Avala Resources Ltd.
TSX VENTURE : AVZ

Avala Resources Ltd.

February 25, 2013 09:43 ET

Avala Resources Reports Bigar Hill Infill Drilling Results

Also reports acquisition of exploration licences covering the southern extension of the Timok Gold belt in Serbia

LONGUEUIL, QUEBEC--(Marketwire - Feb. 25, 2013) - Avala Resources Ltd. (TSX VENTURE:AVZ) (the "Company" or "Avala") is pleased to present drill results from the Bigar Hill Infill drilling program, part of the Timok Gold Project, and details of its belt-wide ground acquisition program.

1. HIGHLIGHTS

Bigar Hill Infill Drilling Program

  • The 40 metre by 40 metre infill drilling program at Bigar Hill has been completed and a validated database has been delivered to independent mining consultants AMC Consultants Limited (UK) ("AMC") in order to produce an updated NI43-101 compliant resource estimate.
  • Very encouraging gold intercepts (0.4 g/t Au cut-off grade) have been returned from the infill drilling program, typically characterised by multiple gold mineralized intersections per hole.
Hole ID From (m) To (m) Interval (m) Au (g/t) Gram-meters
BHRC/DT166 121 140 19 2.37 45
BHRC/DT166 163 170 7 0.42 3
BHRC/DT166 175 182 7 0.59 4
BHRC/DT166 204 232 28 3.00 84
BHDT176 188 194 6 4.14 25
BHDT176 323 335 12 8.05 97
BHRC132 135 173 38 3.64 138
BHRC132 203 212 9 0.75 7
BHRC148 50 56 6 8.19 49
BHRC148 62 78 16 7.86 126
BHRC148 209 232 23 1.23 28
BHRC148 258 285 27 1.63 44
BHRC151 44 77 34 2.91 99
BHRC151 141 166 25 2.72 68
BHRC185 102 164 62 1.69 105
BHRC185 191 230 39 1.22 48
BHRC194 70 84 14 5.80 81
BHRC194 130 139 9 2.50 23
BHRC194 190 209 19 2.11 40
BHRC201 131 226 95 1.53 145
BHRC203 87 109 22 1.86 41
BHRC203 116 128 12 3.77 45
BHRC203 142 153 11 1.72 19
BHRC203 203 223 20 0.95 19
BHRC205 123 156 33 0.96 32
BHRC205 164 218 54 1.80 97
BHRC205 226 231 5 1.23 6
BHRC215 100 160 60 1.25 75
BHRC215 176 197 21 2.36 50
BHRC224 136 148 12 0.57 7
BHRC224 157 165 8 0.61 5
BHRC224 184 209 25 1.91 48
BHRC224 215 237 22 1.00 22
BHRC224 245 269 24 3.77 90
BHRC288 168 203 35 3.20 112
BHRC288 215 220 9 0.77 4
BHRC288 279 284 5 0.48 2
BHRC297 140 156 16 0.92 15
BHRC297 162 186 24 2.09 50
BHRC297 198 220 22 3.14 69
BHRC297 264 274 10 2.22 22
BHRC333 24 31 7 4.18 29
BHRC333 62 77 15 2.30 35
BHRC333 87 94 7 6.44 45
BHRC333 172 178 6 1.61 10
BHRC333 192 226 34 0.99 34
  • Note: Intersections calculated using 5 meter minimum thickness, 5 meter maximum included waste.
  • Note: BHRC/BHDT denotes a drill hole that was started as an RC hole and finished with a diamond drill core 'tail'.

Belt-wide ground acquisition program

  • Following a detailed review of the regional geology of eastern Serbia, four additional exploration licences have been applied for, covering the southern extensions of the Timok Gold Belt within Serbia. Refer to Figure 1 for the licence locations and a summary of Avala's current ground holding in the Timok Gold Project.
  • Three licenses have been granted to date (Goli Vrh, Manojlica and Jerma for a total of 374 square kilometers ) and one remains under application (Babin Kal, for 148.8 square kilometres).
  • Avala now holds, or has applied for, approximately 1,383 square kilometres, covering the vast majority of the target stratigraphy that hosts gold mineralization within the Timok Gold Project.

2. INFILL DRILLING AT BIGAR HILL

  • Avala commenced infill drilling at Bigar HIll in February 2012 and the program was completed in October, for a total of 56,684.3 meters (40 diamond drill holes for 12,055.3 meters, including 6 twin drill holes, and 44,629 meters of reverse circulation drilling).
  • A total of 208 RC drill holes, for 44,629 meters, have been completed in the infill drilling program, to provide a notional 40m by 40m drill collar spacing. The average hole depth is 214 meters and the calculated drill recovery was 93%.
  • In additional some 34 diamond drill holes, including diamond 'tails' of RC holes (completed when wet drilling conditions were encountered) also form part of the infill drilling program, for 10,195.5m. The average drill hole depth of the diamond drill holes is 300 meters and a 98% core recovery was recorded.
  • 'Twin' diamond drilling of reverse circulation drill holes represented approximately 4% of total RC drilling, comprising 6 holes for 1859.8 meters.
  • Refer to Table 1 for a summary of the Bigar Hill infill drill program intersections at a 0.4g/t Au cut-off grade. Figure 2 shows a gram-meter total metal contour plot (intervals greater than 0.4g/t Au x thickness), of all Bigar Hill drilling to date, superimposed on topographic contours. Drill collars for holes reported in this release are highlighted in red in Figure 2.
  • The routine reverse circulation-diamond 'twin' drilling program continues to confirm that the majority of mineralized intercepts and hence the deposit style, are dominated by layer-parallel, lithology/fault-controlled gold mineralization.
  • The reverse circulation-diamond 'twin' drill holes suggest that there can be close spaced variation in gold grade, as is typical for gold deposits.
  • Multiple gold mineralized intercepts per hole are a common feature of the gold mineralization outlined to date in the Bigar Hill, Korkan and Kraku Pester target areas.

3. CANADIAN NATIONAL INSTRUMENT 43-101 COMPLIANT RESOURCE ESTIMATION

  • Following full internal validation, the updated Bigar Hill exploration database has been delivered to AMC in order to undertake an independent resource estimation update.
  • It is planned to complete the updated Canadian National Instrument 43-101 compliant resource estimate on Bigar Hill during Q2, 2012.
  • All drill holes have been down-hole surveyed at regular intervals; with drill collars surveyed using DGPS or total station surveying methods. The topographic surface is based on detailed DGPS and total station surveying methods, with an average survey station spacing of approximately 15 meters by 15 meters.
  • As per standard Avala data acquisition protocols, a full set of field duplicates, lab duplicates and replicates, blanks and internationally accredited assay standards have been routinely collected and inserted into the sample sequence.
  • All drill hole assaying and bulk density measurements have been carried out independently by SGS.

4. ADDITIONAL INFORMATION

  • Figure 3 shows the location of the Bigar Hill deposit within the greater sediment-hosted gold belt, as defined in this image by mapped 'target stratigraphy'. Figure 3 also shows anomalous gold soil geochemistry, on which the total metal contour plots, based on drill intersections, are superimposed
  • Please see the following link to view all Korkan-Bigar and Kraku Pestar drill holes located spatially in three dimensions: http://www.corebox.net/properties/timok-gold-project

5. SAMPLING AND ANALYSIS

The Company has established a fully equipped, 'state of the art' laboratory facility at Bor, Eastern Serbia which is independently managed by SGS. Diamond drill core and RC samples have been prepared and assayed at the SGS-managed laboratory facility at Bor. A one metre sampling interval has been used where possible for the Sediment-Hosted Gold project diamond drilling program. Half core is routinely submitted to the laboratory for analysis. Reverse circulation drill samples, collected using a routine one meter sampling interval, have been prepared and assayed at the laboratory facility at Bor. Following Avala standard quality assurance procedures, a full suite of field and laboratory duplicates and replicates along with internationally accredited standards and blanks, have been submitted with each batch of samples.

All data collected in the field was routinely entered into geology and structural geology spread sheets using Field Marshal software for subsequent entry to an acQuire database and validation.

Dr Julian F. H. Barnes, a qualified person under National Instrument 43-101, a Director and the Company's Special Consultant, has supervised the preparation of the technical data in this press release.

About Avala Resources Ltd.: Avala Resources is a mineral exploration company focused on the exploration and development of the Timok Gold Project in Eastern Serbia. Avala has recently announced NI 43-101 compliant resource estimates on the three principal targets of its Timok Gold Project. Avala controls 100% of this newly identified sediment-hosted gold belt, which totals approximately 1,200 square kilometers. The common shares of Avala trade on the TSX Venture Exchange under the symbol 'AVZ'. Avala's issued and outstanding share capital totals 254,492,223 common shares, of which approximately 53.1% is held by Dundee Precious Metals Inc. (TSX:DPM). Avala is well-capitalized, with approximately $9 million in its treasury at January 31, 2013, which it plans to use for the exploration and development of its mineral projects in Serbia.

Cautionary Statement

This press release contains 'forward-looking information' within the meaning of applicable Canadian securities legislation. Forward looking information in this news release includes information with respect to the Bigar Hill mineral resource estimate and its potential expansion, plans to complete an updated NI 43-101 compliant mineral resources, the timing and location of future work programs, the results and interpretation of studies and exploration activities, the nature of the mineralization of the project, the potential size of the sediment-hosted gold system, the possibility that the Timok Gold Project will prove to be economic, and the suggested similarity to the style of gold mineralization of the North Carlin Trend project.

Forward-looking information is based on reasonable assumptions that have been made by the Company as at the date of the information and is subject to known and unknown risks, uncertainties, and other factors that may cause actual results or events to differ materially from those anticipated in the forward-looking information. 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 factors that cause results to be other than as anticipated, estimated or intended. There can be no assurance that the forward looking information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information. Accordingly, readers should not place undue reliance on forward-looking information contained herein, except in accordance with applicable securities laws.

Figures and tables are available at the following link: http://media3.marketwire.com/docs/Fig_Tables_AVZA0225.pdf.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this press release.

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