Big boost for Reefton resources

Source: www.NZResources.com

Owner OceanaGold Corporation (ASX, TSX, NZX: OGC) detailed results from the first phase of a brownfields drilling programme that identified extensions to gold mineralisation at the General Gordon, Souvenir and Empress deposits.

Souvenir, which is the furthest south of the three deposits, is less than 3 kilometres from the processing plant for the Globe-Progress mine and within the current mining permit.

Oceana said the new mineralisation at Souvenir and General Gordon were likely to result in increased reserves and pit expansions. Follow up drilling was already underway.

The mineralised extensions obtained at Empress 1 were showing scope for “underground mining opportunities”.

Intensive mapping and geochemical sampling identified six additional “highly prospective” near-mine targets and drilling of these has begun.

Follow up drilling on Souvenir will target further down-dip continuation of the ore body.

“Based on assay results to date, an increase to reserves and a subsequent expansion of the Souvenir open pit is expected. The extent of the revised open pit will be determined once the new zones of mineralisation at depth have been determined by the current drilling,” Oceana said.

At the Empress, brownfields drilling targeted extensions to mineralisation at depth. Two diamond holes indicated a strong mineralised package continues at depth.

This feasibility of mining this area by underground methods will be evaluated.

Oceana said results of three hole RC holes at General Gordon identified “good widths of mineable grade at depth.

“As with Souvenir, a follow up RC programme is underway to test the limit of these extensions. Based on results to date, a re-optimisation of this deposit is expected and will likely result in an enlarged open pit design and an expanded reserve.

Since beginning the brownfields quest at Reefton, Oceana has significantly increased the size of the exploration team which now comprises 13 geologists and field assistants.

Oceana holds permits over greater than 95% of the historic 2 million ounce hard-rock production goldfield which stretches for more than 30 kilometres.

Targets in the Reefton field to be explored later this year include Capleston, Crushington and Big River.

The Reefton goldfield is significant in Australasia for being a multi-million ounce producer in the late 1800s and early 1900s but with virtually no production since circa 1920 (apart from the Blackwater mine which ceased mining in 1951).

The revival came with Oceana commissioning the Globe Progress open cut in 2007.

Most historic mining in Reefton was from high grade underground operations with head grades from 15 to 34 g/t gold. These deposits were traditionally narrow veined structures that were discovered at surface and mined down dip.

Oceana’s chief executive Paul Bibby said: “These encouraging results from Reefton, combined with the more than 120,000 oz of reserves that were added in December 2009, are a very good start to this brownfields exploration programme.

“With the majority of the new mineralised extensions being open at depth, combined with the ongoing brownfields drilling and focused near mine potential, we are very excited about what the future may hold.”

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