Bema drills Kupol (September 15, 2003)

Vancouver — Impressive drill results continue to roll in from the Kupol gold property in Russia’s Far East region.

So far, operator Bema Gold (BGO-T) has put down 130 holes comprising 17,052 metres of drilling. The program has defined the high-grade Kupol vein system over a 2.6-km strike length down to depths of 250 metres below surface, with the results for the first 116 holes indicating good mineral continuity in four contiguous zones.

At the highest-grade zone, dubbed Big Bend, the company extended the mineralization by 150 metres to the south. Highlights from the last 13 holes into the zone include: 77.1 grams gold and 949.9 grams silver per tonne over 9.8 metres in hole 113; 37.4 grams gold and 371.6 grams silver over 17.9 metres in hole 111; and 32.7 grams gold and 596.5 grams silver over 10 metres in hole 108.

Mineralization at Big Bend is currently defined over a 650-metre strike length to depths of 250 metres below surface. Bema aims to continue testing the zone both at depth and along strike.

At the Central zone, Bema drilled 27 additional 50-to-100-metre step out holes. The best results came from holes 71 and 99, which yielded 45.3 grams gold and 346.47 grams silver over 12.9 metres, and 48.71 grams gold and 323.1 grams silver over 5.4 metres, respectively. Drilling to date has traced the zone over 800 metres of strike length and down to 200 metres below surface.

Bema has discovered a vein 60 metres east of the main vein in the hanging wall. Hole 102 cut the vein, returning 1 metre grading 102.94 grams gold and 636 grams silver. The company will target this promising intercept with more drilling.

Moving north, the North zone extends at least 350 metres and is still open at depth. Two of the most recent holes, numbers 86 (33.5 metres grading 32.76 grams gold and 406.24 grams silver) and 77 (11.4 metres grading 20 grams gold and 303.53 grams silver), better define the large high-grade shoot discovered in the earlier holes.

Four holes drilled north of an interpreted fault, in what is called the North Extension zone, cut clay-altered volcanics with stringer veins. The company aims to test for mineralization at depth below the alteration.

The South zone has been traced for 600 metres to the south of the Big Bend zone. Three new holes tested the high-grade shoot cut in holes 42A and 31. Hole 63 tested the down dip extension of this mineralization but hit a dyke shortly after intersecting the vein. The hole yielded 13.54 grams gold and 77.26 grams silver over 0.8 metre. Hole 80 returned 1.7 metres grading 9.48 grams gold and 529.6 grams silver, while hole 57 failed to cut any significant values.

The company also punched seven widely spaced holes to the south at the South Extension zone, which is marked by 750 metres of alteration, vein float and outcrop. Holes 87 and 96 intersected dykes and did not hit the vein zone, while holes 110 and 112 failed to reach the depth required to test the mineralized structure. The best values came from hole 104, which returned 9.13 grams gold and 96.78 grams silver over 1.6 metres.

The Kupol project is in a remote setting, 940 km northeast of Bema’s Julietta mine and 200 km east of the nearest town, Bilibino. From Bilibino, the property is accessible by road or helicopter.

The project was discovered in 1995 through regional geochemistry, although a Russian operator previously explored the area. Thirty-five ditches and trenches have systematically tested more than 3 km of strike length, returning several bonanza intercepts from a 1,800-metre section highlighted by 183 grams gold and 2,557 grams silver per tonne across 11.8 metres, and 155 grams gold and 549 grams silver over 9 metres.

The Russian group completed 2,500 metres of drilling in 24 holes, testing a 400-metre-long section to a depth of no more than 140 metres. Better intercepts included 41.3 metres of 51.6 grams gold and 531 grams silver, 29.2 metres of 16 grams gold and 340 grams silver, and 6.6 metres of 85.3 grams gold and 704 grams silver. The drilled area was estimated to contain an inferred resource of 780,000 tonnes averaging 33.3 grams gold and 373 grams silver, representing 835,000 oz. gold and 9.3 million oz. silver.

Bema can acquire up to a 75% interest in the Kupol project by making certain expenditures and cash payments. The company has paid US$8 million cash for the right to earn 20% by spending US$5 million on exploration before the end of 2003. It must make two more cash payments totalling US$22.5 million and spend a further US$5 million on exploration before December 2004 to earn a 40% interest. By completing a bankable feasibility study and paying US$5 per oz. for 75% of the gold defined as reserves, Bema can earn the final 35%. Upon a production decision, Bema will pay a further US$5 per oz. for 75% of the ounces identified as ore.