Wednesday, 20 July 2011

Kalgoorlie Mining Company boosts highly prospective gold tenement holding around Bullant mine

Kalgoorlie Mining Company (ASX: KMC) has increased the ability to reach the one million gold ounce resource at the company's portfolio which includes and surrounds the Bullant gold mine, with the granting of additional tenements.

The wholly owned tenement area has jumped 128% to over 27 square kilometres, following the granting of exploration tenements by the Department of Mines and Petroleum, which includes nine prospecting licenses.

Chris Daws, chief executive officer, commented on the newly granted tenements, “The increase emphasises the main aim of the company strategy, to be proactive in acquiring and increasing its land holding in the Kalgoorlie region and to be actively committed to exploration and building its resource base for the company."

Kalgoorlie Mining will now undertake detailed geological investigation of the entire tenement package to define exploration targets, with initial investigation highlighting only limited historical exploration work over the new area.

The additional tenement ground holding is another positive for Kalgoorlie Mining which follows hot on the heels of some good results for the company.

Earlier in the week in maiden surface diamond drilling Kalgoorlie Mining intersected high grade gold located just 300 metres from previous development, boosting the potential of extending the known resource to the south.

The highlights included 3.4 metres at 8.16 grams per tonne (g/t) gold from 284 metres, and 10.2 metres at 6.32g/t gold from 282 metres.

Drilling tested areas south of the historic Bullant Mine Development to both infill and confirm confidence in areas of historic drilling, while exploring for possible depth and strike extensions of the “Main Lode”.

The area is highly prospective due to the proximity to the old mine in an area that contained no drill information, while being located outside the known interpretation of the Bullant Lodes.

Kalgoorlie Mining is also eyeing gold production within months after recently executing a non-binding term sheet with an Australian subsidiary of Barrick Gold Corporation (NYSE: ABX).

The agreement is for the proposed sale of ore from the Bullant Gold mine to Barrick’s Kanowna Belle processing facility, where ore was treated previously when Barrick operated the mine.

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