Breaking News Release
Breaking News Release
Spanish Mountain Gold Announces Updated Resource Estimate: Increased Measured and Indicated Category Reported
Spanish Mountain Gold Ltd. (the Company) (SPA-TSXV) is pleased to announce an updated resource estimate (National Instrument 43-101 compliant) for the Main Zone at the wholly owned Spanish Mountain Gold Project (the "Project") in central British Columbia, Canada. This resource estimate is an update to the previous estimate disclosed by the Company in a news release dated November 15, 2011. The updated resource was based on all drill data, including data from the 24,000 metre (142 drill holes) in-fill drilling program completed by the Company within the Main Zone during the first half of 2012.
The updated resource at selected gold cut-off grades is as follows:
Spanish Mountain updated resources (at a 0.30 g/t gold cut-off) effective July, 2012
Classification
Tonnes
Gold grade
(g/t)
Silver grade
(g/t)
Gold
(ounces)
Silver
(ounces)
Measured
21,240,000
0.73
0.64
500,000
440,000
Indicated
113,230,000
0.56
0.69
2,040,000
2,510,000
Measured plus Indicated
134,470,000
0.59
0.68
2,540,000
2,950,000
Inferred
147,830,000
0.49
0.67
2,320,000
3,180,000
The Company completed a Preliminary Economic Assessment as disclosed in a news release dated November 23, 2010. That assessment established an economic cut-off of 0.2 g/t gold based on assumptions of operating costs for a potential open pit operation. The following table presents the updated resource at a cut-off grade of 0.2 g/t gold.
Spanish Mountain updated resources (at a 0.20 g/t gold cut-off) effective July, 2012
Classification
Tonnes
Gold grade
(g/t)
Silver grade
(g/t)
Gold
(ounces)
Silver
(ounces)
Measured
29,360,000
0.60
0.67
560,000
630,000
Indicated
186,870,000
0.44
0.69
2,620,000
4,150,000
Measured plus Indicated
216,220,000
0.46
0.68
3,180,000
4,780,000
Inferred
316,740,000
0.36
0.65
3,650,000
6,620,000
Tonnages and contained ounces presented above may not total as shown due to rounding. Readers are cautioned that mineral resources, which are not mineral reserves, do not have demonstrated economic viability.
Highlights
The latest infill drilling program has been successful in increasing the Projects resource in the Measured and Indicated categories at a gold cut-off grade of 0.2 g/t when compared to the previous resource estimate by the following amounts:
An increase of 69% in contained gold ounces within the Measured category.
An increase of 40% in contained gold ounces within the Indicated category.
An increase of 46% in contained gold ounces within the Measured and Indicated categories.
Brian Groves, President and CEO said today: "We are very pleased by the success of the infill drilling in yielding such an increase in the Measured and Indicated resource categories for the Main Zone. The Company will now focus completely on the timely completion of a Pre-Feasibility Study for this zone."
Details of the parameters used in the resource estimate are as follows:
Out of a total of 816 drill holes provided, 670 diamond drill holes penetrated the various geologic solids. Missing or unsampled intervals were filled with 0.001 g/t gold. Samples not analyzed for silver from earlier drill campaigns were left blank.
A three dimensional geologic model was produced by the Companys geologist using Vulcan 3D mining software. The main zone mineralization was modeled into an upper argillite unit, an altered siltstone unit, a tuff unit and a lower argillite unit. The North zone argillite was a separate solid. All material outside of these domains was considered waste.
The gold grade distributions within the mineralized domains were examined to determine if capping was required. In each case the distribution for gold was strongly skewed. A lognormal cumulative frequency plot was produced for gold in each domain and in all cases showed multiple overlapping lognormal populations. Capping levels were determined to reduce the effect of small high grade populations that can be considered erratic. A similar procedure was used to cap silver values.