Eldorado Gold posts maiden resource on Tocantinzinho in Brazil

Eldorado Gold‘s (ELD-T, EGO-N, EAU-A) 100%-owned Tocantinzinho deposit in the Tapagos district of northern Brazil has measured and indicated resources of 58.56 million tonnes grading 1.10 grams gold for contained gold of 2.07 million oz., according to an initial resource estimate.

Inferred resources add 18.92 million tonnes grading 0.67 gram gold for 410,000 oz. gold, at a cutoff grade of 0.2 gram gold per tonne.

The maiden resource figures were based on 152 diamond drill holes and 43,300 metres, of which Eldorado drilled 56 holes or 17,940 metres.

Based on work in 2009, Eldorado has defined a potential 4.4 million tonne-per-year open-pit operation and expects to complete a prefeasibility study during the fourth quarter of 2010.

Average production is estimated to be in the range of 150,000-160,000 oz. gold per year.

If all goes well, Eldorado expects to complete a feasibility study on the granite-hosted stockwork deposit by the middle of next year, and make a construction decision before the end of 2011.

Management points out hat Eldorado has a “large prospective land package in and around the project,” which it argues gives it a dominant operating position in the district. Eldorado has also retained senior management from its Sao Bento gold mine.

Final field studies necessary for an Environmental Impact Assessment have been authorized, and the EIA is forecast to be completed in the first quarter of next year.

Next up is an induced polarization (IP) survey of areas of up to 150 km around the main deposit. The IP data will help the company target about 3,000 metres of exploration drilling that has been budgeted for the remainder of this year.

At presstime in Toronto, the company, which also has assets in Turkey, China, and Greece, was trading at $16.76 per share.

Over the last year Eldorado has traded in a range of $9.82-$19.73 per share and the company has about 540 million shares outstanding.