By Sunridge Gold,
Sunridge Gold Corp. (the “Company” or “Sunridge“) (SGC:TSX.V/SGCNF:OTCQX) is pleased to provide an outlook on the Company’s planned activities for 2013.
The Company’s primary focus for early 2013 is to complete the feasibility study (the “Study“) and apply for a mining license on the four mineral deposits that make up the Asmara Project in Eritrea. The Company also plans to continue exploration work on its fifth deposit the Adi Rassi copper-gold deposit where initial resources were announced on December 4, 2012 as well as to conduct exploration work on additional targets on the Asmara Project.
ASMARA PROJECT FEASIBILITY STUDY
The Asmara Project comprises four mineral deposits; three copper, zinc, gold and silver volcanogenic-massive-sulphide (“VMS”) deposits as well as a near-surface gold deposit.
The Study on these deposits started in April 2012 and remains on schedule to be completed in the second quarter of 2013. A positive Asmara Project Pre-Feasibility Study (“PFS”) was completed in May 2012 which studied an integrated mining operation for all four deposits with a central mill located at the large Emba Derho Deposit.
The PFS demonstrated robust economics, with a pre-tax net present value (“NPV”) of $555 million with a 10% discount applied ($1.642 billion NPV with zero discount) and an internal rate of return (“IRR”) of 27%.
Recent work on the Study has identified significant improvements over the PFS which should result in earlier cash-flow, as well as possible lower initial capital costs and stronger economics. A summary of significant points are as follows:
- The Study will include early mining of the copper-gold direct shipping ore (“DSO“) from Debarwa and early heap-leaching of the surface gold material from the project;
- Cash-flow is expected a year earlier (2015) than presented in the PFS;
- Initial capital costs are expected to be reduced and overall economics enhanced in the Study compared to the PFS;
- Full production at 4 million tonnes per year would be reached approximately 2 years after commencement of mining activities. Production rates will be similar to those outlined in the PFS with an annual average of 70 million pounds (31,750 tonnes) of copper, 140 million pounds (63,500 tonnes) of zinc, 31,000 ounces of gold and 997,000 ounces of silver to be produced over the first eight years of the mine life.
The Asmara Project area is made up of four distinct deposits;
1) The Emba Derho copper-zinc-gold-silver VMS deposit which can be mined by open-pit methods,
2) The Adi Nefas zinc-gold-copper VMS deposit, located approximately 6 kilometres away from Emba Derho — to be mined by underground methods,
3) The Gupo gold deposit located approximately 8 kilometres from Emba Derho which can be mined by open-pit methods and,
4) The Debarwa copper-gold VMS deposit, located approximately 40 kilometres south of Emba Derho which will also be mined by open-pit methods.
Following the completion of the Study, Sunridge will complete a social and environmental impact assessment (“SEIA”) report in the second quarter of 2013 and will then apply for a mining license.
NEGOTIATIONS WITH ‘ENAMCO’ Eritrean National Mining Corporation (“ENAMCO”)
On July 4, 2012, The Eritrean National Mining Corporation (ENAMCO) exercised its option to purchase an additional 30% of the Asmara Project from the Company. These negotiations continue and the Company issued an update news release on December 17, 2012 which stated that talks have been progressing between Sunridge and ENAMCO within the framework of the mining code of the country as summarized as follows:
- The 30% participating interest in the Asmara Project to be purchased by ENAMCO is in addition to ENAMCO’s existing right to receive a 10% non-assessable interest that will be carried to production by the participating partners.
- ENAMCO’s 10% non-assessable interest will carried two-thirds by Sunridge and one-third by ENAMCO.
- The price and terms of the purchase of the participating interest by ENAMCO are currently being negotiated.
- Once negotiations are concluded, ENAMCO will contribute one-third of all development costs as they are incurred, as well as any other ongoing expenditure on the project, including exploration.
THE ADI RASSI COPPER-GOLD DEPOSIT
On December 4, 2012, Sunridge announced an initial, independent Inferred resource estimate on the Adi Rassi copper-gold deposit. Mineralization at Adi Rassi is distinctly different to Sunridge’s four other deposits on the Asmara Project and is considered to be remobilized copper and gold from a distal source, possibly an as yet unidentified buried VMS mineralization and is associated with a major shear zone that trends northeast for over 3 kilometers and dips steeply to the west.
Mineralization has been defined for over a 450 metre north-northwest oriented strike length, 40 – 100 meters in width and to a vertical depth of 360 meters The mineralized zone dips steeply to the west and is off-set by an east-west oriented fault. The zone remains open in depth, to the north and possibly to the south; additional exploration potential exists along the 3 kilometre length of the host shear zone. A program of expansion drilling, trenching and local mapping and sampling is planned for 2013.
KODADU VMS EXPLORATION PROJECT
Sunridge is planning to start a reverse-circulation drilling program this month to better define the oxide gold cap within the gossans defined at the Kodadu VMS mineral occurrence. The goal of this work is to rapidly define a resource that could potentially be mined as feed to a gold plant at Emba Derho.
The Kodadu VMS target is located approximately 25 kilometres south of the Emba Derho deposit. Several gossans trend north-northeast for over a 1.2 kilometer strike length with an average width of 10 metres and about 35 metres deep. A recent (2009) Sunridge trenching program in which 87 samples were taken, returned 28 gold values of over 0.2 g/t and the best values were 10.67g/t over 14.7m, 2.3g/t over 8m and 1.79 g/t over 13.3m.
Also to be drill tested is gold mineralization that has been identified in a one kilometre shear zone running parallel and about 100 metres west of the Kodadu gossans. Geological mapping has shown the zone to be approximately 30 metres wide and historic gold values from trenches sampled by a previous operator are reported as 3.85g/t over 50 metres; 2.05g/t over 50 metres; and 11.87g/t over 8 metres.