Resource at Busang climbs to 15 million oz.

Bre-X Minerals (ASE) has released the much-anticipated resource calculation for a portion of the Southeast zone at the Busang gold project in East Kalimantan, Indonesia.

Based on a cutoff grade of 0.75 gram gold per tonne, Southeast Zone 1 has measured and indicated resources of 41.1 million tonnes averaging 2.72 grams gold and inferred resources of 110.8 million tonnes averaging 2.65 grams, equal to a resource of more than 13 million oz.

The zone is more than 600 metres wide, 300 metres deep and has a possible strike length of 330 metres.

Taking into account the previous resource calculation for the Central zone, the total Busang resource (measured, indicated and inferred) stands at 15.7 million oz.

The independent calculation was based on 157 holes totalling more than 17,000 metres and drilled to an average depth of 375 metres. In the Central zone, 105 holes were drilled at intervals of 25 to 50 metres on lines spaced 50 metres apart over a 900-metre strike length. The average depth of the holes drilled in the Central zone was 175 metres.

Meanwhile, on the periphery of the Southeast Zone 1, holes are being drilled at 50-metre intervals on lines spaced at 250 metres. Exploration indicates the entire Southeast zone could have a composite strike length of 7 km.

Bre-X believes the Busang could hold as much as 40 million oz., and the company is drilling on adjacent lines SEZ-44 and SEZ-59, which are 250 metres beyond SEZ-49 and SEZ-54, respectively.

In other news, the company has entered into an agency agreement with several brokerage firms who have agreed to buy 250,000 Bre-X common shares at $120 per share. The transaction, which will raise $30 million for exploration, is expected to close by March 1.

At the annual meeting, scheduled for March 14, the board of directors will ask shareholders to approve a 10-for-1 stock split. The arrangement would raise the number of outstanding Bre-X shares to more than 230 million.

The board will also seek endorsement of a proposed shareholders’ rights protection plan. Otherwise known as a “poison pill,” the plan is designed give the board of directors time to react to any unwanted takeover bids.

Bre-X also plans to transfer its interest in two other Indonesian properties into a new and wholly owned subsidiary, to be listed on the Alberta Exchange.

Bre-X’s shareholders will receive shares in the new entity as consideration for transferring to the subsidiary a 60% interest in the Sangihe copper-gold project on Sulawesi and a 80% interest in the Sable gold project in Sumatra.