GGG Resources plc
LSE : GGG

GGG Resources plc

February 08, 2011 02:16 ET

GGG Resources plc (the "Company" or "GGG") Bullabulling Gold Project-February Project Update

LONDON, UNITED KINGDOM--(Marketwire - Feb. 8, 2011) - GGG Resources plc (LSE:GGG) is pleased to announce a project update on its Bullabulling project, the former producing gold mine in the Coolgardie Goldfield of Western Australia. The update includes results from an additional 29 drill holes of the current resource drilling programme. Bullabulling is being re-developed by the Company with its joint venture partner, Auzex Resources Limited.

Highlights

  • Latest drill highlights indicate all 29 new drill holes were mineralised including:
    18m at 4.37 g/t Au from 53m in BJ0057,
    4m at 3.30 g/t Au from 42m in BJ0084,
    5m at 8.20 g/t Au from 23m in BJ0085.
  • To date 87 of 88 holes show mineralisation consistent with the current JORC resource model
  • 22% of mineralisation in the current programme extends beyond the current JORC
  • JORC resource model upgrade on track to be reported in Q2 2011
  • Additional 7km of drilling commissioned on top of the existing budgeted 17km
  • Metallurgical drilling has been completed ahead of schedule and preliminary results indicate material is softer than expected
  • New prospecting licences were added to the existing tenements for a total of 144km2

Jeff Malaihollo, Managing Director of GGG Resources, says:

"Results from the drilling continue to increase our confidence in the quality of the historic data and the accuracy of the resource model. We have now commissioned a further 7kms of new drilling in order to infill the new mineralisation we found outside of the historically drilled areas. If the results are consistent with the rest of the deposit, we expect to include these zones in the new resource estimate to an Indicated Resource category. We are also delighted that the metallurgical work indicates a softer material than expected. Although at an early stage, this may have a positive impact on the project by lowering mining and crushing costs and therefore enabling us to use a lower cut-off grade."

Geological Review and Drilling:

The Joint Venture is pleased to announce an update on progress to date on work at the Bullabulling Gold Project. Work in the period after Christmas has focussed on completing the resource drilling, reviewing QAQC results, reviewing drill spacing requirements to upgrade the new resource estimate and completing metallurgical testwork.

The Bullabulling Gold project is a large tonnage, low grade deposit with high grade shoots, associated with the regional Bullabulling shear zone which extends over tens of kilometres. The current programme focuses on approximately 2.3km of the 6km portion known as the Bullabulling Trend which was previously mined by Resolute Mining. The focus for the Joint Venture is to establish an initial reserve to commence production in 2013. Mineralisation is open in all directions, and it is planned to follow up new exploration targets once the current programme is completed.

Resource Drilling

A key objective of the resource drilling programme is to compare results from the historic drilling to improve the confidence in the historical assays which should allow the current inferred resource to be reclassified in the indicated and measured categories. This, in turn, should enable initial JORC compliant reserves to be established for the project. The current reported JORC compliant mineral resource is 41,517,000 tonnes @ 1.48 g/t Au for 1.98 million ounces of gold at a 0.7 g/t Au cut off. This is estimated to an assumed economic mining depth of 315m RL, approximately 120m below the current surface.

Total drilling to date is 14,518m from 115 holes since the programme started (Table 1), including pre-collars for the metallurgical testwork sampling with average drilling since the start of the programme of 241m per day. This is an increase of 56 holes for 7,595m since the last work update announcement. Drilling during the period focussed on Titan, south and north of Phoenix, Bacchus South and reconnaissance drilling at Bonecrusher, which is located at the northern end of the Bullabulling mineralised trend.

Results have been received for 82 RC holes and 6 Diamond drillholes out of a total of 115 holes. Results from the remaining 27 holes are still pending, The results from the drilling to date continues to increase our confidence in the quality of the historic data and accuracy of our resource estimate. Only one hole drilled to date has failed to intersect mineralisation and this was predicted by the resource model (Table 2). The majority of holes are returning intersections similar to those predicted by the resource model and about a quarter are intersecting new zones of mineralisation outside the resource model both below and along strike from known mineralisation.

New intersections not reported previously include:

  • 7m at 1.44 g/t Au from 64m in BJ0041
  • 18m at 4.37 g/t Au from 53m in BJ0057
  • 18m at 1.10 g/t Au from 92m in BJ0058
  • 5m at 1.45 g/t Au from 117m in BJ0058
  • 5m at 2.10 g/t Au from 147m in BJ0063
  • 12m at 1.07 g/t Au from 36m in BJ0067
  • 12m at 1.08 g/t Au from 87m in BJ0071
  • 11m at 1.15 g/t Au from 12m in BJ0074
  • 6m at 1.73 g/t Au from 99m in BJ0077
  • 12m at 1.94 g/t Au from 62m in BJ0079
  • 4m at 3.30 g/t Au from 42m in BJ0084
  • 5m at 8.20 g/t Au from 23m in BJ0085
  • 7m at 1.64 g/t Au from 36m in BJ0085
  • 16m at 1.09 g/t Au from 44m in BJ0091
  • 6m at 1.41 g/t Au from 99m in BJ0092
  • 10m at 1.16 g/t Au from 26m in BJ0093 and
  • 6m at 1.41 g/t Au from 156m in BJ0095.

There are 303 intersections returned to date from 82 assayed RC holes, which averages 4 intersections per hole relating to the multiple stacked lodes defined by the structural mapping. These intersections have been compared to the resource block model to assess the validity of the reported resource.

Approximately 22% of the reported intersections have returned gold mineralisation outside the current resource model, which has been reported to approximately 120m below surface and these will add to the current resource base of the project.

Approximately 41% of the intersections returned similar grades or widths of mineralisation to the resource model.

About 20% of the intersections have better grades or widths than predicted by the resource model.

Only 17% of intersections returned widths not intersected or worse than predicted by the model.

Resource Estimation

Snowden, the project geological consultants, continue to work on the new resource and reserve estimate and are continuously reviewing drilling results as they become available in relation to QAQC and drill spacing requirements to upgrade the current resource to the Indicated and Measured categories. The drilling QAQC Standard Operating Procedures (SOP's) have been reviewed following a site visit and the QAQC twinning of historic Resolute drillholes has been modified to infilling between holes rather than exact twinning of historic holes. The QAQC part of the programme has consequently been redesigned to infill down-dip of holes originally planned for twinning. A review of the standards, blanks and duplicate samples to date has also been completed. While a high number of the Quality Assurance Quality Control (QAQC) samples are within the expected range of gold content, several batches of results have some inconsistencies and these have been resubmitted.

A geostatistical review of the results to date suggest that a drill spacing of at most 50 metres between sections along strike is required to classify any resources as Indicated. Most of the area that is being targeted, between Phoenix and Bacchus, is covered with a drill spacing of 50m or less. However, the number of new intersections that lie outside the current resource model at depth and to the east mean that additional drilling is required to infill these areas to the required drill spacing. About 7km of additional drilling is now planned to infill the new mineralisation with the aim of including these zones in the new resource estimate to an Indicated Resource category.

Drilling Programme Increased

The total number of meters planned over the targeted 2.5km strike of the Bullabulling trend has now increased to 24,140m over 175 drill holes. The new JORC resource estimate is expected to be completed on track in Q2 2011.

Metallurgy Test Work

The recent review study included an assessment of historical metallurgy and processing costs. The review has highlighted that processing costs are a critical variable in the economics of the Project. Although recoveries typically exceeded 90% and there does not appear to be any refractory gold within the deposit, the economics of the project and mining of the ore zones are sensitive to cut off grade. Also as the bulk of the resource upgrade has come from transitional and fresh material at depth, and the majority of ore processed historically came from oxide ore, a new metallurgical programme has been designed to review the metallurgical characteristics of fresh ore in detail with both physical and leaching properties closely examined. Gravity gold recovery will also form part of the programme due to the anticipated coarser gold in the plant feed, particularly the fresh ore.

Metallurgical core collected from the recent diamond drilling programme has been logged, photographed and selected 20-25m intervals (300kg) from each drillhole delivered to the Ammtec laboratory in Perth. The core has now been reviewed and various samples selected for comminution (the process in which solid materials are reduced in size, by crushing, grinding and other techniques), recovery and variability test work. Results have been received from the comminution metallurgical test work showing that a Bond Work Index of 6.9-9.5 with one sample at 12.6. In general the mineralised rock is competent and should not have any issues when crushed.

The remaining core has been crushed and assayed and composite samples selected with grades from 0.7 g/t – 1.5 g/t Au for recovery and metallurgical variability test work. Lycopodium is currently reviewing the data and has started modelling potential processing and plant capital costs, assuming a base case plant capacity of 5.0 mtpa and an alternate plant capacity of 3.5 mtpa. Preliminary crushing, mill and plant design work will also be carried out. This information will then be used to define operating and capital costs for the planned reserve estimation. Although at an early stage, the Bond Work Index is softer than expected and this may lower the operational costs and therefore lower the required economic cut-off grade.

New Prospecting Licences Acquired

The Joint Venture is also pleased to announce that new Prospecting Licences have now been granted to the Joint Venture. The Joint Venture now controls 144km2 in the region. These areas cover most of the prospective areas along the Bullabulling shear zone. The latest map of tenement will be available on the Company's website.

Technical information in the Company's news release has been reviewed and approved by Dr. Jeffrey F. A. Malaihollo the Company's Managing Director, who is a Fellow of the Geological Society of London.

Table 1: Bullabulling Collar information for RC drilling completed up to 01February 2011, excluding those reported in December 2010 and January 2011.
                             
Hole   Easting   Northing   RL   Dip   AZ   Length   Comment
BJ0057   299857   6567380   439   -60   90   109   Mineralised
BJ0058   299813   6567381   438   -60   90   130   Mineralised
BJ0060   299731   6567375   437   -60   90   181   Mineralised
BJ0063   299618   6567200   433   -60   90   169   Mineralised
BJ0065   299770   6567228   434   -60   90   121   Mineralised
BJ0066   299728   6567230   434   -60   90   139   Mineralised
BJ0067   299689   6567227   434   -60   90   193   Mineralised
BJ0068   299650   6567225   433   -60   90   181   Mineralised
BJ0069   299804   6567680   444   -60   90   121   Mineralised
BJ0070   299760   6567680   443   -60   90   79   Mineralised
BJ0071   299703   6567374   437   -60   90   121   Mineralised
BJ0072   299663   6567375   435   -60   90   139   Mineralised
BJ0073   299623   6567376   435   -60   90   163   Mineralised
BJ0074   299734   6567477   438   -60   90   169   Mineralised
BJ0075   299700   6567477   437   -60   90   109   Mineralised
BJ0076   299660   6567477   437   -60   90   139   Results pending
BJ0077   299628   6567478   437   -60   90   157   Mineralised
BJ0078   299570   6567477   437   -60   90   199   Mineralised
BJ0079   299717   6567583   440   -60   90   115   Mineralised
BJ0080   299697   6567577   440   -60   90   127   Mineralised
BJ0081   299673   6567577   440   -60   90   139   Results pending
BJ0082   299634   6567577   439   -60   90   163   Results pending
BJ0083   299596   6567578   438   -60   90   181   Results pending
BJ0084   299453   6566175   372   -60   90   121   Mineralised
BJ0085   299434   6566125   374   -60   90   127   Mineralised
BJ0086   299404   6566075   372   -60   90   133   Results pending
BJ0087   299460   6566025   372   -60   90   133   Mineralised
BJ0088   299457   6565975   372   -60   90   115   Mineralised
BJ0089   299422   6565875   367   -60   90   145   Results pending
BJ0090   299454   6566075   372   -60   90   115   Results pending
BJ0091   299730   6567680   443   -60   90   103   Mineralised
BJ0092   299700   6567680   441   -60   90   121   Mineralised
BJ0093   299676   6567677   440   -60   90   128   Mineralised
BJ0094   299624   6567670   440   -60   90   160   Mineralised
BJ0095   299584   6567670   440   -60   90   181   Mineralised
BJ0096   299550   6567670   440   -60   90   205   Mineralised
BJ0097   299680   6567716   441   -60   90   127   Results pending
BJ0098   299640   6567716   438   -60   90   145   Results pending
BJ0099   299615   6567722   439   -60   90   157   Results pending
BJ0100   299579   6567725   440   -60   90   181   Results pending
BJ0101   299833   6567778   444   -60   90   157   Results pending
BJ0102   299803   6567778   444   -60   90   61   Results pending
BJ0103   299781   6567778   443   -60   90   70   Results pending
BJ0104   300050   6567880   444   -60   90   43   Results pending
BJ0105   300025   6567880   444   -60   90   49   Results pending
BJ0106   299985   6567880   444   -60   90   79   Results pending
BJ0107   299945   6567880   446   -60   90   109   Results pending
BJ0108   299825   6567880   445   -60   90   49   Results pending
BJ0109   299785   6567880   443   -60   90   67   Results pending
BJ0111   299705   6567880   444   -60   90   109   Results pending
BJ0112   300048   6567980   448   -60   90   79   Results pending
BJ0113   300018   6567980   428   -60   90   97   Results pending
BJ0114   299864   6570782   434   -60   90   187   Results pending
BJ0121   299429   6566075   372   -60   90   127   Results pending
BJ0122   299757   6566481   481   -60   90   121   Results pending
BJ0123   299719   6566480   428   -60   90   121   Results pending
 
Table 2: Intersection summary from drill assays received to 01February 2011, excluding those already reported in December 2010 and January 2011.
                         
Hole   From   To   Width   Au g/t   Includes   Comment
BJ0041   40   42   2   0.36       New
BJ0041   44   46   2   0.97       New
BJ0041   56   58   2   0.35       New
BJ0041   64   71   7   1.44   1m @ 7.30g/t From 64m   New
BJ0041   83   95   12   0.92       New
BJ0057   42   45   3   0.47       New
BJ0057   53   71   18   4.37   2m @ 36.26g/t From 61m   New
BJ0057   76   85   9   0.54       New
BJ0057   101   104   3   0.80       New
BJ0058   34   53   19   0.48       New
BJ0058   92   110   18   1.10       New
BJ0058   117   122   5   1.45   1m @ 5.42g/t From 117m   New
BJ0060   23   25   2   0.64       New
BJ0060   63   70   7   0.61       New
BJ0060   78   84   6   0.85       New
BJ0060   122   128   6   0.41       New
BJ0060   133   139   6   0.56       New
BJ0060   142   144   2   0.41       New
BJ0060   156   161   5   0.32       New
BJ0063   60   62   2   0.48       New
BJ0063   68   75   7   1.08       New
BJ0063   84   88   4   0.43       New
BJ0063   94   104   10   0.52       New
BJ0063   125   127   2   2.89   1m @ 5.37g/t From 126m   New
BJ0063   130   133   3   0.34       New
BJ0063   138   142   4   0.65       New
BJ0063   147   152   5   2.10   3m @ 3.21g/t From 147m   New
BJ0065   29   32   3   0.55       New
BJ0065   36   40   4   0.42       New
BJ0065   48   59   11   0.46       New
BJ0065   85   92   7   0.65       New
BJ0065   98   101   3   0.32       New
BJ0066   26   31   5   0.66       New
BJ0066   55   57   2   0.46       New
BJ0066   98   102   4   0.36       New
BJ0066   103   105   2   0.37       New
BJ0066   107   109   2   0.65       New
BJ0067   36   48   12   1.07   1m @ 7.07g/t From 46m   New
BJ0067   82   84   2   0.69       New
BJ0067   148   152   4   0.89       New
BJ0067   169   183   14   0.83   1m @ 3.97g/t From 177m   New
BJ0068   0   3   3   0.32       New
BJ0068   59   66   7   0.69       New
BJ0068   72   77   5   0.73       New
BJ0068   92   95   3   0.77       New
BJ0068   103   107   4   0.61       New
BJ0068   119   122   3   0.50       New
BJ0068   129   134   5   0.55       New
BJ0068   173   175   2   1.29       New
BJ0068   178   180   2   0.32       New
BJ0069   26   48   22   0.91   3m @ 2.39g/t From 34m, 1m @ 5.80g/t From 46m   New
BJ0069   98   120   22   0.73       New
BJ0070   41   65   24   0.47       New
BJ0071   37   45   8   0.46       New
BJ0071   49   53   4   0.40       New
BJ0071   63   66   3   0.46       New
BJ0071   74   77   3   0.78       New
BJ0071   87   99   12   1.08   3m @ 2.16g/t From 96m   New
BJ0071   101   103   2   0.36       New
BJ0072   36   50   14   0.56       New
BJ0072   79   94   15   0.90       New
BJ0072   100   102   2   1.40       New
BJ0073   59   76   17   0.96   2m @ 3.14g/t From 60m   New
BJ0073   111   117   6   0.58       New
BJ0073   126   128   2   0.63       New
BJ0073   133   138   5   0.81       New
BJ0074   12   23   11   1.15   1m @ 6.58g/t From 12m   New
BJ0074   26   29   3   0.39       New
BJ0074   31   44   13   0.61       New
BJ0074   53   55   2   0.50       New
BJ0074   75   79   4   1.65       New
BJ0074   99   102   3   0.42       New
BJ0074   116   121   5   0.31       New
BJ0074   138   146   8   0.63       New
BJ0075   14   16   2   0.39       New
BJ0075   29   43   14   0.66       New
BJ0077   55   63   8   0.88       New
BJ0077   74   81   7   0.62       New
BJ0077   99   105   6   1.73   2m @ 3.73g/t From 99m   New
BJ0077   113   128   15   0.72       New
BJ0078   88   90   2   0.45       New
BJ0078   94   101   7   0.76       New
BJ0078   142   161   19   0.72   1m @ 3.29g/t From 154m   New
BJ0078   175   189   14   0.70       New
BJ0079   21   25   4   0.48       New
BJ0079   50   57   7   0.34       New
BJ0079   62   74   12   1.94   4m @ 3.17g/t From 64m, 4m @ 2.17g/t From 69m   New
BJ0079   93   97   4   0.81       New
BJ0080   9   11   2   0.68       New
BJ0080   31   35   4   0.35       New
BJ0084   31   33   2   1.37       New
BJ0084   42   46   4   3.30   1m @ 11.80g/t From 42m   New
BJ0084   95   100   5   0.65       New
BJ0085   0   2   2   0.75       New
BJ0085   6   14   8   0.75   1m @ 3.34g/t From 13m   New
BJ0085   23   28   5   8.20   2m @ 14.62g/t From 23m, 2m @ 5.67g/t From 26m   New
BJ0085   36   43   7   1.64   2m @ 4.40g/t From 36m   New
BJ0087   125   127   2   1.18       New
BJ0088   1   3   2   0.80       New
BJ0088   8   12   4   0.40       New
BJ0088   27   35   8   0.95       New
BJ0091   18   21   3   0.61       New
BJ0091   33   36   3   0.57       New
BJ0091   44   60   16   1.09   9m @ 1.65g/t From 45m   New
BJ0091   76   78   2   0.46       New
BJ0092   16   27   11   0.99       New
BJ0092   33   35   2   0.43       New
BJ0092   71   75   4   0.32       New
BJ0092   87   93   6   1.41   2m @ 3.58g/t From 87m   New
BJ0093   26   36   10   1.16   2m @ 3.43g/t From 26m   New
BJ0093   78   83   5   0.69       New
BJ0093   101   103   2   0.40       New
BJ0093   104   108   4   0.74       New
BJ0094   0   2   2   0.68       New
BJ0094   55   61   6   1.24       New
BJ0095   58   60   2   0.43       New
BJ0095   68   84   16   0.76   1m @ 8.08g/t From 68m, 3m @ 2.40g/t From 75m   New
BJ0095   119   121   2   0.40       New
BJ0095   123   126   3   0.75       New
BJ0095   156   162   6   1.41   1m @ 6.52g/t From 156m   New
BJ0096   84   92   8   0.82       New
BJ0096   97   99   2   0.92       New
BJ0096   145   147   2   0.94       New
BJ0096   149   151   2   0.37       New
BJ0096   156   158   2   0.38       New
BJ0096   163   172   9   0.53       New

To view the map, "The Bullabulling Gold Trend," please visit the following link: http://media3.marketwire.com/docs/gggFig1.pdf

To view the map, "Drill plan showing the location of QAQC and infill drilling in the main resource areas and holes targeting the high grade mineralisation in the Bacchus Deeps area," please visit the following link: http://media3.marketwire.com/docs/gggFig2.pdf

To view the map, "Updated tenement Map of the Bullabulling Joint Venture," please visit the following link: http://media3.marketwire.com/docs/gggFig3.pdf

Contact Information

  • GGG Resources plc
    Dr. Jeffrey Malaihollo
    01992 531820
    www.gggresources.com
    or
    Gresham PR
    Neil Boom
    07866 805 108
    or
    Westhouse Securities Limited (Nominated Adviser)
    Tom Price / Martin Davison
    020 7601 6100
    or
    Collins Stewart Europe Limited (Broker)
    John Prior / Adam Miller
    020 7523 8350