Kenai Resources Ltd.: Encouraging Electromagnetic Anomalies Located at Sao Chico Gold Project, Brazil
January 12 2011 - 7:39PM
Marketwired
Kenai Resources Ltd. ("Kenai") (TSX VENTURE: KAI) is pleased to
announce encouraging exploration results from the Sao Chico Gold
Project in Brazil from an initial horizontal loop electromagnetic
survey (HLEM) over the main vein zone at Sao Chico. Initial
geophysical surveying of the main vein area at the Sao Chico Gold
Project has revealed the presence of two large anomalous conductive
zones. Persistence of the anomalism throughout all frequencies
indicates significant depth extent. The anomalous zones are most
likely associated with pyritic mineralised zones in the basement
granite.
Two composite rock grab samples of pyritic granite from a nearby
mine shaft returned encouraging assay results of 1.61 and 36.0 g/t
gold and as previously reported, similar pyritic samples from the
nearby Sao Chico Vein No.1 returned an average assay result of 15.0
g/t gold. A recent trench in the anomalous area intersected old
garimpeiro workings and a 4.45m zone of stockwork veining.
Follow-up induced polarisation (IP) geophysical traversing has been
undertaken and is currently being interpreted. The results will be
used to select targets for further trenching and drill testing.
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The HELM survey was undertaken along a series of 50 metre spaced
N-S orientated lines over the main Sao Chico gold vein area.
Several regional traverse lines were also surveyed and were
randomly selected within the AP to the east (1.0km, 1.5km and
4.5km) of the main prospect area. The larger of the two conductive
anomalies was delineated immediately south of the main vein along
which a drive was developed from the Waldimiro shaft at Sao Chico
Vein No. 1.
Further south into the anomalous zone, a recent trench (21) area
intersected old garimpeiro workings and a 4.45m zone of stockwork
veining. Three channel samples from within this zone returned
assays of 1.02 g/t gold, 2.89 g/t gold and 11.34 g/t gold. A large
conductive anomaly was also delineated some 100 metres to the east
of the main zone (where veins are known) and discrete conductive
anomalies were also detected on the two traverse lines 1.0 and 1.5
km to the east. The latter two areas require follow-up as there are
no veins known in these areas.
Follow-up induced polarisation (IP) surveying has been
undertaken and the data is currently being interpreted to further
define the conductivity anomalies and to select priority targets
for drill testing early in 2011.
As a result of the encouraging exploration results at Sao Chico,
Kenai has decided to cease further exploration at its Albisu
project in Northern Nevada. While the Albisu project showed
promise, the potential shown at Sao Chico combined with growing
environmental issues at Albisu led to this decision.
About Sao Chico:
The Sao Chico gold project is located along a prominent NW-SE
trend which is the most mineralized zone within the Tapajos Mineral
Field in central-northern Brazil. The Tapajos field was the site of
the biggest gold rush in Brazilian history in the late 1970's and
1980s when approximately 500,000 garimpeiros (artisanal miners)
rushed to the area to exploit extensive areas of newly discovered
alluvial gold. Approximately 20 to 30 million ounces of gold
(unofficial figures) were produced from these operations before the
easily won alluvial gold deposits were largely depleted. The
garimpeiros have little expertise in underground mining and
environmental considerations and were thus urged by the government
to consolidate their small claims and form joint ventures with
established mining companies. The area has had little exploration
by modern exploration methods compared to other equivalent gold
fields in the world.
The GUIA license provides for mining and processing of up to
50,000 tons of gold mineralized rock per year for up to two years.
It is anticipated that there is currently sufficient tonnage
available to sustain an initial startup operation commencing at a
rate of 50 tonnes per day and increasing to 100 tonnes per day
after two months of plant start-up, from veins that vary in
thickness from less than one centimetre to three metres. It is
estimated from Gold Aura Brasil's trenching and sampling that the
vein aggregate thickness over the currently identified one km
strike length is up to around five metres.
Gold recovery will be undertaken via gravity concentration and a
processing plant has been purchased from Gekko Systems in
Australia. This plant has now arrived in Brazil. The new plant
components have been delivered to site and the used components are
now Details of Kenai's investment in the Sao Chico project can be
found in its release dated 21 September, 2010.
Kenai announces that it has engaged Seahawk Capital Corp.
("Seahawk"), of Vancouver, BC, to provide investor relations
services. Kenai has agreed to pay Seahawk $3,000 per month for an
initial term of 12 months. The principal of Seahawk is Saf Dhillon.
The agreement is subject to the approval of the TSX Venture
Exchange.
Kenai also announces that Mr. John Watt has been appointed as
CFO to replace Mr. Paul Larkin. Mr. Watt is a Chartered Accountant
with over 37 years of business experience. He serves as Chief
Financial Officer for two other Canadian public junior mining
companies with exploration programs in Latin America. Mr. Watt has
provided financial and tax consulting services to both public and
private companies, and has consulted to foreign filers with the US
Securities and Exchange Commission on Sarbanes-Oxley Act
compliance. Mr. Watt earned a B.A. with a Major in Economics. Mr.
Larkin will remain as Corporate Secretary and a director of
Kenai.
About Kenai Resources:
Kenai is a Canadian company focused on precious mineral project
exploration and development, towards early significant gold
production. In addition to the Sao Chico gold project in Brazil ,
Kenai is also involved in exploration of the wholly-owned Quartz
Mountain and Hope Butte gold epithermal gold projects in
South-Eastern Oregon, both located in Malheur County, close to the
Oregon border with Idaho. Kenai's current indicated and historical
gold resources from the two Oregon projects are summarized as
follows:
Project Tonnes Grade Ounces Au Status/Classification
Quartz 15,050,200 0.80 g/t Au 352,667 Indicated Resources NI43-101
Mountain compliant
Hope Butte 5,000,000 0.91 g/t Au 146,300 Historical, not NI 43-101
compliant
Footnotes:
1. For Quartz Mountain, resources above a 0.34 g/t cutoff with silver
converted to gold equivalent using a ratio of 49.5:1 silver to gold.
Metallurgical recoveries were not considered. Indicated resources are as
reported in an independent November 2006 NI 43-101 report, posted on
SEDAR at that time.
2. The Hope Butte resources are considered historic in nature, do not
comply with current NI 43-101 standards, have not been verified by the
Company and therefore should not be relied upon. It is uncertain if
further exploration will result in the discovery of an economic mineral
resource.
On behalf of the Board of Directors of Kenai Resources Ltd.
Greg Starr, President and CEO
Forward-Looking Statements: Statements in this release that are
forward-looking statements are subject to various risks and
uncertainties concerning the specific factors disclosed and
elsewhere in the company's periodic filings with Canadian
securities regulators. The economic viabilities of the resources
estimates discussed in the release have not been established and
may not be. Such information contained herein represents
management's best judgment as of the date hereof based on
information currently available. The company does not assume the
obligation to update any forward-looking statement.
Kenai's Vice President Technical Service, Neil Cole, as the
company's Qualified Person has declared in writing that scientific
or technical information in this release has been prepared under
the supervision of Mr Ken Chapple, Executive Director of Gold
Anomaly Limited. Mr Chapple has sufficient experience which is
relevant to the style of mineralization under consideration and to
the activity which he is undertaking to qualify as a Competent
Person as defined in the JORC Code and to qualify as a "Qualified
Person" under NI 43-101. Mr Chapple has verified the data disclosed
in this release, including sampling, analytical and test data
underlying the information or opinions contained in this release.
Mr Chapple consents to the inclusion in this release of the matters
based on his information in the form and context in which it
appears.
Shares Outstanding: 35,906,734
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 release.
Contacts: Kenai Resources Ltd. 604-669-5753 604-688-9895 (FAX)
info@kenairesources.com www.kenairesources.com
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