Orezone tests Sadiola neighbour

Ottawa-based junior Orezone Resources (ORZ-T) has begun a program of trenching and pitting on the recently optioned Kantela property, which adjoins the producing Sadiola Hill gold mine in western Mali.

The program aims at testing a 2-km-long zone of soils with anomalous gold concentrations on the 50-sq.-km property.

Under an option deal with a private syndicate, Orezone can earn a 51% interest in the property by paying $100,000 in cash over three years, plus US$500,000 on exploration. Once Orezone earns its 51% interest, it can earn the remaining 49% by paying a further $100,000 in cash and spending US$1 million on exploration.

The vendor retains a 3% net smelter return. Orezone may reduce this to 1% by paying US$1 million. Orezone notes that the anomaly trends to the northeast are similar to the higher-grade trends of the Sadiola deposit. Following positive results, follow-up drilling will begin before the rainy season in July.

Kantela adjoins the Sadiola property, which is held by AngloGold (AU-N), Iamgold (IMG-T) and the Malian government, on the south, about 15 km from the open pit. A 2-km-long zone (with soils bearing anomalous gold concentrations) has not been fully tested. Orezone intends to drill in the area before the end of June.

Teck (TEK-T) has advanced $300,000 to Orezone to fund work at Kantela and the Shea gold option in Ghana. In return, Teck retains the first right of refusal for 60 days after the completion of any program utilizing these funds. Teck also has the right to earn up to a 60% interest in the project by backing Orezone’s existing option on each property and by funding the project through to a mining decision.

In Burkina Faso, Orezone has completed a 1,000-metre, 20-hole reverse-circulation drill program on the Intiedougou property with its partner Australia’s Delta Gold. The program followed up on a high-grade discovery at the property. A reverse-circulation hole yielded 19.1 grams gold over 10 metres. Results are expected in the next two weeks.