Lupaka Gold Corp.
TSX : LPK

Lupaka Gold Corp.

March 05, 2012 08:00 ET

Lupaka Gold Corp. Announces Updated Gold Resources at Crucero Gold Project

VANCOUVER, BRITISH COLUMBIA--(Marketwire - March 5, 2012) - Lupaka Gold Corp. ("Lupaka Gold" or "the Company") (TSX:LPK) is pleased to report the Company's updated National Instrument 43-101 ("NI 43- 101") Indicated and Inferred mineral resource estimate for its 100% owned Crucero project located in southeastern Peru. The updated resource estimate has been prepared by Wardrop, a Tetra Tech Company ("Tetra Tech") of Vancouver, Canada (see Table 1 below).

The Company reports an indicated resource of 34.6 million tonnes at 1.03 gold grams per tonne (g/t) capped grade for 1,145,000 gold ounces at the A-1 Zone within the Crucero Gold project. In addition, the Company reports an inferred resource of 29.0 million tonnes at 0.69 g/t capped grade for 647,000 gold ounces at the A-1 Zone. Indicated resource ounces have increased 45%, and inferred resources have increased 59% compared to the last resource update completed February 22, 2011 which is available under the Company's profile on the SEDAR website at www.sedar.com.

Eric Edwards, President and CEO of Lupaka Gold, commented, "We are extremely pleased with the growth of the A-1 Zone resource as announced in today's updated NI 43-101 resource estimate. The size and confidence level of the resource is clearly improved with 64% of our total resource ounces falling within the Indicated category. The A-1 mineralized envelope remains open to the Northwest, leaving additional exploration opportunities for 2012 to continue to grow the A-1 Zone resource."

The following table summarizes resources estimated at a 0.4 g/t threshold (cut-off), effective as at March 2, 2012:

Resource AU CAP AU CAP
Category Tonnes G/T * OZ*
Indicated 34,641,000 1.03 1,145,000
Inferred 28,966,000 0.69 647,000
* - Assay values capped at 17 g/t

Resource estimates generated at varying threshold (cut-off) gold grades are presented as Table 1 at the end of this news release.

Mr. Edwards continued, "The A-1 Zone is only one of 11 known exploration anomalies currently identified at the Crucero Gold Project, and is the only anomaly that has been drill tested. This year we plan to drill on new target anomalies that have not been drilled previously. With our current geological understanding of the A-1 Zone, we look forward to an exciting exploration year ahead."

This updated resource estimate includes the assay results from all 54 holes drilled (totalling 15,380 metres) within the A-1 Zone, including the 17 holes drilled in the A-1 Zone during the 2011 exploration program that was completed on December 31, 2011.

2012 Resource Estimate Methodology

The updated resource estimate in this news release has been prepared by Gregory Mosher of Tetra Tech. Mr. Mosher is a Qualified Person for the purposes of NI 43-101.

The geological interpretation of the A-1 Zone is simple and has not been substantially modified from that generated during the previous resource estimate: the zone has been modeled as a single geological solid that represents a grade shell that contains gold values generally greater than 0.1 g/t. This grade represents a natural and reasonably sharp boundary between unmineralized and continuously mineralized rock, although minor intervals with a grade of less than 0.1 g/t gold have been incorporated within the solid. These lower-grade intervals were not physically excluded from the geological solid by modification of the boundaries of the solid because it is improbable that they could be effectively segregated during mining and as well, the block model interpolation process accounts for these intervals and they can subsequently be identified and discounted on the basis of grade thresholds applied to the resource tabulation. On the basis of the operating costs and cut-off grades used in a number of open pit gold mines in Peru and elsewhere, a lower grade threshold of 0.4 g/t gold is considered reasonable for this type of deposit in this type of location. The resource at this lower limit is considered as the base case and is highlighted in Table 1. Using ID2 and at a lower threshold of 0.4 g/t, the A1 Zone is estimated to contain an Indicated resource of about 34.6 million tonnes with an average, capped grade of 1.03 g/t gold (approximately 1.15 million Troy ounces) and an Inferred resource of about 29.0 million tonnes with an average, capped grade of 0.69 g/t gold (approximately 647,000 Troy ounces). For the current estimate the capping level was re-assessed to take into account the additional data acquired, and a capping level of 17 g/t gold was found to be appropriate. Bulk density measurements of three core samples from drill hole CR-01 were made by SGS Analytical Laboratories in Lima. The average bulk density of these three measurements (2.86, 2.82, and 2.93) is 2.87.

Note: Both tonnes and grade have been rounded relative to the corresponding numbers in Table 1. The Indicated capped grade and contained resource is about 8% lower than the uncapped equivalent; for the Inferred resource the difference is about 6%.

2012 Drill Program

The Company has planned for 11,000 metres of drilling for the 2012 program with 5,500 metres for resource expansion on A-1, and 5,500 metres for exploration on the other anomalies within the Company's 5,500 hectare property area. The Company recently filed permit applications for the A-3/A- 4/A-5 Zone areas, approximately 2 kilometers to the east of the A-1 Zone and plans to commence exploration drilling on these exploration anomalies by mid-year 2012. A significant program of mapping, soil sampling and geophysics is also planned across the property to better define drill targets for the previously identified exploration anomalies.

About the Company

Lupaka Gold is aggressively exploring and developing the Crucero Gold Project, its 5,500 hectare gold property located in southern Peru. The Company, based in Vancouver, Canada, is project operator and holds a 100% interest in the property. The Company began exploring at Crucero in April 2010. In addition to the existing resource, Lupaka Gold has identified several exploration targets within the Crucero Property that display similar anomalous characteristics. Lupaka Gold is led by a strong management team with a proven ability to develop, finance and operate mining projects. The Company completed an initial public offering of its common shares and warrants on the Toronto Stock Exchange on June 28, 2011.

Quality Control and Assurance

Drill assays for this resource estimate were carried out by SGS Peru and ALS Chemex in Lima, Peru, exercising a thorough Quality Assurance and Control program (QA/QC). As part of QA/QC protocol, duplicates, standards and blanks were inserted into the sample processing stream. The core was photographed for reference, logged and mineralized sections were sawed in half. Sample lengths vary between 0.5 to 2.0 metres. Half core samples were bagged, sealed and delivered to SGS Peru in Juliaca, Peru, and ALS Chemex in Lima, Peru both accredited laboratories. The remaining core is stored on site for reference. Gold was assayed by a 50 gram fire assay with an AAS finish. All SGS Peru and ALS Chemex labs are ISO 9000 registered.

Greg Mosher is an employee of Tetra Tech, a "qualified person" as defined by National Instrument 43- 101 and independent of Lupaka Gold as defined by Section 1.5 of NI 43-101. He has reviewed and approved the scientific and technical information contained in this news release. Mr. Mosher has verified the technical and scientific information including sampling, analytical and test data underlying the information or opinions contained in this news release. A technical report supporting this disclosure will be filed under the Company's profile on SEDAR (www.sedar.com ) within 45 days of this news release.

Forward-Looking Information

This news release contains "forward-looking statements" and "forward-looking information" within the meaning of applicable securities regulations in Canada and the United States (collectively, "forward-looking information"). The forward-looking information contained in this news release is made as of the date of this news release. Except as required under applicable securities legislation, the Company does not intend, and does not assume any obligation, to update this forward-looking information. Forward-looking information includes, but is not limited to, statements with respect to mineral resource estimates, the 2012 Crucero Project drill plan, the anticipated effect of completed drill results on the Crucero Project, planned work programs, future upgrading of mineral resources and expected outcomes. Often, but not always, forward-looking information can be identified by the use of words such as "plans", "expects, "is expected", "budget", "scheduled", "estimates", forecasts", "intends", "anticipates", or "believes", or the negatives thereof or variations of such words and phrases or statements that certain actions, events or results "may", "could", "would", "might", or "will" be taken, occur or be achieved.

The forward-looking information contained in this news release is based on certain assumptions that the Company believes are reasonable, including, with respect to mineral resource estimates, the key assumptions and parameters on which such estimates are based, that the current price of and demand for gold will be sustained or will improve, that general business and economic conditions will not change in a material adverse manner, that financing will be available if and when needed on reasonable terms, that supplies, equipment, personnel, permits and local community approval required to conduct the Company's planned exploration and development activities will be available on reasonable terms and that the Company will not experience any material accident, labour dispute, or failure of equipment.

However, forward-looking information involves known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the forward-looking information. Such factors include, among others, risk that actual results of exploration activities will be different than anticipated, that cost of labour, equipment or materials will increase more than expected, that the future price of gold will decline, that the Canadian dollar will strengthen against the U.S. dollar, that mineral resources are not as estimated, unexpected variations in mineral resources, grade or recovery rates, risk of accidents, labour disputes and other risks generally associated with mineral exploration and unanticipated delays in obtaining or failure to obtain governmental or community approvals or financing. Although the Company has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward- looking information, there may be other factors that cause actions, events or results to not be as anticipated, estimated or intended. There can be no assurance that forward-looking information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Readers are cautioned not to place undue reliance on forward-looking information due to the inherent uncertainty thereof.

Table 1 : Crucero A-1 Zone Inverse Distance Squared Resource Estimate

THRESHOLD G/T TONNES AU AU CAP AU AU CAP
INDICATED G/T G/T OUNCES* OUNCES*
5.00 202,916 10.00 1.88 65,230 12,278
4.00 271,836 8.57 1.83 74,857 15,956
3.00 528,990 6.07 1.93 103,193 32,767
2.00 2,543,525 3.09 2.03 252,323 166,315
1.00 15,539,049 1.67 1.46 832,608 730,322
0.80 20,991,619 1.47 1.31 989,627 885,536
0.70 24,224,388 1.37 1.24 1,067,593 962,627
0.60 27,710,095 1.28 1.16 1,140,303 1,034,527
0.55 29,359,518 1.24 1.13 1,170,809 1,064,695
0.50 31,099,708 1.20 1.09 1,200,121 1,093,826
0.45 32,938,565 1.16 1.06 1,228,229 1,121,583
0.40 34,641,233 1.12 1.03 1,251,567 1,144,667
0.35 36,445,774 1.09 1.00 1,273,361 1,166,290
0.30 38,078,528 1.05 0.97 1,290,447 1,183,232
0.25 39,446,851 1.03 0.94 1,302,563 1,195,273
0.20 40,532,270 1.01 0.92 1,310,459 1,203,097
0.10 42,305,419 0.97 0.89 1,318,358 1,210,952
THRESHOLD G/T TONNES AU AU AU AU CAP
INFERRED G/T G/T OUNCES* OUNCES*
5.00 40,120 5.64 1.11 7,277 1,426
4.00 85,072 4.97 1.06 13,601 2,890
3.00 166,464 4.17 0.93 22,344 4,995
2.00 622,069 2.93 1.03 58,566 20,660
1.00 4,062,068 1.50 1.15 196,326 150,140
0.80 7,937,327 1.20 1.02 307,051 260,165
0.70 11,512,382 1.06 0.93 392,693 345,716
0.60 16,347,936 0.94 0.85 493,457 446,307
0.55 19,111,272 0.89 0.81 544,555 497,260
0.50 22,135,184 0.84 0.77 595,532 548,212
0.45 25,461,047 0.79 0.73 646,235 598,886
0.40 28,965,683 0.75 0.69 694,094 646,716
0.35 32,546,280 0.70 0.66 737,348 689,921
0.30 35,728,944 0.67 0.63 770,612 723,149
0.25 39,465,209 0.63 0.60 803,677 756,169
0.20 42,844,596 0.60 0.57 828,276 780,767
0.10 48,397,436 0.55 0.52 853,105 805,582
* 1 TROY OUNCE = 31.10348 GRAMS

Contact Information

  • Lupaka Gold Corp.
    Scott Warren
    Manager, Investor Relations
    +1 (604) 681-5900
    www.lupakagold.com