Kalimantan Gold Corporation Limited

Kalimantan Gold Corporation Limited

January 05, 2005 14:26 ET

Kalimantan Gold Drilling Well Underway


NEWS RELEASE TRANSMITTED BY CCNMatthews

FOR: KALIMANTAN GOLD CORPORATION LIMITED

TSX VENTURE SYMBOL: KLG

JANUARY 5, 2005 - 14:26 ET

Kalimantan Gold Drilling Well Underway

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Jan. 5, 2005) - Kalimantan
Gold Corporation Limited (TSX VENTURE:KLG) resumed drilling in the
southern extension area of the Far East Zone at Baroi in the beginning
of December 2004. Drilling began with hole BF42 in the center of the
airborne magnetic high anomaly (assays pending) which is 500 meters
south-west of holes BF39/40.

Drilling in hole BF42 first encountered granodiorite, followed by
sediments (silt/sandstone), then it changed to porphyritic textured
dacite that is mineralized with copper and strong pyrite for 33 meters -
then more sediments and the last one meter before the hole was stopped
at 299.50 meters finished in well mineralized breccia. This depth is the
absolute limit of our company owned drill. This drilling confirms the
existence of copper at depth well below the granodiorite.

All of these next planned holes target different potential porphyry
intrusions and we are optimistic of success.

Hole BF42A is being drilled south of BF42 about 200 meters into the
center of the magnetic high anomaly where several radiating major
structures will be intersected. Our geologists have observed that the
rock is much fractured on surface in the area of the drill hole.

An aeromagetic and structure map (the NR05-1 map) that shows the
location of the holes drilled to date, and the proposed holes, at Baroi
has been posted in the project, map section of our web site at
www.kalimantan.com. The map is an in-house interpretation that uses the
original regional data and shows the detail inside the area of low
magnetic response where holes BF43, BF44 and BF45 are planned. This
detail was not so obvious on Figure 11 of our Technical Report that used
an external consultant's interpretation. These magnetic anomalies that
display moderate magnetic highs located within a broad area of magnetic
low are classic porphyry responses. They also correspond and confirm the
ground magnetic data which previously was at question.

Drilling on hole BF42A began on December 26, 2004. Once this hole is
completed the drill will be moved to drill, one or both depending on
results, of BF43 or BF44 to test a silicified and leached ridge 650
meters north of BF39/40. Next will be BF45 to be drilled into a zone of
near continuous high-grade surface samples (numbers 1837 to 1871) over a
width of 190 meters that also corresponds to a high ground magnetic
anomaly. The last planned hole in this drill series is identified as
BF0?? is designed to test the intersection of major structures at the
elevated response within the broad low magnetic anomaly.

Baroi mapping and sampling

Monzonite is a favorable host for mineralized porphyry deposits. Surface
sampling of a mineralized monzonite area in the Baroi Central Zone, west
of the Far East Zone (FEZ) is well underway. Before moving the focus of
our exploration activity to the FEZ, to follow up high-grade surface
samples there, we recovered a 9 meter channel sample that returned 0.45
% copper, 11 grams per tonne silver and 2.53% zinc from a 10 by 10 meter
outcrop in the Central Zone. Now with more exploration information, we
are going back and exposing more areas for channel sampling. This
monzonite outcrop is also located near a well defined magnetic high.
Preparations are being made to move the Company's scout drill rig to
this location in the near future. Dependant on results of the present
mapping and sampling program it is expected a series of scout holes will
be drilled to test this conducive geological environment.

Kalimantan Gold's exploration efforts are directed first towards
intercepting porphyry mineralization at depth and subsequently to
continue drilling to define the size of the deposit. We at Kalimantan
Gold remain confident that through our commitment to the drilling
program, a source intrusion responsible for the extensive high-grade
mineralization at Baroi will be identified.

Qualified Person

All data, as disclosed in this press release, including sampling,
analytical and test data have been verified by the Company's Qualified
Person, Didik Prasetyo, Senior Project Geologist.

Quality Assurance

The Company in addition to its normal laboratory work with PT Indoassay
Laboratories from Balikpapan, has established quality assurance
procedures for sampling and assaying. This includes duplicate and
re-assay checks of samples with PT Intertek Utama Services, Jakarta an
internationally recognized laboratory.

The Company

Kalimantan Gold Corporation Limited has a 75% interest in a 129,200
hectare Contract of Work located in Central Kalimantan, Indonesia.
Baroi, a porphyry copper-gold prospect is one of 38 prospects identified
within the CoW and is currently the main exploration focus of the
Company.

Doris Meyer, President and Chief Executive Officer

Kalimantan Gold Corporation Limited

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Contact Information

  • FOR FURTHER INFORMATION PLEASE CONTACT:
    Kalimantan Gold Corporation Limited
    Doris Meyer
    President and Chief Executive Officer
    (604) 516-0566
    Email: dorism@telus.net
    Website: www.kalimantan.com
    The TSX Venture Exchange does not accept responsibility for the adequacy
    or the accuracy of this release.