Kalimantan Gold reports significant development in Baroi drilling program

In a significant development in its Baroi drilling program, Kalimantan Gold Corporation Limited has found strongly indicative evidence that a mineralized porphyry intrusion may in fact lie to the East of the Far Eastern Zone (FEZ) and this lead the company to start a scout drilling at the area, the company said in a press release on Tuesday.

During its 6-hole 300 meter drilling program in the central part of the FEZ of its Baroi prospect to locate a mineralized copper-silver-gold porphyry intrusion, Kalimantan Gold found the above evidence. In line with the geographical mapping, the drilling was concentrated in the Eastern area of the FEZ, the release said.

To date, four 300 meter holes have been completed in the central part of the FEZ prospect. Whilst some good mineralization was encountered more significantly, results of the drilling have provided strong evidence that the source of the mineralization (high grade breccias & veins) found in the central part of the FEZ is derived from an up-flow zone emanating from a porphyry intrusion located in the East - FEZ. The evidence for this was in the higher grade portions of these holes where the mineralization is contained in fairly flat easterly dipping breccias and hairline veinlets, ie indicating the source direction, the company said.

Detailed geological mapping in the East - FEZ has identified a large zone of 1500 x 600 meters that contains evidence of being proximate to a porphyry intrusion. This evidence is in the form of high grade disseminated copper mineralization associated with a pervasive phyllic alteration containing a 750 x 350 meter zone of strongly silicified breccia, that also hosts high grade copper mineralization.

This alteration sequence and associated mineralization, typical of geological environments found at the top of a porphyry intrusion, coupled with the fact that this area is 300 meters lower in elevation than the central area, makes it the prime porphyry target at Baroi. This East-FEZ area also correlates well with a high airborne magnetic response highlighted and surrounded by a broad low anomaly.

Exceptionally high grade surface channel sampling also confirms the prospective nature of the East-FEZ.

In order to develop a better understanding of the structure of the FEZ, an IP and ground magnetic survey are planned to commence at the beginning of May. This work will cover the entire FEZ that now measures 2200 x 700 meters, including the East-FEZ

Next week the company will commence 6 shallow scout holes in the East-FEZ. This type of drilling at Baroi has proven highly successful as a geological tool. Pending results of these holes plus that of the IP and ground magnetic surveys, the Company will drill more 300 meter holes. (*)