Canaco defends turf and releases strong drill results

Canaco Resources (CAN-V) continues its surge up the market on the back of stellar drill results and the successful defense of its turf in Tanzania.

The latest round of assays helped push the company’s share price up 3% or 16¢ to $6.10 on 800,000 shares traded.

Canaco shares had been trading in the low $3.00 range as recently as last November, but a steady stream of positive results from its Handeni Project coupled with word that the government had sided with the company on a claim dispute has provided plenty of upward momentum recently.

The newest results come from 30 holes drilled on the Magambazi zone at Handeni.

Highlights from the new drill results include, 48.3 metres grading 7.24 grams gold; 8.7 metres grading 38.76 grams gold and 17.7 metres grading 2.72 grams gold.

Canaco says mineralized true thicknesses between 60% and 100% of stated thicknesses.

With the recent focus on Magambazi the company has managed to extend the known gold lode system a further 40 metres north, with the mineralized lodes still remaining open to the north.

Satisfied for now with the work it has done on Magambazi, Canaco says the drills will now turn to definition drilling at the high-grade Keel Zone between Magambazi and Magambazi North.

The company reported that five drill rigs are now operational on site, accelerating both resource definition and systematic drilling of regional targets.

As for the claims dispute, Canaco announced on Feb. 14 that the Tanzanian Ministry of Energy and Minerals validated its exclusive mineral rights to an area of the Magambazi discovery.

Abdallah Omary Kigoda, who had a rival claim on the ground, has had his claim cancelled but was awarded US$2 million in cash and a 2% net smelter royalty on any minerals recovered from the 0.07 sq. km area.

The compensation, which is to be paid by Canaco, was given in light of the “substantial development work on the conflicted mineral right had already been undertaken by Kigoda,” Canaco said in a release.