Sunridge Gold Completes Initial Resource Estimate For Adi Rassi Copper-Gold Deposit, Asmara Project, Eritrea

Sunridge Gold Corp. (“Sunridge” or the “Company”) (TSX.V:SGC; OTCQX:SGCNF) reports that it has completed an initial independent NI43-101 and JORC compliant mineral resource estimate for the Adi Rassi copper-gold deposit located on the Asmara project, Eritrea.

HIGHLIGHTS:
  • Inferred Mineral Resource of 15.77 million tonnes with an average grade of 0.54% copper and 0.33 g/t gold
  • Contained metal = 189,060,000 pounds of copper and 167,000 ounces of gold
  • The resources area is open for expansion in most directions
  • Less than 10 km from Debarwa deposit and paved road access
  • Positive initial metallurgical results
  • Further expansion drilling planned in 2013

Adi Rassi is the fifth mineral resource defined by Sunridge on the Asmara Project. On May 2, 2012, Sunridge announced the results of a prefeasibility study (“PFS”) on the other four deposits (Adi Nefas, Emba Derho, Gupo and Debarwa) that concluded that the optimum economic scenario is to construct a single centralized processing plant near the Emba Derho deposit. A feasibility study is now underway and is scheduled for completion in April 2013.

Initial results from ongoing testwork by Blue Coast Research suggest that copper, gold and silver can be successfully recovered from the mineralized material at Adi Rassi by standard flotation methods, which is compatible with the recovery processes with the other deposits on the Asmara project.

“The defining of a fifth deposit by Sunridge continues to show the prolific nature of the Asmara Project area. We are pleased with this initial mineral resource estimate for the Adi Rassi deposit based on just twenty-two new drill holes by Sunridge and believe that further drilling will significantly expand and upgrade the mineralization.” states Michael Hopley, President and CEO of Sunridge. “Metallurgical test work continues, but initial results show that the copper and gold can be successfully recovered by standard flotation methods compatible with the process to be used in the mine plan currently being examined in the feasibility study”.
 
Adi Rassi Mineral Resource Statement - David G. Thomas

P.Geo., of Fladgate Exploration Consulting Corp. (“Fladgate”)

Effective Date December 1, 2012
            Grades       Contained Metal
Tonnes Copper       Gold       Silver Copper       Gold       Silver

('000

 

('000
Inferred Mineral Resource       ('000s)       (%)       (g/t)       (g/t)      

lbs)
     

('000oz)
     

oz)
Open Pit (0.21% Cu Eq cut-off) 14,940 0.54 0.30 1.5 176,640 143 721
Underground (0.72% Cu Eq cut-off)       840       0.67       0.89       1.5       12,430       24       40
Total       15,770       0.54       0.33       1.5       189,060       167       761
*Cut-off calculation is based on prices and costs provided by Sunridge. The open pit Inferred mineral resource is reported at a copper equivalent cut-off of 0.21% within a Lerchs-Grossman resource pit shell optimized on copper, gold and silver grades with metal prices of $3.75/lb of copper, $1,700/oz gold and $32/oz silver. Assumed metallurgical recoveries are 95%, 70% and 70% for copper, gold and silver respectively. Mining costs are assumed to be $1.75 /t. Underground Inferred mineral resources are reported at a copper equivalent cut-off of 0.72% within a grade shell based upon an underground mining cost of $40/t. The contained metal figures shown are in situ. No assurance can be given that the estimated quantities will be produced. All figures have been rounded to reflect accuracy and to comply with securities regulatory requirements. Summations within the tables may not agree due to rounding. Fladgate undertook quality assurance and quality control studies on the mineral resource data for the Adi Rassi project. Fladgate concludes that the collar, survey, assay and lithology data are adequate to support mineral resource estimation. CIM Definition Standards describe that Mineral Resource Estimates are not Mineral Reserves and do not have demonstrated economic viability. There is no certainty that all or any part of the Mineral Resource will be upgraded to Indicated or Measured mineral resources categories or that it will be converted into Mineral Reserve until the required studies have been completed. The quality and grade estimates of reported Inferred mineral resources are uncertain in nature and there has been insufficient exploration work to define the Inferred mineral resources as Indicated and Measured mineral resources and it is uncertain if further exploration work will result in upgrading them to Indicated or Measured mineral resource categories.

Adi Rassi Geologic Background

The Adi Rassi mineralization is distinctly different to Sunridge’s four other deposits on the Asmara Project; three of the deposits are volcanogenic-massive sulphide (VMS) deposits (Emba Derho, Adi Nefas and Debarwa) or remobilized gold only (Gupo Gold). The mineralization at Adi Rassi is considered to be remobilized copper and gold from a distal source, possibly unidentified buried VMS mineralization.

Mineralization at Adi Rassi is associated with a major shear zone that trends northeast for over 3 kilometres and dips steeply to the west. The copper and gold mineralization is hosted in strongly foliated and distorted altered mafic volcanic tuffs. Mineralization has now been defined for over 450 metres north-northwest oriented strike length, 40 to 100 metres in width and to a vertical depth of 360 metres. (see map at the end of this news release). The mineralized zone dips steeply to the west and is off-set by an east-west oriented fault. The zone remains open in depth, to the north and possibly to the south; additional exploration potential exists along the 3 kilometre length of the host shear zone. A program of expansion drilling, trenching and local mapping and sampling is planned for 2013.

Methodology

The mineralization on which the Adi Rassi Inferred mineral resource estimate is based extends over a strike length of 400 metres and a width of up to 80 metres and has been drilled to a maximum vertical depth from surface of approximately 360 metres. The Inferred mineral resource has been estimated using 26 exploration drill holes consisting of 22 diamond drill core holes by Sunridge and 4 diamond drill holes from a previous operator. Assays of split core samples have been used in the estimation of mineral resources.

Sectional interpretations of the mineralized zone were completed on east-west sections spaced between 20 m and 50 m apart using a nominal 0.1% Cu threshold. The interpretations were linked together to form a wireframe representing the mineralization. The wireframe interpretations formed the basis for the construction of a block model as well as selecting composites for geostatistical analysis and grade estimation. A block model was constructed in MineSight mining software with cell dimensions of 5 metres (X) x 5 metres (Y) x 5 metres (Z).

Grades for copper, gold and silver were estimated within the mineralization wireframe using Ordinary Kriging after compositing the assay intervals to 6 metre down-hole lengths within the mineralized wireframe. Gold grade estimates were further constrained with a probabilistic model to prevent over-projection of the higher grades into lower grade areas.

Search ellipsoid dimensions and orientations were determined on structural geological and geostatistical information. An average density (specific gravity) value of 2.825 was assigned to blocks based on 592 density measurements provided by Sunridge.

The blocks falling within the mineralized zone were categorized for mineral resource classification as Inferred if the nearest composite fell within a distance of 100 m.

Inferred mineral resource estimates reported for Adi Rassi are constrained by a conceptual pit shell in order to assess reasonable prospects of economic extraction. Parameters used in the generation of the Whittle pit shell are: gold price = US$1,700/ounce; copper price = US$3.75/lb: silver price US$32/oz; mining cost = US$1.75/tonne; processing cost (including administration cost) = US$16.50/tonne; copper recovery = 95%, gold recovery 70%, silver recovery 70%; pit slope angle = 50 degrees. The process recoveries, metal prices and ore based costs (processing and G&A) were used to calculate a marginal copper equivalent cut-off of 0.21%. Mineralization exists below the conceptual pit shell. An ore based underground mining cost of $40/tonne in addition to the processing costs were used to define a copper equivalent cut-off of 0.72%. Fladgate assessed the reasonable prospects of economic extraction of this material by creating a grade shell at a 0.72% copper equivalent threshold. Isolated blocks were removed from the material reported as Inferred mineral resource.

Qualified Person:

Michael Hopley, President and CEO of Sunridge Gold Corp. is the Qualified Person responsible for the contents of this press release and has reviewed and verified the scientific and technical information in the release and confirmed that it is consistent with that provided by the independent Qualified Person responsible for the Inferred mineral resource estimate, David G. Thomas P. Geo., Associate Geologist with Fladgate Exploration Consulting Corp.

About Sunridge:

Sunridge is a mineral exploration and development company focused on the acquisition, exploration, discovery and development of base and precious metal projects on the Asmara Project in Eritrea and exploration properties in Madagascar. Sunridge currently has approximately 175,162,728 million shares outstanding and trades on the TSX Venture Exchange under the symbol SGC. For additional information on the Company and its projects please view the slide show on our website at www.sunridgegold.com or call Greg Davis at the numbers listed below.

SUNRIDGE GOLD CORP.

“Michael Hopley”

Michael Hopley, President and Chief Executive Officer

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.

This news release contains forward-looking statements that are based on the Company’s current expectations and estimates and include information relating to the initial mineral resource estimate for the Adi Rassi deposit on the Asmara Project. Forward-looking statements are frequently characterized by words such as “plan”, “expect”, “project”, “intend”, “believe”, “anticipate”, “estimate”, “suggest”, “indicate” and other similar words or statements that certain events or conditions “may” or “will” occur. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that could cause actual events or results to differ materially from estimated or anticipated events or results implied or expressed in such forward-looking statements. Such factors include, among others: the actual results of current exploration activities; conclusions of economic evaluations; changes in project parameters as plans to continue to be refined; possible variations in ore grade or recovery rates; accidents, labor disputes and other risks of the mining industry; delays in obtaining governmental approvals or financing; and fluctuations in metal prices. There may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. Any forward-looking statement speaks only as of the date on which it is made and, except as may be required by applicable securities laws, the Company disclaims any intent or obligation to update any forward-looking statement, whether as a result of new information, future events or results or otherwise. Forward-looking statements are not guarantees of future performance and accordingly undue reliance should not be put on such statements due to the inherent uncertainty therein.

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