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KGL RESOURCES LIMITED — Capital/Financing Update 2013
Sep 5, 2013
65179_rns_2013-09-05_d055437b-d65f-4ef0-9774-706c89accdee.pdf
Capital/Financing Update
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6 September 2013
20,000 metre Diamond and RC Drilling Program Commenced
Jervois Copper-Silver-Gold Project, NT (KGL 100%)
With KGL in a strong cash position, a 20,000m diamond and RC drilling program has commenced at Jervois. The scoping study completed in 2012 demonstrated that even a modest increase in the size of the resource and throughput significantly improved the project’s NPV and cash flow. The key objective of this drilling program is to substantially increase the size of the current Resource as part of the current Pre-Feasibility Study.
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After a competitive tender process the drilling contract was awarded to Pinnacle Drilling. They will supply two multipurpose drilling rigs, the first of which arrived on site this week and the second rig will commence drilling next week.
KGL Managing Director Simon Milroy said:
“We are certainly seeing the benefit of operating during this downturn with increased availability and reduced cost of equipment and services. Where last year it could be 2 months before we would see any results from the lab this year the turnaround is likely to be 2 weeks.”
In addition to realising the exploration potential adjacent to the existing resource as identified by H&S Consulting in their most recent resource update the drilling program will also test a number of exploration targets within the Jervois tenements.
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Since acquiring Jervois in 2011, KGL has established a significant Resource at Jervois and increased the Resource twice through successful exploration drilling.
Recent work points to the potential for further discoveries at Jervois as well as extensions to existing mineralisation.
Historical Induced Polarisation (IP) data from surveys conducted in 1999-2001 under previous ownership was reprocessed using current state-of-the-art inversion technology, and some of this data are shown on Figures 1&2 below. In Figure 1 a strong IP response can be seen along strike north and south of known mineralisation at Bellbird and Bellbird North. At Rockface a strong IP response has been recorded in an area previously undrilled and yet adjacent to known copper mineralisation.
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----- Start of picture text ----- MineralisationIP Chargeability 40mV/VIP Chargeability 20mV/V----- End of picture text -----
Figure 1 Induced Polarisation results for southern prospects at Jervois
In Figure 2 the reprocessed data shows chargeability anomalies that correlate well with the known Resources at both the Marshall and Reward deposits. Two thirds of the known Resources at Jervois are located at Marshall and Reward.
Specifically, the data, as expressed in Figure 2, shows
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A large chargeability anomaly at Morley, to the east of Reward, and
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A continuation of the chargeability anomaly to the south of Marshall.
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Mineralisation IP Chargeability 30mV/V IP Chargeability 20mV/V
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Figure 2 Induced Polarisation results for northern prospects at Jervois
The drilling program will extend to other locations along the 12km strike length of Jervois (see Figure 3), testing exploration targets in addition to expanding the established resources.
Commenting on the receipt of the funds and the drilling program, KGL Managing Director Simon Milroy said:
“Backed by a strong cash position, KGL has in Jervois a high quality project on which it can now continue to focus an active exploration program to build the size of the resource.”
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Figure 3 Jervois Project planned drill collar locations
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For further information contact:
Mr Simon Milroy Managing Director Phone: (07) 3071 9003
About KGL Resources
KGL Resources Limited is an Australian mineral exploration company focussed on increasing the high grade Resource at the Jervois Copper-Silver-Gold Project in the Northern Territory and developing it into a multi-metal mine. Jervois currently has Indicated and Inferred Resources of 13.5 million tonnes @ 1.3% copper and 25.8 g/t silver for a total of 170,415 tonnes copper and 11.6 million oz silver at a 0.5% copper cutoff, together with 69,000 oz gold, 26,000 tonnes lead and 22,000 tonnes zinc.
Competent Person Statement
The data in this report that relates to Jervois Mineral Resource Estimates is based on information evaluated by Mr Simon Tear who is a Member of The Australasian Institute of Mining and Metallurgy (MAusIMM) and who has sufficient experience relevant to the style of mineralisation and type of deposit 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 (the “JORC Code”). Mr Tear is a Director of H&S Consultants Pty Ltd and he consents to the inclusion in the report of the Mineral Resource in the form and context in which they appear.
The data in this report that relates to Jervois cut off grades and mining assumptions is based on information evaluated by Mr Simon Milroy who is a The Australasian Institute of Mining and Metallurgy (MAusIMM) and who has sufficient experience relevant to the style of mineralisation and type of deposit 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 (the “JORC Code”). Mr Milroy is a full-time employee of KGL Resources Limited and he consents to the inclusion in the report of the cut off grades and mining assumptions in the form and context in which they appear.
The data in this report that relates to exploration results for Jervois is based on information compiled by Rudy Lennartz, who is a member of the Australasian Institute of Mining and Metallurgy and a full time employee of Kentor Minerals (NT) Pty Ltd. Mr. Lennartz has sufficient experience which is relevant to the style of the mineralisation and the type of deposit under consideration and to the activity to 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. Mr. Lennartz has consented to the inclusion of this information in the form and context in which it appears in this report.
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