Sovereign Gold claims new gold system at Mount Adrah

THE DRILL SERGEANT: Sovereign Gold (ASX: SOC) is making a lot of noise concerning the possibility it has encountered, what he company describe to be, “a giant new gold system” at its Mount Adrah gold project, near Wagga Wagga.

The claim comes after the company received final drill results from the first drill hole.

Latest assays from the Hobbs Pipe 1 deposit show a continuous gold intercept from surface to a depth of 886 metres, which supports Sovereign’s conceptual exploration target for Pipe 1 of between 2.25 to 4 million ounces of contained gold.

Final assays results from the first hole at Pipe 1 are:

–    886m at 1.2 grams per tonne gold from surface, including 400m at 1.4g/t gold from surface, including 720m at 1.3g/t gold from surface.

Sovereign Gold said the drill results have provided it with further indication Pipe 1 is part of a broader substantial new gold system, which the company has estimated to contain an overall gold resource of up to 40 million ounces of gold as part of a broader conceptual exploration target.

“The final drill results further validates our belief that Mount Adrah can be a world class deposit,” Sovereign Gold managing director Michael Leu said in the company’s announcement to the Australian Securities Exchange.

“Diamond drilling of the second hole – designed to test the width of Pipe 1 – is underway and early results indicate it has contacted mineralisation at approximately 335 metres from surface as predicted.”

The company reported metallurgical testing by ALS Metallurgy has shown overall gold recovery rates are approximately 90 per cent, validating historical metallurgical work carried out in 1996 that showed gold recoveries of up to 94 per cent.