Glass Earth Gold Signs Deal to Allow Hard Rock Gold Mining This Year
August 18 2009 - 10:08AM
Marketwired
Glass Earth Gold Limited (TSX VENTURE: GEL)(NZAX: GEL) ("Glass
Earth") announces that it has entered into an option agreement to
acquire a 50% equity interest in Exploration Permit 40 427 known as
the Ophir prospect in Otago, New Zealand, with Ophir Gold Ltd, a
private company.
Transaction
The proposal amalgamates together the land positions of the more
advanced resource position of Ophir Gold's EP 40 427 with possible
extensions of structures into Glass Earth's EP 40 870, and also
provides for additional Glass Earth ground around both those
permits.
The transaction is a farm-in by Glass Earth into EP 40 427
(which has existing near-surface gold mineralisation) on the
following terms:
a. Glass Earth to solely fund an evaluation study of a deposit
within the Joint Venture Area (see attached map);
b. Concurrently, Glass Earth will spend NZ$250,000
(approximately C$185,000) on the JV Area; then
c. Subsequent to the JV being formed and making a Decision to
Mine, Glass Earth would be responsible for the design, resource
permitting and installation of suitable processing plant on the
chosen mining site (including the initial funding thereof);
d. Ophir Gold would reimburse Glass Earth for its 50% share of
any plant acquisition costs out of 50% of its net profits from
mining;
e. Glass Earth contributes additional ground around Ophir Gold's
EP 40 427 Permit. The joint venture, with Ophir Gold, will be
shared 50:50. (see map).
The Project
The Ophir Project is a 640 ha area located in the heart of
Central Otago reef gold country, two hours drive northwest of
Dunedin. Numerous highly prospective mineralized reefs, as well as
near-surface gold bearing gravels, contribute to the excellent
potential of the overall Joint Venture Area.
Historic hard rock gold production (up to 1939) from the Ophir
prospect was approximately 1,200 oz, won from 13,000 tonnes at an
average grade of 3g/t. Native gold occurs as grains between 4mm and
10mm diameter in the Ophir prospect areas (including Wai-iti, South
Wai-iti and Air-strip).
More recently, exploration work undertaken by Ophir Gold Ltd in
2005/06 has consisted of:
- Geologic mapping; soil sampling; rock chip and channel
sampling; small pit excavations and a preliminary round of shallow
drilling (Phase 1 - approximately C$290,000);
- Magnetic surveys across the Wai-iti target; drilling of 11 RC
Holes (661m total) and 4 diamond drill holes (192m) (Phase 2 -
approximately C$275,000)
Ophir Gold has previously published estimates of mineralisation
and these are being re-evaluated by Glass Earth as part of the
evaluation study underway.
The predominance of coarse gold raises difficulties in
adequately testing such mineralisation via drilling. Glass Earth's
preferred approach would be to tackle the appraisal for mining via
bulk testing of several of the vein systems.
Objective
The evaluation study will examine the potential for open pit
mining the near-surface oxidized ore zones and separating out the
coarse gold by means of conventional crushing/grinding followed by
a gravity separation process. Irrespective of the smallish scale of
the initial mining approach, it may provide positive cash flow for
Glass Earth, especially as gold prices remain high. The potential
to replicate the mining on other pods of near-surface ore will be
progressively evaluated going forward.
Qualified Persons
Glass Earth's exploration programmes are carried out under the
supervision of Glass Earth's President and CEO, Simon Henderson,
M.Sc, M.AUSIMM, F.SEG. Mr. Henderson meets the qualified person
requirements (as defined by National Instrument 43-101) with more
than 30 years of experience in the gold mining and exploration
industry.
About Glass Earth Gold Limited
Glass Earth is one of the largest New Zealand-based gold
exploration companies exploring a land position of over 17,000 km2
in the North and South Islands. With its main office in Wellington,
New Zealand, Glass Earth Gold Limited is listed on the TSX Venture
Exchange (TSX VENTURE: GEL) and the New Zealand Alternative Stock
Exchange (NZAX: GEL).
To receive Company news via email, contact lindsay@chfir.com and
mention "Glass Earth news" in the subject line.
To view the map accompanying this release please click the
following link:
http://media3.marketwire.com/docs/gelmap818.pdf.
Neither the TSX Venture Exchange nor New Zealand Exchange
Limited has reviewed this release and neither accepts
responsibility for the adequacy or accuracy of this release.
Contacts: Glass Earth Gold Limited Simon Henderson President and
Chief Executive Officer +64 4 903 4980 info@glassearthlimited.com
www.glassearthgold.com CHF Investor Relations Lindsay Carpenter
Account Manager +1 416 868 1079 x239 lindsay@chfir.com
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