VANCOUVER — Helio Resource (HRC-V) has released an initial resource estimate for its SMP gold project in Tanzania following a season of concentrated drilling on the Porcupine target.
The resource includes both the Porcupine and the Kenge targets at the SMP project, located on a 238-sq.-km land package in the southwest region of the country.
Using a restrained estimate, which limits the influence of some high-grade intercepts, and a 0.5 gram gold cutoff, the project hosts 10.8 million measured and indicated tonnes grading 1.43 grams gold for roughly 497,000 contained oz. gold, and a further 7.1 million inferred tonnes of 1.19 grams gold for about 273,000 contained oz. gold.
Unrestrained, the resource increases to 10.8 million measured and indicated tonnes of 1.65 grams gold for 575,000 oz., and the inferred category grows to 7.5 million tonnes of 1.32 grams gold for 321,000 oz.
The company describes gold mineralization as being associated with brittle fracture zones and ductile shear zones that cut through intrusive rocks of Lower Protero- zoic age.
The majority of the resources, and the entire measured resource, are held in the Porcupine Main zone, with 7.7 million measured and indicated tonnes grading 1.41 grams gold restrained. The company notes that the recently discovered Footwall and Quill zones could significantly expand the Porcupine resource.
Metallurgical testing for the Porcupine target shows gravity separation recovery at 22%, whole ore flotation at 95% while heap-leach recoveries are not yet determined. The Kenge target, some 12 km west of Porcupine, has recoveries of 34.7% gravity, 96% whole-ore flotation and 70% heap-leach.
Along with the company’s Tanzanian project, the company holds claims in Namibia. Helio focused exploration in Tanzania this year but is planning a work program for its Damara gold project next year.
A 2011 exploration program in both countries depends on further market financing. The last financing Helio did was a $6.21-million, 11.5-million-unit private placement at 54¢ apiece with the International Finance Corp (IFC). Following the financing, the IFC had roughly 15% of the company’s issued and outstanding shares.
In April, the Tanzanian government passed a law that increased royalties on the gross value of metallic minerals from 3% to 4%.
Helio’s share price dropped 7¢ to close at 56¢ on the SMP resource news. The company has a 52-week trading range between 30¢ and 75¢, and 79 million shares outstanding.
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