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Ocean Finance Loans:
Market Cap
£44.62m
Change Today
0.000p ()
Share Price
30.50p
Quarterly Results
Medusa Mining Limited
31 July 2007
MEDUSA MINING LIMITED
(AIM: MML)
QUARTERLY ACTIVITIES REPORT
PERIOD ENDING 30 JUNE 2007
Medusa Mining Limited ("Medusa" or "The Company"), the Australian based company
operating and developing gold mines in the Philippines, is pleased to provide
its quarterly update on activities for the period ending 30 June 2007, as
required by the Australian Stock Exchange.
KEY POINTS:
Co-O MINE PRODUCTION
• Gold production for the quarter totalled 8,132 ozs at an average grade
of 17.7 g/t gold and average cash cost of US$217 per ounce;
• Production affected by local government elections and mine workforce
re-organisation.
Co-O EXPLORATION
• New very high grade discoveries with up to 1.0 metre at 198.84 g/t gold,
2.7 metres at 92.03 g/t gold and 2.15 metres at 58.88 g/t gold. Next full
drill report due in August 2007;
• New Co-O Mine resource/ reserve estimations are expected by early
September 2007.
ANOLING
• Drilling in progress with 300 metres of potentially mineralised section
of the Hope Vein outlined with best intersection 4.0 metres at 17.17 g/t
gold.
BAROBO CORRIDOR
• 16 km corridor with numerous gold targets and two porphyry copper
targets identified.
TAMBIS BANANGHILIG
• Data compilation and drilling continuing;
• Update expected in August.
SINUG-ANG
• Data assessment in progress.
CORPORATE
• Completed a fund raising of A$20.125 million before costs via the
issuance of 17,500,000 shares at A$1.15 per share;
• Acquisition of an uncapped 1.32% gross royalty over the Co-O Mine and
surrounds for A$1.12 million.
GOLD PRODUCTION
The production statistics for the current financial year are summarised in Table
1.
Table I: Gold Production
Period Ore Gold Head Cash Comments
milled produced grade costs
(dmt) (ozs) (g/t (US$
gold) per
oz)
Jul 2006
to 29,075 8,484 9.1 308 Major development, stope ore and
Mar 2007 re-establishment of mine access.
Apr to 14,241 8,132 17.7 217 Continued mine development and stope
Jun 2007 ore. Grade enhanced by presence of
"black leaders".
TOTAL 43,316 16,616 11.9 269
The Company produced 8,132 ounces of gold at an average grade of 17.7 g/t gold
and average cash production costs of US$217 per oz. The grade for the quarter
has been enhanced by the presence of "black leaders".
Production was hampered during the quarter by local government elections, which
resulted in the status quo being maintained in the Company's areas of operation,
and also by a re-organisation of the mine workforce which has subsequently
increased the efficiency of production, reduced costs and improved the overall
mine operation.
Co-O MINE
Development on the 3050 and 3000 metre levels
Development of the 3050 metre level at the bottom of the 3W shaft has progressed
well with access gained to the Central Vein, the North Vein and the Edphil Vein
on the east side of the Oriental Fault, and to the Breccia Vein on the west side
of the Oriental Fault.
Access to the west of the Oriental Fault along the Central Vein drive was cut
off early in the second half of the quarter by a rock fall in the main drive
near old inactive stoping and brecciated areas at the junction of the first
Central Vein split. To ensure continuing long term safe access to the west, it
was decided to develop a new by-pass drive in waste of approximately 70 metres
in length. This has been completed and has re-established access to the high
grade Central Vein extensions to the west of the previously stoped area. This
disruption to mine production scheduling has not impacted production for the
June quarter but will restrict production during the September quarter to
similar levels.
A new pumping station has been commissioned and two electric locomotives now
operate on the 3050 metre level increasing the efficiency of materials handling.
Stoping operations are underway on the four metre wide section of the Central
Vein east of the Oriental Fault in the area where "black leaders" occur. High
grade black leaders (local terminology) commonly contain gold grades of 200 to
400 g/t. The black leaders consist of sphalerite-galena-minor pyrite and rare
chalcopyrite and are usually associated with zones colloform chalcedony and
calcite.
A new main haulage level development has commenced on the 3000 metre level in
the Central Vein.
New Adit Development
The new adit that commenced late January to service the 3W shaft is nearing
completion. Difficult ground conditions for over more than half its length have
required close spaced timber support and in places, concreting. This additional
intense work has considerably increased the time taken. However this new rail
link will decongest the main adit and improve the overall ventilation to the
mine.
Deep Drilling
Programme description
In December 2006 the Company commenced a drilling programme designed to
intersect the Co-O Mine vein system at approximately 100 metres below the
current bottom of the mine (ie, at level 2950 metres), which is approximately
200 metres below the adit to the mine (level 3150 metres). Holes are being
spaced at approximately 50 metre intervals, but the intersection depth and
position of each drill hole is dependent on topographic constraints. The next
drilling update is expected to be available by mid-August.
Intersections of >4g/t gold from the drilling are presented in Table II.
It is important to note that drilling of narrow epithermal veins at best
generally provides only an indication of the presence of the gold mineralised
vein and rarely provides good quantitative data with respect to accurate grade
and volume estimations for some or all of the following reasons:
• Veins commonly pinch and swell and may be brecciated or displaced by faults;
• Gold distribution is commonly erratic, in shoots or controlled by structures
within the vein; and
• Drill core recovery can be reduced because of the brecciation and soft
unconsolidated material and hence the recovered material may not be
representative of the material drilled.
Consequently, the Company regards the initial drilling as indicative only and
operates the policy of using drilling to locate the extent of the mineralised
veins. This is then followed by level development to support the drilling
results, which provides a more accurate estimate of vein grades and facilitates
the estimation of resources.
Co-O Vein System Discussion
The Co-O Mine vein system trends westerly and is truncated by a major
north-trending fault (the Oriental Fault) which has vertically downthrown the
vein system on the eastern side of the fault by an estimated 300 metres and
moved the veins horizontally by approximately 20 to 40 metres, with the east
side moved to the south. The effect of the downthrow is that the Co-O veins on
the east side of the fault are not exposed at surface and the tops of the veins
appear to commence approximately 160 metres below surface and below the 3150
metre adit level
When the mine was originally developed in the late 1980s, the vein system had
only been discovered on the west side of the Oriental Fault (despite exploration
drilling on the east side) and all mine development was carried out on the west
side over approximately 600 metres of strike length. Drilling, which commenced
in late 2004 (holes MD 1 to 8), intersected the vein system on the east side of
the Oriental Fault and subsequently delineated the vein system over a strike
length of approximately 250 metres to east. Drilling and mapping to the east of
the Oriental Fault have demonstrated that the Co-O Vein system is still open to
the east and is potentially over 1.5 km in length.
The recent discovery by drilling of the exceptional grade Jereme and five New
Catto Veins south of the known Co-O system has enhanced the potential of the
project. These veins are further discussed below Table II.
In 2006 the Company, in cooperation with the Centre for Exploration Targeting at
the University of Western Australia, contracted the services of a post graduate
research geologist to undertake detailed studies initially on the Co-O Mine
followed by other deposits and prospects. The aim of the research is to
understand the depth potential of the Co-O veins through determination of the
temperature of vein deposition, vein and alteration mineralogies and other
characteristics within the regional structural framework of the mineralising
Philippine Rift Fault system. In addition, these results would be utilised to
determine if they could be used as vectors to locate potential porphyry copper
gold intrusives which the Company interprets may be the source of mineralisation
within the Co-O aeromagnetic anomaly.
In summary, the work to date has identified the following important features:
• The Co-O veins are comprised of two gold bearing phases, the first being
a quartz- chalcedony +/- calcite phase deposited at a temperature of
approximately 180(o)C, and a second phase comprising blocky calcite-quartz +
/- barite likely deposited from boiling fluids in a temperature range of
200-250(o)C, and
• The top of the Co-O mineralisation formed most probably in the upper 300
metres from the surface, therefore the veins are essentially fully preserved
(meaning the veins have been subjected to minimal erosion). This implies
that to date the drilling is in the upper parts of the vein system and does
not appear to have reached the bottom of the mineralisation with two of the
deepest intersections east of the Oriental Fault returning high grades (2.70
metres at 92.03 g/t gold in MD 34 and 1.90 metres at 79.05 g/t gold in MD
44) at approximately 300 metres vertically below the mine adit.
New Drill Holes MD 20 to MD 44
Results of the new diamond drill holes MD 20 to 34 are contained in Table II.
On 9 July the Company announced the discovery of exceptional intersections in
the Jereme and New Catto Veins which are summarised in Table III. An update
drilling report is due in August.
Table II: Drill results >4 g/t gold for holes MD 20 to MD 34
------- ------- ------ ------ ------- -------- ------- ---------
Hole East North Dip Azimuth From Width Grade (uncut)
(degrees) (degrees) (metres) (metres) (g/t gold)
------- ------- ------ ------ ------- -------- ------- ---------
MD 20 614099 913092 -51 214 230.10 1.50 16.75
-------- ------- ---------
250.25 0.85 4.22
-------- ------- ---------
265.90 0.45 7.19
-------- ------- ---------
290.70 0.60 4.92
-------- ------- ---------
311.40 4.70 57.66
-------- ------- ---------
323.10 1.70 15.76
-------- ------- ---------
333.10 1.50 4.65
-------- ------- ---------
337.05 4.55 6.98
-------- ------- ---------
352.20 0.80 11.41
-------- ------- ---------
359.60 0.80 4.14
-------- ------- ---------
361.55 1.55 15.23
-------- ------- ---------
381.95 0.35 15.56
------- ------- ------ ------ ------- -------- ------- ---------
MD 21 614120 913134 -50 214 41.40 0.70 13.53
-------- ------- ---------
185.90 1.80 5.04
-------- ------- ---------
Hole stopped at 268.10 metres
------- ------- ------ ------ ------- -------- ------- ---------
MD 23 614120 913134 -56 214 45.20 1.70 8.30
-------- ------- ---------
190.80 1.40 14.77
-------- ------- ---------
349.10 0.40 7.98
------- ------- ------ ------ ------- -------- ------- ---------
MD 22 614025 913188 -45 210 135.50 0.55 30.95
-------- ------- ---------
161.60 0.30 14.50
-------- ------- ---------
324.15 0.65 8.78
-------- ------- ---------
360.80 4.80 8.19
------- ------- ------ ------ ------- -------- ------- ---------
MD 24 614026 913190 -55 210 281.25 0.55 21.47
-------- ------- ---------
357.75 1.25 12.38
-------- ------- ---------
407.60 0.60 4.76
------- ------- ------ ------ ------- -------- ------- ---------
MD 25 614160 913120 -49 210 309.60 1.00 5.82 (*)
-------- ------- ---------
393.05 0.50 19.88
-------- ------- ---------
400.25 1.85 4.13
-------- ------- ---------
410.40 0.25 11.54
------- ------- ------ ------ ------- -------- ------- ---------
MD 26 614003 913253 -48 211 165.00 1.50 5.13
-------- ------- ---------
359.75 0.65 8.74
-------- ------- ---------
364.20 0.25 16.02
-------- ------- ---------
412.70 0.85 6.15
------- ------- ------ ------ ------- -------- ------- ---------
MD 28 614200 913075 -48.5 212 199.70 0.20 9.18
-------- ------- ---------
246.70 0.70 8.62
-------- ------- --------
295.20 0.40 11.69
-------- ------- ---------
320.50 2.80 15.35
-------- ------- ---------
346.50 0.30 4.93
-------- ------- ---------
412.55 2.10 15.65
------- ------- ------ ------ ------- -------- ------- ---------
MD 29 613942 913243 -45 211 356.70 1.00 9.47
------- ------- ------ ------ ------- -------- ------- --------
MD 31 613842 913223 -49 200 221.10 0.30 18.08
-------- ------- ---------
325.30 1.40 14.89
-------- ------- ---------
330.50 1.50 13.73
------- ------- ------ ------ ------- -------- ------- ---------
MD 32 614254 913017 -51 217 282.10 0.80 5.75
-------- ------- ---------
313.80 2.30 19.30
-------- ------- ---------
321.10 1.30 16.45
------- ------- ------ ------ ------- -------- ------- ---------
MD 34 614285 912923 -50 227 242.40 0.60 44.60
-------- ------- ---------
304.20 0.50 18.92
-------- ------- ---------
306.50 0.80 4.12
-------- ------- ---------
354.30 2.70 92.03
------- ------- ------ ------ ------- -------- ------- ---------
Notes: (i) McPhar Geoservices Inc. assays are quoted where available/ (ii) (*)
denotes Philsaga assays
The tops of the New Catto Veins are presently believed to be between the same
elevation as the bottom of the 3W shaft at 3050 metres and the new sublevel at
the 3000 metre elevation. All veins are open in at least three directions. It is
now apparent that some of the early holes have drilled over the top of some of
the veins or were not deep enough.
Current interpretations are based on 3D plotting and modelling of the data
available and future interpretations may be subject to change as more data
become available.
The Jereme Vein has been identified on the 3050 metre level to the south of the
3W shaft but was not previously recognised as a coherent high grade vein.
Table III: Initial Drill Results greater than 4 g/t gold from the Jereme and New
Catto Veins
Hole East North Dip Azimuth Vein name From Width Grade (uncut)
(g/t gold) (degrees) (degrees) (meters) (meters) (g/t gold)
-------- ------ ------ ----- ------ ------- ------- ------ ---------
MD 28 614003 913253 -48 211 NCV 2 413.00 0.90 32.32
-------- ------ ------ ----- ------ ------- ------- ------ ---------
MD 32 614254 913017 -51 217 Jereme 313.80 2.30 16.97
------- ------- ------ ---------
Jereme
South 321.90 0.50 38.55
Split
------- ------- ------ ---------
NCV 2 371.10 0.70 6.66
-------- ------ ------ ----- ------ ------- ------- ------ ---------
MD 34 614285 912923 -50 227 NCV 2 304.20 0.50 18.92
------- ------- ------ ---------
NCV 1 354.30 2.70 92.03
-------- ------ ------ ----- ------ ------- ------- ------ ---------
MD 35 614243 912851 -58 297 Jereme 198.30 0.30 34.59(*)
------- ------- ------ ---------
NCV 3 209.30 0.60 75.39(*)
------- ------- ------ ---------
NCV 2 253.50 0.90 9.34
------- ------- ------ ---------
NCV 1 268.50 1.70 55.77
-------- ------ ------ ----- ------ ------- ------- ------ ---------
MD 38 614240 912815 -47 237 NCV 1 187.90 0.30 65.56
-------- ------ ------ ----- ------ ------- ------- ------ ---------
MD 39 614240 912850 -58 205 Jereme 209.70 0.20 64.56(*)
------- ------- ------ ---------
NCV 3 233.55 0.45 33.24(*)
-------- ------ ------ ----- ------ ------- ------- ------ ---------
MD 40 614173 912951 -52 245 NCV 4 312.90 1.70 10.19(*)
------- ------- ------ ---------
NVC 5 324.25 1.80 10.41(*)
-------- ------ ------ ----- ------ ------- ------- ------ ---------
MD 41 614240 912849 -65 205 Jereme 240.60 1.00 198.84(*)
------- ------- ------ ---------
NCV 3 261.55 1.35 75.98(*)
-------- ------ ------ ----- ------ ------- ------- ------ ---------
MD 43 614273 912908 -60 221 Jereme 277.90 0.40 19.74(*)
------- ------- ------ ---------
NCV 2 360.07 0.60 6.06(*)
------- ------- ------ ---------
NCV 1 383.50 2.15 58.88(*)
-------- ------ ------ ----- ------ ------- ------- ------ ---------
MD 44 614212 912983 -54 209 Jereme 262.80 1.95 15.39(*)
------- ------- ------ ---------
NCV 3 270.45 0.70 42.29(*)
------- ------- ------ ---------
NCV 2 359.60 0.50 18.23(*)
------- ------- ------ ---------
NCV 1 376.90 0.20 57.19(*)
------- ------- ------ ---------
NCV 4 413.60 4.50 20.05(*)
------- ------- ------ ---------
NCV 5 436.90 1.90 79.05(*)
-------- ------ ------ ----- ------ ------- ------- ------ ---------
Notes: McPhar Geoservices Inc. assays are quoted when available; (*) Awaiting
check assays from McPhar; and MD 28, 32 and 34 results previously reported.
In summary, the new drilling east and west of the Oriental Fault has
successfully demonstrated a system of multiple high grade veins over a strike
length of over 500 metres which is open in most directions within a known 1500
metre long vein system.
A new resource/reserve estimation incorporating all relevant drill holes is
expected by early September 2007.
BAROBO CORRIDOR
As announced on 16 July 2007, the Barobo Corridor has been defined from regional
mapping, aerial photography and aeromagnetics and surface sampling and is
located at the northern end of the Company's tenements. The aeromagnetics,
regional mapping, pan concentrate and surface sampling were completed by the
Company. All other information provided is historic.
The Barobo Corridor extends over approximately 16 km straddling a major fault
named the Barobo Fault and which parallels the main Philippine Rift Fault
located approximately 25 km to the west.
The Barobo Fault is a major aeromagnetic feature and is topographically
distinctive.
The Tambis regional area is located within a bullseye 9.5 km by 7.3 km
aeromagnetic anomaly indicative of and resulting from intense argillic
alteration. This widespread alteration has been field verified in numerous
places and is located on the south side of the intersection of two regional
scale faults, the Barobo Fault and the west-northwest trending Liang Bay Fault,
and partly straddling the Barobo Fault. The faults intersect immediately to the
west of the Bananghilig Gold Mine.
It should be emphasised that reconnaissance field exploration to date has been
restricted to outcropping rocks on ridges and in creeks and silica boulder
trains with a large number of the outcrops being identified as potentially
mineralised. Various exploration methods are being assessed to provide regional
scale data for prioritising targets for additional work.
Porphyry targets
At the northern end of the Barobo Corridor is the Sopon porphyry copper target
which consists of an altered and quartz veined diorite with visible copper
minerals. The diorite is associated with massive sulphide skarn-style
mineralisation which is not yet fully defined. In the 1990s stream sediment
sampling programme described below, one sample in a small creek near the Sopon
porphyry copper prospect recorded an anomalous value of 124 ppm copper, and a
stream sediment sample 2 km to the west recorded 17.3 ppm gold.
A regional stream sediment sampling programme carried out in the 1990s over the
entire strike length of the Company's tenements by a previous explorer located
the highest regional stream sediment copper values in three creeks draining the
Bananghilig Mine area, being 1,662 ppm, 616 ppm and 530 ppm. This programme was
not systematic in that coverage was restricted to drainages accessed by roads,
with large areas not sampled.
The above stream sediment sampling programme post dates the large BLEG anomaly.
The BLEG survey was a systematic programme carried out to specifically target
gold.
The Sumugbong porphyry target consisting of altered and quartz veined diorite is
located to the west of the Alikway and Guinhalinan Prospects further to the
south on the west side of the Barobo Fault. The 1990s regional stream sediment
survey referred to above also sampled in two creeks distant from and draining
southwards from this porphyry target and recorded regionally anomalous copper
values of up 124 ppm.
Gold targets
A plethora of gold targets of several different styles have been located along
the Barobo Fault over a strike length of over 10 km and still open to the south.
Pan concentrates were initially employed to discriminate gold targets but the
presence of ubiquitous visible gold in all creeks has rendered pan concentrates
sampling as essentially non-discriminating, hence other regional methods are
being investigated. Some of the styles are:
• Silica replacement style targets in sediments: these include the
Guinhalinan Prospect and number of areas to the north of Guinhalinan where
silicification of limestones and siltstones has occurred, commonly
controlled by numerous northeast-trending structures which may result in the
development of large areas of silicification. Some of the silicified zones
are also brecciated. Gold mineralisation appears to be ubiquitous in the
silicified zones, along with common lead and zinc mineralisation in
potentially commercial quantities. Copper mineralisation has also been
identified in some areas.
• Skarn style targets in limestones: some subtle aeromagnetic anomalies
have been identified as containing skarn-style silica replacement in
limestones with gold, lead and zinc and disseminated magnetite. Some of
these bodies also contain mineralised breccia zones.
• Veins: a large number of veins have been identified commonly with a
northeast trend. The most consistent of these to date is the Alikway Vein
where high grade mineralisation has been identified over a distance of 500
metres and is open in both directions. Numerous other veins in the Alikway
vicinity, particularly to the south, have also been discovered.
It should also be noted that there is a very large area of anomalous stream
sediment BLEG gold values defined by an earlier explorer covering an area of
approximately 21 km by 8 km in the area encompassing the Bananghilig Mine and
Sopon porphyry target and other prospective areas.
TAMBIS BANANGHILIG
The Tambis Bananghilig Mine is located approximately 35 km by the National
Highway to the north of the Co-O Plant.
The project is subject to on-going drilling and assessment. Undergound
exploration has been suspended while the assessment and drilling are being
advanced. Once the assessment programme is sufficiently advanced, a
comprehensive report on activities will be provided during the next quarter.
SINUG-ANG
The Sinug-ang Project situated immediately north of the Co-O Mine comprises two
prospects. The Banbanon Prospect is where most of the current drilling has been
completed and was explored in the 1980s by surface sampling and drilling. The
Sinug-ang prospect is located further to the north on the same vein system which
trends in a NNW direction parallel to the Philippine Rift Fault trend. Some
small scale mining activities of selected parts of the Banbanon Vein and with
limited lateral extent have been undertaken to a depth of approximately 130
metres below surface and one shaft extends to approximately 190 metres below
surface.
Following a topographical survey, a full assessment and interpretation of all
drilling and underground mapping sampling is in progress.
ANOLING
The MOA with Alcorn Gold Resources Inc. covers Mining Production Sharing
Agreement ("MPSA") application number 039-XIII situated to the north of the Co-O
mine and millsite.
Following the granting of two Small Scale Mining Permits during the previous
quarter, the processing of the Anoling MPSA is now being pursued.
Diamond Drilling and Geology
Two parallel veins trending westerly have been defined to date over respective
strike lengths of approximately 650 metres for the Hope Vein and approximately
750 metres for the Loring Vein, and both veins are open to the east. Within the
long strike lengths, drilling and surface sampling has started to define
potentially economically mineralised zones. There are also northeast trending
vein segments, such as was explored in the Alcorn exploratory shaft, but the
veins on this orientation, from current information, appear to have shorter
strike lengths than the westerly-trending veins. Indications of other parallel
veins have recently been located during routine mapping and drilling.
Twenty diamond drill holes totalling approximately 2,269 metres have been
completed to date to intersect veins at approximately 50 to 100 metres below
surface. Table IV summarises all the diamond drill hole intersections greater
than 2 g/t gold.
Table IV: Summary of drilling results for holes ANL5 to ANL20 for intersection
grades >2 g/t gold
Hole East North Dip (degrees) Azimuth (degrees) From (metres) Width (metres) Grade (uncut) (g/t gold)
------- -------- ------- ------ ------- ------- -------- ---------
ANL 05 614662 922889 -56 3 190.25 0.95 4.39 (*)
------- -------- ------- ------ ------- ------- -------- ---------
ANL 06 614552 922989 -65 0 66.80 0.50 4.07 (*)
------- -------- ------- ------ ------- ------- -------- ---------
ANL 08 614601 922987 -60 0 59.00 0.95 2.95 (*)
------- -------- ------- ------ ------- ------- -------- ---------
ANL 09 614508 922984 -60 0 55.90 2.70 13.96 (*)
------- -------- ------- ------ ------- ------- -------- ---------
ANL 11 614480 922980 -50 0 65.45 0.45 7.77
------- -------- ------- ------ ------- ------- -------- ---------
ANL 14 614395 923137 -55 0 84.50 1.90 2.86
------- -------- ---------
87.40 0.65 2.33
------- -------- ------- ------ ------- ------- -------- ---------
ANL 15 614445 923123 -55 0 99.40 0.60 13.10
------- -------- ------- ------ ------- ------- -------- ---------
ANL 16 614498 923140 -68 0 88.95 1.00 2.09
------- -------- ------- ------ ------- ------- -------- ---------
ANL 17 614545 923143 -70 0 57.30 1.40 4.20
------- -------- ---------
62.70 1.60 10.08
------- -------- ------- ------ ------- ------- -------- ---------
ANL 18 614595 923143 -60 0 59.70 0.90 9.30
------- -------- ------- ------ ------- ------- -------- ---------
ANL 19 614644 923139 -60 0 91.50 4.00 17.17
------- -------- ---------
147.70 0.55 7.26
------- -------- ------- ------ ------- ------- -------- ---------
ANL 20 614692 923139 -60 0 92.50 1.50 7.39
------- -------- ---------
104.60 0.30 24.30
------- -------- ------- ------ ------- ------- -------- ---------
Notes: (i) McPhar Geoservices Inc. assays are quoted where available/ (ii) (*)
denotes Philsaga assays
The Hope Vein longitudinal projection exploratory diamond drilling has achieved
potentially economic intersections over a strike length of 300 metres to date,
which is still open east and west and at depth. Further infill drilling is in
progress prior to a decision to commence underground exploration.
The Loring Vein has been tested by underground sampling of old workings and by
six drill holes with good grades being returned from the underground sampling
and from drill hole ANL009. Whilst other drill holes have returned lower grades,
owing to to the pinch and swell nature of the veins, underground exploration has
commenced through the refurbished Loring Shaft, previously dug by local
prospectors, which provides quick and cheap access to the vein for exploratory
purposes. To date underground sampling has established 40 metres of strike
length of mineralised vein averaging 6.87 g/t gold over an average width of 0.90
metres.
The exploration programme is continuing.
OTHER PROJECTS
• Abacus Project
The Mines Operating Agreement ("MOA") with Abacus Consolidated Resources and
Holdings Inc. covers Exploration Permit ("EP") application number 000028-XIII
situated to the north of the Co-O mine and millsite.
The granting process for the Abacus EP is now being pursued.
• Das-Agan Project
The MOA covering MPSA application number 039-XIII comprising two parcels and
situated to the north and east of the Co-O Mine and millsite. The granting
process for the Das-Agan MPSA is now being pursued as a high priority to
facilitate drilling of the Lingig porphyry later in the year.
The Lingig porphyry discovery was tested by one drill hole only in 1974
returning 150 metres containing 0.4% copper with the hole ending in high grade
copper mineralisation with accessory gold.
• Saugon Project
The Saugon Exploration Permit has been renewed and an exploration review is in
progress.
• Panaon Project
The Company has terminated the joint venture with Goldsearch Limited and due to
the Company's commitments at the Co-O Project, the Panaon Project has been
returned to the claim owners.
• Bunawan Project (Magnum Gold NL earning 50%)
No field work was conducted during the quarter.
CORPORATE
• On 27 June 2007, the Company announced that Gallagher Holdings Limited
had become a cornerstone investor in Medusa via the placement of 17,500,000
fully paid shares at A$1.15 per share to raise A$20,125,000 before costs. A
total of 7,000,000 unlisted options exercisable within 18 months at a price
of A$1.60 will also be issued to the investor subject to shareholder
approval at a meeting to be held on 7 August 2007.
The funding is being used for early payment of vendor finance resulting from
completion of the Philsaga acquisition in December 2006, and will be used for
drilling the Lingig porphyry copper discovery later in the year, as well as
expanding exploration in the Barobo Corridor and at other prospects.
• As part of the Company's ongoing corporate rationalisation in the
Philippines, the Company completed the acquisition of a 1.32% uncapped gross
royalty over the Co-O Mine and surrounding areas for A$1,120,000.
The information in the above announcement was compiled by Geoff Davis, who has
sufficient experience which is relevant to the style of mineralisation and type
of deposit under consideration and to the activity which he is undertaking to
qualify as a Competent Person as defined in the 2004 Edition of the
"Australasian Code for Reporting of Exploration Results, Mineral Resources and
Ore Reserves". Geoff Davis consents to the inclusion in the report of the
matters based on his information in the form and context in which it appears.
For further information, please contact:
Medusa Mining Limited + 61 8 9367 0601
Geoffrey Davis, Managing Director
Roy Daniel, Finance Director
www.medusamining.com.au
Ambrian Partners + 44 (0)20 7776 6417
Richard Brown / Richard Greenfield
Bankside Consultants + 44 (0)20 7367 8888
Michael Padley / Louise Davis
Note to editors:
Medusa Mining is an ASX and AIM-listed gold producer, focused on the
Philippines. The Company controls over 700km(2) of tenements over a 70km strike
length of the richly endowed East Mindanao ridge. Production, which will be
sourced from a number of operating mines within trucking distance of the central
plant, is currently heading for 40,000ozs per annum and is planned to increase
to approximately 100,000ozs in late 2007 - early 2008. The main producer will be
the Co-O Mine, which has returned grades as high as 29 g/t Au. Additional ore
will be sourced in the near term from the Tambis Banaghilig and Anoling Mines,
followed by the development of the Sinug-ang Mine area in mid 2007.
COMPANY PROFILE:
• High grade mining inventory (195,000ozs @ 17.6 g/t gold) at Co-O Gold
Mine set to increase;
• New resource/reserve estimations expected by early September 2007;
• Centrally located mill, multiple mines;
• Initial production target of 40,000 ounces per annum;
• Expanding production profile;
• Estimated long term cash costs of approximately US$200 per ounce;
• Extensive exploration area of >700 km(2), along 70 km strike of the
richly endowed East Mindanao ridge;
• Regional assessment confirms excellent prospectivity for gold and
porphyry copper-gold deposits.
Share capital as at 30 June 2007:
Shares: 142,037,548 (ASX/AiM code :MML)
Unlisted options: 6,821,446
Listings
Australian Stock Exchange
Alternative Investment Market (London)
Frankfurt Stock Exchange
This information is provided by RNS
The company news service from the London Stock Exchange