Raising $5.3M Helio CEO details Tanzanian drill program

Vancouver – A cashing-up Helio Resource (HRC-V, HELOF-O) is tentatively planning a 20,000 metre drill program at its SMP gold project in the Lupa Goldfields of Tanzania, the company’s CEO Richard Williams says.

Helio has announced two private placements with a combined value of $5.3 million. In one Dundee Securities and Primary Capital will underwrite a $2.8 million financing of 8 million units at 35¢ a unit and in the other Helio expects Macquarie Bank to buy 7 million units at the same price for proceeds of $2.5 million.

In both private placements each unit will be worth one common share and one half a share purchase warrant. Holders can redeem warrants for 50¢ in the first year following the closing of the issue, likely April 7, and 60¢ in the next year.

Williams says with the proceeds of the financing the company forecasts expenditures of between $2 and $3 million on a 20,000 metre drill campaign this year that will largely focus on the eastern extent of its SMP gold project.

Though no final decisions have been made Helio will probably run two drill-rigs.

Largely through geochemistry and geophysics he says Helio has identified about 8 km of what may be continuous strike length extending between the Porcupine, Gap, Reefski and Panya zones. Respectively the zones run west to east and are each separated by about 2 km.

Helio has drilled some of property’s most promising drill-holes at Porcupine where it has so far defined a 200 metre long and deep near-surface mineralized area grading between 1 and 4 grams gold per tonne over intercepts between about 5 and 50 metres.

It has also intercepted similar grades and widths at targets 15 km to the west in the Kenge and Mbenge zones.

Williams says Helio may proceed with a resource estimate at the conclusion of the planned drill program but that at the moment the company is concentrating on indentifying and defining mineralized areas.

The SMP property is 230-sq.-km in size and the company says it can earn 100% interests on the property through five individual licenses.

On news of the private placement Helio’s share price gained 2.5¢. It has 50.4 million shares outstanding.