Oromin’s Idziszek and Dragovan focus on West Africa

Vancouver — It seems like a far cry from the gold discoveries that made Oromin Explorations (OLE-V, OLEPF-O) president Chet Idziszek and partner Nell Dragovan household names in Canadian exploration circles.

But eyeing the potential in a region that the couple consider to be underexplored, they have turned their attention to Senegal, a West African country that has lately been experimenting with democracy after 40 years of Socialist Party rule ended in 2000.

The focus of Oromin’s exploration effort is the 230-sq.-km Sabodala concession in southeastern Senegal, now the flagship project for the company, which is also exploring for oil in Argentina and gold in Brazil.

The property is located about 30 km south of the border that separates Senegal from Mali, and within a geological horizon that hosts five gold mines in Mali, including Sadiola Hill. Together, they are estimated to host 30 million oz. gold.

Australian company Mineral Deposits Ltd. (mnldf-o, mdl-a), has outlined a gold resource of 2.2 million oz. gold that it hopes to develop on property surrounded by Oromin’s Sabodala concession.

“This is one of the best places we have worked in,” says Idziszek, a 59-year-old geologist, and former director of exploration activities for the late promoter Murray Pezim. In that role he was involved with a long list of discoveries, including Eskay Creek in northern British Columbia and Petaquilla in Panama.

Idziszek is married to Dragovan, an Oromin director best known for her part in the Hemlo, Ont., gold discoveries.

It was that track record, according to Idziszek, that enabled Oromin to emerge as the winner in an open bidding process when Sabodala came up for sale in October 2004.

Now the Vancouver company is part of a joint-venture group that is earning a 100% stake in the Sabodala concessions from the Senegalese government in return for spending at least US$8 million on exploration by April 2007.

Having invested US$11 million by the end of last year, the joint venture had agreed to complete a feasibility study by February 2008.

Holding a 43.5% stake in the concession, Oromin is working with Saudi-controlled Bendon International, which owns 43.5%, and Badr Investment & Finance Co., with 13%. The government of Senegal retains a US$6.50-per-oz. royalty on any future production and a free carried interest after repayment of capital.

Oromin is the operator and provides management services to the joint venture.

Jim Stewart, Oromin’s director and corporate counsel says Oromin decided to get involved after it was alerted to the potential at Sabodala by a former Saudi-based director of one of Oromin’s sister companies, Madison Minerals (MMR-V, MMRSF-O).

Stewart declined to name the former Madison director but says he agreed to cover any due diligence expenses.

“We had the technical wherewithal and our Saudi partners had the funds to back us,” Idziszek says.

Oromin decided to bid on the project because Senegal remains relatively unexplored in comparison to Mali, but has a similar geological environment.

“The geological and structural setting of the Sabodala region has similarities to Mali’s gold districts and to other orogenic gold camps in the world, such as Timmins in Canada and Ashanti in Africa,” the company said in a report.

It said the concession is underlain by a sequence of Birimian-age volcanics and sediments, within a system that hosts a series of world-class gold deposits discovered over the past two decades in Mali, and more recently in eastern Senegal.

They include Mali’s largest producing mine, the 480,000-oz.-per-year Sadiola Hill, which is operated by AngloGold Ashanti (AU-N). Other gold mines in the region include Yatela, Kofi southwest, Loulo and Segala/Tabakoto.

The company’s game plan is to find enough gold deposits to feed a central processing plant.

In a bid to earn the interest, Oromin agreed to complete a 10,000-metre drilling program designed to follow up on previous sampling on the property. The company says drilling is focusing on four targets, known as Golouma, Niakafiri South, and Masato.

The grade and style of mineralization at Masato is similar to Mineral Deposits Ltd.’s (MDL’s) Sabodala deposit, located 1.2 km west. MDL is continuing to expand and upgrade the resource it has outlined so far, while arranging US$150 million in production financing.

Golouma covers a series of structurally controlled, outcropping vein systems, as well as artisanal workings and geochemical anomalies. The company says recent drilling and trenching suggest that the broad Golouma geochemical anomaly (1.5 by 3 km, and open for expansion) contains multiple zones of mineralization, including three near surface.

The Niakafiri South target has been traced for more than 2 km south of MDL’s concession boundary and is open to the south and west. The first drill hole returned 7 metres grading 1.15 grams gold per tonne and 8 metres of 2.29 grams gold.

In mid-January, Oromin released the results of 10 holes, which tested the Golouma South gold zone just before the Christmas break. Highlights included the southernmost hole completed to date, which returned 9 metres of 24.58 grams gold.

“These new drill results confirm and expand the lateral and depth continuity of gold mineralization previously identified at Golouma South by both excavator trenching and diamond core drilling,” the company said in a release.

Having resumed drilling in January, Oromin says reverse-circulation rigs would focus on drilling at 40-metre spacings in known mineralized zones as a precursor to future resource calculations. Diamond core rigs will be used to broadly define the lateral and vertical extent of gold zones and deeper drilling requirements.