Alhambra Resources Ltd.
TSX VENTURE : ALH

Alhambra Resources Ltd.

June 27, 2005 16:39 ET

Alhambra Provides Update on Uzboy Project Activities

CALGARY, ALBERTA--(CCNMatthews - June 27, 2005) - Alhambra Resources Ltd. (TSX VENTURE:ALH) is pleased to provide an update on activities at its 100% owned Uzboy gold project located in north central Kazakhstan. Activities are highlighted as follows:

a) Ten of the 25 diamond drill holes planned for the Uzboy west zone in 2005 have been completed. This drilling is designed to test the zone of gold mineralization that occurs below the oxide layer. The fire assay results for these holes have not been received.

b) Fire assay results on diamond drill core from the northeast portion of the Uzboy East zone have outlined a zone of gold mineralization that is a minimum of 250 metres long.

c) Total gold precipitated at the Uzboy heap leach test is estimated to be approximately 5,000 troy ounces. Gold sold and estimated gold shipped for refining and sale since January 1st, 2005 is approximately 4,000 troy ounces.

d) Column leach tests on oxide gold mineralization from the Dombraly zone yielded 94.7% gold recovery in solution.

e) Exploration on some of the other mineral showings located within the Uzboy Project to be explored in 2005 has yielded positive results.

Uzboy West Diamond Drilling:

The first phase of diamond drilling (10 inclined holes) planned for the Uzboy West zone in 2005 (see attached Figure 1) have intersected a zone of metasomatic altered rocks from section 13 to section 53, a horizontal distance of 400 metres. The historical fire assay results contained in a news release dated May 19th 2005 being:



----------------------------------------------------------------
Average grade
Drill Hole From (m) To (m) Interval (m) (g/t gold)
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DDH-1762 79 116 37 12.06
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DDH-1762 169 223 54 12.42
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DDH-96-17 176 191 15 25.6
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DDH-96-7 53 73 20 6.63
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were intersected on section 37 of the Uzboy West zone located within this zone of metasomatic alteration.

These historical weighted average grades have not yet been verified by the Company, and the current drilling program is designed to confirm the historical drilling results. The Corporation has not attempted to either confirm or verify the historical exploration results for the mineral showings previously outlined in the Uzboy Project. In addition, none of the historical exploration results have been reviewed by an independent Qualified Person, nor has any of this historical information been audited by an independent Qualified Person, and this information may not conform to the Canadian Institute of Mining and Metallurgy and petroleum ("CIMM") standard of reporting pursuant to the requirements under national Instrument 43-101.

The altered zone comprises tuff, porphyritic andesite and porphyritic dacite, is dark gray in color and is characterized by disseminated fine grained pyrite (1% and 3%). This zone ranges in thickness from 66 metres on section 21 to 106 metres on section 45 and is open to the southwest and down dip.

Contingent on the analytical results from the first phase of drilling, a second phase of drilling consisting of a minimum of 8,000 metres has been planned. Analytical results from all the diamond drill holes completed on the Uzboy west zone in 2005 will be reported when received.

Uzboy East Drilling Results:

Further to a news release dated May 19th, 2005, the fire assay results for the 13 diamond drill holes (NQ core size) completed in the northeast portion of the Uzboy East zone have been received. The drilling completed on this portion of the Uzboy East zone was designed to further delineate the limits of the gold mineralization in the oxide and transition zones. The northeast area of the Uzboy East zone between section 60 and section 82 is characterized by a zone of oxide mineralization that is a minimum of 250 metres long with several mineralized intervals occurring over a width of up to 70 metres.

Wide intervals of significant gold mineralization was intersected in the oxide, transition and primary zone over a minimum horizontal distance of 250 metres. The zone of oxide gold mineralization is open along strike to the northeast based on the mineralized interval located in diamond drill hole C8201.

The weighted average grades for the mineralized intervals in the diamond drill holes completed between section 60 and section 82 (estimated using a 0.20 g/t cutoff and no grade capping) are presented below:



------------------------------------------------------------------------
From, To, Interval, Average Grade Au
Profile # DDH # metres metres metres (cutoff 0.2 g/t)
------------------------------------------------------------------------
62 C6201 0.40 30.00 29.60 0.55
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55.00 62.50 7.50 0.28
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62 C6202 6.00 16.00 10.00 0.80
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30.00 52.70 22.70 0.74
------------------------------------------------------------------------
63.90 82.00 18.10 1.21
------------------------------------------------------------------------
66 C6601 19.60 39.50 19.90 0.59
------------------------------------------------------------------------
46.20 65.00 18.80 0.41
------------------------------------------------------------------------
66 C6602 4.40 41.70 37.30 1.65
------------------------------------------------------------------------
66.20 94.50 28.30 0.43
------------------------------------------------------------------------
70 C7001 35.10 43.40 8.30 0.45
------------------------------------------------------------------------
54.50 75.00 20.50 0.52
------------------------------------------------------------------------
70 C7002 5.50 18.50 13.00 0.22
------------------------------------------------------------------------
23.00 40.50 17.50 0.74
------------------------------------------------------------------------
46.50 64.60 18.10 0.96
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74 C7401 0.90 4.50 3.60 3.54
------------------------------------------------------------------------
10.00 28.50 18.50 0.60
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38.00 48.60 10.60 0.30
------------------------------------------------------------------------
55.20 65.00 9.80 0.38
------------------------------------------------------------------------
74 C7402 2.00 29.10 27.10 0.84
------------------------------------------------------------------------
46.50 60.30 13.80 1.49
------------------------------------------------------------------------
74 C7403 34.10 55.20 21.10 1.57
------------------------------------------------------------------------
76.00 93.60 17.60 0.39
------------------------------------------------------------------------
78 C7801 0.60 17.00 16.40 0.87
------------------------------------------------------------------------
50.00 64.00 14.00 0.34
------------------------------------------------------------------------
78 C7802 20.80 28.50 7.70 0.28
------------------------------------------------------------------------
37.30 40.50 3.20 1.62
------------------------------------------------------------------------
49.50 58.80 9.30 2.21
------------------------------------------------------------------------
63.20 75.00 11.80 0.34
------------------------------------------------------------------------
78 C7803 53.60 65.00 11.40 2.07
------------------------------------------------------------------------
82 C8201 26.30 51.50 25.20 1.00
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Uzboy Trend Exploration:

A total of 2,340 metres of Reverse Air Blast circulation drilling (RAB) has been completed in 374 vertical holes on the flanks of the Uzboy West zone and on the southwest portion of the Uzboy Trend. Preliminary exploration of the Uzboy Trend is being completed by drilling a 6 metre deep hole and sampling the last metre (approximately 5 to 6 metres below surface) in the hole. The holes are being drilled on sections that are 500 and 1,000 metres apart with holes spaced at 50 metre intervals on each section. Geochemical anomalies located by the RAB drilling will be followed up by additional RAB drilling, trenching and possibly diamond drilling. The RAB drilling on the Uzboy Trend is expected to be completed by mid-July.

Heap Leach Test Results:

As part of the ongoing heap leach test at the Uzboy site, approximately 155,000 grams (5,000 troy ounces) of gold have been precipitated on resin to date from test leach pad #1. Approximately 327,000 tonnes of material have been stacked on test leach pad #1. The gold concentration in solution from test heap pad #1 increased substantially since early May and has averaged 1,600 grams (51 troy ounces) per day over the past 50 days. The stacking of oxide gold mineralization on a second test leach pad (referred to as test leach pad # 3) located beside test leach pad #1 commenced in June. Approximately 63,000 tonnes have been stacked on test leach pad # 3 as part of the 720,000 test mining and heap leaching program proposed for 2005.

The onsite operations at the Uzboy gold project are supervised by senior mining, metallurgical and geological personnel employed by Saga Creek Gold Company LLP. Saga Creek is a wholly owned subsidiary of Alhambra Resources Ltd.

Dombraly Zone : Column Leach test:

A 200 kilogram bulk sample of oxide gold mineralization collected from the waste pile and the former open pit at the Dombraly zone was screened into plus and minus 20 millimetre-size fractions. The minus 20-millimetre size fraction was agglomerated and composited with the plus 20 millimeter size fraction prior to being placed in a 0.24 metre diameter by 2.20 metre high column. The column leach test was performed over a period of 30 days and yielded the following:

a) gold recovery into solution 94.7%.

b) solution application rate of 2.45 M3 per tonne of material leached,

c) 60.0 kilograms of lime per tonne of material agglomerated, and

d) 0.485 kilograms of cyanide consumed per tonne of material leached.

The high percentage gold recovery and relatively low cyanide consumption indicated by the column leach test are very encouraging. Two diamond drills are currently drilling on the Dombraly zone in the area of the former open pit. The objectives of the current phase of drilling are to confirm historical exploration results, provide representative samples of the oxide gold mineralization for additional agglomerated and non-agglomerated column leach tests and to confirm the depth of the oxide horizon. It is expected that the current phase of drilling (minimum of 2,000 metres in nine inclined holes) should be completed by mid-July.

Other Exploration Areas:

Exploration on the Shirotina Area, the Mamay Zone and the Point # 20 Zone has commenced. Exploration is scheduled to commence on the Kemaly Zone, the Kasatkoe Zone and Taskuduk Zone in early July (see attached Figure 2). A brief summary of the work performed on each area by Alhambra and historical exploration results is presented below.

Shirotina Area:

Limited wide spaced trenching and pit sampling has defined two zones of (0.2 g/t) disseminated style oxidized gold mineralization. The first zone is estimated to be 2,500 metres long by 500 metres wide. One trench within this zone returned a weighted average of 1.36 g/t gold over a distance of 60 metres. Numerous lower but significant gold values also occur within this zone. The second zone is estimated to be 2,000 metres long by 250 metres wide. The geology and style of mineralization in the Shirtoina Area shows many similarities to the oxide gold mineralization at the Uzboy zone. A substantial portion of the area to be explored in 2005 lies under a marsh and exploration consisting of trenching and RAB drilling is planned for late 2005.

Mamay Zone:

A total of 4,200 linear metres of trenching (15 trenches) over a strike length of 2,000 metres has outlined a zone of strongly altered sandstone, siltstone and tuff that is up to 150 metres wide and is open along strike in both directions. Due to the depth of recent clay deposits, two of the trenches did not reach bedrock. Mapping and sampling (2.0 metre sample intervals) of the trenches that reached bedrock have been completed.

Historical exploration results indicate the Mamay zone covers an area that is approximately 3.4 kilometres long by 400 metres wide. The geology, geochemical signature and historical exploration results of this area suggests potential for zinc-copper-lead-silver-gold style of mineralization. Historical exploration includes the drilling of three diamond drill holes, trenching and small scale open pit mining for gold. Analytical results of the historical diamond drill holes (spectral analysis) and trenching are as follows:



Diamond Drilling
DDH # Interval (m) Zn (%) Cu (%) Au (g/t)
--------------------------------------------------------------
M97-1 22.60 2.19 0.26 0.220
M97-2 39.00 0.70 0.10 0.040
M97-3 57.20 2.42 0.24 0.289

Trenching
Trench # Interval (m) Au (g/t) Trenched Over
--------------------------------------------------------------
K-9 6.90 1.85 DDH 97-1
K-8 12.80 4.30 DDH 97-2
K-13 23.65 2.50 DDH 97-3
K-13 11.60 2.00 DDH 97-3
--------------------------------------------------------------


Point # 20 Area:

This area is located approximately 10 kilometres along strike of the former Dombraly open pit mine. The geology of the area consists of oxidized sediments and tuff. Historical exploration results from trenches within this zone returned up to 1.50 g/t gold over an interval of 30 metres. Limited re-sampling of some of the old trenches by Alhambra returned the following gold values.



--------------------------------------------------------------
Trench # Interval (m) Grade (g/t)
--------------------------------------------------------------
1 5.00 1.30
2 5.00 3.70
3 5.00 0.54
4 5.00 1.35
--------------------------------------------------------------


The above sampling was completed over an area that is approximately 2,000 metres long by 200 m wide to confirm some of the historical exploration results. In addition to the gold values indicated above, a substantial number of lower but significant gold values were also outlined within the above defined area. Systematic trenching (average depth of 2.0 metres) of this zone is scheduled to be completed in July 2005.

Kimalyi Area:

This area is located approximately 15 kilometres northeast of the former Dombraly open pit mine. Two zones of oxide gold mineralization have been defined based on historical exploration results. The first zone covers an area of 1,000 m X 20 m and the second zone covers an area of 300 m X 700 m. These gold showings cover the sites for two former small open pits.

Kasatkoe Area:

Historical exploration has defined an area with approximate dimensions of 2,000 metres by 500 metres. Numerous surface samples collected from shallow pits within this area show gold values of greater than 1.0 g/t and one diamond drill hole is reported to have intersected a zone of oxide gold mineralization that average 7.0 g/t over an interval of 12 metres. Trenching is planned for this zone in July 2005.

Diamond Drilling and Sampling Procedures:

The diamond drilling on the Uzboy East zone was completed using a 76 mm diameter core barrel. Core recovery was estimated to be greater than 97%. After cutting with a diamond saw, one half of the core is collected for preparation and analysis and the other half is retained for future reference. Sample intervals were selected based on lithologies and intensity of oxidization. The sample interval and sample weight averaged one-meter and 1.6 kilograms respectively. Sample preparation was completed by Reactive Ltd. located in Stepnogorsk using the following procedure: core samples were pulverized in a jaw crusher to minus 1mm, mixed and split into two 0.75 kilogram sub-samples. One sub-sample is ground to - 200 mesh and the other sub-sample is retained for reference purposes. A 100 gram sample is selected from the -200 mesh material and used for fire assaying and the balance is retained for future purposes. A 50-gram sample is used in the fire assaying procedure. Centregeoanalit laboratory in Karaganda completed the fire assaying of the samples with an atomic absorption finish. Centergeoanalit Ltd. does not have an International Standard Organization rating.

Alhambra follows a rigorous Quality Assurance/Quality Control program consisting of inserting standards, blanks and duplicates into the sample stream submitted to the laboratory for fire assay.

Elmer B. Stewart, MSc. P. Geol., President of Alhambra, is the Company's nominated Qualified Person responsible for monitoring the supervision and quality control of the exploration programs completed on the Uzboy Property. Mr. Stewart has reviewed and verified the technical information contained in this news release.

This document contains statements about expected or anticipated future events and financial results that are forward looking in nature and, as a result, are subject to certain risks and uncertainties, such as general economic, market and business conditions, the regulatory process and actions, technical issues, new legislation, competitive and general economic factors and conditions, uncertainties resulting from potential delays, operating in foreign countries or changes in plans, the occurrence of unexpected events and the Corporation's capability to execute and implement its future plans. Actual results may differ materially from those projected by management. For such statements, we claim the safe harbor for future looking statements within the meaning of the Private Securities Legislation Reform Act of 1995.

There are maps of the Uzboy Project available on CCNMatthews' website at http://www2.ccnmatthews.com/database/fax/2000/627alh1.pdf

The TSX Venture Exchange Inc. has not reviewed and does not accept responsibility for the adequacy or accuracy of this news release.

Contact Information

  • Alhambra Resources Ltd.
    Elmer B. Stewart
    President & Chief Operating Officer
    (403) 228-2855
    or
    Alhambra Resources Ltd.
    Jim Clarke
    Investor Relations
    Toll Free: 1-888-290-1335
    Website: www.alhambraresources.com