By Wits Gold is pleased to announce a revised resource model for the De Bron-Merriespruit (DBM) Project in the southern Free State goldfield, South Africa, following the completion of an 11-hole (12,000 meters) drilling programme. The results of the second phase of this drilling (7,027 metres) were released in November 2011. Full details of this resource update are reported in the Company's JSE Limited SENS announcement released today, 10 January 2012.
Key highlights of the DBM Project resource update include:
- Indicated gold Resource increases by 27% to 7.5Moz
- High-grade zone of the Indicated Resource increases by 50% to 3.6Moz at an average grade of 8.1 g/t
- Shallow mineralisation in multiple reefs may allow for safer and more efficient mechanised mining methods
- Indicated Resource for uranium by-product increases by 35% to 8.2Mlbs
- Independent pre-feasibility study on track for completion in May 2012
Commenting on the revised resource model Wits Gold CEO, Mr Philip Kotze said, "This significant increase in Indicated Resources reported at the DBM Project proves the robustness of this shallow orebody. The coherent higher grades at shallow depth imply higher initial returns, which mean quicker capital payback. The possible application of mechanised mining methods over a higher grade, narrow stoping width is quite exciting, as it is known to be safer and more cost effective. We are eagerly anticipating the outcome of the pre-feasibility study and remain confident that the DBM Project will demonstrate exceptional returns for our investors".
BackgroundThe previous resource estimate, released in February 2011, was used by Turgis Consulting (Turgis) to complete a preliminary economic assessment or scoping study at the DBM Project, which was released in June 2011.The scoping study was undertaken on the Indicated Resource only and did not include some 40% of the total DBM Resource that was classified as an Inferred Resource. The scoping study recommended an appropriate drilling programme be undertaken with the aim of converting the Inferred Resources into the Indicated category for pre-feasibility study purposes.
2nd Phase Drill ProgramThe results of second phase drill program were used to revise the resource model at the DBM Project during December 2011 by Snowden Mining Industry Consultants (Snowden). Using an accumulation cut-off of 300 cm.g/t Au, the Indicated Resource on the Beatrix, Kalkoenkrans, B and Leader Reefs has increased by 27% to 41.8Mt at 5.5g/t Au (7.5Moz), with Inferred Resources commensurately decreasing by 19% to 19.5Mt at 5.4g/t Au (3.4Moz) when compared with the February 2011 estimate. High grade optionIncluded within this global resource is an Indicated Resource of 13.8Mt at 8.1g/t Au (3.6Moz) and an Inferred Resource of 5.5Mt at 8.1g/t Au (1.4Moz) using an accumulation cut-off of 600 cm.g/t Au. This represents a 50% increase in the Indicated Resource previously reported using the same cut-off grade. The resource model indicates that the bulk of this higher grade zone occurs between 480 and 1 000 metres below surface, which could facilitate a higher grade mining opportunity in the earlier years of this project.Mechanised MiningThe Company also requested Snowden to calculate a resource over a stoping width of 60cm for the Indicated Resources of the Beatrix, Kalkoenkrans and Leader Reefs, where mineralisation is observed to be concentrated towards the base of these reefs. The B Reef was excluded as it has a variable distribution of mineralisation throughout the vertical extent of the reef.At a 300cm.g/t cut-off, 17.7Mt have been estimated with an average grade of 8.8g/t, giving an Indicated Resource of 5.0Moz Au. Significantly, this implies that cost-effective and safer mechanised mining methods may be utilised, and the effects of this on the economics, compared to conventional mining methods, will be investigated in the pre-feasibility study.
UraniumWits Gold currently holds the rights to uranium over the southern portion of the DBM Project area only. This area contains an estimated Indicated Resource of 21.7 Mt at 0.17 kg/t U3O8 (8.2 Mlbs U3O8) in addition to an Inferred Resource of 12.5 Mt at 0.167 kg/t U3O8 (4.6 Mlbs U3O8). The total uranium resources have increased by some 31% from the previously reported figures, partly due to the granting of uranium rights over the Floriana area in the east. The viability of producing uranium as a by-product will also be considered in the pre-feasibility study.Mineral Resource StatementThe updated Mineral Resource estimates for the DBM Project using an accumulation cut-off of 300 cm.g/t Au are set out below. They are reported in accordance with the Canadian Institute of Mining Definition Standards and the SAMREC Code.
Indicated Gold Resources |
Indicated Uranium Resources |
Inferred Gold Resources |
Inferred Uranium Resources | ||||||||
Mt |
Grade (g/t) |
Moz |
Mt |
Grade (kg/t) |
Mlbs |
Mt |
Grade (g/t) |
Moz |
Mt |
Grade (kg/t) |
Mlbs |
41.8 |
5.5 |
7.5 |
21.7 |
0.17 |
8.2 |
19.5 |
5.4 |
3.4 |
12.5 |
0.17 |
4.6 |
Exploration activities by Wits Gold at the DBM Project have been conducted under the supervision of Mr Dirk Muntingh, the Company's Qualified Person and Exploration Manager. Mr Muntingh (M.Sc Geology) is a registered Pr.Sci.Nat with SACNASP and has 20 years of experience in gold exploration.
For further information please contact:
Mr. Philip Kotze
Chief Executive
Officer
Philip@witsgold.com
Mr. Hethen Hira
Executive: Investor Relations
Hethenh@witsgold.com
Johannesburg
10 January 2012
Forward looking information involves known and unknown risks, uncertainties and other important factors that could cause the actual results, performance or achievements of the Company to be materially different from the future results, performance or achievements expressed or implied by such forward looking information. Such risks, uncertainties and other important factors include among others: economic, business and political conditions in South Africa; decreases in the market price of gold; hazards associated with underground and surface gold mining; the ability to attract and retain qualified personnel; labour disruptions; changes in laws and government regulations, particularly environmental regulations and mineral rights legislation including risks relating to the acquisition of the necessary licences and permits; changes in exchange rates; currency devaluations and inflation and other macro-economic factors; risk of changes in capital and operating costs, financing, capitalisation and liquidity risks, including the risk that the financing required to fund all currently planned exploration and related activities may not be available on satisfactory terms, or at all; the ability to maximise the value of any economic resources. These forward-looking statements speak only as of the date of this news release.
You should not place undue importance on forward-looking information and should not rely upon this information as of any other date. The Company undertakes no obligation to update publicly or release any revisions to these forward-looking statements to reflect events or circumstances after the date of this document or to reflect the occurrence of unanticipated events except where required by applicable laws.
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