Canarc cuts more gold at Benzdorp (December 08, 2003)

Vancouver — Canarc Resource (CCM-V) is encouraged by the latest batch of drill results from the JQA prospect at its Benzdorp property in Suriname.

Benzdorp, which comprises 1,380 sq. km, is 300 km southeast of Paramaribo, Suriname’s capital. The property is accessible by air, or by boat up the Marowijne River.

A first phase of drilling will resume in the coming weeks, and before year-end, Canarc expects to drill 10 more holes. The work is designed to test the extensions of the JQA mineralization to the east, and the Roche Kreek prospect, to the south.

Highlights from recent drilling are as follows:

— Hole 18 intersected 67.8 metres averaging 0.57 gram gold per tonne starting from surface; this included a 39.6-metre interval of 0.73 gram gold.

— Hole 20 cut 30.5 metres of 0.78 gram gold starting from surface, includiong a 6.1-metre section that assayed 1.41 grams gold.

All the holes intersected porphyry-type stockwork mineralization. The latest fence of holes extended the width of the JQA mineralized zone to 600 metres; it remains open to the east and west.

Holes 22 and 23 failed to intersect mineralization 400 metres to the north. The mineralized zone appears to trend west of these two drill holes, beneath Pointu Kreek.

Core recoveries in holes 18-23 averaged only 76%, and bedrock was not reached in holes 19 and 21, owing to difficult ground conditions.

Canarc says Benzdorp is geologically analogous to the Boddington porphyry deposit in Western Australia, which is held by Newmont Mining, AngloGold and Newcrest Mining. Boddington is a structurally controlled, intrusion-related gold-copper deposit of Archean age. Reserves are pegged at 400 million tonnes grading 0.8 gram gold per tonne and 0.12% copper.

Canarc owns 40% of Benzdorp and can earn up to 80% by paying US$300,000 to state-owned Grassalco, spending US$3 million on exploration, and delivering a positive feasibility study. Grassalco ultimately will own 20% of the project, which gives it the right to receive either a floating net smelter return of 1.5% to 6%, rising with the price of gold, or a 20% net profits interest, which takes effect after Canarc recovers all of capital investment plus interest.

To date, the junior has identified 12 gold targets on just 5% of the property. These include the JQA and Roche Kreek porphyry gold-copper prospects, as well as four gold prospects with high-grade shear-vein mineralization, known as JQS, JQW, JQB and Pointu Kreek.

The JQW, JQS and Pointu Kreek prospects host gold mineralization in shear zones and veins that trend in a northeasterly direction. Gold occurs with sulphide and oxide minerals in quartz-calcite veins, as well as in replacement bodies within the shear zones. The Roche Kreek anomaly is 4 km south of the main JQA anomaly and measures 700 metres long and up to 280 metres wide. It remains open to the north and south.