LONGUEUIL, QUEBEC--(Marketwire - Feb. 6, 2012) - Avala Resources Ltd. (TSX VENTURE:AVZ.V - News) (the "Company" or "Avala") is pleased to present an update on progress and drill results from the Korkan-Bigar trend, part of the sediment-hosted gold belt within the Cretaceous magmatic arc bordering the Timok Magmatic Complex ("TMC") in Eastern Serbia.
"The initial phase of resource definition drilling at Bigar Hill has now been completed and the drill hole database has been delivered to the independent consultants, in order to complete an initial resource estimate and a technical report compliant with Canadian National Instrument 43-101. Results to date indicate the existence of a very large area of mineralization and potentially substantial gold resource at Bigar Hill", said James Crombie, President and CEO of Avala. "Resource definition drilling has now commenced on the Korkan and Kraku Pestar target areas with the objective of completing the programs by the end of Q2, 2012. Concurrently we are advancing our other recently discovered target areas which are located in close proximity to the resource definition drilling areas"
1. HIGHLIGHTS
-- The recently completed Bigar Hill resource definition program was
focused on establishing continuity of mineralization. The drilling
program has used a nominal 80 meter by 80 meter grid spacing, together
with a subset of the target area at a nominal 40 meter by 40 meter grid
spacing. The drill holes are located within the Bigar Hill mineralized
'footprint' that was outlined by Avala during the earlier, wide-spaced,
160 meter by 160 meter diamond drilling program, which started in
February, 2011.
-- Recently complete resource definition reverse circulation (RC) drilling
at Bigar Hill has returned the following strong to moderate gold
intercepts (0.4g/t cut-off grade):
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Hole ID From (m) To (m) Interval (m) Au (g/t) Gram-meters
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BHRC058 79 84 5 9.46 47
BHRC059(i) 7 33 26 2.21 57
BHRC060(i) 21 89 68 1.21 82
BHRC061(i) 10 48 38 2.01 76
BHRC062(i) 32 92 60 1.60 96
BHRC065 71 99 28 1.97 55
BHRC065 176 190 14 2.77 39
BHRC071 174 206 32 1.88 60
BHRC077(i) 11 49 38 1.27 48
BHRC078 70 117 47 4.24 199
BHRC078 123 145 22 1.72 38
BHRC079(i) 101 172 71 1.79 127
BHRC079(i) 190 225 35 1.10 39
BHRC080(i) 101 144 43 1.24 53
BHRC082(i) 7 28 21 1.77 37
BHRC083 55 124 69 1.46 101
BHRC083 148 183 35 2.27 79
BHRC084(i) 15 65 50 1.72 86
BHRC086(i) 24 49 25 2.42 61
BHRC088(i) 43 59 16 1.84 29
BHRC088(i) 71 85 14 1.59 22
BHRC089(i) 88 111 23 3.66 84
BHRC091(i) 99 149 50 0.82 41
BHRC092(i) 63 81 18 2.70 49
BHRC093(i) 18 38 20 2.00 40
BHRC094(i) 43 72 29 1.78 52
BHRC095(i) 34 51 17 2.63 45
BHRC095(i) 130 146 16 1.61 26
BHRC100(i) 44 97 53 1.71 91
BHRC101(i) 20 55 35 1.64 57
BHRC102(i) 18 69 51 1.27 65
BHRC103(i) 27 71 44 2.21 97
BHRC105 169 206 37 1.76 65
BHRC108(i) 65 104 39 4.84 189
BHRC111(i) 129 166 37 2.59 96
BHRC112(i) 115 153 38 2.57 98
BHRC113(i) 111 139 28 3.24 91
BHRC114(i) 91 130 39 1.76 69
BHRC115(i) 72 101 29 1.97 57
BHRC115(i) 126 157 31 2.32 72
BHRC119(i) 54 96 42 2.87 121
BHRC121(i) 123 166 43 1.20 52
BHRC125(i) 48 67 19 3.99 76
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- Note: Intersections calculated using 5 meter minimum thickness, 5 meter
maximum included waste.
- Note: The listing does not include 'twin' RC drill hole intersections of
previously drilled diamond drill holes.
- ((i)) Denotes a nominal 40 meter by 40 meter infill drill hole.
-- To date, Avala has outlined gold mineralization at Korkan over an area
of approximately 1,200 meters by 600 meters surrounding the original
discovery hole (open to the east and north-east) and an area of 1,000
meters by 1,000 meters on the Bigar Hill target area (open in all
directions). Kraku Pestar has been traced over 600 meters by 300 meters
and is open to the south.
-- Resource definition drilling has commenced on the Korkan target area.
-- Exploration drilling continues to test additional target areas, located
in close proximity to the Korkan and Bigar Hill mineralized
'footprints'.
-- Avala intends to continue the wide-spaced drilling program, concomitant
with the resource definition program, in order to continue to test the
prospective 'target stratigraphy' within the Korkan-Bigar trend. The key
aim of this aspect of Avala's exploration program is to effectively
outline the size of the newly defined sediment-hosted gold system.
-- The combined Korkan-Bigar trend is over 10 kilometers long and 2.5
kilometers wide and represents only a small part of the northern portion
of the sediment-hosted gold belt, as displayed in Figure 1.
-- Avala currently has eight diamond drill rigs and two RC drill rigs
operating on the Korkan-Bigar portion of the sediment-hosted gold belt.
2. GEOLOGY AND MINERALIZATION STYLE
-- Sediment-hosted gold, located along the western margin of the Timok
Magmatic Complex, represents a previously unrecognized style of gold
mineralization within the Timok region.
-- Within the Korkan-Bigar trend, stratabound, fault-controlled breccia
together with minor karst-infill breccia represent the styles of
sediment-hosted gold mineralization recognized to date.
-- Gold mineralization appears to be associated with fine-grained pyrite
(sulfidation reaction) and a number of alteration styles including
kaolinitization, decarbonatization of calcareous sedimentary rock
adjacent to the gold mineralization and occasionally, silicification.
-- Gold mineralization is hosted within a favourable sedimentary package -
the 'target stratigraphy' - which is underlain by Jurassic and Lower
Cretaceous limestones and consists predominantly of calcareous
sandstones and conglomerates which include an interbedded fine grained
sandstone and clay-rich siltstone unit.
-- The upper portion of the target stratigraphy consists of 'red'
sandstones and volcanic-lithic clastic sediments, which are in turn,
overlain by calcareous marls, andesitic volcanic and volcaniclastic
rocks, representing the youngest portion of the target stratigraphy. The
andesitic volcanic and volcaniclastics are part of the Timok Magmatic
Complex.
-- Figure 1 shows the location of the Korkan-Bigar trend and the Kraku
Pestar target area within the greater sediment-hosted gold belt, as
defined in this image by mapped 'target stratigraphy'. Figure 1 also
shows anomalous gold soil geochemistry, on which the total metal contour
plots based on drill intersections are superimposed. The significant
potential of the belt can be clearly seen when the surface area of the
mineralized 'footprints' of the currently drilled target areas within
the Korkan-Bigar trend are compared to the overall extent of the
presently defined gold soil anomalies.
3. DRILLING AT KORKAN-BIGAR
-- Resource Definition Drilling (Bigar Hill): Avala commenced RC drilling
at Bigar Hill on the 18th August, 2011. Drilling was completed on the
23rd December, 2011 for a total of 44,114.6 meters (17,456.6 meters of
diamond drilling and 26,658 meters of reverse circulation drilling).
'Twin' diamond drilling of reverse circulation drill holes represented
approximately 15.4% of total drilling.
-- The Bigar Hill target area, representing approximately 1,000 meters by
1,000 meters, has been drilled on a nominal 80 meter by 80 meter grid
spacing. In addition, a portion of the target area has been drilled on a
nominal 40 meter by 40 meter grid spacing to provide geostatistical
support for resource estimation purposes.
-- A second RC drill rig has arrived on site and is expected to be
operational in February, 2012 and will commence on the Korkan and Kraku
Pestar target areas. It is planned to drill Korkan and Kraku Pestar at a
primary spacing of 80 meters by 80 meters for resource definition.
Additionally, selected locations within both Korkan and Kraku Pestar
target areas will be drilled to a nominal 40 meter by 40 meter grid
spacing to provide geostatistical support and diamond 'twin' drilling of
the RC drill holes will be carried out across the target areas at a
nominal rate of 15% of total RC drilling.
-- Refer to Table 1 for a summary of all intersections at various cut-off
grades for the results of reverse circulation drill holes BHRC055 to
BHRC125 and diamond drill holes BHDD050 to BHDD070. Figure 2 shows a
gram-meter total metal contour plot (intervals greater than 0.4g/t Au x
thickness), of all Bigar Hill drilling to date, superimposed on
topographic contours. Figure 3 shows a representative 'pseudo' long-
section through Bigar Hill including recently completed infill RC drill
holes. The dominant stratiform nature of the gold mineralization at
Bigar Hill is clearly evident. Figure 4 shows a drill collar plan of all
Bigar Hill drilling to date superimposed on topographic contours.
-- The routine reverse circulation-diamond 'twin' drilling program
continues to confirm that the majority of mineralized intercepts and
hence the deposit style, is dominated by layer-parallel, lithology-
controlled gold mineralization.
-- There is also evidence of steeper mineralized structures in addition to
the dominant, stratigraphically controlled (stratabound), gold
mineralization. These intersections represent a 'bonus' and are likely
to be intersected in greater numbers as the infill drilling program
progresses.
-- The reverse circulation-diamond 'twin' drill holes suggest that there
can be close spaced variation in gold grade, as is typical for gold
deposits.
-- Multiple gold mineralized intercepts per hole are a common feature of
the gold mineralization outlined to date in the Bigar Hill and Korkan
target areas.
4. CANADIAN NATIONAL INSTRUMENT 43-101 COMPLIANT RESOURCE ESTIMATION
-- Following site visits by international consultants AMC Consultants (UK),
the Bigar Hill exploration database has been delivered in order to begin
independent resource estimation.
-- It is planned to complete the initial Canadian National Instrument 43-
101 compliant resource estimate on Bigar Hill by the end of Q1, 2012.
-- The current Bigar Hill database is based on 26,658 meters of RC drilling
and 17,456.6 meters of diamond drilling for a total of 44,114.6 meters
in 195 drill holes. The database includes over 140,000 analyses (gold,
silver and sulfur) including 59,779 gold assays, of which approximately
23% are internationally accredited standards, blanks and routine QAQC
duplicate and replicate check assays. All drill holes have been down-
hole surveyed at regular intervals; with drill collars surveyed using
DGPS or total station surveying methods. The topographic surface is
based on detailed DGPS and total station surveying methods, with an
average survey station spacing of approximately 15 meters by 15 meters.
Over 2,956 bulk density measurements have been collected, using standard
wax-sealed immersion methods. Over 17 diamond/RC, RC/RC and
diamond/diamond drill pairs have been completed to date.
-- Both assaying and bulk density measurements have been carried out
independently by SGS.
5. DISCUSSION
-- A major sediment-hosted gold belt bordering the western boundary of the
Timok Magmatic Complex, identified by soil and trench samples, extends
over 20 kilometers along strike and is up to 8 kilometers wide. Soil
sampling has been completed to the north and south of the currently
defined 20 kilometer strike in order to attempt to determine the overall
extent of the sediment-hosted gold belt which, based on the extent of
mapped 'target stratigraphy', has the potential to be approximately 70
kilometers in length.
-- The geology, geochemistry and available drill intersections suggest a
strong similarity to the style of gold mineralization typified by the
North Carlin Trend, Nevada, USA.
-- The recognition that the majority of the significant trench and diamond
drill intercepts returned to date occur within the same flat lying or
shallow dipping sedimentary package has significant implications for the
gold potential of the Korkan-Bigar trend and the entire sediment-hosted
gold belt.
-- Exploration drill testing within the Korkan-Bigar trend will continue
with wide spaced (nominal 160 meter by 160 meter), exploration diamond
drill holes, in conjunction with the ongoing resource definition
drilling program, to allow Avala to outline the potential size and
economic potential of the sediment-hosted gold system.
-- Avala controls 100% of this newly identified sediment-hosted gold belt,
which totals approximately 250 square kilometers, and intends to
systematically drill test all currently defined priority target areas.
-- Please see the following link to view all Korkan-Bigar and Kraku Pestar
drill holes located spatially in three dimensions:
http://www.corebox.net/properties/potoj-cuka-gold-belt
6. SAMPLING AND ANALYSIS
The majority of soil samples have been assayed at the ALS Chemex laboratory, Perth, Australia. More recent programs have been assayed at the SGS managed laboratory at Chelopech in Bulgaria using a combination of ICP-OES and ICP-MS; whereas, gold has been assayed by low level detection fire assay method with an AAS finish. The Company has established a laboratory facility at Bor, Eastern Serbia which is independently managed by SGS. Trench samples were prepared at the laboratory facility at Bor and the samples have been assayed at the SGS managed laboratory at Chelopech in Bulgaria or the laboratory facility at Bor. Diamond drill core has been prepared at the laboratory facility at Bor and assayed at either the SGS managed laboratory at Chelopech in Bulgaria or the assay laboratory at Bor. A one metre sampling interval has been used where possible for the Sediment-Hosted Gold project diamond drilling program. Half core is routinely submitted to the laboratory for analysis. Reverse circulation drill samples have been prepared at the laboratory facility at Bor and assayed at the laboratory at Bor. A one metre sampling interval has been used for the Sediment-Hosted Gold project reverse circulation drilling program. Following Avala standard quality assurance procedures, a full suite of field and laboratory duplicates and replicates along with internationally accredited standards and blanks, have been submitted with each batch of samples.
Trench sampling was carried out as channels in the wall just above the trench floor on 2m intervals. Except where extensive soil cover is encountered, trenches were sampled in their entirety. The samples were routinely weighed prior to final bagging to maintain an even sample size and to avoid sampling bias in harder rock types. An average channel sample weight was maintained at 3kg/m, which produces a consistent sample weight approximating half HQ core samples. Field duplicate samples were taken every 20 samples and known standards were inserted into the sample stream after every 20th sample. A geological and structural log was completed as for diamond drilling. All data collected in the field was routinely entered into geology and structural geology spread sheets using Field Marshal software for subsequent entry to an acQuire database and validation.
Dr Julian F. H. Barnes, a qualified person under National Instrument 43-101, a Director and the Company's Special Consultant, has supervised the preparation of the technical data in this press release.
Previously released data refers to data included in the "Potoj Cuka Gold Project, Serbia National Instrument 43-101 Technical Report" by Paul Mazzoni dated March 10, 2010 (the "Technical Report"), filed on SEDAR at www.sedar.com. Further information in respect of results, investigations, interpretations, quality assurance and quality control measures, along with geology, mineralogy, sampling, and analytical procedures is included in the Technical Report.
About Avala Resources Ltd.: Avala is a recently-formed company focused on the exploration and development of the Potoj Cuka sediment-hosted gold project and the Timok gold-copper project in Serbia. The common shares of Avala trade on the TSX Venture Exchange under the symbol AVZ.
Avala is well-capitalized, with approximately $31 million in its treasury at December 31, 2011, which it plans to use for the exploration and development of its mineral projects in Serbia. Avala's issued and outstanding share capital totals 214,492,223 common shares, of which approximately 51.4% is held by Dundee Precious Metals Inc. (TSX:DPM.TO - News).
Cautionary Statement
This press release contains forward-looking information. Although the Company believes in light of the experience of its officers and directors, current conditions and expected future developments and other factors that have been considered appropriate that the expectations reflected in this forward-looking information are reasonable, undue reliance should not be placed on them because the Company can give no assurance that they will prove to be correct. Forward looking information in this news release includes statements regarding the completion and potential size of a resource estimation, the nature of the mineralization of the project, the results of the exploration activities and interpretation of such results, the potential size of the sediment-hosted gold system, the suggested similarity to the style of gold mineralization of the North Carlin Trend project and the timing and location of future work programs. Forward-looking information involves known and unknown risks, uncertainties, assumptions and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking information. The forward-looking statements contained in this press release are made as of the date hereof and the Company undertakes no obligations to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.
Figures 1 to 4 and Table 1 are available at the following address: http://media3.marketwire.com/docs/avala_0206.pdf
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 press release.
Avala Resources Ltd.
+1.450.640.0810
info@avalaresources.com
www.avalaresources.com
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