High-grade gold for CGA Mining in Nigeria

CGA Mining (CGA-T, CGX-A) has its hands full with its first gold pour in May at Masbate in the Philippines and wrapping up a feasibility study at its next development project, a copper deposit in Zambia. But it’s the drill results from the Segilola gold project in Nigeria that are probably stirring up the most excitement at company headquarters at the moment.

Grades encountered so far from the core at Segilola vary between less than 1 gram gold per tonne and 136 grams gold per tonne in a regional setting that is very similar to the Ashanti and Sefwi systems in nearby Ghana, which have hosted gold production of more than 20 million ounces, the company says.

New high-grade drill intercepts published today include 4 metres grading 105.15 grams gold per tonne including 3 metres at 135 grams gold and 1 metre at 15.6 grams gold. A second drill hole yielded 41.8 metres cutting 3.76 grams gold per tonne, including 2.6 metres at 12.32 grams gold and 16 metres at 6.88 grams gold.

Other intercepts resulted in 7.8 metres grading 5.71 grams gold and 12.5 metres cutting 9.95 grams gold per tonne including 2.5 metres at 32.24 grams gold. The known mineralized zone extends over a strike length of 1,500 metres.

Segilola is the most advanced gold exploration project in the country, according to CGA Mining, which so far has earned 25% of the project. CGA Mining has an agreement with Tropical Mines, a private Nigerian company, to acquire a 51% interest (by earn in) in the project. Tropical Mines is a Nigerian company that is owned 80% by local investors and 20% by the government.

The project is near the city of Ilesha in Nigeria’s Osun state, and about 120 km northeast of Lagos, the country’s major commercial center.

Mineralization is associated with steep dipping quartzite veins and occurs with pyrite and molybdenite. Major fractures and shear zones appear to be a common feature of the area.

The company is working on a National Instrument 43-101 resource and notes that the drilling so far “suggests a grade in excess of 5 grams gold per tonne may be achievable.”

Apart from Segilola, CGA poured its first gold in May at its Masbate gold project, about 350 km south of Manila, the capital of the Philippines. Currently Masbate is ramping up to full production and has a total indicated resource of 4.55 million ounces and inferred resources of 3.22 million ounces. The project is forecast to produce over 200,000 ounces of gold a year.

CGA acquired Masbate in March 2007. Atlas operated Masbate from 1980 to 1994 as an open pit and underground operation, processing a total of 17.4 million tonnes at a grade of 2.12 grams gold per tonne for 1.08 million ounces of gold and 944,474 ounces of silver.

In Zambia, meanwhile, CGA is developing the Mkushi copper project about 60 km from the regional centre of Kapiri Mposhi and 250 km north of Lukasa, the state capital. Kapiri Mposhi is the Zambian terminus for the Tanzam railway, which was built in the 1970s to transport copper products to the port of Dar es Salaam in Tanzania. Ndola, the main town servicing the copperbelt, is about 180 km north of Kapiri Mposhi.

At presstime in Toronto CGA Mining was trading at $1.65 per share. The company has a 52-week trading range of 60¢-$1.80 per share and has about 269.2 million shares outstanding.