30.2M as at the end of the Quarter.
This includes the proceeds from an offering of 50,405,000 ordinary shares at a price per share of C$0.40 to raise a total of C$20,162,000. The offering was conducted in Canada and attracted a number of new North American institutions as well as some prominent North American distribution groups and existing institutional shareholders. Casimir Capital Ltd and RBC Dominion Securities Inc. acted as joint lead managers and Argonaut Securities (Australia) and Canaccord BGF (Australia) as co-managers (Refer ASX release dated 27(th) March 2012).
At the end of the March Quarter Azumah had 333,614,095 ordinary shares on issue, 9,500,000 unlisted options and 2,000,000 performance rights.
Increases interest in Castle Minerals Limited
Azumah has investments in two listed entities. It holds 19,315,812 shares in Ghana neighbour, Castle Minerals Limited
, and during the Quarter increased its stake from 14.743% to 16.986% through the acquisition of 2,581,947 shares (refer ASX release dated 2(nd) March 2012). The additional shares were acquired through an issue of 1,188,739 Azumah shares.Azumah also has a holding of 2,547,615 shares in Endeavour Mining Corporation
. The Endeavour Mining shares are not a long term strategic holding.Change of principal place of business
During the March Quarter, Azumah's principal place of business changed to Unit 2, 11 Ventnor Avenue, West Perth. The company also relocated its Ghana office to 5 Kinshasa Street, East Legon, Accra.
June 2012 Quarter
During the June Quarter 2012, the Company expects to:
-- Complete Maiden Mineral Reserves estimates for the Wa Gold
Project
-- Receiveresults from deeper drilling at Kunche, Bepkong and
Julie
-- Completeanother phase of infill drilling at the Aduane -
Bepkong South geochemical anomaly
-- Advanceand test targets at several other prospects
-- Commissionits on-site sample preparation facility
-- Appoint an engineering group to commence front-end engineering
and design work for the Wa Gold Project
-- Progress infrastructure arrangements including power and water
supply
Full details of the ASX releases on which the above summary is based (inclusive of associated figures and drilling results) are available from the ASX at www.asx.com.au, on the Sedar website at www.sedar.com, or from Azumah's website at www.azumahresources.com.au.
For further information on Azumah Resources Limited and its projects please visit the Canadian SEDAR website and Azumah's own website at www.azumahresources.com.au
Table 1 - Summary of Wa Gold Project Mineral Resources - JORC & NI 43-101 Compliant
Measured Indicated Measured and Indicated Inferred
Tonnes Grade Gold Tonnes Grade Gold Tonnes Grade Gold Tonnes Grade Gold
(Mt) (g/t) (ozs) (Mt) (g/t) (ozs) (Mt) (g/t) (ozs) (Mt) (g/t) (ozs)
Kunche 3.17 1.94 198,000 4.95 1.52 242,000 8.13 1.68 440,000 7.35 1.33 315,000
Bepkong 2.02 1.81 117,000 1.67 1.36 73,000 3.69 1.60 190,000 1.98 1.32 84,000
Julie 7.92 1.52 386,000 7.92 1.52 386,000 3.74 1.51 181,000
Collette 1.69 1.45 79,000
Total 5.19 1.89 315,000 14.54 1.50 701,000 19.74 1.60 1,016,000 14.76 1.39 659,000
Competent Person's Statement
The information in this report that relates to Exploration Results is based on information compiled by Mr Nick Franey, who a full-time employee (General Manager Geology) of Azumah Resources Ltd. Mr Franey is a Member of the Australian Institute of Geoscientists and 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' and to qualify as a 'Qualified Person' as defined in National Instrument 43 -101 - Standards of Disclosure for Mineral Projects ('NI 43-101') of the Canadian Securities Administrators. Mr Franey consents to the inclusion in this report of the matters based on his information in the form and context in which it appears.
For a description of Azumah's standard data verification processes, quality assurance and quality control measures, and details of the key assumptions, parameters and methods used to estimate the Mineral Resources set out in this report and the extent to which the estimate of previously declared Mineral Resources set out herein may be materially affected by any known environmental, permitting, legal, title, taxation, socio-political, marketing or relevant issues, readers are directed to the technical report entitled 'NI 43-101 Azumah Resources Limited Wa Gold Project, North West Ghana', dated April 14, 2011. An updated NI43-101 technical report is in preparation.
Forward-Looking Statement
This release contains forward looking information. Such forward-looking information is often, but not always, identified by the use of words such as 'seek', 'anticipate', 'believe', 'plan', 'estimate', 'expect' and 'intend' and statements that an event or result 'may', 'will', 'should', 'could', or 'might' occur or to be achieved and any other similar expressions. In providing the forward-looking information in this news release, the Company has made numerous assumptions regarding: (i) the accuracy of exploration results received to date; (ii) anticipated costs and expenses; (iii) that the results of the feasibility study continue to be positive; and (iv) that future exploration results are as anticipated.
Management believes that these assumptions are reasonable. Forward-looking information is subject to known and unknown risks, uncertainties and other factors that could cause actual results to differ materially from those contained in the forward-looking information. Some of these risks, uncertainties and other factors are described under the heading 'Risks Factors' in the Company's annual information form available on www.sedar.com. Forward-looking information is based on estimates and opinions of management at the date the statements are made. Except as required by law, Azumah does not undertake any obligation to update forward-looking information even if circumstances or management's estimates or opinions should change. Readers should not place under reliance on forward-looking information and readers are advised to consider such forward-looking statements in light of the risks set forth in the Company's continuous disclosure filings as found at the (Canadian) SEDAR website.
SOURCE Azumah Resources Inc
Image with caption: 'Figure 1: Wa Gold Project - Key Deposits and Prospects (CNW Group/Azumah Resources Inc)'. Image available at: http://photos.newswire.ca/images/download/20120423_C8036_PHOTO_EN_12601.jpg
Azumah Resources Inc
CONTACT: For further information on the Wa Gold Project in general please
refer
to the Company's website at www.azumahresources.com.au and sedar.com
Stephen Stone
Managing Director
Tel: +61 (0) 418 804 564
stone@azumahresources.com.au
Nicole Harrison - Australia
NWR Communications
+61 (0) 451 184 148
nicole.harrison@nwrcommunications.com.au
Joanna Longo - North America
Terre Partners
+1 416 238 1414
Jlongo@terrepartners.com