East Asia Rises On Miwah Gold Results

VANCOUVER — Consistent, highgrade channel sample and drilling results from the Miwah gold project in Indonesia have lifted East Asia Minerals’ (EAS-V, EAIAF-O) share price 460% since early June.

Miwah is a high-sulphidation epithermal gold system in northern Sumatra’s Aceh province.

The zone as delineated to date has three major parts: the main Miwah zone, the Miwah Bluff zone adjacent to the west, and the South Miwah Bluff zone that, as the name implies, sits south of Miwah Bluff. In addition, the Sipopak gold zone lies 1.5 km to the north-northeast.

At the main Miwah zone, more than 2,000 metres of rock-saw channel sampling in 2008 over a 1- sq.-km area of high sulphidation alteration averaged 1.2 grams gold per tonne and better than 3 grams silver. Higher gold grades, including 4.1 grams gold over 200 metres, are associated with massive, residual vuggy silica-sulphide that forms a clear, east-northeast-trending cliff stretching 1.2 km along strike.

The latest channel sampling at Miwah has focused on the eastern end of that 1.2-km strike length and the results remain strong. Recent results include 106.5 grams gold over 4.6 metres, 3.1 grams gold over 5.6 metres, and 1 gram gold over 12 metres. Earlier results from the eastern portion of the main zone include 14 grams gold over 20 metres, 6.19 grams gold over 6 metres, 2.41 grams gold over 32 metres and 0.58 gram gold over 50 metres.

And East Asia is now drilling at Miwah, guided by those channel sampling results. The company has completed six holes of an initial 10- hole program. The first three holes were drilled from the same collar, located near the western end of the main zone.

Hole 1 cut 57.1 metres grading 1.97 grams gold from 11 metres depth, including 38.3 metres of 2.78 grams gold. Hole 2 intercepted 158 metres grading 1.71 grams gold from 8 metres depth, including 66 metres of 3.29 grams gold.

And hole 3 returned 142.9 metres grading 2.25 grams gold from 9 metres below surface, including 51 metres of 4.31 grams gold. For all three holes, channel sampling results from directly above the intercepts indicate that mineralization is continuous to surface.

Hole 4 was collared to the southwest, and at some 60 metres lower in elevation, was designed to validate a historic hole that returned 71 metres of 1.42 grams gold. The new hole cut a similar intercept: 64.4 metres of 1.37 grams gold, starting just 4.5 metres down-hole.

Based on work to date, Miwah has two components. The majority of the 2008 rock samples came from a tabular, 1.2-km-long, 300-to 400-metre-wide zone that is 200 metres thick on average. The other component comprises vertical diatreme breccia feeder zones that are beneath the tabular zone and cut through it. These feeder zones support higher gold grades, such as 83.6 grams gold over 24 metres and 20.1 grams gold over 12 metres in channel samples.

Another area that shows promise is South Miwah Bluff, a southwesterly extension of the highgrade structures at Miwah. Specifically, South Miwah Bluff comprises three to four northerly-trending diatreme breccia feeder structures, with associated crosscutting structures providing more concentrated gold mineralization. The feeder zone is currently 650 metres long; the north limit is defined as where the structures enter the Miwah Bluff zone but the structures continue through the zone and toward Sipopak, 1.5 km to the north. And South Miwah Bluff is up to 350 metres wide on surface.

To date, East Asia has taken 205 metres of rock channel samples from South Miwah Bluff and the average grade is 14.25 grams gold. Dominant alteration is vuggy and massive silica, with moderate to strong oxidation.

And East Asia’s most recent news contained assay results for the first two drill holes into South Miwah Bluff. Both holes suffered poor core recovery, losing as much as 100% of the core in parts of the mineralized interval because of its vuggy nature. Nevertheless, hole 5 returned 21.4 metres grading 3.36 grams gold and hole 6 cut 20.3 metres averaging 5.38 grams gold.

In discussing the South Miwah Bluff drill results, East Asia president and CEO Michael Hawkins said geologists have identified a 10- to 20-metre-wide high-grade zone running along the western margin of the larger diatreme breccia feeder. The company is addressing the core loss issue and plans to return to South Miwah Bluff after completing the planned 10-hole program.

The Miwah prospect saw 11 drill holes totalling 3,000 metres by a previous explorer in 1997. All of those historic holes intersected alteration and mineralization; some of the best results were 71 metres grading 1.4 grams gold and 58 metres grading 1.1 grams gold.

On reviewing the historical data, East Asia concluded that the early drilling was oriented parallel to the higher-grade gold structures at surface and was topographically too low to intersect those structures at depth. So, the company expects to prove up a resource that is both bigger and higher-grade than the historical estimate of 100 million tonnes averaging just over 1 gram gold.

This is East Asia’s first time focusing its efforts at Miwah. Last year, the company concentrated more on its other project in Indonesia: a 130-hole drilling effort at the Abong prospect, which is part of the Barisan property, also in northern Sumatra, returned significant near-surface epithermal gold mineralization in most holes.

The mineralization came from an extensive, sub-horizontal, outcropping jasperoid unit that remains open in several directions.

Abong results indicate the presence of a series of northeast-trending, elongated, high-grade gold zones surrounded by lower-grade envelopes. High-grade results include 9 metres of 4.84 grams gold and 11 metres of 6.29 grams gold. The pods are contained within a major northwest-trending corridor that is up to 800 metres wide and traceable for over 2 km. The company expects to release a resource estimate for Abong in September.

And East Asia completed a similar resource-definition drill program at its Sangihe property, where the company drilled 79 holes for 7,560 metres. Sangihe hosts two major prospects. At Bawone, drills cut through shallow gold mineralization; results included 95 metres of 2.15 grams gold and 125 metres of 1.67 grams gold. At Binebase, results were similar: 36 metres of 4.03 grams gold and 188.3 grams silver; and 96.2 metres of 1.3 grams gold and 48.3 grams silver. East Asia expects a resource estimate for Sangihe by the end of September.

At the end of June, East Asia had $5.5 million in cash, following the close of a non-brokered private placement wherein it sold 9.1 million units at 51¢ apiece for proceeds of $4.64 million. Each unit consisted of one share and half a warrant, with each warrant exercisable at 75¢ for 2.5 years.

Earlier in the year, East Asia shares sat near 50¢, but news out of Miwah lifted them to nearly $3 apiece in mid-August. The stock recently retreated, closing at $2 towards the end of August. The company has 56 million shares outstanding.