TIDMMML
RNS Number : 1496L
Medusa Mining Limited
27 July 2011
MEDUSA MINING LIMITED
ABN: 60 099 377 849
Unit 7, 11 Preston Street
Como WA 6152
PO Box 860
Canning Bridge WA 6153
Telephone: +618-9367 0601
Facsimile: +618-9367 0602
Email: admin@medusamining.com.au
Internet: www.medusamining.com.au
27 July 2011
Co-O MINE MINERAL RESOURCE INCREASES
(ASX & LSE: MML)
Medusa Mining Limited ("Medusa" or the "Company"), through its
Philippines operating company, Philsaga Mining Corporation
("Philsaga"), advises that it has increased the Global Resources at
its Co-O Mine by 30% to 1,960,000 ounces from 1,501,000 ounces (and
after taking into account gold produced since 21 June 2010).
As a result of the new resource model contained in this report
and drill results announced on 6 July 2011, the Company will be
revising the Conceptual Exploration Target size for the Co-O
Mine.
Table I. Co-O Mine mineral resource estimate at 30 June 2011
Category > 0 g/t gold
--------------------- ---------------------------------
tonnes g/t gold ounces
--------------------- ---------- --------- ----------
Indicated resources 1,601,000 12.0 616,000
--------------------- ---------- --------- ----------
Inferred resources 4,747,000 8.8 1,344,000
--------------------- ---------- --------- ----------
TOTAL RESOURCES 6,348,000 9.6 1,960,000
--------------------- ---------- --------- ----------
Peter Hepburn-Brown, Managing Director of Medusa, commented:
"This extremely pleasing result highlights the exceptional
potential of the Co-O Mine vein system. It means we have added
approximately 560,000 ounces (including replacing the ounces
produced during the year) by drilling in the last 12 months at a
drilling discovery cost of approximately US$24 per ounce. At this
point there is no geological reason why a similar result can't be
achieved in this current financial year as we continue work with
five underground rigs and six surface rigs.
The slight resource grade variation compared to last year is due
primarily to drilling in the tops of the East Agsao veins to the
east-northeast where we see clear trends in the drilling of
increasing grades with depth, and we anticipate grades should
increase in this area as drilling becomes deeper.
We anticipate being able to expand the Co-O vein system for
quite some time yet."
MINERAL RESOURCE MODEL
Discussion
Surface and underground diamond drilling has continued since the
last resource model update based on data as at 21 June 2010 and
announced on 22 July 2010 and has focused on infilling some data
deficient areas and on extending the Co-O vein system along the
northern side and at the eastern end of the mine.
The variation in resource grade compared to last year is due
primarily to the addition of the extensive veins to the
east-northeast where drilling has followed the vein structures to
depth demonstrating increasing grades with depth. A large number of
the drill hole intersections in this area are still in the tops of
the veins where it is anticipated that grades should increase with
depth as indicated by the trends.
It should be noted that not all drill hole intersections
reported since 21 June 2010 (see announcements dated 29 October
2010, 18 January 2011, 5 April 2011 and 6 July 2011) are able to be
incorporated into the resource estimate, particularly where the
spacing of drilling is too wide to facilitate high levels of
confidence in vein interpretations.
Figure 1 (please see link at the end of this announcement) shows
the updated 3D resource model. The veins are open at depth and
currently only limited by the depth and density of drilling.
Figure 2 (please see link at the end of this announcement) is
the Level 6 map of the Co-O Mine area showing the veins in the 3D
resource model at Level 6. This vein distribution on the plan shows
that areas to the west, east, south and north require infill and
additional deeper drilling to extend the veins down to Level 6 and
below as some veins are still only partly defined to shallow
depths, eg, the Royal Veins, some of the northern East Agsao Veins
and parts of the western end of the vein system.
Table II is a summary of the resources for the major veins.
Indicated resources are primarily located around the areas of
underground development and Inferred resources are drilling only.
Resources have been estimated for 46 veins at this stage.
Table II. Co-O Mine mineral resource estimates for the major
veins at 30 June 2011 with >=50,000 ounces
Vein name Category > 0 g/t gold
------------------- ----------- ---------------------------------
contained
tonnes g/t gold ounces
------------------- ----------- ---------- --------- ----------
Great Hamish HW Indicated 48,000 11.4 18,000
Inferred 104,000 10.3 34,000
------------------------------- ---------- --------- ----------
Great Hamish Indicated 281,000 19.7 178,000
Inferred 343,000 12.5 138,000
------------------------------- ---------- --------- ----------
Great Hamish FW Indicated 49,000 12.8 20,000
Inferred 194,000 8.8 55,000
------------------------------- ---------- --------- ----------
Great Hamish East
FW2 Indicated 86,000 10.4 29,000
Inferred 536,000 12.9 223,000
------------------------------- ---------- --------- ----------
Central Indicated 367,000 9.6 113,000
Inferred 267,000 3.3 28,000
------------------------------- ---------- --------- ----------
Jeremy Indicated 146,000 10.9 51,000
Inferred 118,000 4.3 16,000
------------------------------- ---------- --------- ----------
Catto 1 Indicated 54,000 20.9 37,000
Inferred 90,000 26.2 76,000
------------------------------- ---------- --------- ----------
Roysan Indicated 83,000 19.1 51,000
------------------- ----------- ---------- --------- ----------
Inferred 94,000 12.8 38,000
------------------------------- ---------- --------- ----------
East Agsao 2 Inferred 343,000 10.0 110,000
------------------- ----------- ---------- --------- ----------
East Agsao 7 Inferred 422,000 7.6 104,000
------------------- ----------- ---------- --------- ----------
East Agsao 14 Inferred 272,000 7.3 64,000
------------------- ----------- ---------- --------- ----------
East Agsao 15 Inferred 701,000 6.8 152,000
------------------- ----------- ---------- --------- ----------
Other veins Indicated 487,000 8.4 119,000
Inferred 1,264,000 7.2 306,000
Total Indicated Resources 1,601,000 12.0 616,000
-------------------------------- ---------- --------- ----------
Total Inferred Resources 4,747,000 8.8 1,344,000
-------------------------------- ---------- --------- ----------
TOTAL RESOURCES 6,348,000 9.6 1,960,000
-------------------------------- ---------- --------- ----------
Notes:
- A lower cut-off of 0 g/t gold has been applied
- Variable upper cuts up to 300 g/t gold has been applied to
different veins
- Rounding to the nearest 1,000 may result in some slight
discrepancies in totals.
Vein modelling
Cube Consulting Pty Ltd of Perth, Western Australia was
contracted to undertake the resource estimations. A wireframe model
of the vein system and the mine depletions were based on all
available information as at 30 June 2011. A Specific Gravity value
of 2.62 was used in the estimations. A 2D longitudinal modelling
approach was used and is based on an accumulation variable
incorporating mineralised vein horizontal width and intercept
grade. Variography was used to analyse the spatial continuity of
the horizontal width and accumulation variables within the
mineralised veins and to determine appropriate estimation inputs to
the interpolation process. The accumulation variables were
interpolated into blocks using Ordinary Kriging. High grade limits
were applied to gold prior to the calculation of the accumulation
variable. Mineral resources have been reported in accordance with
The 2004 Australasian Code for Reporting of Exploration Results,
Mineral Resources and Ore Reserves (JORC Code).
Information in this report relating to Exploration Results has
been reviewed and is based on information compiled by Mr Geoff
Davis, who is a member of The Australian Institute of
Geoscientists. Mr Davis is the Chairman of Medusa Mining Limited
and has sufficient experience which is relevant to the style of
mineralisation and type of deposits under consideration and to the
activity which he is undertaking to qualify as a "Competent Person"
as defined in the 2004 Edition of the "Australasian Code for
Reporting of Exploration Results, Mineral Resources and Ore
Reserves" and is a "Qualified Person". Mr Davis consents to the
inclusion in the report of the matters based on his information in
the form and context in which it appears.
Information in this report relating to Mineral Resources has
been estimated and compiled by Mark Zammit of Cube Consulting Pty
Ltd of Perth, Western Australia. Mr Zammit is a member of the
Australian Institute of Geoscientists and has sufficient experience
that is relevant to the style of mineralisation and type of deposit
under consideration and to the activity which he is undertaking to
qualify as a Competent Person as defined in the 2004 Edition of the
"Australasian Code for Reporting of Exploration Results, Mineral
Resources and Ore Reserves". Mr Zammit consents to the inclusion in
the report of the matters based on his information in the form and
context in which it appears.
For further information please contact:
Australia
Medusa Mining Limited +61 8 9367 0601
Geoffrey Davis, Chairman
Peter Hepburn-Brown, Managing
Director
United Kingdom
Fairfax I.S. PLC +44 (0)20 7598 5368
Financial Adviser and Broker
Ewan Leggat/Laura Littley
Click on, or paste the following link into your web browser, to
view the associated PDF document.
http://www.rns-pdf.londonstockexchange.com/rns/1496L_1-2011-7-27.pdf
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