Monday, 6 February 2012

Lachlan Star keeps the broad gold strikes coming with 220m at Tres Perlas in Chile

Lachlan Star (ASX: LSA, TSX: LSA) continues to unearth broad intersections of gold at the Tres Perlas deposit, confirmed with further assays from drilling at its wholly owned CMD Gold Mine in Chile.

Highlight intersections include:

- 220 metres at 0.53 grams per tonne (g/t) gold from 0 metres, including 110 metres at 0.77g/t from 78 metres;
- 215 metres at 0.41g/t gold from 19 metres, ending in mineralisation; and
- 200 metres at 0.42g/t gold from 0 metres, including 53 metres at 0.49 g/t from 24 metres and 52 metres at 0.66g/t from 142 metres, ending in mineralisation.

With these latest results, the Tres Perlas deposit is proving itself up as a near surface, bulk tonnage deposit.

This is evidenced by two drill holes which demonstrate the continuation of the mineralisation between the Tres Perlas and El Sauce deposits.

The gold mineralisation at Tres Perlas is up to 200 metres thick at a cut-off grade of 0.15g/t gold. The deposit has an Indicated Resource of 252,000 ounces and an Inferred Resource of 333,000 ounces.

All holes tend to contain a higher gold grade core within the broader mineralised zone of around 200 metres thickness.

The mineralisation is open down dip to the south east and along strike to the northeast, and sits beneath copper mineralisation that is the extension of the copper deposit being mined at the adjacent Carmen de Andacollo mine by Teck.

Current drilling is targeted to test the down dip and along strike extension of the gold mineralisation identified in historical holes.

Managing director Declan Franzmann said the Churrumata, Tres Perlas and El Sauce mineralisation has been under drilled in the past, with the result that the deposits have been modelled separately and on incomplete data.

“The work we are currently doing has greatly advanced our knowledge of the gold and copper mineralisation to the extent that we now have a zone of mineralisation that is at least 2 km along strike, by 0.6 km down dip with thicknesses of over 200m."

In total, the CMD Mine currently hosts an Indicated Resource of 37.6 million tonnes at 0.6% for 725,000 gold ounces, along with 49.8 million tonnes at 0.6% for 923,000 gold ounces.

Market re-rating

Lachlan Star has been on an upward share trajectory in recent weeks on the back of its aggressive drilling campaign at the CMD Mine as well a record gold pour of 11,326 ounces during the 2011 December quarter.

At the end of January, shares hit a new high of A$1.13, up from around $0.85 just two weeks earlier.

Gold ounces produced in the December quarter marked a 10% increase over the previous quarter.

Another plus for Lachlan Star is a decrease of 8% for the total cost/tonne of ore at US$18.30/t.

Lachlan’s cash balance continues to be boosted by record gold production, with the company now holding about $14.5 million at the end of the December quarter.

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