Archipelago reports exploration results from N. Sulawesi gold project

London-stock exchange listed firm Archipelago Resources Plc reported Tuesday the initial drilling results from its previously announced two-year, US$30m exploration program at its 95% owned Toka Tindung gold project in North Sulawesi.

To date the Reverse Circulation (RC) drilling has focused on extensions of mineralization to the north and east of the Toka Tindung orebody, the largest of five deposits in the project, the company said.

At Toka North, mineralization has now been confirmed to extend by at least 500m to the north of the Toka Tindung open pit and generally takes the form of large widths of low grade mineralization, it said. It added that of the 44 holes reported from this location, 18 contain low grade intersections of greater than 20 meters in width ranging up to a maximum of 44 meters, while a further two holes each contain two intersections of greater than 20 meters in width. Hole TNRC019 44m @ 1.34 g/t gold from 70 to 140 meters

At Toka East, similar large widths of low grade mineralization have also been identified, including two intersections of 93 meters and 51 meters width in the same drill hole. Some high grade mineralization was also intersected.

Hole TIT0022 93m @ 1.17 g/t gold from 15 to 108 meters; and
51m @ 1.17 g/t gold from 118 to 169 meters

Hole TIT0013A 2m @ 12.3 g/t gold from 64 to 66 meters; and
2m @ 15.4 g/t gold from 80 to 82 meters

Hole TIT0015 4m @ 10.4 g/t gold from 6 to 10 meters

At Toka Pit, drilling has also identified low grade intersections up to 76 meters in width as well as higher grade mineralization up to 18 grams per tonne gold commencing at surface.
Hole TOPI041 76m @ 1.03 g/t gold from 36 to 112 meters
Hole TOPI020 6m @ 14.9 g/t gold from 13 to 19 meters
Hole TOPI026 6m @ 18.2 g/t gold from 0 to 6 meters

In total, 159 holes have been drilled for a total of 19,857m with the more significant results (> 3 gram meters)

While assay results are still awaited from some of the holes drilled at Toka North and Toka East, four rigs are continuing to drill at Toka North and East together with other target areas peripheral to the current or proposed open pits in the project area.

The company is very encouraged by these initial intersections and in due course looks forward to a positive revision of the project's resource and reserve in the latter half of this year.

Currently the project contains a JORC compliant resource of 1.75m ounces of gold equivalent, of which 1.1m ounces is initially mineable by a series of open pits feeding a central processing plant. Production commenced in April 2011 and is currently ramping up to full production by Q4 2011.

Production is targeted to reach an average 160,000 ounces of gold equivalent for the first six years of the current eight-year project life. However based on these initial drilling results and the highly prospective nature of the ground surrounding the known deposits, the company is confident of increasing the resource and reserve and thereby significantly extending the mine life. (romel)