Canaco Resources Inc.
TSX VENTURE : CAN

Canaco Resources Inc.

September 13, 2010 06:00 ET

Canaco's Regional Exploration Extends Gold Trend to 15 Kilometres, Discovers New Gold Mineralization 5km WNW of the Magambazi Gold Discovery

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Sept. 13, 2010) - Canaco Resources Inc. (TSX VENTURE:CAN) is excited to announce significant new exploration developments from the Company's 100% owned Handeni Gold Project located in the United Republic of Tanzania. Including the identification of important new parallel trends of gold mineralization, successful RAB drilling on regional targets and the discovery of a new mineralized zone 5 kilometres WNW of the Magambazi Gold Discovery.

Early results from the regional exploration on the Handeni Gold Trend indicate the work program has already made significant progress in identifying new gold targets and upgrading the potential of previously identified gold zones. Over the past month, the regional program has included over 3000 metres of Reverse Circulation ("RC") drilling, approximately 10,000 metres of reconnaissance Rotary Air Blast ("RAB") drilling, a detailed airborne survey, detailed mapping some of the key target areas defined to date and geochemical interpretation.

The Majiri-Semwaliko-Kwadijava ("MSK") Gold Trend:

Recent soil sampling completed as part of the regional exploration program has now defined 6 kilometre extension of the MSK Gold Trend 2.5 kilometres west of the Magambazi gold discovery. These results have now confirmed the presence of gold in soils over a continuous strike length of 12 kilometres. The Handeni Gold trend is now recognized as consisting of two, parallel gold trends with a combined strike length of over 15 kilometres.

New discovery at Kwadijava South:

Initial results at the Kwadijava South prospect have indicated the presence of ore-grade gold mineralization over significant widths. The gold mineralization is hosted in sulphide-rich garnet and silica altered amphibolite, similar to the Magambazi Main Lode.

Kwadijava South is the site of recently identified bedrock artisanal workings that target sulphidic quartz veins in amphibolite host rocks. The Kwadijava South zone has been traced over a strike length of 3.2 kilometres and is defined by current and historic bedrock and alluvial workings, strongly anomalous gold values in soil and geological mapping of gossan (weathered sulphide) and intense silica-garnet alteration.

Canaco's exploration team is currently revising drilling priorities and examining access options to accommodate the mobilization of drills to advance the exploration of this important new gold target. 

RAB Drilling identifies new targets:

RAB drilling has been completed north of Magambazi at Bahati, west of Magambazi and along the Kwadijava-Semwaliko Trend, and at Tajiri, west of Majiri. Less than half of the assay results collected from the RAB drilling program have been received to date. However, early results from shallow RAB drilling have already identified new gold mineralization west of Magambazi Hill in 3 holes over a width of 120 metres.

A program of follow-up RC drilling is currently being planned to determine the size and continuity of this new mineralized zone.

New Mineralization at Magambazi West:

Mapping on the western flank of Magambazi Hill has defined an additional target associated with a linear gold soil anomaly. Recently identified historic artisanal workings occur over a 1.2 kilometre strike along an altered amphibolite contact and significant alluvial gold is shed from the trend. RAB results for The Magambazi West target are pending.

"Initial results from the regional exploration program are highly significant and highlight the enormous potential Canaco has along the Handeni Gold Trend", said Andrew Lee Smith. "Regional exploration on the 100% Canaco owned Kilindi licence is at an early stage, and the recent discovery at Kwadijava South and significant new target zones identified during regional exploration work, validates the trend as having the potential to host other Magambazi-type gold deposits."

The planning, execution and monitoring of quality control programs at the Handeni project are under the supervision of Andrew Lee Smith, P.Geo, Canaco's CEO. Mr. Smith is a qualified person as defined by National Instrument 43-101.

Additional information and public documents about Canaco Resources, including drill hole intercepts, drill collar maps, and images of 2009 exploration activities, can be viewed at the Company's website www.canaco.ca or at www.sedar.com. Canaco Resources Inc. is listed on the TSX Venture Exchange and is engaged in the exploration and development of Tanzanian gold prospects.

Andrew Lee Smith, P.Geo

CEO, Canaco Resources

Dr. Jingbin Wang

Chairman, Canaco Resources

The Company relies on litigation protection for "forward-looking" statements.

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

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