African Gold Group, Inc. Northern Step-Out Hole Intercepts 112 Meters of 2.14 g/t Au-Hole Ends in Mineralization-Kobada, Mali
TORONTO, ONTARIO -- (Marketwire) -- 11/15/11 -- African Gold Group, Inc. (TSX VENTURE: AGG), ('AGG' or the 'Company') is pleased to report the analytical results for six near surface (oxide), reverse circulation (RC), step-out drill holes, from the Company's Kobada, Mali gold project. All six holes represent northern step out holes that were collared up to 100 meters north of the Zone 1 deposit.
Near Surface (Oxide) Drill Highlights From Northern Step-Out Holes Include:
KBRC11-189: 112 m @ 2.14 g/t Au, incl, 1 m @ 90.19 g/t Au, ended in
mineralization
KBRC11-192: 88 m @ 1.66 g/t Au, incl 2 m @ 25.60 g/t Au
KBRC11-191: 55 m @ 0.79 g/t Au, incl 1 m @ 15.06 g/t Au
KBRC11-190: 42 m @ 0.96 g/t Au, incl 1 m @ 12.42 g/t Au
KBRC11-193: 12m @ 0.89 g/t Au, ended in mineralization
The assay results depicting the 6 near surface, (oxide) northern step-out RC holes are listed in Table 1 below:
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Section Hole ID From To Length Au EOH Degrees Hole Objective
(m) (m) (m) (g/t) (m) (tn)
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Zone 1 - Northern
1000S KBRC11-189 14 126 112 2.14 200 Step-Out
Ended In
including 15 16 1 90.19 126 Mineralization
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Zone 1 - Northern
1000S KBRC11-190 12 16 4 6.04 200 Step-Out
including 13 14 1 20.79
1000S KBRC11-190 56 82 26 0.51
1000S KBRC11-190 92 134 42 0.96
including 92 93 1 12.42 138
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Zone 1 - Northern
1000S KBRC11-191 9 64 55 0.79 200 Step-Out
including 53 54 1 15.06
1000S KBRC11-191 74 77 3 2.23 100
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Zone 1 - Northern
1000S KBRC11-192 1 4 3 0.83 200 Step-Out
1000S KBRC11-192 12 100 88 1.66
including 12 14 2 25.60 102
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Zone 1 - Northern
1000S KBRC11-193 0 3 3 0.66 200 Step-Out
1000S KBRC11-193 11 14 3 1.29
1000S KBRC11-193 48 51 3 0.54
1000S KBRC11-193 59 62 3 0.47
Ended In
1000S KBRC11-193 90 102 12 0.89 102 Mineralization
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Zone 1 - Northern
1000S KBRC11-194 10 15 5 0.45 108 200 Step-Out
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1) Significant drilled intercepts have a minimum length of 3m at 0.3 g/t or
the product 'Length X Grade' greater than 0.9 g.m/t. Intercepts are
drilled lengths and may not be true width within a structure dipping 70
degrees to 80 degrees
2) Up to 7 m of horizontal mineralized 'waste' included within mineralized
intercept
Kobada Review
On July 14, 2011 AGG announced the results of a positive NI 43-101 Preliminary Economic Assessment (the 'PEA' or the 'Study') that evaluates the potential of an open pit, bulk mining model, utilizing a gravity recovery process plant, at the Company's Kobada (Mali) gold project. The PEA incorporates and includes drill data up to the end of December, 2010. There is no drill data from the 2011 campaign included in the PEA. More specifically, the PEA does not incorporate drill data for the northern extension holes that hold potential to extend Zone 1 up to 2 kilometers north of the Zone 1 deposit, in addition, the PEA does not incorporate the 2011 southern holes that hold potential to extend Zone 1 up to 1.55 kilometers south of the Zone 1 deposit, nor does the Study include any potential from the newly discovered Foroko North deposit, the newly discovered Termite Zone or the recently announced Gosso discovery zone the latter three discovery zones being separate and distinct structures from Zone 1.
Project Economics - Base Case
The PEA estimates an after-tax Net Present Value (NPV) of US$216.9 million from commencement of construction and an after-tax Internal Rate Of Return (IRR) of 90.57% using a base case of US$1,100 per ounce of gold and a discount rate of 5%.
The Kobada project base case is for processing 20,000 tonnes per day for a total of 7,000,000 tonnes per year in a gravity process plant that is projected to recover 87.9% of the gold contained in 41,750,000 tonnes of lateritic material assaying 0.64 g/t Au, for average annual production of 126,600 ounces of gold for the first five years of operation. The average annual operating cost is calculated to be US$8.27/t for the first five years of operation with a CAPEX of US$122,500,000. The project produces gold at the direct cost of US$470.90 per ounce. The Study demonstrates that the Kobada gold project is economically optimized by adopting bulk mining versus selective mining. The direct implications of bulk mining are demonstrated in a substantial increase in tonnage and recoverable gold but with an associated decrease in the average gold grade. Please visit www.africangoldgroup.com to review the entire content of AGG's July 13, 2011 press release announcing the results of the positive Preliminary Economic Assessment.
ZONE 1 NORTHERN STRIKE POTENTIAL ESCALATES
The results contained in today's release serve to reinforce AGG's growing perception of its ability to extend the 43-101 Zone 1 resource further north along strike. On April 07, 2011, AGG announced the analytical results of the first set of 27 northern step-out drill holes from the 2011 campaign. The 27 northern step out holes were grouped in four distinct regions, north of the Zone 1 deposit. The group of holes closest to the Zone 1 deposit, located on 1100S have already been in-filled and now form part of the NI 43-101 resource that was published in conjunction with the July 13, 2011 dissemination of AGG's PEA. The most northerly grouping of holes, located on Section 400N, are situated 1.5 kilometers north of the current NI 43-101, Zone 1 resource.
To view the collar and trace of the six northern step out holes on Section 1100S, please visit the following link:
http://media3.marketwire.com/docs/745078DrillSection.JPG
To view the cross sections on Section 1000S, please visit the following link:
http://media3.marketwire.com/docs/745078AreaSec670E.JPG
Highlight holes from the April 07, 2011 set of 27 northern step-out holes included:
Section 400S - 600 meters north of drill holes released today on 1000S
KBRC11-016: 15 m @ 1.61 g/t Au
And 20 m @ 0.46 g/t Au
And 10 m @ 2.38
KBRC11-015: 8 m @ 5.08
And 22 m @ 1.48
Section 000N - 1 km north of drill holes released today on 1000S
KBRC11-012: 8 m @ 0.59 g/t Au
And 7 m @ 0.34 g/t Au
And 8 m @ 6.23 g/t Au
And 9 m @ 0.59 g/t Au
And 7 m @ 0.56 g/t Au
Section 400N - 1.4 km north of drill holes released today on 1000S
KBRC11-003: 6 m @ 1.29 g/t Au
And 4 m @ 0.51 g/t Au
And 10 m @ 0.80 g/t Au
And 6 m @ 1.23 g/t Au
And 13 m @ 0.57 g/t Au
KBRC07-038: 5 m @ 4.04 g/t Au
'We are most encouraged by the drill results contained in today's release. We have no doubt that our Zone 1, 43-101 resource will ultimately extend north and include the potential tonnes and ounces of Au intercepted within the area contained by these step-out holes. Of even greater significance is the blue sky potential that is being amply demonstrated by the mineralized intercepts encountered as much as 1.4 km north of the drill holes that are the subject of today's release on Section 1000S. We remain open along strike, in both directions and at depth. We have encountered new discovery zones at Foroko North, Gosso and the Termite Zone. We have drill tested less than three per cent of our 218 sq km footprint and are confident that Kobada will continue to grow,' states AGG President, Michael A. Nikiforuk
Pending Drill Results
At present, the following Kobada step-out holes, forming part of AGG's ongoing 2011 exploration campaign, remain pending: Zone 1 southern extension step-out holes; Foroko North strike extension step-out holes and step-out holes east of Zone 1 to test a perceived parallel structure. The analytical results for the outstanding step-out drill holes will be published upon receipt of the results from the laboratory.
Sampling - QA/QC Program
RC cuttings are recovered at the bottom outlet of the RC rig cyclone into 50-kg capacity poly-weave bags to recover the cuttings from each 1 meter of drill penetration. Each one meter sample weighs an average of approximately 19 to 23 kg. Each sample is passed through a 3-tier Jones Riffler (1 to 8 split), the samples are riffled twice to obtain from 3 to 5 kg of cuttings which are put in a numbered sample bag. Each bag is sealed and picked up on site by ALS Chemex Laboratories for delivery to its Burkina Faso facilities. The remaining 14 to 18 kg of cuttings (field rejects) are stored in camp under tarps to protect the bags against the elements.
Original samples are analyzed using Leachwell on 2 kg of pulp. Leachwell is a bottle roll cyanidation procedure with the addition of a catalyst to speed up gold dissolution. A QA/QC program is in place and includes: blank (1 in 20 samples), duplicates (1 in 20), standards (1 in 20), external lab checks (1 in 30) and two different analytical procedures checks (1 in 100).
Under the guidelines of National Instrument 43-101, the qualified person for the Kobada Gold Project is Mr. Pierre Lalande, P. Geo. Mr. Lalande is a member of the Association of Professional Geoscientists of Ontario and has reviewed and approved the contents of this news release.
African Gold Group, Inc., based in Toronto, Canada, is engaged in the identification, acquisition and exploration of prospective gold projects that are situated along significant gold trends within West Africa. To date, the Company controls a total of eleven gold concessions that are consolidated in four distinct stand alone exploration projects. Three of these projects are located in Ghana and one project (Kobada) is located in Mali, West Africa.
Mineral resources that are not mineral reserves do not have demonstrated economic viability. The preliminary assessment includes inferred mineral resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves, and there is no certainty that the preliminary assessment will be realized.
Additional Information is available on the Company's website at www.africangoldgroup.com and on www.sedar.com and through the Company's offices at: Sun Life Financial Tower, Suite 2518, 150 King St. West, Toronto, Canada M5H 1J9
On Behalf of the Board:
Michael A. J. Nikiforuk, President, Director
The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.
Contacts:
African Gold Group, Inc.
Michael A. J. Nikiforuk
(647) 288-0453
majn@africangoldgroup.com
