Southwestern hits China high grade at Boka 1 South

Vancouver – Southwestern Resources (SWG-T, SWGGF-O) said it is on track to deliver a prefeasibility study for its Boka gold project in southwest China after releasing new drill results from the property.

The latest results are from three drill holes, which aim to expand the Boka 1 South deposit. Highlights include hole B07-234, which returned a 15-gram-gold-per-tonne intersection over 30.4 metres.

The company said this intersection included a higher-grade zone of six metres, grading 52.7 grams per tonne, but added that true widths are not known at this time.

On February 21, the day the drill results were released, Southwestern shares rose 83 cents to $8.03 on the Toronto Stock Exchange.

We are excited to see continued expansion of the Boka 1 South gold deposit and especially the presence of high grade material, said Southwestern chief executive officer John Paterson. There are currently five diamond drill rigs operating at Boka 1 South, which, the company said, remains open to the north and southeast.

Covering 157 square kilometres, the Boka project is a joint venture between Southwestern (90%) and Team 209 of the Yunnan Nuclear Industry of Yunnan Province, which retains a 10% carried interest.

An engineering report by Hatch of Mississauga, Ont., describes Boka as a significant gold discovery that is situated in a relatively accessible region of Yunnan province, about 110 kilometres north of Kunming, the provincial capital

The topography in the immediate exploration area is rugged with deeply incised valleys and creeks, cutting across the general north-south trend of the mineralized zones that come close to out-cropping along the scarp slope of the plateau, Hatch said in its report.

About four years ago, Southwestern recognized the propertys potential following an evaluation of shallow underground workings over a strike length of about 5 kilometres.

The Boka 1 deposit is now estimated to host 31.2 million measured and indicated tonnes, grading 3.05 grams gold per tonne (just over 3 million contained oz.), a 215% increase over the mid-2005 estimated conducted by Hatch.

About one third of that resource is located in Boka 1 South.

Estimates do not include an additional 23.4 million inferred tonnes, grading 2.72 grams (over 2 million contained oz.) bringing total measured, indicated and inferred to 5.1 million oz.

Southwestern said the Boka project is in the prefeasibility stage and a draft of the prefeasibility study is on track for delivery to the company by the end of the second quarter

According to Hatch, the terrain around the property will pose challenges for development of surface mine and location of the large infrastructure required to support a high-rate processing operation.

Capital costs for mine processing and associated site infrastructure can be expected to fall into the range of US$139 million to US$235 million for a 6,500 tonne-per-day operation, Hatch said in its report.

Separately, Southwestern is also exploring for precious metals on a 7,933-hectare concession known as the Pacapausa project in southern Peru.

A 2,000-metre exploration drilling program recently got under way on the Pacapausa property, which is underlain by several northeast-southwest trending low sulphidation epithermal veins and breccia/stockwork zones.

Pacapausa is subject to an option agreement with Minera Oro Vega, a Peruvian subsidiary of International Minerals (IMZ-T), under which Oro Vega has the option to earn a 70% stake in the Pacapausa project.

To earn the interest, it must meet certain working commitments, complete a feasibility study, and finance the project to production