Cluff Gold PLC
LSE : CFG

May 03, 2011 02:00 ET

Baomahun Gold Project-Feasibility Study Update

FOR:  CLUFF GOLD PLC
AIM SYMBOL:  CLF
TSX SYMBOL:  CFG
May 3, 2011
Baomahun Gold Project-Feasibility Study Update
LONDON, UNITED KINGDOM--(Marketwire - May 3, 2011) - Cluff Gold plc (AIM:CLF)(TSX:CFG) ("Cluff Gold" or the
"Company"), the dual AIM/TSX listed West African focused gold mining company, is pleased to announce positive
progress on the definitive feasibility study ("DFS") work at its Baomahun Gold Project ("Baomahun") in Sierra
Leone.
Highlights:
--  15,000m of in-fill drilling has been completed since the last resource
    update, announced on 4 June 2010, which has confirmed greater continuity
    of mineralisation within the current resource area than had previously
    been modelled.
--  Completion of the definitive feasibility study is expected in Q3 2011,
    with all major aspects well underway.
--  Ongoing metallurgical optimisation studies suggest that an intermediate
    flotation stage may result in a material decrease in both capital and
    cash operating costs compared to a conventional CIP/CIL plant due to
    reduced grinding requirements.
--  A feasibility study has been commissioned into the establishment of a
    hydro-electric power station which would have the potential to
    materially reduce cash costs compared to the heavy fuel oil power option
    currently modelled.
Peter Spivey, Chief Executive Officer of Cluff Gold, commented:
"We are very pleased with the progress we have made to date, and we remain on track for the completion of the
feasibility study in Q3 2011. With the hydro-electric power and flotation options, together with the along
strike exploration program currently underway, there is significant potential to further improve the project
economics beyond the feasibility study."
Feasibility Study Update
Since the last resource update, announced on 4 June 2010, over 15,000m of in-fill drilling has been completed,
which has confirmed greater continuity of mineralisation within the current resource area than had previously
been modelled. Assay results have been received for first 20 holes totalling 8,340m, which continue to confirm
broad, high grade mineralised zones. Notable intercepts include:
--  16m @ 7.1g/t from 346m, including 10m @ 10.2 g/t from 347m
--  19m @ 5.7g/t from 611m, including 10m @ 6.89 g/t from 612m
--  22m @ 4.2g/t from 332m, including 11m @ 7.0 g/t from 335m
--  13m @ 5.4g/t from 421m, including 3m @ 18.7 g/t from 429m
--  12m @ 8.2g/t from 48m, including 5m @ 12.8g/t from 50m
A full schedule of assay results is set out in the Appendix.
A new resource block model is currently being developed, which is expected to be announced during Q2 2011. A
lower-risk open-pit only mining method is being adopted for the DFS, compared to the combined open pit and
underground mining schedule set out in the Preliminary Economic Assessment announced on 12 August 2010.
The DFS is expected to be completed in Q3 2011, with all major components including environmental and social
studies, engineering plans and mine infrastructure planning well underway.
The Company is also carrying out additional cost optimisation studies outside the DFS with a view to achieving
the best possible economics. Principally these are:
--  Ongoing metallurgical test work suggests that a process route
    incorporating a flotation stage may be viable. If successful, this would
    result in a significant reduction in capital and operating costs
    compared to the conventional CIP/CIL option currently modelled due to a
    reduction in grinding requirements. Final results for this test work are
    expected to be available in Q3 2011 for integration in the detailed
    plant design.
--  The topographical relief and rainfall pattern of the region enables the
    provision of hydro-electric power ("HEP") without the need for major dam
    construction or land inundation. A feasibility study into the
    establishment of an HEP station has been commissioned, with 12-month
    river flow gauging due to be completed in July 2011. Results to date
    suggest that a 20MW run of river HEP plant could provide 72% annual
    power availability, which would significantly reduce cash costs at
    current fuel prices compared to the heavy fuel oil power option
    currently modelled. The HEP feasibility study is expected to be
    completed in Q4 2011.
Quality Assurance and Quality Control
Drill intersections were calculated using a cut-off of 0.5g/t and include up to two metres of internal waste.
The intersections are from infill drill holes within the resource area and do not necessary represent
extensions to already defined zones of mineralisation. The true thickness of the mineralisation may vary from
40% to 70% of the intersected widths.
Drill cores for assaying were taken at a maximum of one metre intervals and were cut with a diamond saw. One
half of the core was placed in sealed bags and sent to the Company's sample preparation facility at Baomahun,
Sierra Leone. The core samples were then crushed to minus 4mm and split, with approximately 1.5kgs of sample
pulverised down to 95% passing 106 microns. Approximately 120 grams of the pulverised sample were then shipped
to the SGS Laboratories (which are independent of the Company) in Siguiri, Guinea, and Tarkwa, Ghana, where the
samples were analysed for gold by fire assay using a 50g charge. As part of the Company's QA/QC procedures,
internationally recognised standards and blanks were inserted into the sample batches.
About Cluff Gold
Cluff Gold is a gold developer-producer with assets in West Africa. The Company generates significant cash flow
through its Kalsaka gold mine in Burkina Faso. The Company remains focused on its objective of becoming a mid-
tier producer through the development of its wholly-owned Baomahun project in Sierra Leone, which is expected
to contribute an additional 157,000oz of gold per annum, with significant exploration potential along strike.
With its experience of bringing new mines into production and a project pipeline of exploration licenses in
Burkina Faso and Mali, the Company aims to further increase its production profile with its highly prospective
exploration work across all assets.
Baomahun is Cluff Gold's defining development gold project in Sierra Leone. Definitive feasibility study work
is progressing in the immediate resource area, where 1.4Moz of measured and indicated resources (0.5Moz
measured comprising 5.5Mt at 2.9g/t and 0.9Moz indicated comprising 9.6Mt at 2.9g/t) and a further 1.0Moz of
inferred resources (comprising 12.2Mt at 2.6g/t) have been delineated to date(1). The current resource base is
contained in an area of approximately 2 sq. km while the total project licence area is 136 sq. km, with
significant exploration upside along strike.
This press release includes certain "forward-looking information" within the meaning of applicable Canadian
securities legislation. All statements other than statements of historical fact, included in this release,
including, without limitation, the positioning of the Company for future success, statements regarding
potential future production at Baomahun, the implementation and potential benefits of intermediate flotation
stage and hydro-electric power, the timing of the feasibility study and exploration and future drilling results
at Baomahun, and future capital plans and objectives of Cluff Gold, are forward-looking information that
involve various risks and uncertainties. There can be no assurance that such statements will prove to be
accurate and actual results and future events could differ materially from those anticipated in such
statements. Important factors that could cause actual results to differ materially from Cluff Gold's
expectations include, among others, risks related to international operations, the actual results of current
exploration and drilling activities, changes in project parameters as plans continue to be refined as well as
future price of gold. Although Cluff Gold has attempted to identify important factors that could cause actual
results to differ materially, there may be other factors that cause results not to be as anticipated, estimated
or intended. There can be no assurance that such statements 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 statements. Cluff Gold does not undertake to update any forward-
looking statements that are included herein, except in accordance with applicable securities laws.
Mr. Andrew Asante, (M.Sc., AusIMM), Resource Manager for Cluff Gold plc and a "qualified person" as such term
is defined in National Instrument 43-101, has reviewed the contents of this press release. Mr. Asante has
verified the data disclosed in this release, including sampling, analytical and test data underlying the
information contained herein.
(1) As per the Company's report Technical Review of the Baomahun Gold Exploration Project, Sierra Leone dated
12 August 2010, made available on the Company's website and on SEDAR.
                                  Appendix
----------------------------------------------------------------------------
               Dip   Azimuth                  From
Hole ID  (degrees) (degrees)       Intercept   (m)  Comments
----------------------------------------------------------------------------
----------------------------------------------------------------------------
DDH325          50       229   8m @ 2.10 g/t    68
----------------------------------------------------------------------------
                               2m @ 1.30 g/t    94
----------------------------------------------------------------------------
                               3m @ 1.62 g/t   245
----------------------------------------------------------------------------
                                                    Includes 3m @ 4.55 g/t
                              16m @ 2.19 g/t   252  from 255m
----------------------------------------------------------------------------
                               6m @ 3.58 g/t   278
----------------------------------------------------------------------------
                               3m @ 1.06 g/t   310
----------------------------------------------------------------------------
DDH326          73       182   3m @ 1.11 g/t    89
----------------------------------------------------------------------------
                               4m @ 1.86 g/t   115
----------------------------------------------------------------------------
                               2m @ 1.02 g/t   137
----------------------------------------------------------------------------
                               3m @ 2.65 g/t   147
----------------------------------------------------------------------------
                                                    Includes 4m @ 11.04 g/t
                               8m @ 5.92 g/t   341  from 344m
----------------------------------------------------------------------------
DDH327          45       212   2m @ 1.19 g/t    76
----------------------------------------------------------------------------
DDH328          45       262   3m @ 1.39 g/t   109
----------------------------------------------------------------------------
                               3m @ 3.00 g/t   127
----------------------------------------------------------------------------
                                                    Includes 2m @ 15.2 g/t
DDH329A         60       219   5m @ 7.18 g/t   327  from 328m
----------------------------------------------------------------------------
                               5m @ 1.76 g/t   378
----------------------------------------------------------------------------
                                                    Includes 3m @ 11.9 g/t
                                6m @ 6.27g/t   386  from 386m
----------------------------------------------------------------------------
DDH330          58       207   2m @ 1.30 g/t   282
----------------------------------------------------------------------------
                               2m @ 1.63 g/t   290
----------------------------------------------------------------------------
                              15m @ 1.55 g/t   378
----------------------------------------------------------------------------
DDH331          52       212   4m @ 2.45 g/t   305
----------------------------------------------------------------------------
                                                    Includes 10m @ 10.20 g/t
                              16m @ 7.09 g/t   346  from 347m
----------------------------------------------------------------------------
DDH332          67       205   3m @ 2.38 g/t   417
----------------------------------------------------------------------------
                               6m @ 2.16 g/t   471
----------------------------------------------------------------------------
                                                    Includes 2m @ 7.89 g/t
DDH333          49        58   6m @ 3.09 g/t   365  from 368m
----------------------------------------------------------------------------
                               2m @ 1.02 g/t   374
----------------------------------------------------------------------------
DDH334          47        47   2m @ 2.24 g/t   301
----------------------------------------------------------------------------
                               5m @ 1.69 g/t   401
----------------------------------------------------------------------------
                               7m @ 5.26 g/t   409
----------------------------------------------------------------------------
                               2m @ 1.20 g/t   452
----------------------------------------------------------------------------
DDH335          52        61   2m @ 1.15 g/t   505
----------------------------------------------------------------------------
                                                    Includes 10m @ 6.89 g/t
                              19m @ 5.68 g/t   611  from 612m
----------------------------------------------------------------------------
                               3m @ 2.02 g/t   642
----------------------------------------------------------------------------
                               3m @ 6.29 g/t   671
----------------------------------------------------------------------------
DDH336          49        65   9m @ 1.66 g/t   273
----------------------------------------------------------------------------
                               4m @ 1.90 g/t   285
----------------------------------------------------------------------------
                               7m @ 2.15 g/t   305
----------------------------------------------------------------------------
                                                    Includes 4m @ 5.77 g/t
                              32m @ 2.16 g/t   352  from 370m
----------------------------------------------------------------------------
                                                    Includes 6m @ 5.60 g/t
DDH337          47        68  12m @ 3.27 g/t   315  from 319m
----------------------------------------------------------------------------
                                                    Includes 11m @ 7.03 g/t
                              22m @ 4.15 g/t   332  from 335m
----------------------------------------------------------------------------
                               2m @ 2.20 g/t   361
----------------------------------------------------------------------------
                              11m @ 1.11 g/t   377
----------------------------------------------------------------------------
                               3m @ 2.00 g/t   391
----------------------------------------------------------------------------
                              10m @ 1.46 g/t   397
----------------------------------------------------------------------------
                              15m @ 1.42 g/t   443
----------------------------------------------------------------------------
DDH338          47        65   2m @ 2.19 g/t   415
----------------------------------------------------------------------------
                                                    Includes 3m @ 18.66 g/t
                              13m @ 5.43 g/t   421  from 429m
----------------------------------------------------------------------------
                                                    Includes 3m @ 6.46 g/t
                              10m @ 3.03 g/t   439  from 444m
----------------------------------------------------------------------------
                               8m @ 1.09 g/t   473
----------------------------------------------------------------------------
                               5m @ 3.62 g/t   537
----------------------------------------------------------------------------
DDH339          45        55   2m @ 2.83 g/t   430
----------------------------------------------------------------------------
                                                    Includes 3m @ 5.37 g/t
                               5m @ 4.00 g/t   441  from 442m
----------------------------------------------------------------------------
                              3m @ 11.38 g/t   451
----------------------------------------------------------------------------
                                                    No significant
DDH340                                              intersection
----------------------------------------------------------------------------
DDH341         253        78   8m @ 1.53 g/t   196
----------------------------------------------------------------------------
                               3m @ 1.25 g/t   256
----------------------------------------------------------------------------
                               2m @ 1.71 g/t   264
----------------------------------------------------------------------------
                               4m @ 1.04 g/t   281
----------------------------------------------------------------------------
DDH342         247        72   5m @ 2.09 g/t   253
----------------------------------------------------------------------------
                               5m @ 2.49 g/t   288
----------------------------------------------------------------------------
                               4m @ 1.60 g/t   332
----------------------------------------------------------------------------
                                                    Includes 5m @ 12.76 g/t
DDH343           5        50  12m @ 8.15 g/t    48  from 50m
----------------------------------------------------------------------------
                               3m @ 2.25 g/t    77
----------------------------------------------------------------------------
                               2m @ 1.19 g/t   102
----------------------------------------------------------------------------
                               2m @ 4.07 g/t   150
----------------------------------------------------------------------------
DDH344         253        70   5m @ 1.00 g/t    51
----------------------------------------------------------------------------
                                                    Includes 3m @ 6.76 g/t
                                5m @ 4.60g/t   177  from 178m
----------------------------------------------------------------------------
-30-
FOR FURTHER INFORMATION PLEASE CONTACT:
Cluff Gold plc
J.G. Cluff
Chairman
+44 (0) 20 7340 9790
OR
Cluff Gold plc
Pete Gardner
Finance Director
+44 (0) 20 7340 9790
OR
Evolution Securities Limited
Tim Redfern
+44 (0) 20 7071 4300
OR
Evolution Securities Limited
Jeremy Ellis
+44 (0) 20 7071 4300
OR
Pelham Bell Pottinger
Investor Relations (Global)
Lorna Spears
+44 (0) 20 7861 3232
OR
Pelham Bell Pottinger
Investor Relations (Global)
Philippe Polman
+44 (0) 20 7861 3232
OR
Farm Street  Communications Ltd
Press Relations (U.K.)
Simon Robinson
+44 (0) 7593 340 107
simon.robinson@farmstreetmedia.com
NO REGULATORY AUTHORITY HAS APPROVED OR DISAPPROVED THE CONTENT OF THIS PRESS RELEASE.
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