Sunridge Gold Corp. (CVE:SGC) (OTCQX:SGCNF) has unveiled what it calls "encouraging" initial results from channel samples at its Kodadu target on its Asmara project in Eritrea.
The company also completed the reverse circulation drilling program it announced at the target in January, with results from this expected next month. A total of 22 holes targeting the oxide gold cap of the Kodadu volcanogenic-massive sulphide (VMS) area and a nearby gold shear zone were drilled.
The aim of its work at Kodadu is to quickly define a resource that could potentially be mined as feed to a central gold plant at Emba Derho - one of the four established deposits of the Asmara project. Kodadu is located around 25 kilometres south of Emba.
As of now, the Asmara project consists of the Emba Derho, Debarwa and Adi Nefas copper-zinc-gold and silver deposits and the Gupo gold deposit - all located within 40 kilometres of the capital city of Asmara.
At the Kodadu target, notable channel sample results included 11 metres at 1.46 grams per tonne (g/t) gold, 22.5 metres at 0.69 g/t gold and 7.00 metres at 1.11 g/t gold.
These results were from 14 channels cut across the surface of the target over a 1.2 km strike length, as well as over part of the gold mineralized shear zone nearby.
Sunridge said in its statement Tuesday that "several gossans" have been identified by surface mapping that trend north-northeast for over 1.2 kilometre strike length, and they have an average width of about 10 metres.
In addition to the Kodadu VMS target, the company added that gold mineralization has also been found 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 around 30 metres wide, the company says, and historic results from trenches sampled by a previous operator were reported as 3.85 g/t over 50 metres and 11.87 g/t over 8 metres.
The results of a preliminary feasibility study at the Asmara project in May that considered four deposits, excluding Kodadu, being processed at a central mill showed a pre-tax net present value of $555 million at a 10 per cent discount rate, and an internal rate of return of 27 per cent, with an initial capital cost pegged at $489 million.
Sunridge is now working on finishing a feasibility study on the Asmara project, on track for April this year, after which the application for a mining license and permitting will follow, along with the social and environmental impact assessment.
The junior gold explorer also late last year completed its initial resource estimate for the Adi Rassi copper-gold deposit - the fifth gold deposit defined on its Asmara project. The new resource totalled 15.77 million tonnes at 0.54% copper and 0.33 grams per tonne (g/t) gold containing 85,158 tonnes of copper and 167,000 ounces of gold in the inferred category.
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