More gold reserves at Chirano

Vancouver — An updated independent reserve estimate for Red Back Mining‘s (RBI-V) Chirano gold project in southwestern Ghana indicates more than 1 million oz. gold. As a result, the mine life is now projected to be eight years.

The estimate pegs proven and probable reserves at 17.8 million tonnes grading 1.9 grams gold per tonne, or 1.1 million contained gold oz.

Chirano, in which Red Back has a 95% interest, is 15 km south of AngloGold-Ashanti‘s (AU-N) multi-million-ounce Bibiani gold mine. The property is underlain by the contact between Upper and Lower Birimian rocks comprising mainly volcaniclastic and sedimentary rocks intruded by late-stage porphyritic granites. The steeply dipping gold mineralization is associated with finely disseminated sulphides hosted mainly near the granitic contacts. The depth of oxidation is around 25 metres.

The new reserve estimate, which is based on a gold price of US$375 per oz., adds 161,000 oz. to the projection contained in the bankable feasibility study. The waste-to-ore ratio has decreased 20% to 3.1-to-1, thereby improving the economics of the proposed mine.

Recent drilling has increased the resource by 22% in the measured and indicated categories to 28.8 million tonnes grading 2 grams gold per tonne. In the inferred category are 509,000 oz., which will be the focus of infill drilling.

The project was awarded an environmental permit in April, as well as a 15-year mining lease that covers 36.3 sq. km.

Red Back is newly listed on the TSX Venture Exchange. The company, which was formed through the merger of Canadian-listed Champion Resources and Aussie-based Red Back Mining, is part of the Lundin Group, based in Vancouver.