SOURCE: Sarama Resources Ltd.

Sarama Resources Ltd.

November 24, 2016 08:28 ET

Sarama Resources Targets Extensions to Mineral Resources at the South Hounde Project in Burkina Faso

VANCOUVER, BC--(Marketwired - November 24, 2016) - Sarama Resources Ltd. ("Sarama" or the "Company") (TSX VENTURE: SWA) advises that aircore ("AC") and diamond drilling has commenced at the South Houndé Project (the "Project") in south-western Burkina Faso. The program is designed to build on encouraging results from the last drilling campaign and to test for strike and down-dip extensions to grow the current 2.1Moz1,2 gold inferred mineral resource to advance the Project.

Highlights

  • Encouraging intersections from previous drill programs and review of geophysical survey data have generated new targets that could add to the current 2.1Moz1,2 gold mineral resource at the South Houndé Project.
  • 1,200m diamond drill program planned to target down-dip extensions of a high-grade lens at the MM Prospect to a vertical depth of 450m.
  • 4,000m AC program planned to test for oxide mineralisation at the Djimbake Prospect, located a further 3.2km along strike from the southerly extent of the eastern horizon of the mineral resource.
  • 2,200m AC program planned to test for oxide mineralisation along cross-structures inferred to link the MM-MC and Phantom East-MM Prospects.
  • USD$3.5M (CAD$4.7M) exploration program, funded by Acacia Mining plc, is budgeted for 2017 including geochemical and geophysical surveys and drill programs.

Sarama's President and CEO, Andrew Dinning, commented:

"After a phase of drilling in close proximity to the established mineral resource, we look forward to conducting step-out drilling to test for extensions to the strike of the mineral resource and also test down-dip of high-grade zones that have the potential to support underground mining.

This drilling is expected to yield valuable geological information to further develop the geologic model and enhance targeting and, if successful, will highlight the potential for extensions to the mineral resource that will be followed-up in 2017.

We firmly believe that the South Houndé Project has the potential to be an open pit and underground mining complex. The Project will play a key role in the development of the southern part of the Houndé Belt where Sarama has significant interests across three projects that collectively host a sizeable gold mineral resource."

Diamond Drilling

Depth Extension of High-Grade Lens -- MM Prospect

A high-grade lens within the MM Prospect that is defined by intersections including 10.2m @ 14.85g/t Au from 109.3m in DDH025, 15.5m @ 9.36g/t Au from 176.5m in DDH045, and 19.1m @ 4.06g/t Au from 263.5m in DDH050 will be tested for down-dip extensions.

The lens is centred at 1176800mN and two 600m-long diamond core holes are planned to target the down-plunge extension approximately 120m below the last significant drill intersection and to a vertical depth of 450m (Figure 1). The drilling will assist in resolving the plunge orientation of this lens and will lead to better targeting of the high-grade lenses within the mineralized zones which have potential to be amenable to underground mining.

Aircore Drilling

South-Western Corridor Extension -- Djimbake Prospect

A 4,000m AC drill program has commenced along the south-western extension of the Tankoro Corridor, a 10.2km-long zone of structurally emplaced porphyry dykes and associated gold mineralization. Mineralization is open to the north-east and to the south-west along this mineralized corridor.

The objective of the reconnaissance drill program at the Djimbake Prospect (Figure 1) is to test for oxide mineralisation potentially hosted in two parallel horizons up to 3.2km along strike from the limit of the current mineral resource. The drilling is guided by gold-in-soil and geophysical anomalies and an interpreted 070°-striking cross fault that is part of the mineralized structural geometry.

Linking Structures -- MC, MM and Phantom East Prospects

A 2,200m AC program is planned to test for oxide mineralisation in near-surface expressions of cross-structures that are interpreted to link north-north-easterly striking mineralised lodes at the MM-MC Prospects and the Phantom East-MM Prospects. The reconnaissance-level targets were generated from geophysical surveys and the geological concept is supported by the presence of high-grade mineralisation in other areas of the mineralised system with a strike direction that is oblique to the main trend (Figure 1).

Figure 1 - Drill Plan Showing Location of Planned Drilling

ABOUT SARAMA RESOURCES LTD

Sarama Resources Ltd. (TSX VENTURE: SWA) is a West African focused gold explorer with substantial landholdings in Burkina Faso. Sarama is focused on consolidating under-explored landholdings in Burkina Faso and other established mining jurisdictions.

Sarama's flagship properties are situated within the Company's South Houndé Project area in south-west Burkina Faso. Located within the prolific Houndé Greenstone Belt, Sarama's exploration programs have built on significant early success to deliver an inferred mineral resource estimate of 2.1 Moz gold1,2. Acacia Mining plc is earning up to a 70% interest in the South Houndé Project by satisfying certain conditions, including funding earn-in expenditures of up to US$14 million, over a 4-year earn-in period and may acquire an additional 5% interest, for an aggregate 75% interest in the Project, upon declaration of a minimum mineral reserve of 1.6 million ounces of gold.

Sarama holds a 31% participating interest in the Karankasso Project Joint Venture ("JV") which is situated adjacent to the Company's South Houndé Project in Burkina Faso and is a JV between Sarama and Savary Gold Corp. ("Savary"). Savary is the operator of the JV and in October 2015, declared a maiden inferred mineral resource estimate of 671,000 ounces of contained gold3,4 at the Karankasso Project JV.

Sarama has also agreed to acquire a 100% interest in the Bondi Deposit from Orezone Gold Corporation (refer news release May 24, 2016). Bondi has a historical estimate of mineral resources of 0.3Moz Au (measured and indicated) and 0.1Moz Au (inferred)5,6.

Together, the South Houndé Project, Bondi Deposit and the Karankasso Project form a cluster of advanced gold deposits, within trucking distance of one another, which potentially offers a development option for a multi-source fed central processing facility in the southern Houndé Belt region of Burkina Faso.

Incorporated in 2010, the Company's Board and management team have a proven track record in Africa and a strong history in the discovery and development of large-scale gold deposits. Sarama is well positioned to build on its current success with a sound exploration strategy across its property portfolio.

  1. 43.0 Mt @ 1.5 g/t Au (reported above cut-off grades ranging 0.3-2.2 g/t Au, reflecting the mining methods and processing flowsheets assumed to assess the likelihood of the inferred mineral resources having reasonable prospects for eventual economic extraction)
  2. The effective date of the Company's inferred mineral resource estimate is February 4, 2016. For further information regarding the mineral resource estimate please refer to the technical report titled "NI 43-101 Independent Technical Report South Houndé Project Update, Bougouriba and Ioba Provinces, Burkina Faso", dated March 31, 2016. The technical report is available under Sarama Resources Ltd.'s profile on SEDAR at www.sedar.com.
  3. 9.2 Mt @ 2.3 g/t Au (at a 0.5 g/t Au cut-off)
  4. The effective date of the Karankasso Project JV mineral resource estimate is October 7, 2015. For further information regarding the mineral resource estimate please refer to the technical report titled "Technical Report and Resource Estimate on the Karankasso Project, Burkina Faso", dated October 7, 2015. The technical report is available under Savary Gold Corp's profile on SEDAR at www.sedar.com. Sarama has not independently verified Savary's mineral resource estimate and takes no responsibility for its accuracy.
  5. 4.1Mt @ 2.1g/t Au for 282,000 oz Au (measured and indicated) and 2.5Mt @ 1.8g/t Au for 149,700 oz Au (inferred), reported at a 0.5 g/t Au cut-off
  6. The effective date of the historical estimate of the Bondi Deposit mineral resource estimate is February 20, 2009. For further information regarding the mineral resource estimate please refer to the technical report titled "Technical Report on the Mineral Resource of the Bondigui Gold Project", dated February 20, 2009. The technical report is available under Orezone Gold Corporation's profile on SEDAR at www.sedar.com.

CAUTION REGARDING FORWARD-LOOKING STATEMENTS

Information in this news release that is not a statement of historical fact constitutes forward-looking information. Such forward-looking information includes statements regarding the Company's plans for drilling and geochemical and geophysical surveys at the South Houndé Project, the results of such drilling, the Earn-In Agreement with Acacia, including the amounts that may be spent on exploration and interests in the South Houndé Project that may be earned by Acacia upon making certain expenditures and estimating a minimum reserve, the potential to expand the present oxide component of the Company's existing estimated mineral resources, and future exploration plans. Actual results, performance or achievements of the Company may vary from the results suggested by such forward-looking statements due to known and unknown risks, uncertainties and other factors. Such factors include, among others, that the business of exploration for gold and other precious minerals involves a high degree of risk and is highly speculative in nature; Mineral Resources are not Mineral Reserves, they do not have demonstrated economic viability, and there is no certainty that they can be upgraded to Mineral Reserves through continued exploration; few properties that are explored are ultimately developed into producing mines; geological factors; the actual results of current and future exploration; changes in project parameters as plans continue to be evaluated, as well as those factors disclosed in the Company's publicly filed documents. There can be no assurance that any mineralisation that is discovered will be proven to be economic, or that future required regulatory licensing or approvals will be obtained. However, the Company believes that the assumptions and expectations reflected in the forward-looking information are reasonable. Assumptions have been made regarding, among other things, Acacia's continued funding of exploration activities, the Company's ability to carry on its exploration activities, the sufficiency of funding, the timely receipt of required approvals, the price of gold and other precious metals, that the Company will not be affected by adverse political events, the ability of the Company to operate in a safe, efficient and effective manner and the ability of the Company to obtain further financing as and when required and on reasonable terms. Readers should not place undue reliance on forward-looking information.

Sarama does not undertake to update any forward-looking information, except as required by applicable laws.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

NOTES -- DRILLING

The following applies only to the Company's South Houndé Project and not to its indirect interest in the Karankasso Project Joint Venture or the Bondi gold deposit which it has agreed to acquire.

Drilling results are quoted as downhole intersections. True widths of mineralisation are estimated to be approximately 70% to 80% of reported downhole intersection lengths, except as otherwise noted. The orientation of some of the mineralised units is not yet well understood.

The reported composites for the drilling were determined using a cut-off grade of 0.30g/t Au to select significant and anomalous intersections, with a maximum of 2m internal dilution being incorporated into the composite where appropriate. No top-cuts were applied to assay grades. Isolated mineralised intersections less than 2m in length have not been reported.

Gold assays for the drilling were undertaken by several internationally owned laboratories in Burkina Faso and Mali. Assays are determined by fire assay methods using a 50 gram charge, lead collection and an AAS finish with lower detection limits of 0.01g/t A.

The drilling was generally designed using a range of azimuths, according to program aims and mineralization orientation, dipping at -50-55° and were of variable length. Holes were spaced at 25-50m intervals along drill lines. All AC and RC holes were sampled at regular 1m downhole intervals. All diamond holes were sampled according to geological intervals but were generally <1m.

Intersection oxidation state classification is based on visual logging of the drillholes.

Sarama undertakes geological sampling and assays in accordance with its quality assurance/quality control program which includes the use of certified reference materials for AC, RC and diamond drilling as well as field duplicates in the case of AC and RC drilling.

For further information regarding the Company's QAQC protocols please refer to the technical report titled "NI 43-101 Independent Technical Report, South Houndé Project Update, Bougouriba and Ioba Provinces, Burkina Faso", dated March 31, 2016. The technical report is available under the Company's profile on SEDAR at www.sedar.com.

QUALIFIED PERSONS' STATEMENT

Scientific or technical information in this news release that relates to the Company's exploration activities in Burkina Faso is based on information compiled or approved by Guy Scherrer. Guy Scherrer is an employee of Sarama Resources Ltd and is a member in good standing of the Ordre des Géologues du Québec and has sufficient experience which is relevant to the commodity, style of mineralisation under consideration and activity which he is undertaking to qualify as a Qualified Person under National Instrument 43-101. Guy Scherrer consents to the inclusion in this report of the information, in the form and context in which it appears.

Scientific or technical information in this news release that relates to the preparation of the Company's mineral resource estimate is based on information compiled or approved by Adrian Shepherd. Adrian Shepherd is an employee of Cube Consulting Pty Ltd and is considered to be independent of Sarama Resources Ltd. Adrian Shepherd is a Chartered Professional Member in good standing of the Australasian Institute of Mining and Metallurgy and has sufficient experience which is relevant to the commodity, style of mineralisation under consideration and activity which he is undertaking to qualify as a Qualified Person under National Instrument 43-101. Adrian Shepherd consents to the inclusion in this news release of the information, in the form and context in which it appears.

Scientific or technical information in this news release that relates to the preparation of the Karankasso Project's mineral resource estimate is based on information compiled or approved by Eugene Puritch and Antoine Yassa. Eugene Puritch and Antoine Yassa are employees of P&E Mining Consultants Inc. and are considered to be independent of Savary Gold Corp. and Sarama Resources Ltd. Antoine Yassa is a member in good standing of the Ordre des Géologues du Québec and Eugene Puritch is a member in good standing of Professional Engineers Ontario. Eugene Puritch and Antoine Yassa have sufficient experience which is relevant to the commodity, style of mineralisation under consideration and activity which they are undertaking to qualify as a Qualified Person under National Instrument 43-101. Eugene Puritch and Antoine Yassa consent to the inclusion in this news release of the information, in the form and context in which it appears. Sarama has not independently verified Savary's mineral resource estimate and takes no responsibility for its accuracy.

Scientific or technical information in this news release, in respect of the Bondi Deposit relating to mineral resource and exploration information drawn from the Technical Report prepared for Orezone on that deposit has been approved by Guy Scherrer. Guy Scherrer is an employee of Sarama Resources Ltd and is a member in good standing of the Ordre des Géologues du Québec and has sufficient experience which is relevant to the commodity, style of mineralisation under consideration and activity which he is undertaking to qualify as a Qualified Person under National Instrument 43-101. Guy Scherrer consents to the inclusion in this report of the information, in the form and context in which it appears.

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