Sovereign Gold increases Mount Adrah resource potential

THE DRILL SERGEANT: Sovereign Gold (ASX: SOC) has boosted the JORC resource estimate at Pipe 1, located within the company’s Mount Adrah Hobbs gold deposit southeast of Wagga Wagga in New south Wales.

The increase is the result of an independent review based on exploration work completed so far and updated geological computer modelling by Melbourne-based Geosun Pty Ltd.

Sovereign Gold has reported the JORC-compliant resource estimate of Pipe 1 has increased to 650,027 ounces of contained gold at a grade of 1.23 grams per tonne.

Previously, the resource estimate was 239,000 ounces of contained gold at a grade of 1.13g/t.

The resource boost has also enabled the company to increase the conceptual exploration target at Pipe 1 to between 3.2 to 4.6 million ounces of gold from the previous target of 2.25 to 4 million ounces.
   
“Our confidence in the JORC resource uplift at Pipe 1 has been strengthened with the inclusion of the estimate in the Measured and Indicated categories,” Sovereign Gold chief executive Michael Leu said in the company’s announcement to the Australian Securities Exchange.

“It is exciting the company is able to announce a significant JORC resource uplift two months after drilling at Pipe 1 started.

“The consistency and presence of gold mineralisation throughout both drill holes enabled Geosun to quickly revise the JORC resource estimate.

“The next two drill holes will determine the strike length of Pipe 1, with estimations increased to between 250 to 300 metres.”

Sovereign Gold indicated it is fully-funded for the next two drill holes, plus further exploration work, after raising a total of $1.6 million through a share placement last week.

The Hobbs deposit sits on the same geo-structural system as Newcrest Mining’s Cadia Ridgeway gold mine – which hosts 60 million ounces of gold equivalent – and Rio Tinto’s eight million ounce gold equivalent Northparkes gold mine.