Canaco Resources Inc.
TSX VENTURE : CAN

Canaco Resources Inc.

February 08, 2011 06:00 ET

Canaco Initiates Phase 1 Drill Program on the Handeni Gold Trend in Tanzania

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Feb. 8, 2011) - Canaco Resources Inc. (TSX VENTURE:CAN) is pleased to report that reverse circulation (RC) drilling has commenced on its 100%-owned Kilindi licence on the Handeni project in Tanzania. A total of 10,000 metres of drilling is planned for the four key target areas of Kwadijava, Kwadijava South, Majiri and Majiri Bomba. Infill and extension drilling has also recommenced on the Magambazi zone with three rigs, and an additional fourth rig is scheduled to start in February to accelerate Magambazi definition drilling. 

Three high-priority targets are defined along the Majiri-Semwaliko-Kwadijava (MSK) trend, supported by artisanal workings including bedrock and alluvial operations, soil geochemical anomalies, and magnetic and IP targets/trends. These targets will be the principal focus of the RC drill campaign.

The Handeni gold trend is now recognized as consisting of two parallel gold trends with a combined strike length of over 15 kilometres. All of Canaco's diamond drilling to date, which comprises more than 100 holes totalling 30,000 metres, has been along the Magambazi trend. The MSK trend has not been drill tested. The MSK trend is a sequence of metamorphosed mafic rocks (amphibolites) inter-bedded with sedimentary rocks (shales and siltstones – now kyanite-bearing gneiss), directly above a major geological boundary (basement granitic gneiss).

Quality Control

The planning, execution and monitoring of Canaco's quality control programs at the Harvest project are under the supervision Jeff Heidema, P.Geo, Canaco's VP Exploration, and Dr. David Groves, Canaco's Director of Project Development. Mr. Heidema and Dr. Groves are Qualified Persons as defined by National Instrument 43-101. Canaco utilizes an industry standard QA/QC protocol with respect to sampling procedures. Blanks and certified reference standards are inserted into the sample stream to monitor laboratory performance and duplicates of pulps and bulk rejects are also used to monitor laboratory performance.

Additional information and public documents about Canaco, including a complete list of drill hole intercepts and drill collar maps, can be viewed at the Company's website www.canaco.ca or at www.sedar.com.

About Canaco

Canaco is a Vancouver-based mineral exploration company focused on advanced exploration in Africa. Built on a foundation of experienced management and focused on rapidly advancing exploration projects in Tanzania and throughout Africa, Canaco is well positioned to build shareholder value through discovery and resource development.

Canaco's shares trade on the TSX Venture Exchange under the symbol CAN.

On behalf of the Board of Directors

Andrew Lee Smith, P.Geo, President, CEO and Director

Cautionary Statement Regarding Forward-Looking Information

This press release contains "forward-looking information" within the meaning of applicable Canadian securities legislation. Generally, forward-looking information can be identified by the use of forward-looking terminology such as "anticipate", "believe", "plan", "expect", "intend", "estimate", "forecast", "project", "budget", "schedule", "may", "will", "could", "might", "should" or variations of such words or similar words or expressions. Forward-looking information is based on reasonable assumptions that have been made by the Company as at the date of such information and 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: risks associated with mineral exploration and development; metal and mineral prices; availability of capital; accuracy of the Company's projections and estimates; interest and exchange rates; competition; stock price fluctuations; availability of drilling equipment and access; actual results of current exploration activities; government regulation; political or economic developments; environmental risks; insurance risks; capital expenditures; operating or technical difficulties in connection with development activities; personnel relations; the speculative nature of strategic metal exploration and development including the risks of diminishing quantities of grades of reserves; contests over title to properties; and changes in project parameters as plans continue to be refined. Forward-looking statements are based on assumptions management believes to be reasonable, including but not limited to the price of gold; the demand for gold; the ability to carry on exploration and development activities; the timely receipt of any required approvals; the ability to obtain qualified personnel, equipment and services in a timely and cost-efficient manner; the ability to operate in a safe, efficient and effective manner; and the regulatory framework regarding environmental matters, and such other assumptions and factors as set out herein. 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 information. Accordingly, readers should not place undue reliance on forward-looking contained herein, except in accordance with applicable securities laws.

Neither 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 release.

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