REG - SolGold PLC - Regional Exploration Update

SolGoldAnnouncement

30/05/2019 07:05

RNS Number : 5364A
SolGold PLC
30 May 2019
 


30 May 2019
SolGold plc
("SolGold" or the "Company")
 
Extensive Lithocap Identified at Rio Amarillo with Significant Copper and Gold Results
 
The Board of SolGold (LSE & TSX code: SOLG) is pleased to provide an update from the Company's regional exploration activities from its 100% owned Rio Amarillo Project in northern Ecuador, held by wholly owned subsidiary Carnegie Ridge Resources.
 
Highlights:
 




Ø


Initial exploration on the Rio Amarillo Project has identified 5 prospects on concessions Rio Amarillo 1 & 2.




 


·   


An extensive 2km by 2.4km lithocap has been identified in Rio Amarillo 2.  The lithocap is characterised by advanced argillic alteration with crackle and hydrothermal breccias.  Veins rich in realgar (Photo 3) were also identified providing further evidence of hydrothermal activity.  Lithocaps commonly form over porphyry intrusions.  Best rock chip results from in and around the lithocap include:




 


·   


R01001075   0.33% Cu, 0.31 g/t Au, 32 ppm Mo




 


·   


R01001089   0.21% Cu, 0.05 g/t Au, 45 ppm Mo




 


·   


Three other prospects have been identified in Rio Amarillo 1 surrounding the lithocap; known as the Chilanes, Cuambo and Pasquel prospects. 




 


·   


The Cuambo and Pasquel prospects are distal to the lithocap with epithermal vein mineralisation identified.  Best rock chip results include:




 


·   


Cuambo Prospect




 


o 


R01001018    11.3 g/t Au




 


o 


R01001019    1.85 g/t Au




 


·   


Pasquel Prospect




 


o 


R01001290    13.35 g/t Au




 


o 


R01001294    3.00 g/t Au




 


o 


R01001295    2.45 g/t Au




 


·   


At the Chilanes prospect, located proximal to the lithocap, B type veins have been mapped and sampled with best rock chip results including:




 


·   


R01000025    0.93 g/t Au, 0.18% Cu, 11.85ppm Mo




 


·   


R01000026    0.90 g/t Au, 0.01% Cu, 13.75 ppm Mo




 


·   


R01000029    0.51 g/t Au, 0.13% Cu, 10.35 ppm Mo
 




Ø


The Puguran prospect is located in Rio Amarillo 2.  It represents a 250m long quartz diorite outcrop in Palomar creek with B type veins identified.  Rock saw sampling returned:




 


·   


140m @ 0.24% Cu




 


o 


Including 13m @ 0.65% Cu




 


o 


Including 12m @ 0.38% Cu



 
 
 
 
 
 



 
*Please see all figures in this announcement to see the ranges of all samples
 
References to figures and tables relate to the version visible in PDF format by clicking the link below:
 
http://www.rns-pdf.londonstockexchange.com/rns/5364A_1-2019-5-29.pdf
 
 
 
Introduction
 
Ecuador is located on the rich and under-explored section of the Andean Copper Belt, from which the well explored southern portion is renowned as the production base for nearly half of the world's copper (Figure 1).  SolGold's strategy to become a tier 1 copper and gold producer through systematic exploration continues to yield exciting results.  Follow up exploration has focussed on 12 priority projects identified across SolGold's 72 regional concessions.
 
With 12 priority projects now recognised, ongoing exploration by SolGold technical teams is focussed on advancing these priority projects with a view to progress to drill testing as soon as possible.  SolGold's high success rate has been achieved by operating multiple field teams comprising 42 Ecuadorean geologists in regional exploration, applying the successful exploration blueprint developed by SolGold over the last 4 years. 
 
Drilling is scheduled to commence on regional projects as soon as practical following completion of permitting processes.
 
Further Information
The Rio Amarillo project consists of 3 concessions; Rio Amarillo 1, 2 & 3.  Currently, 5 prospects have been identified on concessions 1 & 2.  The main geological feature of the Rio Amarillo project is the extensive lithocap extending 2km by 2.4km in area. 
 
Whilst the lithocap has an extensive covering of volcanic ash, outcrops of crackle and hydrothermal breccia (Photo 1) have been located, including areas of silica clay and advanced argillic hydrothermal alteration.  Bordering the altered lithocap are various outcrops of diorite and quartz-diorite containing mineralised B type veins (Photo 2).  Best rock chip results include:
 




·   


R01001075  0.33% Cu, 0.31 g/t Au, 32 ppm Mo




·   


R01001089  0.21% Cu, 0.05 g/t Au, 45 ppm Mo




·   


R01001068  0.14% Cu, 0.84 g/t Au, 4 ppm Mo




·   


R01001056  0.12% Cu, 0.45 g/t Au, 5 ppm Mo




 
Cuambo and Pasquel prospects are distal to the lithocap with epithermal vein mineralisation identified.  The epithermal veining at these prospects are possibly associated with a deeper porphyry system that is responsible for the advanced argillic alteration forming the lithocap.  Best results include:
 




·   


Cuambo Prospect




 


o 


R01001018   11.3 g/t Au




 


o 


R01001019   1.85 g/t Au
 




·   


Pasquel Prospect




 


o 


R01001290   13.35 g/t Au




 


o 


R01001294   3.00 g/t Au




 


o 


R01001295   2.45 g/t Au




 
At the Chilanes prospect, located proximal to the lithocap, B type veins have been mapped and sampled.  An outcrop of stockwork B type veins (Photo 5) has been identified hosted in a dark micro diorite - quartz diorite with the matrix altered to magnetite and chlorite, with best rock chip results including:
 




·   


R01000025      0.93 g/t Au, 0.18% Cu, 11.85ppm Mo




·   


R01000026      0.90 g/t Au, 0.01% Cu, 13.75 ppm Mo




·   


R01000029      0.51 g/t Au, 0.13% Cu, 10.35 ppm Mo




 
The Puguran is located in Rio Amarillo 2.  It represents a 250m long quartz diorite outcrop in Palomar creek (Photo 6) with B and D type veins identified.  Alteration in this creek is interpreted as potassic overprinted by later phyllic alteration.  Rock saw sampling returned:
 




·   


140m @ 0.24% Cu




 


o 


Including 13m @ 0.65% Cu




 


o 


Including 12m @ 0.38% Cu




 
 
Figure 1: Location plan showing the Rio Amarillo project in northern Ecuador.
 
 
Figure 2: Prospect location map - Rio Amarillo
 
 
Figure 3:  Rock chip locations - copper and gold results
 
 
Photo 1: Hydrothermal breccia found in the lithocap
 
 
Photo 2:  Quartz diorite with B type veining
 
 
Photo 3:  Realgar vein associated with hydrothermal systems
 
 
Photo 4: Pasquel Prospect - gold rich iron oxide veins
 
 
Photo 5: Copper gold stockwork B type veins
 
 
Photo 6:  Pugaran prospect - strongly altered and copper rich with B and D type veining
 
 




Sample ID


easting


northing


elevation


Au g/t




R01001290


814971


58823


1742


13.35




R01001294


814900


58852


1761


3.0




R01001298


814900


58840


1756


2.45




R01001295


814791


58863


1779


1.65




R01001293


814930


58800


1175


1.12




R01001297


814929


58792


1754


1.07




Table 1: Significant rock chip results Pasquel Prospect
 




Sample ID


easting


northing


elevation


Au g/t




R01001018


818460


64085


1365


11.3




R01001019


818381


64198


1362


1.85




R01001006


818300


63713


1481


0.26




R01001003


818436


63548


1521


0.17




Table 2: Significant rock chip results Cuambo Prospect
 




Sample ID


easting


northing


elevation


Au g/t


Cu %




R01000025


816219


63182


2472


0.93


0.18




R01000026


816206


63194


2441


0.90


0.01




R01000029


816205


63224


2453


0.51


0.13




R01000027


816198


63246


2422


0.50


0.12




Table 3: Significant rock chip results Chilanes Prospect
 




Sample ID


easting


northing


elevation


Cu %


Au g/t


Mo_ppm




R01001075


814149


62939


2572


0.33


0.31


32.20




R01001089


814176


63068


2515


0.21


0.05


45.00




R01001127


814795


63000


2303


0.21


0.13


6.69




R01001104


814226


63362


2422


0.19


0.21


3.48




R01001078


814138


62903


2587


0.19


0.05


21.90




R01001242


814791


63081


2265


0.18


0.05


0.27




R01001088


814059


62870


2620


0.16


0.23


21.60




R01001068


814167


63004


2537


0.14


0.84


4.66




R01001056


814168


62987


2542


0.12


0.46


5.09




R01001278


814827


63225


2206


0.01


3.17


0.47




Table 4: Significant rock chip results Lithocap area
 
 




Sample Id


easting


northing


elevation


sample width (m)


Cu %


Au g/t


Mo_ppm






R01000037


806618


59219


2627


2


0.73


0.20


12.60




R01000038


806633


59167


2639


2


0.40


0.08


20.20




R01000039


806620


59200


2674


2


0.17


0.03


6.93




R01000040


806621


59198


2674


2


0.09


0.03


5.56




R01000041


806605


59210


2679


0.9


0.22


0.04


21.50




R01000042


806622


59197


2673


1.95


0.07


0.08


42.20




R01000043


806624


59197


2673


2.34


0.10


0.10


24.00




R01000044


806625


59197


2671


1.66


0.04


0.08


12.85




R01000045


806627


59196


2671


2.07


0.32


0.08


36.60




R01000046


806628


59195


2670


2.29


0.55


0.14


12.60




R01000047


806628


59193


2670


2.23


0.70


0.29


17.35




R01000048


806630


59191


2670


2.2


0.24


0.10


26.30




R01000049


806632


59190


2670


2.14


0.21


0.04


17.50




R01000051


806632


59188


2670


2


0.30


0.03


11.20




R01000052


806633


59186


2669


2


0.02


0.01


0.86




R01000053


806635


59182


2668


2


0.23


0.11


5.01




R01000054


806635


59181


2668


2.08


0.16


0.04


4.56




R01000055


806636


59179


2667


2.13


0.19


0.03


8.85




R01000056


806636


59178


2667


2.09


0.16


0.03


10.75




R01000057


806637


59176


2667


1.11


0.09


0.10


22.50




R01000058


806638


59175


2667


1.89


0.19


0.07


50.60




R01000059


806637


59173


2666


2.1


0.14


0.04


31.30




R01000060


806638


59171


2665


1.93


0.11


0.17


76.20




R01000062


806639


59170


2664


1.98


0.37


0.14


154.00




R01000063


806640


59168


2664


2.04


0.14


0.06


26.90




R01000064


806640


59166


2664


2.01


0.10


0.03


20.00




R01000065


806640


59164


2663


2.03


0.11


0.02


21.60




R01000067


806615


59202


2675


2


0.16


0.05


8.27




R01000068


806613


59203


2675


2


0.27


0.05


8.41




R01000071


806641


59154


2662


2.1


0.09


0.04


14.25




R01000072


806641


59152


2661


2.03


0.11


0.06


20.50




R01000073


806641


59150


2661


1.92


0.25


0.21


27.00




R01000074


806641


59148


2660


2.05


0.16


0.08


58.90




R01000075


806641


59146


2660


1.98


0.10


0.05


20.70




R01000076


806642


59122


2655


2.08


0.16


0.49


14.20




R01000077


806643


59124


2656


2.14


0.17


0.06


24.40




R01000078


806642


59126


2657


1.92


0.06


0.02


5.63




R01000079


806642


59127


2657


1.96


0.12


0.05


37.50




R01000080


806642


59129


2657


1.98


0.14


0.03


32.80




R01000081


806641


59131


2658


1.87


0.09


0.02


10.90




R01000082


806646


59100


2652


2.3


0.34


0.01


6.33




R01000083


806650


59096


2651


1.75


0.13


0.04


19.50




R01000084


806649


59094


2650


1.7


0.21


0.09


58.30




R01000085


806649


59093


2650


2.1


1.24


0.05


28.00




R01000086


806648


59091


2649


2.3


0.68


0.03


12.50




R01000087


806649


59089


2649


2.2


1.30


0.10


25.00




R01000088


806649


59087


2648


2.45


0.19


0.03


23.30




R01000089


806645


59089


2650


2


0.37


0.04


13.30




R01000090


806644


59090


2651


2


0.41


0.03


32.80




R01000092


806643


59092


2652


2.1


0.24


0.02


25.80




R01000093


806642


59094


2652


1.9


0.18


0.03


27.00




R01000094


806641


59095


2653


1.98


0.24


0.06


67.10




R01000095


806641


59097


2654


1.95


0.40


0.03


52.30




R01000096


806640


59099


2654


2


0.16


0.05


34.40




R01000097


806639


59101


2655


2


0.20


0.06


36.80




R01000098


806639


59102


2655


1.76


0.13


0.08


33.00




R01000099


806640


59104


2655


1.8


0.12


0.06


16.25




R01000101


806640


59106


2655


2.15


0.12


0.08


53.50




R01000102


806640


59108


2656


2


0.14


0.07


32.90




R01000103


806640


59110


2656


2


0.13


0.05


34.60




R01000104


806641


59112


2657


2


0.10


0.04


21.90




R01000105


806641


59114


2657


2


0.09


0.05


35.10




Table 5: Puguran rock saw sampling
 
 
Market Abuse Regulation (MAR) Disclosure
 
Certain information contained in this announcement would have been deemed inside information for the purposes of Article 7 of the Regulation (EU) No 596/2014 until the release of this announcement.
 

Qualified Person:
 
Information in this report relating to the exploration results is based on data reviewed by Mr Jason Ward ((CP) B.Sc. Geol.), the Chief Geologist of the Company.  Mr Ward is a Fellow of the Australasian Institute of Mining and Metallurgy, holds the designation FAusIMM (CP), and has in excess of 20 years' experience in mineral exploration and is a Qualified Person for the purposes of the relevant LSE and TSX Rules.  Mr Ward consents to the inclusion of the information in the form and context in which it appears.

 
By order of the Board
Karl Schlobohm
Company Secretary
 
 
CONTACTS
 




Nicholas Mather
SolGold Plc (Chief Executive Officer)
nmather@solgold.com.au
 


Tel: +61 (0) 7 3303 0665
       




Karl Schlobohm
SolGold Plc (Company Secretary)
kschlobohm@solgold.com.au
 


Tel: +61 (0) 7 3303 0661
 




Anna Legge       
SolGold Plc (Corporate Communications)
alegge@solgold.com.au
 


Tel: +44 (0) 20 3823 2131




Gordon Poole / Nick Hennis
Camarco (Financial PR / IR)
solgold@camarco.co.uk
 


Tel: +44 (0) 20 3757 4997




Andrew Chubb / Ingo Hofmaier               
Hannam & Partners (Joint Broker)
solgold@hannam.partners
 


Tel: +44 (0) 20 7907 8500
 




Clayton Bush / Trystan Cullen / Laura Hamilton
Liberum Capital Limited (Joint Broker)
solgold@liberum.com
 


Tel: +44 (0) 20 3100 2222




Ross Allister / James Bavister
Peel Hunt (Joint Broker)
solgold@peelhunt.com
 


Tel: +44 (0) 20 7418 8900




 
Follow us on twitter @SolGold_plc
 
 
CAUTIONARY NOTICE
 
News releases, presentations and public commentary made by SolGold plc (the "Company") and its Officers may contain certain statements and expressions of belief, expectation or opinion which are forward looking statements, and which relate, inter alia, to interpretations of exploration results to date and the Company's proposed strategy, plans and objectives or to the expectations or intentions of the Company's Directors.  Such forward-looking and interpretative statements involve known and unknown risks, uncertainties and other important factors beyond the control of the Company that could cause the actual performance or achievements of the Company to be materially different from such interpretations and forward-looking statements.
 
Accordingly, the reader should not rely on any interpretations or forward-looking statements; and save as required by the exchange rules of the TSX and LSE or by applicable laws, the Company does not accept any obligation to disseminate any updates or revisions to such interpretations or forward-looking statements.  The Company may reinterpret results to date as the status of its assets and projects changes with time expenditure, metals prices and other affecting circumstances.
 
This release may contain "forward‑looking information" within the meaning of applicable Canadian securities legislation.  Forward‑looking information includes, but is not limited to, statements regarding the Company's plans for developing its properties.  Generally, forward‑looking information can be identified by the use of forward-looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or state that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved". 
 
Forward‑looking information is subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of the Company to be materially different from those expressed or implied by such forward‑looking information, including but not limited to: transaction risks; general business, economic, competitive, political and social uncertainties; future prices of mineral prices; accidents, labour disputes and shortages and other risks of the mining industry.  Although the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended.  There can be no assurance that such information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements.  Accordingly, readers should not place undue reliance on forward‑looking information.  The Company does not undertake to update any forward-looking information, except in accordance with applicable securities laws.
 
The Company and its officers do not endorse, or reject or otherwise comment on the conclusions, interpretations or views expressed in press articles or third-party analysis, and where possible aims to circulate all available material on its website.
 
The Company recognises that the term "World Class" is subjective and for the purpose of the Company's projects the Company considers the drilling results at the growing Alpala Porphyry Copper Gold Deposit at its Cascabel Project to represent intersections of a "World Class" deposit.  The Company considers that "World Class" deposits are rare, very large, long life, low cost, and are responsible for approximately half of total global metals production.
 
"World Class" deposits are generally accepted as deposits of a size and quality that create multiple expansion opportunities, and have or are likely to demonstrate robust economics that ensure development irrespective of position within the global commodity cycles, or whether or not the deposit has been fully drilled out, or a feasibility study completed.
 
Standards drawn from industry experts (1) Singer and Menzie, 2010; (2) Schodde, 2006; (3) Schodde and Hronsky, 2006; (4) Singer, 1995; (5) Laznicka, 2010) have characterised "World Class" deposits at prevailing commodity prices. The relevant criteria for "World Class" deposits, adjusted to current long run commodity prices, are considered to be those holding or likely to hold more than 5 million tonnes of copper and/or more than 6 million ounces of gold with a modelled net present value of greater than USD 1 Billion.
 
The Company and its external consultants prepared an initial mineral resource estimate at the Cascabel Project in December 2017. Results are summarised in Table B attached.
 
The Mineral Resource Estimate was completed from 53,616m of drilling, approximately 84% of 63,500m metres drilled as of mid-December 2017, the cut-off date for the maiden resource calculation.  There remains strong potential for further growth from more recent drilling results, and continue rapid growth of the deposit.
 
Any development or mining potential for the project remains speculative.
 
Drill hole intercepts have been updated to reflect current commodity prices, using a data aggregation method, defined by copper equivalent cut-off grades and reported with up to 10m internal dilution, excluding bridging to a single sample.  Copper equivalent grades are calculated using a gold conversion factor of 0.63, determined using an updated copper price of USD3.00/pound and an updated gold price of USD1300/ounce.  True widths of down hole intersections are estimated to be approximately 25-70%.
 
On the basis of the drilling results to date and the results of the Alpala Maiden Mineral Resource Estimate, the reference to the Cascabel Project as "World Class" (or "Tier 1") is considered to be appropriate. Examples of global copper and gold discoveries since 2006 that are generally considered to be "World Class" are summarised in Table A.
 
References cited in the text:
 




1.   


Singer, D.A. and Menzie, W.D., 2010. Quantitative Mineral Resource Assessments: An Integrated Approach. Oxford University Press Inc.




2.   


Schodde, R., 2006. What do we mean by a world class deposit? And why are they special. Presentation. AMEC Conference, Perth.




3.   


Schodde, R and Hronsky, J.M.A, 2006. The Role of World-Class Mines in Wealth Creation. Special Publications of the Society of Economic Geologists Volume 12.




4.   


Singer, D.A., 1995, World-class base and precious metal deposits-a quantitative analysis: Economic Geology, v. 90, no.1, p. 88-104.




5.   


Laznicka, P., 2010. Giant Metallic Deposits: Future Sources of Industrial Metal, Second Edition. Springer-Verlag Heidelberg.




 




Deposit Name


Discovery Year


Major Metals


Country


Current Status


Mining Style


Inventory




LA COLOSA


2006


Au, Cu


Colombia


Feasibility - New Project


Open Pit


1 469Mt @ 0.95g/t Au; 14.3Moz Au




LOS SULFATOS


2007


Cu, Mo


Chile


Advanced Exploration


Underground


2 1.2Bt @1.46% Cu & 0.02% Mo; 17.5Mt Cu




BRUCEJACK


2008


Au


Canada


Development/Construction


Open Pit


3 15.6Mt @ 16.1 g/t Au; 8.1Moz Au




KAMOA-KAKULA


2008


Cu, Co, Zn


Congo (DRC)


Feasibility - New Project


Open Pit & Underground


4 1.3Bt @ 2.72% Cu; 36.5 Mt Cu




GOLPU


2009


Cu, Au


PNG


Feasibility - New Project


Underground


5 820Mt @ 1.0% Cu, 0.70g/t Au; 8.2Mt Cu, 18.5Moz Au




COTE


2010


Au, Cu


Canada


Feasibility Study


Open Pit


6 289Mt @ 0.90 g/t Au; 8.4Moz Au




HAIYU


2011


Au


China


Development/Construction


Underground


7 15Moz Au




RED HILL-GOLD RUSH


2011


Au


United States


Feasibility Study


Open Pit & Underground


8 47.6Mt @ 4.56 g/t Au; 7.0Moz Au




XILING


2016


Au


China


Advanced Exploration


Underground


9 383Mt @ 4.52g/t Au; 55.7Moz Au




Source: after MinEx Consulting, May 2017
1 Source: http://www.mining‐technology.com/projects/la‐colosa
2 Source: http://www.angloamerican.com/media/press‐releases/2009 
3 Source: http://www.pretivm.com/projects/brucejack/overview/ 
4 Source: https://www.ivanhoemines.com/projects/kamoa‐kakula‐project/ 
5 Source: http://www.newcrest.com.au/media/resource_reserves/2016/December_2016_Resources_and_Reserves_Statement.pdf 
6 Source: http://www.canadianminingjournal.com/news/gold‐iamgold‐files‐cote‐project‐pea/ 
7 Source: http://www.zhaojin.com.cn/upload/2015‐05‐31/580601981.pdf 
8 Source: https://mrdata.usgs.gov/sedau/show‐sedau.php?rec_id=103 
9 Source: http://www.chinadaily.com.cn/business/2017‐03/29/content_28719822.htm




Table A:  Tier 1 global copper and gold discoveries since 2006. This table does not purport to be exhaustive exclusive or definitive.
 




Grade
Category


Resource
Category


Tonnage
(Mt)


Grade


Contained Metal




Cu (%)


Au (g/t)


CuEq (%)


Cu (Mt)


Au (Moz)


CuEq (Mt)




Total >0.2% CuEq


Indicated


2,050


0.41


0.29


0.60


8.4


19.4


12.2




Inferred


900


0.27


0.13


0.35


2.5


3.8


3.2




Table B: Alpala Mineral Resource Estimate updated effective 16 November 2018.
 
Notes:




·     


Mr. Martin Pittuck, MSc, CEng, MIMMM, is responsible for this Mineral Resource estimate and is an "independent qualified person" as such term is defined in NI 43-101.




·     


The Mineral Resource is reported using a cut-off grade of 0.3% copper equivalent calculated using [copper grade (%)] + [gold grade (g/t) x 0.6] based on a copper price of US$2.8/lb and gold price of US$1,160/oz.




·     


The Mineral Resource is considered to have reasonable potential for eventual economic extraction by underground mass mining such as block caving.




·     


Mineral Resources are not Mineral Reserves and do not have demonstrated economic viability.




·     


The statement uses the terminology, definitions and guidelines given in the CIM Standards on Mineral Resources and Mineral Reserves (May 2014).




·     


The MRE is reported on 100 percent basis.




·     


Values given in the table have been rounded, apparent calculation errors resulting from this are not considered to be material.




·     


The effective date for the Mineral Resource statement is 16 November 2018.




 




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