Kenai Resources Ltd. ("Kenai") (TSX VENTURE: KAI) is pleased to
announce that it has discovered numerous artisanal workings along
strike from the area of known high grade mineralisation mainly to
the east and south-east of the current trenching area. The
artisanal workings are variable in size, with a maximum depth of 10
to 15 metres below surface. The workings occur over an area of 500
metres by 200 metres and are coincident with a chargeable
geophysical anomaly indicative of sulphide bearing alteration.
Float material observed proximal to the workings comprises oxidised
quartz fragments and altered intrusive rocks.
Artisanal workers have been active in the area of Sao Chico for
25 to 30 years constructing numerous shafts to approximately 15
metres below surface on oxidised vein material. High grades were
recognised on one of numerous shafts and this led to the focus of
exploration in the second half of 2010 on this structure, over an
area of 900 metres east-west by 300 to 500 metres north-south,
where 23 trenches were excavated. The oxidised upper 10 to 15
metres of this vein structure is believed to be amenable to gravity
recovery. There has been no drilling on the property hence
trenching along strike is the only source of data relating to
grades in the area of forthcoming small scale gravity plant
operations. Gold grade and vein width vary in short distances along
strike and down dip and display a nugget effect, resulting in
difficult estimation of gold grades.
This discovery has highlighted further the excellent potential
for a bulk tonnage, near surface target along with narrow but high
grade vein targets. Exploration of the bulk tonnage target will
continue with surface trenching and scout drilling. Other
geophysical anomalies exist in the area; however the geophysical
survey currently covers an area of only 350 metres by 350 metres
and needs to be extended across the entire licence.
Kenai President and CEO, Greg Starr, comments, "Kenai is very
pleased with results of the exploration work on site over the past
few weeks, exposing new highly prospective areas of old workings
outside the prior trenching area. We await assay results from
recent underground sampling. Kenai is also preparing for an initial
2,500 to 3,000 metre program of core drilling, along the lines
shown in the plan prepared by our consulting geologist group. We
also look forward to the commissioning of the gravity plant now
being installed at Sao Chico in the next several weeks."
As shown on the attached figure
(http://media3.marketwire.com/docs/kai211m.pdf), the trench
intersections of gold-bearing vein structures extend over several
hundred metres. Several sub-parallel vein structures have been
sampled, with vein thicknesses varying from less than one
centimetre to three metres. From the trenching and sampling
undertaken since August 2010, it is estimated that the aggregate
vein thickness over the currently identified one kilometre strike
length is up to around five metres.
About Sao Chico
The project is more completely described in Kenai's NI 43-101
Technical Report on the project, details of which were contained in
Kenai's news release of January 20, 2011. It has since been filed
on SEDAR and on Kenai's website at www.kenairesources.com.
The NI 43-101 report was prepared by Exploration Alliance Ltd.
("EAL"), an independent geological consultancy. Mr. Andrew
Tunningley, Principal Exploration Geologist of EAL, is a Qualified
Person within the meaning of NI 43-101 and is the primary author of
the Sao Chico Technical Report.
Highlights of exploration to date include high grades (up to 348
g/t gold over 1 metre) from underground channel sampling in
sulphide ore, and discovery of a previously unidentified area of
artisanal workings over an area of 500 metres by 200 metres, with
coincident geophysical anomalies.
Sao Chico is located in the Amazonian Craton, which is divided
into the Guyana Shield (north) and the Guapore Shield (south). The
Amazonian Craton hosts numerous large gold deposits including Las
Cristinas (32 Moz), Omai (4 Moz), Rosebel (14 Moz) and Nassau
(greater than 3 Moz). The Amazonian Craton was separated from the
West African Craton; hence analogies to the shear hosted deposits
in West Africa can also be drawn.
Sao Chico is within the Tapajos Mineral Field(1) in
central-northern Brazil, hosted in the same suite of intrusive
rocks as the nearby Tocantinzinho. Eldorado Gold Corporation has a
project within the Tapajos district (according to their website)
that contains a NI43-101 compliant Measured and Indicated Mineral
Resource of 2.1 Million ounces of gold. Palito (Serabi Mining plc,
an AIM-listed company) is a vein hosted underground mining
operation with extraction by open pit of the upper portions of the
deposit. Mineralisation at Tocantinzinho presents as disseminated
gold bearing sulphide and has similarities to mineralisation styles
observed in the newly discovered area of workings at Sao Chico.
The foregoing technical information about exploration at Sao
Chico, including the appended plan, has been prepared by EAL.
Only limited exploration work has occurred outside of the 50
hectare area of historic workings and the wider 1416 hectare area
of Exploration License AP12836 requires extensive grass roots
exploration to discover the true potential. The agreement between
Kenai and Gold Anomaly Ltd allows existing application areas
external to AP12836 to be added to the licence package giving Kenai
the benefit of a larger tenement position under option.
Details of Kenai's investment in the Sao Chico project can be
found in its release dated 21 September, 2010.
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 NI 43-
Mountain 101 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.
The technical content of this news release has been reviewed by
Kenai's Vice President Technical Services, Neil Cole, who has
sufficient experience which is relevant to the style of
mineralization under consideration and to the activity which is
being undertaken and planned to qualify as a Qualified Person under
NI 43-101. Mr Cole, who is the technical person responsible for
this news release, has verified the technical data disclosed in
this release, including references to Kenai's other projects and
planned exploration and operational activities, and the sampling of
the gold-bearing reef structures. This news release has been
reviewed and approved by Mr Tunningley of EAL who has consented to
the inclusion in this release of such technical information in the
form and context in which it appears.
(1) 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.
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. Greg Starr President and CEO
604-669-5753 604-688-9895 (FAX) info@kenairesources.com
www.kenairesources.com
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