Tolima Gold Inc.
TSX VENTURE : TOM

July 05, 2012 11:44 ET

Tolima Gold Inc. Identifies Gold Porphyry Mineralization on Its Orofino Property, Middle Cauca Gold Belt, Colombia

TORONTO, ONTARIO--(Marketwire - July 5, 2012) - Tolima Gold Inc. ("Tolima" or the "Company") (TSX VENTURE:TOM) has completed its phase one induced polarization ("IP")-resistivity geophysical program on its Orofino property (within the 28,000 ha ANCAL property package), located in the Middle Cauca Gold Belt in the Antioquia department of Colombia. The program produced multiple anomalies and Tolima is pleased to report that drilling the first IP anomaly has returned anomalous gold mineralization related to porphyry dikes cutting host schists. Drilling is continuing in an effort to vector towards the main porphyry body. This first anomaly at Orofino is one of the five targets identified by the Company in its ANCAL Project.

Over 3,000 geochemical samples gathered in the Orofino property by previous owners have outlined gold-copper anomalies indicating potential for porphyry Au-Cu type mineralization. To allow for better targeting, Tolima conducted a preliminary geophysical survey (IP-3D model), which has confirmed the coincidence of the geochemical anomaly with an IP anomaly. Tolima has now successfully intercepted mineralized areas corresponding to the geophysical anomaly, with the first two drill holes (DDH-01 and DDH-02) of its drilling campaign in the property.

To view the Isometric Model associated with this release, please visit the following link: http://media3.marketwire.com/docs/TOM-IsometricModel.pdf.

Previous Geochemical Sampling

Rock chip sampling has been systematically carried out in the Orofino property, indicating a potential for Au-Cu porphyry type mineralization. Samples taken on the "Bermejal" creek (where the first drill holes have been located), showed anomalous gold values as high as 6.3 g/t in the contact zone of the metamorphic rock with the dacite porphyry.

The table below shows some chip sampling highlights from several target areas within the Orofino property.:

OROFINO AREA SAMPLE ID Au (g/ton) Cu (ppm)
High Zone of BERMEJAL Creek R-9040 2.40 510
R-7655 1.41 330
R-7885 1.06 460
R-7653 0.49 80
R-7878 0.73 160
South Zone of BERMEJAL Creek R-7758 3.65 650
R-7759 0.39 590
R-7786 3.75 100
North Zone of CHIRAPOTO Creek R-7865 2.90 570
R-7866 4.15 100
R-9030 6.33 2,830

Phase One - Geophysics (IP)

Phase one of the geophysics survey in the Orofino property consisted of Induced Polarization (IP) surveying over just 15% of a total of 54 linear kilometers planned. The IP program employed the Pole-Pole array and the processing and interpretation of the apparent 3D Resistivity and 3D Chargeability values show all lines returning elevated IP response with the strongest in the Bermejal Creek area. This anomalous sector, which is shown from the surface to the depth limit of the geophysical reading, is approximately 700 meters long by 400 meters wide and would correspond with a zone of high concentration of disseminated sulphides.

Drill Targets

Vertical drill hole Orofino DDH-01 was drilled to a depth of 536 meters, of which 510 meters were mineralized with pyrite and hydrothermally altered. The dominant rock throughout the drill hole is black schist cut by 3 dacite porphyry dikes from 180 to 212 meters, 253 to 263 meters, and 342 to 351 meters.

Drill hole Orofino DDH-02, collared from the same site as DDH-01, and drilled at -65° to the southeast towards the heart of the IP anomaly, was concluded at a depth of 628 meters. The dominant rock throughout the drill hole is black schist as well, where between the depths of 98 to 108 meters (10 m), 304 to 310 meters (6 m) the drill hole cut porphyry dacite dykes.

Both the black schist and the dacitic porphyries show disseminated and fracture controlled sulphides along with potassic and lesser phyllic alteration. Assays received from DDH-001 show both the schist and porphyries to host anomalous gold along with the pyrite dominant mineralization. Gold values tend to be elevated adjacent to the porphyry dykes indicating, along with alteration, that the gold mineralization is porphyry related. From these two initial drill holes, of which the first one (DDH-01) was conducted in the peripheral part of the anomaly, combined with the preliminary results of the IP survey, the Company has concluded on a preliminary basis that the Bermejal area has good potential for a gold or gold-copper porphyry typical of those found along the Middle Cauca Belt.

The table below shows the strongest gold and copper anomalous intervals from DDH-01:

FROM (m) TO (m) LONG (m) Au (g/ton) Cu (ppm)
Min Max Average Min Max Average
65.0 66.3 1.3 -- 0.50 0.50 -- 867 867
91.6 104.4 12.8 0.05 1.95 0.41 349 1,740 540
116.6 121.1 4.5 0.05 0.97 0.42 164 2,350 1,208
127.0 129.0 2.0 -- 0.43 0.43 -- 251 251
156.4 163.7 7.3 0.09 0.98 0.43 303 547 420
175.0 182.6 7.6 0.13 1.16 0.48 343 1,860 784
199.3 206.8 7.6 0.09 1.58 0.46 243 1,060 752
318.0 324.0 6.0 0.06 1.46 0.55 166 178 173
386.0 394.0 8.0 0.04 1.53 0.44 131 1,000 539
410.0 414.0 4.0 0.05 0.80 0.42 325 423 374
418.0 424.0 6.0 0.04 1.63 0.57 311 415 360
436.0 438.0 2.0 -- 0.43 0.43 -- 701 701
442.0 444.0 2.0 -- 0.60 0.60 -- 433 433

A total of 237 core samples from DDH-02, targeting the centre of the geophysical anomaly have been sent to ALS lab in Peru for analysis. Results are due mid July 2012. The Company expects to update the results of its geophysics and drilling programs as further data is compiled and analyzed.

Mr. Jaime Lopez, President and CEO of the Company stated: "We are very pleased with this discovery. Our initial drilling has just scratched the periphery of the identified anomaly and the results of our geophysics are directing our next drill holes to the core of the system. We expect significant values from our assaying of samples from our second hole and interesting intercepts from our next holes".

Mr. Stephen Letwin, CEO of IAMGOLD Corporation, which recently increased its shareholding in the Company to 16.4 million common shares, representing approximately 14% of the issued and outstanding common shares of the Company, added: "our team on the ground in Colombia continues to monitor Tolima's progress on this project. Tolima's solid technical team and their deep knowledge of the region and the belt where +50Moz of gold resources have been announced over the last few years, make IAMGOLD optimistic in Tolima's future resource potential."

The ANCAL Project is located within the Middle Cauca Gold Belt, a highly prospective area with potential for porphyry-related gold-copper and epithermal precious metal deposits. The area is being explored by numerous companies including Anglo Gold Ashanti (La Colosa), Gran Colombia Gold (Marmato), Continental Gold (Buriticá), Sunward Resources (Titiribí), Colombia Crest (Arabia) and Bellhaven Copper and Gold (La Mina). The geology of the properties includes Paleozoic metamorphic rocks and Tertiary sedimentary and volcano-sedimentary rocks which have been intruded by igneous rocks of recent ages with the potential for two types of mineralization: porphyry-related gold-copper and epithermal gold-silver vein mineralization within the metamorphic, volcanic and intrusive rocks.

Technical Information and Qualified Person

The technical information in this news release has been reviewed and approved by Joaquin Buenaventura (P. Geo.), a "qualified person" within the meaning of National Instrument 43-101 and the Company's Vice-President of Explorations, who stated "We are excited by the geology, alteration, and gold anomalous mineralization encountered in DDH-01 which demonstrates the presence a gold-copper porphyry system at Bermejal. This type of deposit is known for hosting large volumes of low but economically attractive gold-copper grades susceptible to large-scale exploitation. We look forward to the challenge of vectoring into the heart of the porphyry system."

Mr. Buenaventura has over 40 years of experience in the mining industry in Colombia, and he has a Master's Degree in mineral exploration from Queen's University at Kingston, Ontario, Canada. He was a General Manager of Ingeominas (Colombian Institute of Geology and Mines), and has worked as a Senior Geologist, Project Manager and Consultant for various mining and energy companies. Mr. Buenaventura has been an academic professor as well for over 16 years in the Universidad Nacional de Colombia in Bogota. He has over 50 publications related to the mining industry in Colombia.

The grades disclosed in this press release are conceptual in nature; there has been insufficient exploration to define a mineral resource on Tolima's properties and that it is uncertain if further exploration will result in the target being delineated as a mineral resource.

Quality Assurance and Quality Control

The Company utilizes an industry-standard QA/QC program. The drilling samples were prepared in Medellin's laboratory and then shipped for ICP analysis to ALS-certified assay laboratory in Lima Peru. The remaining samples are stored in a secured storage facility for future assay verification. Blanks, duplicates and certified reference standards are inserted into the samples pack to monitor laboratory performance. The cores were packed in polyethylene bags, labeled, tightly sealed and sent to ALS- laboratory for preparation in Medellin Colombia and analysis in Lima Peru. A portion of the samples are periodically check assayed at ACME or SGS laboratories, in Santiago Chile and Lima Peru, respectively.

Information Concerning Tolima

Tolima is a gold exploration, development and production company with interests in mining properties in Colombia. Tolima's properties include the Remedios Project, located in the Remedios/Segovia mining district in the Antioquia Department of Colombia, with over 12,000 hectares of exploration ground, two mines (the "San Pablo" and "Bartola" mines) and an operating gold processing and recovery plant located in the area of "San Pablo" with a capacity of 100 tons per day; the ANCAL Project, located in the Marmato/Caramanta district of the Caldas and Antioquia Departments of Colombia, including more than 28,000 hectares of exploration ground; and the NORTOL project, located in the Tolima Department of Colombia, including more than 40,000 hectares of exploration ground and the "Papayo" mine, which is being rehabilitated. Tolima is continuing to explore opportunities for the acquisition of additional mining interests in prospective mining districts in Colombia.

Cautionary Statements

Some of the ownership interests in the Company's mining properties derive from applications for concessions or mining titles beneficially held, which are subject to formal assignment to the Company's operating subsidiaries. Such applications and assignment are subject to review by the relevant mining authority and to registration before the National Mining Registry of Colombia in order to confirm current compliance with the terms of each mining property and meeting with certain legal, financial and technical criteria. There is no certainty as to if or when issuance of mining titles from applications or formal registration of assignments will be achieved.

Forward-looking statements

This news release contains certain "forward looking statements" including, for example, the ability of Tolima to achieve formal assignment and registration of its mining properties and the ability to carry out exploration activities. Such forward-looking statements involve risks and uncertainties, both known and unknown. The results or events depicted in these forward-looking statements may differ materially from actual results or events. In addition to other factors and assumptions which may be identified herein, assumptions have been made regarding and are implicit in, among other things: receipt of government and third party approvals in respect of transferring assets, the state of the capital markets; tax issues associated with doing business internationally, the ability to successfully manage the political and economic risks inherent in pursuing mineral exploration opportunities in Colombia; and the ability to obtain qualified staff, equipment and services in a timely and cost efficient manner to develop the business. Any forward-looking statement speaks only as of the date of this news release and, except as may be required by applicable securities laws, Tolima does not intend, and disclaims any duty or obligation to, update or revise any forward-looking statements, whether as a result of new information, future events or results or otherwise.

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