SHANTA GOLD LIMITED
RESOURCE ANNOUNCEMENT
SHANTA EXPANDS THE SINGIDA LICENCE PORTFOLIO
23 July 2009
Shanta Gold Limited ("Shanta" or the "Company") is pleased to
announce that the Company has signed an exploration and purchase
option agreement on Mining Licence (ML309/2008) located approximately
400m south-southeast of the Gold Tree and Jem prospects. There is a
strong likelihood that the ML will contain the extensions to these
host structures as well as similar structures in an en-echelon
configuration.
ML309/2008 comprises 14 amalgamated PML's (primary mining licences)
with a total area of 1.28km2. In terms of the exploration development
and purchasing option agreement, Shanta has the sole right to explore
and purchase the ML within 36 months. The Company has paid an initial
option fee of US$25,000, and will pay further annual option fees of
US$15,000 until the option to purchase has been exercised. On
exercising the option to purchase the licence, the Company will pay a
purchase price based on 0.5% of the value of the gold contained in an
independently calculated measured resource (at a 1 g/t cut off
grade), determined using the spot gold price on the day of exercising
the option, and with a minimum initial purchase payment of
US$100,000.
On completion of a bankable feasibility study in which the ML's
resources have been included, a similarly valued further payment will
be made based on additional measured resources defined since the
acquisition. Once production has commenced, should the resource be
further increased, further payments will be made on a similar basis.
Shanta has the option to convert the latter payments to a 0.55% gross
royalty payable on sales of gold and paid quarterly in arrears.
ML309/2008 is located to the south and southeast of the Gold Tree and
Jem prospects. The Company has conducted drilling close to the
northern boundary of the ML, within Shanta's PL2792/2004. Results
indicate that structurally hosted gold mineralisation persists in the
direction of the ML. The results returned are tabulated below.
BHID FROM TO Au g/t
18 19 1.54
SC598 23 24 1.78
24 25 1.12
25 26 2.21
37 38 10.70
46 47 2.13
SC599 48 50 0.91
50 51 1.55
53 54 2.58
64 65 3.13
SC600 70 71 1.18
74 75 1.71
80 82 1.22
Note: These three boreholes were drilled 65 m along the strike of the
mineralised zone from the ML boundary.
Field crews have been deployed to implement a trenching program along
the >800m of projected strike present in the ML. An initial program
of 8 trenches will test the first 400m and results are expected
within this quarter. Should the results justify it, a preliminary
drilling program will be conducted later in 2009.
The ML status of this licence allows Shanta the opportunity to
commence mine development at any stage once ore resource definition
and mining, processing and financial studies have been completed and
show this to be economic.
For further information:
Shanta Gold Limited
http://www.shantagold.com
Walton Imrie
Mobile: +27 (0) 82 444 2851
David Scott
Mobile: + 255 (0) 784 366146
Walter Vorwerk
Moblie: +27 (0)83 308 0080
Fairfax
Ewan Leggat/Laura Littley
+44 (0) 20 7598 5368
GLOSSARY
Along strike. Horizontal direction along the plane of the body.
En echelon. Parallel or sub-parallel, closely-spaced, overlapping or
step-like structural features in rock, such as faults and tension
fractures that are oblique to the overall structural trend.
ML. Mining Licence awarded in terms of Tanzania mining laws and
regulations.
PL. Prospecting Licence awarded in terms of Tanzania mining laws and
regulations.
QA/QC. Quality assurance / quality control.
Shear zone. A zone in which shearing has occurred on a large scale so
that the rock is crushed or such that the rock is deformed.
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