SearchGold Resources Inc. (TSXV: RSG)(FRANKFURT: S1O)("SearchGold")
is pleased to announce it has received an independent, 43-101
compliant, Mineral Resource and Mineral Reserve estimate for Zone A
on its Bakoudou-Magnima Gold Project located in Gabon, Africa. The
estimates were prepared as part of the bankable feasibility study
completed by Managem, SearchGold's majority partner on the project.
The Bakoudou's Zone A mining project foresees the construction
of an open pit gold mine with a projected mine life of 3.5 years.
It will produce approximately 40,000 ounces of gold per year over
the life of the project from a gravity concentrating plant
processing near surface saprolite gold mineralization.
According to the feasibility study, Bakoudou's Zone A holds a
Measured and Indicated Resource of 230,000 ounces of gold including
a Proven and Probable Reserve of 150,000 ounces of gold. These
reported figures represent total reserves and resources contained
in Zone A owned by Ressources Golden Gram Gabon SARL ("REG"). As of
today, SearchGold owns 36% of REG and as part of the
Managem-SearchGold Joint Venture Agreement, SearchGold's ownership
of REG will stand at 27% once regulatory documentation following
the acceptance the bankable feasibility study is completed.
The Mineral Reserve estimate was prepared by Reminex, an
independent Moroccan Engineering Firm, and is based on a Mineral
Resource estimate audited by Systemes Geostat International Inc.
("Geostat") of Montreal, Quebec, Canada.
Highlights of the Managem Feasibility Study
Mineral Reserve Estimate:
- Proven Mineral Reserve:
- 0.58 million tonnes grading 2.54 g/t gold (47,600 ounces)
- Probable Mineral Reserve:
- 1.12 million tonnes grading 2.98 g/t gold (107,100 ounces)
Mineral Resource Estimate :
- Measured Mineral Resource:
- 0.53 million tonnes grading 2.84 g/t gold (48,400 ounces)
- Indicated Mineral Resource:
- 1.87 million tonnes grading 3.06 g/t gold (184,000 ounces)
Commenting on the results of the Managem feasibility study,
Philippe Giaro, President and CEO stated: "The development
objective for Bakoudou-Magnima has always been to establish the
potential of the property well beyond what Zone A can deliver. This
revised resource estimate enables us to confirm the presence of a
critical mass of metal that we intend to use as a starting point to
mine the area. Recent surface results validate our initial theory
that there should be additional gold zones within a 10 km radius of
Bakoudou's Zone A and the newly defined Lekodo anomaly, located
south of Zone A increases the length of the Bakoudou Gold Corridor
to 6 km."
Bakoudou Zone A Mineral Reserve and Mineral Resource Estimate
Summary
The April 30, 2008 Mineral Resource and Mineral Reserve
Statement for Bakoudou's Zone A is summarized in the following
table :
Table 1. Mineral Resource and Mineral Reserve Statement(i) for
Bakoudou's Zone A, Gabon. Prepared by Reminex, April 30, 2008.
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Resource and Reserves Quantity Grades Contained Metal (oz Au)
Classification (Mt) (g/t)
-------------------------------------------------------------------------
Open pit (saprolite)
-------------------------------------------------------------------------
Proven Reserves 583 000 2.54 47 600
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Probable Reserves 1 117 000 2.98 107 100
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Total 1 700 000 2.83 154 700
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Saprolite and hard rock
-------------------------------------------------------------------------
Measured Resources 530 000 2.84 48 400
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Indicated Resources 1 870 000 3.06 184 000
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Total 2 400 000 3.01 232 400
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Inferred 157 000 1.67 8 400
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(i) Notes: Reported figures represent total reserves and resources
contained in Zone A owned by Ressources Golden Gram Gabon SARL ("REG").
SearchGold owns 36% of REG. Mineral resources include mineral reserves.
Mineral reserves are reported at a cut-off of 0.55 g/t gold within a
pit shell optimized using a gold price of US$700 per ounce and
metallurgical recovery of 88 percent. Mineral resources are reported at
a cut-off of 0.5 g/t gold. All figures have been rounded to reflect the
relative accuracy of the estimates. Mineral resources are not reserves
and do not have demonstrated economic viability.
Methodology
In June 2007, Reminex engaged Geostat to Audit the Mineral
Resource estimate prepared by Reminex on Bakoudou's Zone A in the
context of the bankable feasibility study.
The independent Mineral Resource and Reserves estimates are
reported in accordance with Canadian Securities Administrator's
National Instrument 43-101 and conforms to generally accepted
Canadian Institute of Mining ("CIM") "Estimation of Mineral
Resources and Mineral Reserves Best Practices" Guidelines. A
complete National Instrument 43-101 Technical Report will be filed
on Sedar within 45 days of release of this press release.
The audited Mineral Resource statement is based on a total of
184 HQ-NQ diameter core holes (for a total of 11 659m) drilled over
an area of 350x500m over the southern part of the Bakoudou soil
anomaly in 2004-05 and 2006-08. The Mineral Resource model was
constructed in Datamine Studio. A total of 4 main gold zones
wireframes were constructed from interpretation of the drilling
data and subdivided into two weathering profiles (saprolite and
fresh rock). After geostatistical analysis and variography, gold
grades were interpolated into a partial block model (parent block
size of 5x5x2.5m) using ordinary kriging. An average tonnage factor
of 2.28 and 2.63 was used to convert volumes into tonnages for the
saprolite and hard rock, respectively. The gold mineralization is
known to extend at depth beyond the drilling data.
The Mineral Reserve estimate was prepared by Reminex using
Whittle Pit Optimization software to model conceptual pit shells
using the following assumptions: pit wall average angles of 35
degrees for the saprolite and 50 degrees for the hard rock, 12%
mining dilution, a gold price of US$700 per ounce, a gold recovery
of 88.2%, mining costs of US$5.44 per tonne of ore and of US$2.06
per tonne of waste and processing costs of US$8.86 per tonne. Based
on these parameters the economic cut-off was estimated at 0.55 g/t
gold.
The capital expenditures (CAPEX) are estimated at US$30 million
while the operating expenditures (OPEX) used in the financial model
includes refinery costs, reclamation costs, withholding tax,
government royalties and operator management fee. Operating costs
are estimated at US$380 per ounce of gold.
At a discount rate of 8% and a gold price of US$800 per ounce
the project economics are as follows:
IRR 22%
US$
NPV @ 8% 12,000,000
US$
Cash Profit 24,000,000
Sensitivity Analysis
The Mineral Reserves are most sensitive to variations in grade,
gold recovery and the price of gold. The sensibility analysis is
summarized in the following table at a discount rate of 8% used to
estimate the NPV.
Table 2. Sensitivity analysis for Bakoudou's Zone A, Gabon
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Gold %
Price variation -20% - 10% 0% 10% 20%
------------------------------------------------------------------
Gold price
- USD 640 720 800 880 960
------------------------------------------------------------------
IRR 10% 17% 22% 28% 33%
------------------------------------------------------------------
NPV 2,103,175 7,334,644 12,331,167 17,327,691 22,324,214
---------------------------------------------------------------------------
---------------------------------------------------------------------------
Gold % variation -20% -10% 0% 10% 10%
Recovery Gold
------------------------------------------------------------------
Recovery 71% 79% 88,15% 97% 97%
------------------------------------------------------------------
IRR 11% 17% 22% 28% 28%
------------------------------------------------------------------
NPV 2,243,661 7,400,770 12,331,167 17,261,473 17,261,473
---------------------------------------------------------------------------
---------------------------------------------------------------------------
Grade Grade (g/t
gold) 2,29 2,58 2,86 3,15 3,44
------------------------------------------------------------------
%
variation -20% -10% 0% 10% 20%
------------------------------------------------------------------
IRR 10% 17% 22% 28% 33%
------------------------------------------------------------------
NPV 2,138,624 7,352,477 12,331,167 17,309,576 22,287,773
---------------------------------------------------------------------------
---------------------------------------------------------------------------
OPEX Opex
variation -20% -10% 0% 10% 20%
------------------------------------------------------------------
IRR 27% 25% 22% 20% 17%
------------------------------------------------------------------
NPV 16,537,480 14,434,324 12,331,167 10,228,011 8,124,855
---------------------------------------------------------------------------
---------------------------------------------------------------------------
CAPEX Capex
variation -20% -10% 0% 10% 20%
------------------------------------------------------------------
IRR 30% 26% 22% 19% 17%
------------------------------------------------------------------
NPV 15,879,048 14,105,107 12,331,167 10,557,227 8,783,287
---------------------------------------------------------------------------
---------------------------------------------------------------------------
Exchange $/DH 9,51 8,46 7,61 6,92 6,34
Rates ------------------------------------------------------------------
Euro/$ 1,20 1,35 1,50 1,65 1,80
------------------------------------------------------------------
% Variation -20% -10% 0% 10% 20%
------------------------------------------------------------------
IRR 32% 27% 22% 18% 14%
------------------------------------------------------------------
NPV 19,237,156 15,784,162 12,331,167 8,878,173 5,402,889
---------------------------------------------------------------------------
Qualified Persons and Qualification of Reminex, Geostat and
SRK
The technical content of this news release has been reviewed by
Philippe Giaro, P. Geo., President and CEO of SearchGold Resources
Inc. and Qualified Person for SearchGold. The Mineral Resource
estimate was completed by Reminex and was audited by Mr. Michel
Dagbert, P. Eng. of Geostat. Mineral Reserve estimates are based on
engineering work performed by Reminex under the supervision of Mr.
Mohammed Rachek, Ing. Jr. of Reminex. The geological aspect of the
project was audited by Dr. Jean-Francois Couture, P.Geo of SRK
Consulting (Canada) Inc.
By virtue of their academic backgrounds, relevant professional
experience and affiliation to a professional association, Mr.
Giaro, Mr. Dagbert, Mr. Rachek and Dr. Couture are all "Qualified
Persons" as defined by National Instrument 43-101. Furthermore Mr.
Dagbert, Mr. Rachek and Dr. Couture are independent from SearchGold
as defined in Section 1.4 of National Instrument 43-101.
The feasibility study performed by Managem on Bakoudou's Zone A
was completed by Reminex, a Moroccan engineering consulting group
specializing in mining projects. Certain aspects of the project
were subcontracted to independent groups. Scott Wilson of
Chesterfield, England completed the geotechnical studies and the
tailings dam conception and design studies; the environmental
impact study was completed by Terea, a local Gabonese engineering
group and the hydrogeological and hydrology studies have been
completed by Geopole, a Moroccan engineering group.
Systemes Geostat International Inc. is a geological and mining
independent consulting firm providing a broad range of services to
the mining industry including computer assisted ore reserve
estimation. In this specific field, Geostat has earned its leading
position by utilising a rare blend of people with practical mining,
geological and geotechnical experience, world-renown theoretical
knowledge and the latest computer and software technology.
SRK Consulting (Canada) is part of SRK Consulting an
independent, international consulting practice. SRK provides
focused advice and solutions to clients, mainly from earth and
water resource industries. For mining projects, SRK offers services
from exploration through feasibility, mine planning, and production
to mine closure. Formed in 1974, SRK now employs more than 700
professionals internationally in 33 permanent offices on 6
continents. SRK Consulting employs leading specialists in each
field of science and engineering. Its seamless integration of
services, and global base, has made the company a leading
international practice in due diligence, feasibility studies and
confidential internal reviews.
Strategic potential of the Bakoudou-Magnima Project
In July 2005, SearchGold signed a strategic $4,200,000 joint
venture agreement on the 2,294 km2 Bakoudou-Magnima Gold Project
with Managem, a successful, established African-based mining
company (www.managem-ona.com).
Zone A, represents the project's first advanced target and the
strategy for Bakoudou-Magnima has always been to develop the
potential of the property well beyond this initial objective.
Managem and SearchGold's strategy has, from day one, consisted of
undertaking regional exploration in parallel with definition
drilling and the execution of a feasibility study on Zone A. Thus,
implementing a business plan focussed on the development of a
mid-size mining operation with on-going exploration work on
surrounding targets to insure long term feed for the mine.
Exploration activities on Bakoudou-Magnima have initially
focussed on an area within a 10 km radius around Zone A to identify
additional targets within a short distance. Since the initial
discovery of three additional gold zones within that 10 km radius
target area, the follow-up geochemical soil surveys have so far
turned positive on two of them. The newly defined Lekodo anomaly is
located south of Bakoudou and increases the length of the
auriferous trend by 3 km, the Bakoudou-Lekodo gold corridor now
reaches a surface extension of 6 km. Drilling will shortly be
initiated on these new geochemical soil targets.
Managem and SearchGold also control a 40 km strike length of the
Magnima greenstone belt which represents a 5 km wide evolutive
volcanic package with basic volcanic rocks topped by sediments and
acid volcanics intruded by late stage, syn-volcanic plutons. Major
structures comprising mylonites and shear zones transect the
volcanic sequence. The BRGM executed previous work on the Magnima
greenstone belt in the 1980's and identified three soil gold
anomalies up to 2.2 km in strike length with surface grab samples
yielding grades of up to 7.7 g/t gold. The approach for the Magnima
greenstone belt is similar to that of the 10 km radius target area
around Zone A involving initial stream geochemistry, soil
geochemical sampling and drilling of the best targets.
Managem and SearchGold will now intensify their exploration on
Bakoudou-Magnima and intend to report on a regular basis on the
advancement of the work programs.
About SearchGold Resources Inc.
SearchGold Resources is a Canadian-based mining exploration
company whose primary mission is to target, explore and develop
gold deposits in Africa. The expansion strategy in 2006 had set the
stage for the Company's development in 2007 through increased
activity on the advanced projects, a new acquisition and the
segmentation of its activities to unlock value for its
shareholders. SearchGold's diamond assets were re-organized along
with Mano River Resources Inc., to create an integrated diamond
company called Stellar Diamonds Limited of which SearchGold holds
2.7 million shares. SearchGold's Canadian gold assets were also
re-organized through the creation of Golden Share Mining
Corporation (GSH-TSXV), a dynamic junior exploration company
focused on gold exploration in Canada.
If you would like to receive press releases via e-mail please
contact: info@searchgold.ca
The TSX Venture Exchange has not reviewed and does not accept
responsibility for the adequacy or accuracy of this release.
Contacts: SearchGold Resources Inc. Philippe Giaro President
& CEO 32-473-52-30-29 phgiaro@skynet.be CHF Investor Relations
Alison Tullis Senior Account Manager 416-868-1079 x233
alison@chfir.com SearchGold Resources Inc. Denis Tremblay
Vice-President 514-866-4224 info@searchgold.ca
www.searchgold.ca
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