Ashanti proves up Youga

Drilling by Ashanti Goldfields (ASL-N) on the A2 Main deposit at the Youga project in Burkina Faso, West Africa, has returned some encouraging intersections.

Highlights are as follows:

— Hole 10 — 37.3 metres (beginning at a depth of 83 metres) grading 11.3 grams gold per tonne;

— Hole 13 — 7.9 metres (from 50.6 metres) running 14 grams gold;

— Hole 18 — 11 metres from (46 metres) of 8.1 grams gold;

— Hole 77 — 24.5 metres (from 159 metres) averaging 16 grams gold; and

— Hole 83 — 29.7 metres (from 144.4 metres) grading 8.8 grams gold.

The remaining holes generally returned between 2 and 6 grams gold over 10-to-80-metre intervals. Most of the holes contained fine-grained visible gold associated with galena along the margins of quartz veins.

The A2 Main deposit is the largest and most advanced of five known gold deposits at Youga. The deposit outcrops at surface and is covered by less than a metre of overburden. Metallurgical work indicates gold recoveries of 93% from all areas of the deposit. The remaining deposits are the A2 West 1, A2 West 2, A2 West 3, and A2 East.

Based on a million-tonne-per-year operation, Ashanti’s in-house estimate pegs Youga’s probable reserve at 7.1 million tonnes averaging 2.9 grams gold per tonne. Measured and indicated resources total 7.3 million tonnes grading 3.2 grams gold per tonne; another 7.7 million tonnes grading 2.05 grams are classified as inferred.

The Youga project lies on the northeastern extension of the 400-km Bole-Navrongo greenstone belt in Ghana. The belt comprises weakly-to-moderately metamorphosed Lower Birimian basic volcanic flows and syn- to post-Birimian intermediate-to-acid intrusive bodies. Gold mineralization at Youga is mostly contained in silicified arkosic meta-sediments.

The property, 4 km north of the Ghanaian border, comes with a 20-year exploitation permit, which can be renewed in 5-year increments. The permitting process included the approval of both an environmental impact study and an environmental impact assessment.

Etruscan Resources (EET-T) recently agreed to acquire a 90% stake in the Youga deposits plus a 100% interest in three contiguous exploration permits (Zerbogo, Bitou and Bitou East) from equal partners Ashanti and Echo Bay Mines, now part of Kinross Gold (K-T), for US$6.5 million. To fund the acquisition Etruscan recently agreed to sell 6.8 million shares to Sprott Securities at $1.70 apiece for gross proceeds of around $11.6 million. The government of Burkina Faso holds the remaining 10% of Youga.

Etruscan has dispatched a technical team to Youga and plans to strip the overburden to expose the entire surface of the orebody. Infill drilling to confirm the viability of the proposed operation will follow. Etruscan says it plans to break ground for construction as soon as possible.