TORONTO, ONTARIO -- (Marketwire) -- 01/17/12 -- Medusa Mining Limited (ASX: MML)(LSE: MML) ("Medusa" or the "Company"), through its Philippines operating company Philsaga Mining Corporation, advises that drilling is continuing at the Bananghilig Gold Deposit and is now focussed on upgrading the resource to the Indicated category. The Company is aiming to outline approximately 1 million ounces of reserves to trigger the commencement of a feasibility study.
The Bananghilig Deposit is within the regional scale Tambis intrusive-breccia complex where the mineralisation is associated with a combination of multiple diatreme breccias, northeast-trending structures and various intrusive rocks.
Highlights include:
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Width Grade (uncut)
Hole Number (metres) (g/t gold)
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TDH 105 6.05 17.09
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TDH 115 28.55 1.54
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TDH 118 12.70 2.44
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TDH 127 14.05 1.20
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TDH 130 10.70 1.88
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TDH 140 11.95 1.19
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TDH 141 7.45 3.55
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The first drilling update for Bananghilig was published on 12 September 2011.
Peter Hepburn-Brown, Managing Director of Medusa commented:
"It is pleasing that drilling continues to provide positive results in and around the existing resource which allows us to progress to infill drilling and to upgrade the resource category to predominantly Indicated, which will then be used for reserves modelling later in the year.
We have seven rigs in the area and it is our intention to continue drilling throughout this year."
BACKGROUND
The Tambis Project, containing the Bananghilig Gold Deposit is operated under a Mining Agreement with Philex Gold Philippines Inc. over Mineral Production Sharing Agreement ("MPSA") 344-2010-XIII which covers 6,262 hectares.
Additional regional geological and mineralisation information, and drilling results are contained in the announcements made by the Company on 10 May 2011 and 12 September 2011.
AIM OF PROGRAMME
In July 2010, new regional and detailed mapping and drilling programmes were commenced with the aim of validating the current resource and extending it to provide a reserve of approximately 1,000,000 ounces of gold. This reserve would form the basis for a feasibility study which would target production of 200,000 ounces of gold per year from a new milling facility.
REGIONAL GEOLOGICAL SETTING
The Tambis regional geology (Figure 1), termed the Tambis intrusive-breccia complex, typifies a structurally complex intermediate-sulphidation, epithermal gold, breccia-type system, including disseminated gold overprinting the host Tertiary-age igneous package which had been emplaced into an andesitic volcanic basement. The fertile igneous suite comprises a multi-phase calc-alkaline, high level, sub-volcanic intrusive package cut by extensive bodies of phreatomagmatic diatremes and hydrothermal breccias.
BANANGHILIG DEPOSIT
Geological summary
The Bananghilig Deposit currently consists of three zones, each approximately 1 kilometre long and open in all directions, locally termed the Sorex, Garden and Malinao zones. These zones are broadly defined on the basis of the projection in plan of greater than or equal to0.5 g/t gold drill hole intersections.
The mineralisation is located partly within the Bananghilig diatreme breccia which measure at least 1,000 metres west to east and still open to the south beneath the younger sediments, and also around the diatreme margins and in the country rocks along structural corridors.
The diatreme breccias contain unsorted fragments of the andesitic basement as well as fragments of the later intrusive rocks predating the diatreme events in a matrix of comminuted rock flour and magmatic crystals. Fragment sizes range from granule-sized to building-sized mega-blocks which have been torn off the walls of the diatreme during the multi-episodal explosive activity. The explosive activity also fractured the mega-blocks and wall rocks, preparing them for subsequent mineralisation deposition.
Figure 1. Geological interpretation map showing drill hole locations is available at the following address: http://media3.marketwire.com/docs/map_mml.pdf.
DRILL RESULTS
During the period 31 August 2011 to 31 December 2011, 8,568.95 metres of diamond drilling in 21 holes have been completed. Holes TDH 131-134 inclusive have been drilled outside the Bananghilig area.
Figure 1 shows only the drill holes with new assays, being holes TDH 103 to 141 inclusive.
First pass assaying for gold has been undertaken on all samples submitted to the laboratory. Additional assaying is on-going from selected intervals for base metals, silver and other elements.
The results are summarised in Table I where significant intercepts are defined on the following basis:
(i) lower cutoff grade of 0.5 g/t Au, and
(ii) greater than or equal to 5 metres downhole intercept width at greater than or equal to 0.5 g/t Au, or
(iii) less than or equal to 5 metres downhole intercept width at greater than or equal to 5 gram x metres, and
(iv) maximum of 3 metres of downhole internal dilution at less than or equal to 0.5 g/t Au.
Table I. Bananghilig surface drill hole results.
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Grade
(uncut)
Hole Dip Azimuth From Width (g/t
number East North (degrees) (degrees) (metres) (metres) gold)
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TDH 103 945228 612334 -60 130 169.80 1.00 9.74
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TDH 104 945477 613116 -60 130 406.70 8.95 0.69
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432.00 6.00 0.66
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450.00 9.00 0.57
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TDH 105 945493 612520 -60 130 55.95 3.00 3.12
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62.95 6.05 17.09
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80.15 2.85 3.98
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111.50 8.75 0.96
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136.10 0.70 22.19
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177.60 5.30 0.80
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TDH 107 945331 612443 -60 130 45.80 2.45 2.06
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103.60 3.05 2.59
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113.65 6.95 0.84
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136.70 1.30 43.75
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TDH 108 945320 612748 -60 130 106.75 1.45 4.01
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122.80 14.35 1.09
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139.15 6.00 0.63
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231.00 6.60 0.64
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388.10 1.00 5.68
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402.10 1.00 13.20
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TDH 109 945018 612911 -60 130 347.15 16.55 1.00
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406.70 10.25 1.13
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TDH 110 945447 612974 -60 130 200.25 7.60 0.75
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349.70 24.00 0.84
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438.55 1.00 5.93
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455.45 1.00 20.19
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TDH 111 945447 612463 -60 130 127.90 6.50 0.71
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158.95 6.85 0.76
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TDH 113 945296 612481 -60 130 6.40 1.50 10.53
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116.65 4.25 2.20
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TDH 114 944947 613088 -60 130 75.90 1.65 3.14
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94.15 5.95 1.26
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454.15 2.15 4.38
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TDH 115 945367 612381 -60 40 89.95 0.70 9.23
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135.80 28.55 1.54
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TDH 116 945432 612663 -70 130 57.20 6.50 0.79
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TDH 117 945619 612952 -60 130 16.60 9.30 0.57
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41.90 6.75 0.91
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116.90 0.80 8.51
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140.45 5.45 2.75
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181.25 3.55 10.03
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201.20 4.75 1.20
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292.65 3.45 6.98
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332.80 1.40 4.48
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518.05 5.10 0.81
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TDH 118 945037 612514 -60 130 38.80 4.40 8.90
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109.20 12.70 2.44
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TDH 119 945294 612578 -60 130 37.55 2.00 5.54
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TDH 120 945239 612383 -60 130 241.00 1.00 6.42
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338.05 6.00 1.43
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TDH 122 944983 612713 -60 130 139.00 4.70 1.87
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TDH 123 945200 612496 -60 130 100.35 6.30 0.69
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228.10 4.50 2.99
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TDH 124 945108 612614 -60 130 107.20 3.50 2.30
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249.50 5.00 0.73
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279.00 6.65 0.53
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295.50 5.00 0.76
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TDH 125 945458 612567 -60 130 7.15 5.95 0.72
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63.00 6.85 0.69
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TDH 127 945259 612994 -60 130 22.30 5.10 1.76
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114.90 6.55 0.73
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232.35 1.00 10.87
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242.60 6.65 2.17
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265.40 7.50 1.92
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275.90 14.05 1.20
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299.95 7.00 1.01
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TDH 128 945486 612351 -60 130 426.75 9.85 0.76
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TDH 129 945280 612673 -60 130 217.30 5.00 0.66
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230.30 5.55 0.94
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248.55 5.00 0.58
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256.80 7.60 0.56
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TDH 130 945606 612511 -60 130 24.70 1.40 6.25
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165.25 2.35 5.32
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187.90 2.00 2.68
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194.10 10.70 1.88
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257.35 5.50 0.55
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264.85 4.35 2.63
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287.60 0.90 14.02
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TDH 136 945588 612686 -60 130 40.30 6.00 0.58
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68.60 6.00 0.68
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92.10 5.20 0.80
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260.25 7.85 0.51
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317.25 9.65 1.50
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331.90 5.00 1.41
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TDH 137 945522 612397 -60 130 446.45 5.95 2.13
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TDH 138 945278 613055 -60 130 12.55 5.80 0.83
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116.70 6.25 0.81
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151.30 5.80 2.36
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TDH 140 945406 612631 -70 130 3.25 8.75 3.01
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17.00 6.00 1.52
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67.00 4.70 3.04
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91.90 5.75 0.71
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108.15 11.95 1.19
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121.10 6.05 1.15
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138.40 6.60 0.70
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175.45 9.35 1.45
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285.90 6.25 1.33
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TDH 141 945630 612542 -60 130 41.50 15.90 1.18
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61.15 5.75 1.18
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127.00 2.65 6.18
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143.60 2.30 17.19
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262.15 7.45 3.55
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Notes:
i. Intersection widths are downhole drill widths not true widths;
ii. Assays denoted by (i) are by Philsaga Mining Corporation's laboratory,
all other assays are by McPhar Geoservices Inc. in Manila;
iii. Check surveying of collar positions in progress;
iv. Grid coordinates based on the Philippine Reference System 92.
DRILL HOLE SAMPLING AND ASSAYING PROCEDURES
Drilling Procedures
Drilling, sampling and analytical methodologies are of internationally acceptable standards. Drilling and analyses are carried out by independent contractors, SBF Philippines Drilling Resources Corp. ("SBF") and Intertek Testing Services Philippines, Inc. ("Intertek") respectively.
Drilling is carried out by SBF using wireline diamond coring techniques, with the core being predominantly HQ triple-tube (HQ3) diameter (OD 61 mm). The holes are initially collared using PQ drillbits (OD 123 mm) to recover PQ3 core (OD 83 mm) until the drillbit encounters competent ground, then the coring bit is reduced to HQ3 for the remainder of the drill hole. If difficult conditions are encountered, then the drill bit is changed to NQ3 (core OD 45 mm) and the hole continued until the planned depth or bad ground conditions prevent further drilling, whichever occurs first. Core recovery is generally better than 95% and is considered to be good.
Drill Core Sampling
Drill core is recovered from the inner tube and handled carefully to preserve the integrity of the drill core. Structural measurements are taken: Rock Quality Determinations ("RQD") and Fracture Densities. The core is then placed in plastic core trays, aligned, photographed and marked up for sampling.
The drill core is then cut in half by diamond core saw and sampled at one metre intervals or at lithological boundaries. The samples are placed in individually labelled plastic sample bags, a sample number ticket included, and then sealed for despatch to Intertek's Sample Preparation laboratory in Surigao City. The integrity of the core samples are supervised at all times by the geologist until despatch to the laboratory where they are accompanied by company personnel until receipt by Intertek.
One Certified Reference Material ("CRM"), one Blank and if possible, one Duplicate is included within each successive group of twenty samples that are submitted to the laboratory. QA/QC monitoring of the drilling program and the results is ongoing.
Analytical Procedure
Sample preparation is undertaken by Intertek at their Surigao City laboratory, where each sample is registered, dried at 105 degrees C for 6 to 8 hours and crushed to 95% passing 2 mm by jaw crusher, before a 1kg split is taken for fine pulverising, using a riffle splitter or rotary sample divider. Pulverised sample is nominally pulverised to 95% passing 75um (200 mesh).
Quality control procedures include a 1 in 15 resplit after crushing for partial preparation and after pulverising for total preparation. These resplits are also analysed and included in the analysis report. Sizing tests are carried out on 1 in 20 assay pulps at 75um (200 mesh) to monitor the pulverising stage. Four 250 gram splits are obtained, one for sample analyses and the remaining three for storage for future reference.
Standard laboratory procedure is to clean the crusher and pulveriser after each sample treatment with barren material and/or bowl wash, to minimise carry-over contamination.
Pulverised samples are analysed by classical fire assay techniques on a 50 gram charge with Atomic Absorption Spectrometer ("AAS") finish. All assays over 5 g/t gold and other selected samples are re-assayed using gravimetric fire assay techniques on a 50 gram sample.
Information in this report relating to Exploration Results has been reviewed and is based on information compiled by Mr Geoff Davis, who is a member of The Australian Institute of Geoscientists. Mr Davis is the Chairman of Medusa Mining Limited and has sufficient experience which is relevant to the style of mineralisation and type of deposits under consideration and to the activity which he is undertaking to qualify as a "Competent Person" as defined in the 2004 Edition of the "Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves" and is a "Qualified Person". Mr Davis consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.
DISCLAIMER
This announcement may contain certain forward-looking statements. The words 'anticipate', 'believe', 'expect', 'project', 'forecast', 'estimate', 'likely', 'intend', 'should', 'could', 'may', 'target', 'plan' and other similar expressions are intended to identify forward-looking statements. Indications of, and guidance on, future earnings and financial position and performance are also forward-looking statements.
Such forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties and other factors, many of which are beyond the control of Medusa, and its officers, employees, agents and associates, that may cause actual results to differ materially from those expressed or implied in such statements.
Actual results, performance or outcomes may differ materially from any projections and forward-looking statements and the assumptions on which those assumptions are based.
You should not place undue reliance on forward-looking statements and neither Medusa nor any of its directors, employees, servants or agents assume any obligation to update such information.
ABN: 60 099 377 849
Contacts:
Australia
Medusa Mining Limited
Geoff Davis
Chairman
+61 8 9367 0601
Medusa Mining Limited
Peter Hepburn-Brown
Managing Director
+61 8 9367 0601
+61 8 9367 0602 (FAX)
admin@medusamining.com.au
www.medusamining.com.au
United Kingdom
Fairfax I.S. PLC
Ewan Leggat/Laura Littley
Financial Adviser & Broker
+44 (0)20 7598 5368
