More gold for Axmin in Central African Republic

Axmin (AXM-V) has been drilling non-stop at its Passendro gold project in the Central African Republic since the beginning of 2005 and its efforts are starting to pay off with a 17% boost in measured and indicated resources.

Results of infill drilling have raised measured and indicated resources to 23.2 million tonnes, or 1.8 million oz. gold, grading 2.4 grams gold per tonne.

The inferred resource remains unchanged at 16.7 million tonnes, or 1 million oz. gold, grading 1.9 grams gold per tonne.

The new in-situ resource estimate was based on results from drilling up to June 2007 by the company’s two wholly owned core rigs and two wholly owned reverse circulation rigs.

Axmin says it intends to build a substantial gold mine at Passendro with a minimum production profile of 150,000 200,000 oz. gold per year.

A feasibility study is nearly completed and is expected shortly.

Axmin says the Passendro area not only enjoys “exceptional prospectivity” but also boasts discovery costs averaging only about US$6.50 per oz. all the way from grassroots level exploration to resource definition.

The new estimate was derived from the main zone at Passendro in addition to the Katsia, French Camp, Bacanga Head, Barbacoa, Baceta and Ngetepe, prospects, all which lie within a 3-km radius of each other.

Resources have not been calculated for mineralised structures beyond the 3 km range, which are still undergoing exploration.

SRK Consultants applied a block cut-off grade of 1.2 grams per tonne gold for the French Camp, Katsia and Bacanga Head prospects; a 0.8 gram gold per tonne for the main zone; and 1 gram per tonne gold for the Baceta, Barbacoa and Ngetepe prospects.

High grades were capped at 17 grams per tonne gold at the main zone, 40 grams per tonne gold at Katsia and 20 grams per tonne gold at Barbacoa. Cutting was not required at the French Camp, Bacanga Head, Baceta or Ngetepe deposits.

“Although the resource increase has included some depth expansion, the mineralised structures still have only been tested to relatively shallow levels,” Axmin’s head of exploration, Jonathan Forster, said in a prepared statement announcing the results.

“Only 23% of the resource lies within the sulphide zone indicating that substantial potential remains open across the project area at slightly greater depths particularly in view of the plus 15 grams per tonne assays in multi-metre veins reported from Katsia in 2005.”

Axmin says its objective now is to add resources within 20 km of the Passendro project and to initiate programs for more distant areas within the 140-km-long Bambari greenstone belt.

The Central African Republic, a small( 623,000 sq-km) landlocked nation, is bordered by Chad, Sudan, Democratic Republic of Congo, Republic of Congo (Congo Brazzaville) and Cameroon.

Apart from the Central African Republic, Axmin has projects in several other African countries including the Kofi gold project in Mali and the Komahun gold project in Sierra Leone.

With 205 million shares outstanding, the gold exploraton and development company has a 52-week trading range of 56 to $1.09.

At press-time it was trading at about 57 a share.