TIDMAVM
RNS Number : 7612M
Avocet Mining PLC
22 August 2011
Immediate Release 22 August 2011
AVOCET MINING PLC
INATA GOLD RESOURCE INCREASES TO 3.36 MILLION OUNCES
Avocet Mining PLC ("Avocet" or "the Company") announces that the
Mineral Resource as reported to the 30 June 2011, for the Inata
mine license area has been updated to 3.36 million ounces. This
represents an increase of 1.24 million ounces, or 59 per cent, over
the previously published Mineral Resource of 2.12 million ounces,
at the same cut-off grade of 0.5 g/t Au. The new resource
represents an increase of 1.53 million ounces or 83 per cent,
excluding depletion of the resource due to mining since the
drilling programme commenced in October 2010.
Avocet's total Mineral Resources in West Africa have now more
than doubled from 2.36 million ounces at the time of the Company's
acquisition of these assets in 2009 to 5.03 million ounces across
the Company's assets in Burkina Faso and Guinea.
The table below reports the revised Inata Mineral Resource above
a 0.5 g/t Au cut off and beneath the 30 June 2011 topographic
surface in accordance with the Australian JORC Code. The Mineral
Resource has been estimated in accordance with the principles of
the Canadian NI 43-101 and Australian JORC Codes.
Measured 17,672,000 1.72 979,600 881,640
---------------------- ----------- ----- ---------- ----------
Indicated 36,101,000 1.35 1,561,800 1,405,620
---------------------- ----------- ----- ---------- ----------
Measured + Indicated 53,772,000 1.47 2,541,400 2,287,260
---------------------- ----------- ----- ---------- ----------
Inferred 17,663,000 1.45 822,900 740,610
---------------------- ----------- ----- ---------- ----------
Total 71,435,000 1.46 3,364,300 3,027,870
---------------------- ----------- ----- ---------- ----------
The Company owns 90% of Societe des Mines de Belahouro, owner of
the Inata gold mine.
Note: rounding errors may occur.
The updated Mineral Resource is the outcome from the first phase
of a major exploration programme that commenced in October 2010 to
define the extent of the gold mineralisation within the Inata mine
license area. The programme includes 438 reverse circulation drill
holes (61,245 metres) and 163 diamond drill holes (40,722 metres)
drilled and builds on the 123,957 metres of reverse circulation and
diamond drill holes historically completed.
Significant intercepts from this drill programme have been
reported throughout 2011. A further 9,000 metres of deep drilling
from the programme remains to be completed and approximately 16,000
assay results remain to be received. Once the outstanding drilling
has been completed and all assays received, a further update to the
Inata Mineral Resource will be announced. This is expected by the
end of 2011.
The updated Mineral Resource has been estimated in consultation
with CSA Global Pty Ltd ("CSA") at its office in Perth, Australia.
The Mineral Resource is tightly constrained by geology and
conservatively truncated at approximately 50 metres below the
deepest drill hole on each section. Further growth in the Mineral
Resource is therefore likely, given that the mineralised structure
continues at depth and remains open along strike in several
areas.
Gold grades have been estimated using Ordinary Kriging, which
has been found to produce the closest match to the distribution of
gold within the deposit. The resource estimate has resulted in a 70
per cent increase in the tonnage of the Mineral Resource and an 8
per cent decrease in the overall average grade since the last
resource update in April 2011. This reduction in overall grade is
as a result of the addition of areas of low grade material. The
previously reported grades of the core of the deposit remain
unchanged.
The increase in the drilling density has allowed an increase in
the proportion of tonnes in the deposit to be upgraded from
Inferred to Indicated category. Accordingly the enlarged resource
has a higher proportion of Measured and Indicated ounces.
Upon completion of the outstanding drilling in the current
programme, the Company's exploration team will focus on drilling to
expand and upgrade the Souma Mineral Resource (currently 0.56
million ounces gold as announced in November 2010) and identifying
additional Mineral Resources in the immediate vicinity of the Inata
at Filio, Pali, Damba and Kourfadie. This forms part of the
Company's commitment to a three year US$20 million per annum
exploration programme aimed at accelerating the growth of Mineral
Resources in the broader Belahouro District in Burkina Faso.
Avocet has contracted Roscoe Postle Associates ("RPA") to
develop Mineral Reserves from these Mineral Resources, taking into
account recent increases to the operating cost profile and gold
prices. RPA will develop a life-of-mine plan that will underpin the
Company's stated objective to expand production at Inata to
approximately 245,000 ounces per annum. RPA will also conduct an
open pit optimisation study on the expanded resource model to
determine the maximum possible depth of economic open pit mining.
This will guide future drilling programmes that will underpin
further growth in the Mineral Resources and Mineral Reserves.
Commenting on the Mineral Resource upgrade at Inata, Brett
Richards, Chief Executive Officer for Avocet, stated:
"The growth of the Inata Mineral Resource surpasses our
expectations and supports our view that the Inata gold mine is
capable of sustaining higher production rates over a longer mine
life. This upgraded Mineral Resource brings our total Mineral
Resources in the Belahouro District to 3.93 million ounces, which
is significant improvement from the 1.69 million ounces reported
when Avocet acquired these assets in mid-2009. These additional
ounces come at a discovery cost of less than US$10 per ounce.
Accordingly, our total West African resource base has now more than
doubled to over 5 million ounces of gold. I look forward to the
updated Mineral Reserve that is scheduled for late September, as
well as the results of exploration drilling in and around the Inata
and Souma ore bodies in the coming field season."
The information in this announcement that relates to Exploration
Results is based on information reviewed and audited by Mr Peter
Flindell, (MAusIMM), Executive Vice President of Exploration for
Avocet, and the information in this announcement that relates to
Mineral Resources is based on information compiled by Mr David
Williams (MAusIMM, MAIG), Principal Consultant, CSA. Mr Williams
has the experience relevant to the style of mineralisation and type
of deposit under consideration to qualify as a Qualified Person as
defined by the Canadian National Instrument 43-101 for the
reporting of Exploration Results, Mineral Resources and Mineral
Reserves (NI 43-101) and Mr Flindell and Mr Williams are Competent
Persons as defined by the Australasian JORC Code (2004) for the
reporting of Exploration Results, Mineral Resources and Ore
Reserves. Mr Williams and Mr Flindell consent to the inclusion of
the technical information in this announcement in the form and
context in which it appears.
For further information please contact:
Avocet Buchanan Ambrian J.P. Morgan Arctic SEB Enskilda
Mining Partners Cazenove Securities
PLC Limited
Financial NOMAD & Lead Broker Financial Market Maker
PR Joint Adviser
Consultants Broker & Market
Maker
Brett Bobby Morse Samantha Michael Arne Fredrik
Richards, James Harrison Wentworth-Stanley Wenger Cappelen
CEO Mike Strong Jen Neil Passmore Petter
Norris, FD Boorer Bakken
Angela
Parr,
Investor
Relations
+44 20 7766 +44 20 7466 +44 20 +44 20 7588 +47 2101 +47 2100
7674 5000 +44 78 7634 2828 3100 8500
7260 4783 4700
www.avocet. www.buchana www.ambri www.jpmorgancazen www.arctic www.sebenskilda
co.uk n.uk.com an.com ove.com sec.no .no
Notes to Editors
Avocet Mining PLC ("Avocet" or "the Company") is a gold mining
and exploration company listed on the AIM market of the London
Stock Exchange (Ticker: AVM.L) and the Oslo Bors (Ticker: AVM.OL).
The Company's principal activities are gold mining and exploration
in Burkina Faso (as 90 per cent owner of the Inata gold mine and
100 per cent owner of 8 exploration licences in the Belahouro
region surrounding Inata) and exploration in Guinea.
In December 2010 Avocet announced that it had signed a binding
agreement for the conditional sale of its South East Asian assets
to J & Partners L.P., a private company, for US$200 million. On
24 June 2011, the Company announced it had substantially completed
this sale of its main South East Asian assets including the sale of
its 100 per cent interest in the Penjom Gold Mine in Malaysia and
its 80 per cent interest in PT Avocet Bolaang Mongondow, which owns
the North Lanut mine and Bakan project in North Sulawesi,
Indonesia, for proceeds of US$170 million.
The completion of the sale of Avocet's remaining South East
Asian assets pursuant to the same sale agreement, is expected to
occur during Q3 2011, following receipt of necessary government
approvals.
The substantial completion of this transaction has left Avocet
as a West African gold producer and explorer, with a clear strategy
for growth in that region.
The Inata deposit presently comprises a Mineral Resource of 3.36
million ounces and a Mineral Reserve, which is currently under
review, of 1.08 million ounces. Inata poured its first gold in
December 2009 and has now reached a production rate in excess of
13,500 ounces per month. Other assets in West Africa include
exploration permits in Burkina Faso (the most advanced prospect
within Belahouro being the Souma trend, some 20 kilometers from
Inata, with a Mineral Resource of 561,100 ounces), Guinea (the most
advanced being the Tri-K gold exploration project with a Mineral
Resource of 1.10 million ounces) and Mali.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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