LONGUEUIL, QUEBEC -- (Marketwire) -- 10/01/12 -- Avala Resources Ltd. (TSX VENTURE: AVZ) (the "Company" or "Avala") is pleased to present an update on progress and drill results from the Kraku Pester project area, part of the Timok Gold Project, a new gold discovery in an emerging sediment-hosted gold belt located in Eastern Serbia.
1. HIGHLIGHTS
-- The recently completed Kraku Pester resource definition program was
focused on establishing continuity of mineralization. The drilling
program has used a nominal 80 meter by 80 meter grid spacing, together
with a subset of the target area at a nominal 40 meter by 40 meter grid
spacing. The drill holes are located within the Kraku Pester mineralized
'footprint' that was outlined by Avala during the earlier, 160 meter by
160 meter diamond drilling program, which started in August, 2010.
-- Recently completed resource definition reverse circulation (RC) and
diamond (DD) drilling at Kraku Pester has returned the following
moderate to strong, selected gold intercepts (0.4g/t Au cut-off grade):
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Hole ID From (m) To (m)Interval (m) Au (g/t) Gram-meters
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PERC035(i) 39 49 10 4.44 44
PERC040 8 21 13 0.59 8
PERC040 31 63 32 1.24 40
PERC040 83 176 93 1.20 112
PERC041 2 37 35 0.76 27
PERC041 73 126 53 1.61 85
PERC046 2 55 53 0.86 46
PERC046 114 169 55 1.16 64
PERC047 4 132 128 1.16 148
PERC060 6 42 36 1.02 37
PERC062 15 65 50 1.34 67
PERC070 10 50 40 1.17 47
PERC075 1 52 51 2.12 108
PERC077/PEDT077(
ii) 1 138 137 1.63 224
PEDT077 144 155 11 1.02 11
PEDT077 162 178 16 0.71 11
PERC081 12 105 93 1.80 167
PERC087 5 86 81 1.46 118
PERC089 9 80 71 1.19 84
PERC093 3 107 104 1.41 147
PERC094 63 139 76 3.07 233
PEDD031(iii) 17 56.6 39.6 1.13 45
PEDD034 47 85 38 1.49 57
PEDD035 5 110 105 1.35 142
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-- Note: Intersections calculated using 5 meter minimum thickness, 5
meter maximum included waste.
-- Note: The listing does not include 'twin' diamond drill hole
intersections of drilled RC holes.
-- (i) Denotes a nominal 80 meter by 80 meter infill drill hole; all
other listed drill holes are nominal 40 meter by 40 meter infill
drill holes.
-- (ii) PERC077 continued as diamond tail PEDT077 (refer to Table 1).
-- (iii) Drill holes terminate in mineralization i.e. mineralization
remains open at depth.
-- The Timok Gold Project comprises several targets including Bigar Hill,
Korkan and Kraku Pester. Avala controls 100% of this newly identified
sediment-hosted gold belt which totals approximately 250 square
kilometres (Figure 1).
-- The Company reported an initial resource estimate for Bigar Hill on July
6, 2012. The Bigar Hill mineral resource prepared by AMC Consultants
Limited (UK) ("AMC") has been estimated at 38,000,000 tonnes grading an
average of 1.3 g/t gold in the inferred resource category for 1,500,000
ounces of gold, using a 0.4 g/t gold cut-off.
-- The Bigar Hill resource estimate was the first of three scheduled
resource estimates, with Korkan and Kraku Pester to follow. The initial
Korkan resource definition drilling program was completed in August and
the database has been closed off, with the data forwarded to AMC. The
Kraku Pester drilling database has now been closed off, with the data
forwarded to AMC.
-- Infill drilling at 40 meter by 40 meter spacing has re-started at Bigar
Hill and Korkan.
-- Exploration diamond drilling continues to test new targets within the
Timok Project area.
-- Avala currently has five diamond drill rigs and two RC drill rigs
operating on the Timok Gold Project.
2. DRILLING AT KRAKU PESTER
Resource Definition Drilling:
-- Avala commenced RC drilling at Kraku Pester on the 26th February, 2012.
Drilling was completed in September, 2012 for a total of 24,954.5 meters
(9,992.5 meters of diamond drilling and 14,962 meters of reverse
circulation drilling). 'Twin' diamond drilling of reverse circulation
drill holes represented approximately 7% of total RC drilling.
-- The Kraku Pester project, covering an area of approximately 0.15 square
kilometers, has been drilled on a nominal 80 meter by 80 meter grid
spacing. In addition, a portion of the target area has been drilled on a
nominal 40 meter by 40 meter grid spacing to provide geostatistical
support for resource estimation purposes.
-- Refer to Table 1 for a summary of all intersections at a 0.4g/t Au cut-
off grade for all Kraku Pester reverse circulation and diamond drill
holes. Figure 2 shows a gram-meter total metal contour plot (intervals
greater than 0.4g/t Au x thickness), of all Kraku Pester drilling to
date, superimposed on topographic contours. Figure 3 shows a
representative cross-section through Kraku Pester. Figure 4 shows all
Kraku Pester drill hole collar locations.
-- The routine reverse circulation-diamond 'twin' drilling program
continues to confirm that the majority of mineralized intercepts and
hence the deposit style, are dominated by layer-parallel,
lithology/fault-controlled gold mineralization.
-- The reverse circulation-diamond 'twin' drill holes suggest that there
can be close spaced variation in gold grade, as is typical for gold
deposits.
-- Multiple gold mineralized intercepts per hole are a common feature of
the gold mineralization outlined to date in the Bigar Hill, Korkan and
Kraku Pester target areas.
Exploration Drilling:
-- Wide-spaced, nominal 160 meter by 160 meter diamond drilling
approximately 1,000 meters southeast of the area of Kraku Pester
resource definition drilling has returned the following moderate to
strong gold intercepts (0.4g/t Au cut-off grade):
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Hole ID Interval
From (m) To (m) (m) Au (g/t)Gram-meters
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PSDD001 39 49 10 0.55 6
PSDD004 32 42 10 2.75 28
PSDD004 167 179 12 6.05 73
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-- Note: Intersections calculated using 5 meter minimum thickness, 5
meter maximum included waste.
-- Gold mineralization is hosted within the upper portion of the target
stratigraphy which consists of volcanic-lithic clastic sediments
(variably hornfelsed) and also within the footwall monzonite.
-- Mineralization remains demonstrably open to the south and wide-spaced,
diamond drilling continues. Figure 5 shows the location of the Kraku
Pester resource definition area relative to PSDD001 and PSDD004. Refer
to Table 2 for a summary of all intersections at various cut-off grades
for Kraku Pester South diamond drill holes PSDD001 to PSDD005.
-- Avala is very encouraged to have intercepted a new, discrete zone of
gold mineralization approximately 1 kilometer south of Kraku Pester. The
Kraku Pester South intercept confirms both the exploration approach and
the potential of the belt, as the new intercepts are associated with a
strong gold in soil anomaly and encouraging trench sampling.
3. KRAKU PESTER RESOURCE ESTIMATION
-- Following site visits by AMC, the Kraku Pester exploration database has
been delivered to AMC in order to undertake independent resource
estimation compliant with Canadian NI 43-101.
-- It is planned to complete the initial resource estimate on Kraku Pester
by the end of Q4, 2012.
-- The current Kraku Pester database is based on 14,962 meters of RC
drilling and 9,992.5 meters of diamond drilling for a total of 24,954.5
meters in 139 drill holes. The database includes over 50,000 analyses
(gold, silver and sulfur) including 34,296 gold assays, of which
approximately 26% are internationally accredited standards, blanks and
routine QAQC duplicate and replicate check assays. All drill holes have
been down-hole surveyed at regular intervals, with drill collars
surveyed using DGPS or total station surveying methods. The topographic
surface is based on detailed DGPS and total station surveying methods,
with an average survey station spacing of approximately 15 meters by 15
meters. Over 1,500 bulk density measurements have been collected, using
standard wax-sealed immersion methods. Over 7 diamond/RC drill pairs
have been completed to date.
-- All drill hole assaying and bulk density measurements have been carried
out independently by SGS.
4. GEOLOGY, MINERALIZATION STYLE AND DISCUSSION
-- Sediment-hosted gold, located along the western margin of the Timok
Magmatic Complex, represents a previously unrecognized style of gold
mineralization within the Timok region.
-- Within the Timok Gold Project, stratabound, fault-controlled breccia
together with minor karst-infill breccia represent the styles of
sediment-hosted gold mineralization recognized to date.
-- At Kraku Pester, sediment-hosted gold mineralization is of a
predominantly stratabound and fault-controlled breccia style and also
occurs within the pre-mineral, footwall monzonite intrusive.
-- Gold mineralization appears to be associated with fine-grained pyrite
(sulfidation reaction) and a number of alteration styles including
kaolinitization, decarbonatization of calcareous sedimentary rock
adjacent to the gold mineralization and occasionally, silicification.
-- Gold mineralization is predominantly hosted within a favourable
sedimentary package - the 'target stratigraphy' - which is underlain by
Jurassic and Lower Cretaceous limestones and consists predominantly of
calcareous sandstones and conglomerates. Mineralization is also hosted
in the underlying carbonate sequence, dominantly within tectonized
structures.
-- The upper portion of the target stratigraphy consists of 'red'
sandstones and volcanic-lithic clastic sediments, which are in turn,
overlain by calcareous marls, andesitic volcanic and volcaniclastic
rocks, representing the youngest portion of the target stratigraphy.
-- Figure 1 shows the location of the Korkan-Bigar trend and the Kraku
Pester target area within the greater sediment-hosted gold belt, as
defined in this image by mapped 'target stratigraphy'. Figure 1 also
shows anomalous gold soil geochemistry, on which the total metal contour
plots, based on drill intersections, are superimposed. The significant
potential of the belt can be clearly seen when the surface area of the
mineralized 'footprints' of the currently drilled target areas within
the Korkan-Bigar trend are compared to the overall extent of the
presently defined gold soil anomalies.
-- A major sediment-hosted gold belt bordering the western boundary of the
Timok Magmatic Complex, identified by soil and trench samples, extends
over 50 kilometers along strike and is up to 8 kilometers wide.
-- Soil sampling has been completed to the south of the currently defined
50 kilometer strike in order to attempt to determine the overall extent
of the belt which, based on the extent of mapped 'target stratigraphy',
has the potential to be approximately 70 kilometers in length.
-- The geology, geochemistry and available drill intersections suggest a
strong similarity to the style of gold mineralization typified by the
North Carlin Trend, Nevada, USA.
-- The recognition that the majority of the significant trench and diamond
drill intercepts returned to date occur within the same flat lying or
shallow dipping sedimentary package has significant implications for the
gold potential of the Korkan-Bigar trend and the entire sediment-hosted
gold belt.
-- Avala intends to systematically explore all currently defined priority
target areas on the belt.
-- Please see the following link to view all Korkan-Bigar and Kraku Pester
drill holes located spatially in three dimensions:
http://www.corebox.net/properties/timok-gold-project
5. SAMPLING AND ANALYSIS
The majority of soil samples have been assayed at the ALS Chemex laboratory, Perth, Australia. More recent programs have been assayed at the SGS managed laboratory at Chelopech in Bulgaria using a combination of ICP-OES and ICP-MS; whereas, gold has been assayed by low level detection fire assay method with an AAS finish. The Company has established a laboratory facility at Bor, Eastern Serbia which is independently managed by SGS. Trench samples were prepared at the laboratory facility at Bor and the samples have been assayed at the SGS managed laboratory at Chelopech in Bulgaria or the laboratory facility at Bor. Diamond drill core has been prepared at the laboratory facility at Bor and assayed at either the SGS managed laboratory at Chelopech in Bulgaria or the assay laboratory at Bor. A one metre sampling interval has been used where possible for the Sediment-Hosted Gold project diamond drilling program. Half core is routinely submitted to the laboratory for analysis. Reverse circulation drill samples have been prepared at the laboratory facility at Bor and assayed at the laboratory at Bor. A one metre sampling interval has been used for the Timok Gold Project reverse circulation drilling program. Following Avala standard quality assurance procedures, a full suite of field and laboratory duplicates and replicates along with internationally accredited standards and blanks, have been submitted with each batch of samples.
Trench sampling was carried out as channels in the wall just above the trench floor on 2m intervals. Except where extensive soil cover is encountered, trenches were sampled in their entirety. The samples were routinely weighed prior to final bagging to maintain an even sample size and to avoid sampling bias in harder rock types. An average channel sample weight was maintained at 3kg/m, which produces a consistent sample weight approximating half HQ core samples. Field duplicate samples were taken every 20 samples and known standards were inserted into the sample stream after every 20th sample. A geological and structural log was completed as for diamond drilling. All data collected in the field was routinely entered into geology and structural geology spread sheets using Field Marshal software for subsequent entry to an acQuire database and validation.
Dr Julian F. H. Barnes, a qualified person under National Instrument 43-101, a Director and the Company's Special Consultant, has approved the technical data in this press release.
Further information about the Timok Gold Project and the Bigar Hill mineral resource estimate as well as information about geology, mineralogy, sampling, interpretations, analytical procedures, and quality assurance and quality control measures, refer to the NI 43-101 Technical Report prepared by Chris Arnold, MAusIMM (CP) of AMC Consultants (UK) Limited and Deepak Malhotra, P. Eng, PhD (SME), of Resource Development Inc. dated June 30, 2012. The report is available on SEDAR (www.sedar.com) and on the Company's website.
About Avala Resources Ltd.: Avala Resources is a mineral exploration company focused on the exploration and development of the Timok Gold Project in Eastern Serbia. The Timok Gold Project comprises several targets, including Bigar Hill, Korkan, and Kraku Pester. Avala controls 100% of this newly identified sediment-hosted gold belt which totals approximately 250 square kilometers. The common shares of Avala trade on the TSX Venture Exchange under the symbol AVZ.
Avala is well-capitalized, with approximately $10 million in its treasury at August 31, 2012, which it plans to use for the exploration and development of its mineral projects in Serbia. Avala's issued and outstanding share capital totals 214,492,223 common shares, of which approximately 51.4% is held by Dundee Precious Metals Inc. (TSX: DPM).
Cautionary Statement
This press release contains 'forward-looking information' within the meaning of applicable Canadian securities legislation. Generally, forward-looking information can be identified by the use of forward-looking terminology such as "anticipate", "believe", "plan", "expect", "intend", "estimate", "forecast", "project", "budget", "schedule", "may", "will", "could", "might", "should" or variations of such words or similar words or expressions. Forward-looking information is based on reasonable assumptions that have been made by the Company as at the date of the information and is subject to known and unknown risks, uncertainties, and other factors that may cause actual results or events to differ materially from those anticipated in the forward-looking information.
Forward looking information in this news release includes information with respect to the Bigar Hill mineral resource estimate and its potential expansion, the Company's plans to complete resource estimates on the Korkan and Kraku Pester project areas, the timing and location of future work programs, the results and interpretation of studies and exploration activities, the nature of the mineralization of the project, the potential size of the sediment-hosted gold system, the possibility that the Timok Gold Project will prove to be economic, and the suggested similarity to the style of gold mineralization of the North Carlin Trend project.
Although the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking information, there may be factors that cause results to be other than as anticipated, estimated or intended. There can be no assurance that the forward looking information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information. The Company does not intend to update the forward-looking information except as required by law. Accordingly, readers should not place undue reliance on forward-looking information contained herein.
Figures and tables are available at the following link: http://file.marketwire.com/release/AVZ_FIG_TAB.pdf.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this press release.
Contacts:
Avala Resources Ltd.
James Crombie
President and Chief Executive Officer
1.450.640.0810
info@avalaresources.com
www.avalaresources.com
