TORONTO, ONTARIO -- (MARKET WIRE) -- 07/14/10 --
Avion Gold Corporation ("Avion" or "the Company") (TSX VENTURE: AVR)(OTCQX: AVGCF), today announced an updated resource estimation within an optimized pit shell for the Dioulafoundou Zone, which lies approximately two km south of the existing Tabakoto pit on the Tabakoto mining concession (Figure 1). Highlights of the resource estimation are as follows:
-- Overall gold resources at the Dioulafoundou Zone increase 216%;
-- Open pit Indicated resources at a 1 g/t Au cut-off comprise 502,000
tonnes grading 5.16 g/t Au for 83,400 ounces;
-- Open pit Inferred resources at a 1 g/t Au cut-off comprise 105,000
tonnes grading 5.92 g/t Au for 19,900 ounces;
-- Additional new intercept of 9.46 g/t Au over 15.0 metres.
(i) Qualifying Mineral Resources are included below at the end of Table 1.
The Dioulafoundou open pit grades compare favourably with those previously defined at the Segala deposit which, pre-mining, consisted of 1.51 million tonnes Measured and Indicated resources grading 2.65 g/t Au (Avion news release December 12, 2008). A total of six closely spaced mineralized domains make up the Dioulafoundou resource estimate. The largest domain, the Dioulafoundou NW zone, comprises 81% of the resource with Indicated resources of 375,000 tonnes grading 5.96 g/t Au and Inferred resources of 146,000 tonnes grading 6.80 g/t Au. This strong zone of gold mineralization returned gold grades up to 21.77 g/t Au over 21.0 metres. The strongest Dioulafoundou mineralization has been traced for approximately 400 metres along strike and to 170 metres depth (Figure 2). The highest gold grades were intersected along the western half of this zone. The entire zone is open to depth.
John Begeman, President and CEO, commented: "These open pit resources have the potential to provide low cost, high grade feed for the Tabakoto Mill as Avion transitions from open pit to underground mining. In anticipation of the outcome of this resource estimate, Avion has applied for and received all necessary environmental permits, constructed a water diversion ditch, commenced construction of an access road and construction of a perimeter fence. Once these activities are completed, Avion will be able to commence development of the Dioulafoundou resource."
This Dioulafoundou resource estimate was prepared by Eugene Puritch, P.Eng. and Antoine Yassa, P.Geo. both independent Qualified Persons of P & E Mining Consultants Inc. of Brampton, Ontario. A total of 119 drill intercepts were used to calculate the resource derived from 74 drill holes, the bulk of which were drilled during the 2010 exploration program. Bulk densities of 1.75 t/m3, 2.2 t/m3 and 2.68 t/m3 were used for saprolite, oxidized rock and fresh rock, respectively. Grade estimation was undertaken with the inverse distance cubed (1/d3) interpolation method. Grade capping varies by resource domain, with 2.25 g/t Au to 50 g/t Au depending on the resource domain. The Dioulafoundou NW domain has demonstrated the highest grades and thus the highest capping values (see Table 1 at end of the release for details of estimate).
Avion is continuing to drill to better define and extend the zone to depth. To date an additional 19 in-fill and step-out holes, which extend to 310 metres vertical depth, have been completed. Results have been returned in eight of the nineteen holes, with the best results coming from a near-surface hole which returned 9.46 g/t Au over 15.0 metres (see Table 2 at end of release). Additional drilling will be required to define the western edge of the high grade portion of the deposit which is expected to extend between holes D-10-85 and D-10-86.
To date, 388 drill holes comprising 43,230 metres of drilling have been completed on the contiguous Tabakoto, Segala and Kenieba properties. Exploration drilling is continuing to test the cross-structures nearest the Tabakoto deposit.
Avion's procedures for handling core and reverse circulation drill chips have been presented in previous news releases (See for e.g. Avion News Release dated May 13, 2010).
Don Dudek, P.Geo. the Senior Vice President, Exploration of the Company and Eugene Puritch, P.Eng., of P&E Mining Consultants Inc., both Qualified Persons under National Instrument 43-101, have reviewed the scientific and technical information in this press release.
About Avion Gold Corporation
Avion is a Canadian-based gold mining company focused in West Africa that holds 80% of the Tabakoto and Segala gold projects in Mali. Gold production commenced at these projects in 2009 with just over 51,000 ounces of gold produced; 2010 production is estimated at between 75,000 to 85,000 ounces. Production sustainability is supported and enhanced by an aggressive 2010 drill program over an approximately 600 km2 exploration package that both surrounds and is near to the Company's existing mine infrastructure. Additionally, a new, 1,670 km2 exploration property in Burkina Faso is expected to return good results from an ongoing drill program. These properties are the subject of a US$ 12 million dollar, 60,000 metre plus, drill-focused exploration program in 2010, which is expected, based on results to date, to add new resources and future opportunities for Avion. Avion continues to progress towards its longer term goal of 200,000 ounces of gold per year and is preparing to mine underground at the Segala and Tabakoto deposits. Avion has a highly skilled management team, with a focus on growth and consolidation within West Africa.
DIOULAFOUNDOU DEPOSIT
DETAILED RESOURCE ESTIMATE +12345
July 12/10
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DNW2 INDICATED INFERRED
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Au Cut-Off Grade TONNES Au g/t Au oz TONNES Au g/t Au oz
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Open Pit 1.0 g/t 128,086 3.193 13,149 11,950 3.713 1,427
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Underground 2.0 g/t 24,400 2.695 2,114 7,883 2.709 687
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Total 152,486 3.113 15,263 19,833 3.314 2,113
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Dioulafoundou NW INDICATED INFERRED
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Au Cut-Off Grade TONNES Au g/t Au oz TONNES Au g/t Au oz
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Open Pit 1.0 g/t 353,731 6.088 69,237 69,675 7.544 16,899
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Underground 2.0 g/t 21,249 3.825 2,613 75,912 6.117 14,929
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Total 374,980 5.960 71,850 145,587 6.800 31,829
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MAIN 2 DOMAIN INDICATED INFERRED
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Au Cut-Off Grade TONNES Au g/t Au oz TONNES Au g/t Au oz
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Open Pit 1.0 g/t 3,193 1.755 180 20,719 2.217 1,477
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Underground 2.0 g/t 6,289 3.751 758 23,703 4.271 3,255
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Total 9,482 3.079 939 44,422 3.313 4,732
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MAIN 3 DOMAIN INDICATED INFERRED
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Au Cut-Off Grade TONNES Au g/t Au oz TONNES Au g/t Au oz
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Open Pit 1.0 g/t 5,536 1.346 240 675 1.234 27
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Underground 2.0 g/t 0 0.000 0 697 2.437 55
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Total 5,536 1.346 240 1,372 1.845 81
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MAIN 4 DOMAIN INDICATED INFERRED
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Au Cut-Off Grade TONNES Au g/t Au oz TONNES Au g/t Au oz
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Open Pit 1.0 g/t 11,941 1.587 609 1,607 1.717 89
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Underground 2.0 g/t 0 0.000 0 0 0.000 0
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Total 11,941 1.587 609 1,607 1.717 89
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SW DOMAIN INDICATED INFERRED
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Au Cut-Off Grade TONNES Au g/t Au oz TONNES Au g/t Au oz
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Open Pit 1.0 g/t 0 0.000 0 0 0.000 0
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Underground 2.0 g/t 707 2.048 47 795 2.093 53
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Total 707 2.048 47 795 2.093 53
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ALL DOMAINS INDICATED INFERRED
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Au Cut-Off Grade TONNES Au g/t Au oz TONNES Au g/t Au oz
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Open Pit 1.0 g/t 502,487 5.163 83,415 104,626 5.921 19,918
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Underground 2.0 g/t 52,645 3.269 5,532 108,990 5.416 18,979
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Total 555,132 4.984 88,947 213,616 5.664 38,897
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+ Mineral resources which are not mineral reserves do not have
demonstrated economic viability. The estimate of mineral resources may
be materially affected by environmental, permitting, legal, title,
taxation, sociopolitical, marketing, or other relevant issues.
+ The quantity and grade of reported inferred resources in this estimation
are uncertain in nature and there has been insufficient exploration to
define these inferred resources as an indicated or measured mineral
resource and it is uncertain if further exploration will result in
upgrading them to an indicated or measured mineral resource category.
1. The Inferred Resources are in addition to the Indicated Resources.
2. The mineral resources in this press release were estimated using the
Canadian Institute of Mining, Metallurgy and Petroleum (CIM), CIM
Standards on Mineral Resources and Reserves, Definitions and Guidelines
prepared by the CIM Standing Committee on Reserve Definitions and
adopted by CIM Council December 11, 2005.
3. The gold price used in this estimate was the June 30, 2010 two year
trailing average of US$983/oz. Au recovery was 92% and mining costs were
US$2.73/tonne of ore and US$1.54/tonne of waste. Processing and G&A
costs combined were US26/tonne. Pit optimization slopes were 45 degrees.
4. Eugene Puritch, P. Eng. of P&E Mining Consultants Inc. Qualified Persons
under NI 43-101, prepared the Current mineral resource estimates and
have reviewed the technical disclosure herein relating to the resource
estimates.
5. Mineral resources that are not mineral reserves do not have demonstrated
economic viability.
Recent drill results
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Hole Number FROM TO LENGTH (m) True Width Au g/t
D-10-24 NV
D-10-75 188 202 14 9.5 5.4
D-10-77 15.8 28.5 12.7 7.3 5.34
D-10-79 15 30 15 11 9.46
D-10-80 21 27 6 6 1.67
D-10-82 116 122.25 6.25 4.3 4.37
D-10-85 NV
D-10-86 NV
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Cautionary Notes
The ability of Avion to increase production to 200,000 ounces of gold per year has not been the subject of a feasibility study and there is no certainty that the proposed expansion will be economically viable. Further, the ability of Avion to profitably mine the Dioulafoundou deposit has not been the subject of a feasibility study and there is no certainty that such production will be economically viable.
This press release contains "forward-looking information" within the meaning of applicable Canadian securities legislation. Forward-looking information includes, without limitation, statements regarding the updated resource and its impact on the Company; statements with respect to the development potential and timetable of the Mali projects; the future price of gold; the estimation of mineral resources; conclusions of economic evaluation (including scoping studies); the realization of mineral resource estimates; the timing and amount of estimated future production, development and exploration; costs of future activities; capital and operating expenditures; success of exploration activities; mining or processing issues; currency exchange rates; government regulation of mining operations; and environmental risks. Generally, forward-looking information can be identified by the use of forward-looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or state that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved". Forward-looking information is subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of the Company to be materially different from those expressed or implied by such forward-looking information, including but not limited to: general business, economic, competitive, geopolitical and social uncertainties; the actual results of current exploration activities; ability to successfully integrate the purchased properties; foreign operations risks; other risks inherent in the mining industry and other risks described in the annual information form of the Company which is available under the profile of the Company on SEDAR at www.sedar.com. Although the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking information. The Company does not undertake to update any forward-looking information, except in accordance with applicable securities laws.
To view a map of "Tabakoto Project", please visit the following link:
http://media3.marketwire.com/docs/avrmap714-1.pdf
To view a map of "Long Section Dioulafoundou NW Zone", please visit the following link:
http://media3.marketwire.com/docs/avrmap714-2.pdf
NEITHER THE TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.
Contacts:
Avion Gold Corporation
Michael McAllister
Manager, Investor Relations
(416) 309-2134
info@aviongoldcorp.com
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