TORONTO, ONTARIO–(Marketwired – June 16, 2015) – Continental Gold Inc. (TSX:CNL)(OTCQX:CGOOF) (“Continental” or the “Company”) is pleased to announce results for 20 diamond drill-holes through the Veta Sur and Yaraguá vein systems at the Company’s 100%-owned Buriticá project in Antioquia, Colombia. An updated mineral resource estimate for the Buriticá project is nearing completion and the results below are the final assays to be included in the database prior to cut-off.
These intercepts are interpreted to represent extensions of the northern Veta Sur vein families, covering a range of elevations. These vein families remain open along strike to the east at depth.
These and other infill intercepts extend higher grade sub-domains in several vein families in both the eastern Veta Sur and western Yaraguá systems.
These and other intercepts are interpreted to represent extensions of both northern and southern Veta Sur vein families and are encouraging for mineral resource growth in the western portion of the Veta Sur system at moderate elevations in the range of 1,400-900 metres. These vein families remain open vertically and to the southwest.
These and other infill intercepts extend high grade sub-domains in central and southern veins in western Veta Sur.
“Veta Sur continues to deliver robust results and we remain confident that this will be reflected in our upcoming updated mineral resource estimate”, commented Ari Sussman, President and CEO of Continental.
Continental’s 100%-owned, 59,283-hectare project, Buriticá, contains several known areas of high-grade gold and silver mineralization, of base metal carbonate-style (“Stage I”) variably overprinted by texturally and chemically distinctive high-grade (“Stage II”) mineralization. The two most extensively explored of these areas (the Yaraguá and Veta Sur systems) are central to this land package. The Yaraguá system has been drill-outlined along 1,100 metres of strike and 1,700 vertical metres and partially sampled in underground developments. The Veta Sur system has been drill-outlined along 1,000+ metres of strike and 1,800 vertical metres and has been partially sampled in underground developments. Both systems are characterized by multiple, steeply-dipping veins and broader, more disseminated mineralization and both remain open at depth and along strike, at high grades. See “About Continental Gold” below for a précis of the 2014 Preliminary Economic Assessment (the “PEA”) prepared in accordance with Canadian National Instrument 43-101 (“NI 43-101”). This release documents the results of extension and infill drilling through the Yaraguá and Veta Sur vein systems. Significant new drill intercepts are listed below in Table I and are referenced in Figures 1, and 2.
Table I: Drilling Highlights
|* Intercepts calculated at 1 g/t gold + 50 g/t silver cut-off grades for minimum intervals of 0.5 metres, with up to 30% internal dilution. True widths not accurately known but generally are between 30% and 80% of the down-hole interval. Drill-holes designated “BUUY” were collared from underground, and drill-holes designated “BUSY” were collared at surface. Holes directionally-drilled from “mother holes” (BUUYDxxx or BUSYDxxx) are designated BUUYxxxDxx or BUSYxxxDxx), as the case may be.|
|** Intercepts in vein domains are respectively nominated by vein code (e.g. VNC) whereas other intercepts are designated as below or outside of the current Buriticá mineral resource envelope. Dilution is defined as new mineralization between modelled vein domains. Intercepts with grades X thicknesses apparently substantially greater than for the corresponding vein domains in the current mineral resource block model are also highlighted in bold.|
Infill and extension drilling of the Veta Sur system was comprised of three drill-fans, two of these drilled from underground platforms in the Veta Sur ramp and the third from surface (Figures 1 and 2). Five drill-holes, initiated from the eastern-most drill-fan, continued north through the Veta Sur system and into the western Yaraguá system.
In eastern Veta Sur, drilling intersected high-grade veins below or to the east of the current Veta Sur mineral resource envelope. New high-grade and/or broad intercepts include:
These and other intercepts are interpreted to represent extensions of northern Veta Sur vein families. The high grades and widths obtained are encouraging for overall mineral resource growth covering a range of elevations (1,250-1,100 metres RL) and in locations proximal to the main haulage developments proposed in the PEA. These vein families remain open along strike to the east at depth.
Infill drilling encountered multiple vein families with grades X thicknesses that are commonly substantially greater than those expected from the current mineral resource block models for eastern Veta Sur and western Yaraguá. High-grade intercepts in related master veins, include:
These and other infill intercepts extend higher-grade sub-domains in several vein families in the eastern Veta Sur and western Yaraguá systems.
In western and far western Veta Sur, step-out drilling intersected multiple veins below or outside of the current Veta Sur mineral resource envelope. Key high-grade and/or broad intercepts in these areas include:
These and other intercepts are interpreted to represent extensions of both northern and southern Veta Sur vein families and are encouraging for mineral resource growth in the west Veta Sur system at moderate elevations in the range of 1400-900 metres RL. These vein families remain open vertically and to the southwest.
Infill drilling in western Veta Sur encountered multiple vein families with grades X thicknesses that are commonly substantially greater than those expected from the current mineral resource block model in this area. High-grade intercepts in related master veins, include:
These and other infill intercepts extend high grade sub-domains in central and southern veins in western Veta Sur.
Vic Wall, PhD, special advisor to the Company and a qualified person for the purpose of NI 43-101, has prepared or supervised the preparation of, or approved, as applicable, the technical information contained in this press release. Dr. Wall is a geologist with 35 years’ experience in the minerals mining, consulting, exploration and research industries. Following a career in Australian and North American academes, he held senior positions in a number of multinational major and junior minerals companies. A Fellow of the Australian Institute of Geoscientists, Dr. Wall is Principal of Vic Wall & Associates, a Brisbane-based consultancy that provides geoscientific services to mineral companies and government agencies, worldwide.
The Company utilizes a rigorous, industry-standard QA/QC program. HQ and NQ core is sawn or split with one-half shipped to a sample preparation lab in Medellín run by ALS Colombia Limited (“ALS”) in Colombia, whereas BQ core samples are full core. Samples are then shipped for analysis to an ALS-certified assay laboratory in Lima, Peru. The remainder of the core is stored in a secured storage facility for future assay verification. Blanks, duplicates and certified reference standards are inserted into the sample stream to monitor laboratory performance and a portion of the samples are periodically check assayed at SGS Colombia S.A., a certified assay laboratory in Medellín, Colombia.
The Company does not receive assay results for drill-holes in sequential order; however, all significant assay results are publicly reported. A listing of assay results to date for the Buriticá project is available on the Company’s website at www.continentalgold.com.
For additional information on the Buriticá project, please refer to the PEA (entitled “Buriticá Gold Project, NI 43-101 Technical Report Preliminary Economic Assessment, Antioquia, Colombia”, and dated December 22, 2014 with an effective date of November 17, 2014), led by M3 Engineering and Technology of Tucson, Arizona, with contributions from other independent consultants including NCL Ingeneria y Construccion SPA, which was responsible for the underground mine plan for the Buriticá project. The PEA is preliminary in nature and includes inferred mineral resources that are considered to be too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves, and there is no certainty the PEA will be realized. Further, mineral resources are not mineral reserves and have not demonstrated economic viability. The PEA is available on SEDAR at www.sedar.com, on the OTCQX at www.otcmarkets.com and on the Company website at www.continentalgold.com.
About Continental Gold
Continental Gold Inc. is the public holding company of CGL Buritica Ltd. (formerly Continental Gold Limited), an advanced-stage exploration and development company with an extensive portfolio of 100%-owned gold projects in Colombia. Spearheaded by a team with over 40 years of exploration and mining experience in Colombia, the Company is focused on advancing its high-grade Buriticá gold project to production. The PEA included an 18-year mine life based on 20,055,000 tonnes grading 7.80 g/t gold and 19.35 g/t silver, resulting in 4,777,000 ounces of recovered gold and 7,088,000 ounces of recovered silver, and utilized the May 2014 mineral resource estimate prepared in accordance with NI 43-101. The PEA concludes an after-tax net present value at a 5% discount of $1.08 billion and an after-tax internal rate of return of 31.5% on an initial capital cost of $390.3 million with a payback of 2.8 years.
With a goal of being the newest large-scale hard rock gold producer in Colombia, Continental has recently achieved major advances at the Buriticá project and anticipates completing environmental permitting in 2015.
Additional details on the Buriticá project, including the PEA, and the rest of Continental’s suite of gold exploration properties are available at www.continentalgold.com.
This press release contains or refers to forward-looking information under Canadian securities legislation, including statements regarding the estimation of mineral resources, results of the PEA, advancing the Buriticá project, exploration results, potential mineralization, potential development of mine openings, potential improvement of mining dilution grades, timing of an updated mineral resource estimate, and exploration and mine development plans, and is based on current expectations that involve a number of significant business risks and uncertainties. Forward-looking statements are subject to other factors that could cause actual results to differ materially from expected results. Readers should not place undue reliance on forward-looking statements. Factors that could cause actual results to differ materially from any forward-looking statement include, but are not limited to, an inability to advance the Buriticá project to the next level, failure to convert estimated mineral resources to reserves, capital and operating costs varying significantly from estimates, the preliminary nature of metallurgical test results, delays in obtaining or failures to obtain required governmental, environmental or other project approvals, political risks, uncertainties relating to the availability and costs of financing needed in the future, changes in equity markets, inflation, changes in exchange rates, fluctuations in commodity prices, delays in the development of projects and the other risks involved in the mineral exploration and development industry. Specific reference is made to the most recent Annual Information Form on file with Canadian provincial securities regulatory authorities for a discussion of some of the factors underlying forward-looking statements. All of the forward-looking statements made in this press release are qualified by these cautionary statements, and are made as of the date hereof. The Company assumes no responsibility to update them or revise them to reflect new events or circumstances other than as required by law.
Differences in Reporting of Resource Estimates
This press release was prepared in accordance with Canadian standards, which differ in some respects from United States standards. In particular, and without limiting the generality of the foregoing, the terms “inferred mineral resources,” “indicated mineral resources,” “measured mineral resources” and “mineral resources” used or referenced in this press release are Canadian mining terms as defined in accordance with National Instrument 43-101 – Standards of Disclosure for Mineral Projects under the guidelines set out in the Canadian Institute of Mining, Metallurgy and Petroleum (the “CIM”) Standards on Mineral Resources and Mineral Reserves (the “CIM Standards”). The CIM Standards differ significantly from standards in the United States. While the terms “mineral resource,” “measured mineral resources,” “indicated mineral resources,” and “inferred mineral resources” are recognized and required by Canadian regulations, they are not defined terms under standards in the United States. “Inferred mineral resources” have a great amount of uncertainty as to their existence, and great uncertainty as to their economic and legal feasibility. It cannot be assumed that all or any part of an inferred mineral resource will ever be upgraded to a higher category. Under Canadian securities laws, estimates of inferred mineral resources may not form the basis of feasibility or other economic studies. Readers are cautioned not to assume that all or any part of measured or indicated mineral resources will ever be converted into reserves. Readers are also cautioned not to assume that all or any part of an inferred mineral resource exists, or is economically or legally mineable. Disclosure of “contained ounces” in a resource is permitted disclosure under Canadian regulations; however, United States companies are only permitted to report mineralization that does not constitute “reserves” by standards in the United States as in place tonnage and grade without reference to unit measures. Accordingly, information regarding resources contained or referenced in this press release containing descriptions of our mineral deposits may not be comparable to similar information made public by United States companies.
Figure 1 – Plan view of highlights of new drilling in the Veta Sur and Yaraguá systems, showing the surface projection of veins in the current (2014) mineral resource model on geology-topography and underground developments. Line A-B refers to the long section line for Figure 2.
Figure 2 – Long section (Line A-B on Figure 1) showing highlights of new drilling against the 2014 Veta Sur mineral resource envelope.