Papillon Resources discovers new high grade gold at Medinandi

Friday, September 03, 2010

Papillon Resources (ASX: PIR) has reported the third tranche of drill results from its maiden drilling campaign at its flagship Medinandi Project in Mali, West Africa, with new wide, shallow, high grade gold mineralisation discovered.

Reverse circulation drilling at the Fadougou North East (FNE) exploration target has located significant gold intercepts in a north-south trending mineralised zone extending in excess of 700m of strike.

Significant intercepts include:

- 18m @ 7.62g/t Au (FNER015) from 79m to 97m;
- 10m @ 5.02g/t Au (FNER015) from 101m to 111m;
- 13m @ 3.460g/t Au (FNER003) from 19m to 32m;
- 13m @ 3.20g/t Au (FNER006) from 40m to 53m; and
- 5m @ 9.85g/t Au (FNER006) from 101m to 106m.

There is a central 240m zone of strong bedrock gold mineralisation in steeply-dipping zones. There are significant gold intercepts over a strike length in excess of 700m, and the zone remains open to the north and south.

The FNE zone, located some 500m to the NE of the Fadougou Main Zone, has the potential to deliver wide ore-grade gold mineralisation.

Alan Campbell, managing director, said “the width and consistent grade of mineralisation at shallow depths and the broad extent of alteration at this prospect is impressive. These early results underscore the potential of this prospect to add to the Medinandi resource base.”

These results complement the high grade intercepts announced on July 12. The project is located on the Senegal/Malian Shear Zone, where in excess of 42M oz of gold has been discovered.

The company’s maiden drilling programme consisted of 4,320m at Fadougou Main Zone and 8,780m on new exploration targets, and totalled 13,100m of RC drilling.

A total of 36 RC holes have been completed at the FNE prospect of which results have been received for the first 19 holes, and are reported here. In total, results have now been received for 7,545m of 13,100m drilled or 57% of the maiden drilling programme.

Papillon said it is particularly pleased with the consistency and grade of intercepts such as 18m @ 7.36g/t Au and 10m @ 5.02g/t Au in hole FNER_015.

Mineralised intercepts in excess of 1g/t Au have been obtained over a strike length of at least 700m, and the zone remains open to the north and south.

Whilst drilling is at an early stage these initial drill results have confirmed that the FNE zone can deliver wide ore-grade gold mineralisation and the results thus far provide strong impetus for a detailed infill drilling program at this location.

Assay results from approximately 5,555m of the 13,100m of the completed drilling programme are yet to be received.

These drill results will provide information on 3 other new potential gold zones at Fadougou South - South East and East; Tintiba; and Fekola. An independent geological consultancy has been contracted to undertake a resource re-modelling of the Fadougou Main Zone and new discoveries once all results have been obtained.

At the Medinandi Project future exploration work will include and focus on infill and step-out drilling at the Fadougou North East prospect, which remains open to the north and south along strike.

In addition, diamond drilling at the Fadougou Main Zone will test mineralisation at depth. Step-out drilling on the Fadougou Main Zone is to test an extension of mineralisation, which remains open to the north and south along strike.

Preliminary metallurgical test work from selected RC drill samples is scheduled. Dependent upon results from the recently completed RC drill programme, follow up drilling on the exploration targets at Fadougou, Tintiba and Fekola will be planned.

The company also intends to drill targets generated from the recently completed ground geophysical (IP survey) and planned magnetic surveys.

Papillon Resources has 155 million ordinary shares on issue, 75.2 million ordinary quoted options and 10.5 million unlisted options. It has A$3.9 million cash in bank and a market capitalisation of A$41 million.

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