Lydian Hits Gold In Amulsar Stepouts

VANCOUVER — The first drill results of the season from LydianInternational’s (LYD-T, LYDIF-O) Amulsar gold project in Armenia gave the company’s share price a healthy lift.

Lydian discovered gold at Amulsar in 2006 and by last year defined an inferred resource of 31 million tonnes grading 1 gram gold per tonne for 1 million contained ounces gold. The resource covers just 20% of the surface gold expression at the property, so to expand its resource, the company recently started two drills turning on a 14,000-metre stepout program and initial results are promising.

Hole 79 cut 14 metres from surface grading 1.18 grams gold, then encountered 75 metres of 1.06 grams gold at 74 metres depth. Hole 80 returned 64 metres of 1.01 grams gold from 38 metres.

Hole 82 hit 82 metres grading 2.46 grams gold from 102 metres down-hole. And hole 84 got a high-grade hit: 32 metres of 6.24 grams gold, including 18 metres of 10.2 grams gold.

Hole 88 returned 80 metres of 1.13 grams gold from 80 metres depth and hole 93 returned 94 metres averaging 1.49 grams gold from 50 metres down-hole.

These first holes of the season were aimed at testing steeply dipping fault-controlled mineralization as well as shallower, strata-bound zones in the Artavasdes and Arshak areas of the project, which are in the southeast. Work has now shifted to the Erato and Erato North areas, which are northwest of the main zone.

Amulsar is a high-sulphidation, epithermal deposit located in central Armenia. Newmont Mining (NMC-T, NEM-N) is earning a 50% interest in the project, but Lydian is project operator. Initial metallurgical test work completed last year indicates good recoveries — 94-97% of gold — in heap-leach simulation tests on Amulsar rock.

In May, Lydian was granted a 25-year mining licence at Amulsar, one of the first mining licences issued under Armenia’s new mining law. Lydian has now merged its exploration licences such that its mining licence is surrounded by 113 sq. km of contiguous exploration ground.

While Amulsar is Lydian’s prime focus, the company is also exploring several other properties in Eastern Europe. In Kosovo, the company owns the Drazhnje zinc-lead-silver project, which carries a historic resource. Lydian drilled at Drazhnje in 2007 and 2008; a resource calculation and mini scoping study are currently under way.

The company is also exploring the Crepulje zinc-lead oxide project in northern Kosovo and the Muratdag gold-nickel project in western Turkey.

On news of the first set of drill results out of Amulsar, Lydian’s share price gained 43¢ in a day to reach 84¢; over the following days, it settled to 67¢. The company has a 52-week trading range of 11-88¢ and 47 million shares outstanding.

Lydian’s largest shareholders are: the International Finance Corp., which is part of the World Bank; Newmont; and the European Bank of Reconstruction and Development.