Medgold Closes Acquisition of Klondike Gold’s Portuguese Assets
January 30, 2014 (Source: Marketwired) — Medgold Resources Corp. (TSX VENTURE:MED), the European focused gold exploration company, is pleased to announce that it has closed the acquisition of Klondike Gold Corp’s (“Klondike”) Portuguese exploration assets (see Medgold press release dated December 11, 2013). The portfolio is comprised of five gold exploration permits covering 600 sq km in northern Portugal, primarily located along the Valongo Belt, which has been identified as a major gold-bearing district.
Dan James, the President of Medgold, said: “We’re very happy to announce the closing of the Klondike acquisition which puts Medgold at the forefront of gold exploration in Portugal. The deal has secured a major land position covering a series of excellent, large-scale, exploration targets in the north of the country. We now control most of the highly prospective Valongo Belt, including the Castromil project, in addition to our existing Boticas and Vila de Rei projects, which equates to a total land-holding of approximately 1,000 sq km. Our objective now is to generate drill targets for testing as soon as possible.”
The Klondike Projects
The Klondike projects combine five exploration licences (Balazar, Valongo, Legares, Castelo do Paiva and Ponte de Barca), totaling 604 sq km, with four covering the majority of the Valongo anticline, plus Ponte de Barca, which covers several orogenic gold occurrences in the very north of Portugal. The Valongo anticline is a large overturned fold hosting numerous gold occurrences, many of which were exploited by the Romans. Recent interpretations clearly demonstrate that mineralization within the Valongo Belt was introduced by a series of faults and fractures, and is focused into ‘saddle reefs’ and en echelon vein arrays, commonly with zones of massive sulphide and quartz veining in a number of different lithologies.
The most advanced project is the Castromil project, located within the Legares licence. Historical exploration, undertaken by both Connary Minerals plc (“Connary”) and previous explorers, focused on near-surface high-grade mineralization, and included multiple phases of shallow percussion and diamond drilling, culminating in a 1997 mineral resource estimate (historical, see below) of 2.42 Mt at 1.89 g/t Au measured and indicated for approximately 145,000 oz Au. (“Class III feasibility study, Castrolmil Gold Mine, Portugal, for Connary Minerals plc“, ACA Howe Mining & Metallurgy Ltd., October 1997; “the Connary Report”). Recent work by the Company’s adviser, Jim Mortensen, clearly demonstrates that the mineralization is open at depth and along strike in both directions, highlighting the potential for additional discovery.
A qualified person has not done sufficient work to classify the historical mineral resource given in the Connary Report as a current mineral resource, and the Company is not treating the historical mineral resource as current. Neither the qualified person nor the Company has independently verified the information contained in the Connary Report. The historical mineral resource was prepared by ACA Howe Mining & Metallurgy Ltd. using a geologically constrained block model, with block grades calculated using an anisotropic inverse distance weighting method with an elliptical search radius oriented down the plunge of interpreted mineralized rock volumes. The qualified person has been unable to verify whether the definitions of “measured” and “indicated” used in the Connary Report in the context of its mineral resource statement are equivalent to those set out in section 1.2 of National Instrument 43-101. The mineral resource statement in the Connary Report does not report the measured and indicated resource categories separately, and reports no resources in the inferred category. The definition of “Class III feasibility study” described in the Connary Report does not correspond to the definition of “feasibility study” as set out in section 1.4 of National Instrument 43-101. The work described in the Connary Report appears to the Company and its qualified person to have been performed to a high technical standard and they consider it reliable, but it is currently unknown what work would be required to upgrade or verify the historical mineral resource as current, or if it is possible.
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The Ponte de Barca licence is located in northern Portugal and approximately 75 km northeast from the city of Porto. The geology and controls on mineralization are very similar to the Boticas project, where high-grade mineralization is controlled by a series of strike-extensive and high-angle tension veins. Klondike has completed some limited rock-chip sampling, with 15 samples collected, yielding results from trace to 14.8, 12.9 and 12.0 g/t Au. The Company has not independently verified Klondike’s results.
Mr. David Clark, M.Sc., P.Geo. (APEGBC), Consulting Geologist to the Company, is a Qualified Person as defined by National Instrument 43-101 – Standards of Disclosure for Mineral Projects. Mr. Clark has approved the disclosure of technical information contained in this news release.
Medgold is aiming to become the leading Mediterranean-focused gold exploration and project development company, with an extensive portfolio and pipeline of projects across Portugal, Italy and Spain, targeting economically stressed, but politically stable European countries that are seeking foreign investment to invigorate the mining sector.
ON BEHALF OF THE BOARD
Daniel P. James, President & Director
Neither the TSX Venture Exchange nor the Investment Industry Regulatory Organization of Canada accepts responsibility for the adequacy or accuracy of this release.
This press release may contain forward-looking statements including, but not limited to, comments regarding the timing and content of upcoming work programs, geological interpretations, receipt of property titles, potential mineral recovery processes, and other related matters. Forward-looking statements address future events and conditions and therefore involve inherent risks and uncertainties. Medgold’s projects in Europe are at an early stage and all estimates and projections are based on limited, and possibly incomplete, data. More work is required before the mineralization and the projects’ economic aspects can be confidently modelled. Actual results may differ materially from those currently anticipated in this news release. No representation or prediction is intended as to the results of future work, nor can there be any promise that the estimates and projections herein will be sustained in future work or that the projects will otherwise prove to be economic.
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