Wesdome hits gold below Kiena mine (March 29, 2010)

Vancouver – Wesdome Gold Mines (WDO-T) has hit healthy gold intercepts deep below its active Kiena mine in the Val d’Or region of Quebec.

The company acquired the Kiena mine along with a large land package surrounding it in 2003 and has since been exploring the numerous historic deposits on the property.

The latest results come mainly from drilling 300 to 400 metres below the 920-metre deep mine shaft and follow the mineralization along strike in a northwest direction for 300 metres. Mineralization is still open along strike and at depth.

Reported in true widths, hole 4809 cut 3.3 metres grading 17.42 grams gold per tonne starting at 160 metres and hole 4808 hit 0.6 metres grading 13.95 grams gold starting at 160.5 metres.

Deeper down, hole 4808 returned 11.9 metres grading 2.3 grams gold starting at 533 metres, hole 4928 intersected 8.2 metres grading 12.31 grams gold starting 387.8 metres downhole and including 1.2 metres averaging 57.92 grams gold, and hole 4929 cut 5.5 metres carrying 20.66 grams gold including 0.5 metre grading 91.62 grams gold.

Wedome’s latest results follow on a mid-2009 deep drill program it carried out under the mine workings that established a southeast-plunging corridor of mineralization with a strike length of about 200 metres. Highlights of that program include 11.6 metres grading 4.17 grams gold starting at 400 metres, 24.4 metres grading 1.68 grams gold from 440.7 metres downhole, and 0.7 metre grading 22.61 grams gold starting at 458 metres.

The company’s Kiena complex is a contiguous land package of 7,500 ha. based on and around Lac de Montigny. The area has both large disseminated gold deposits associated with stockworks and vein-type deposits.

Wesdome carried out the most recent drilling in the S-50 Zone, which is characterized by calcite and carbonate veins and veinlets, with minor quartz. Elsewhere on the property veins are associated with quartz, pyrite and minor pyrrhotite and chalcophyrite; more generally, mineralization is associated with sheeted veins and stockworks, breccias, and disseminations in diorite dykes and mafic volcanic rocks.

In 2009 Wesdome produced 35,398 oz. gold from 302,000 tonnes of ore at the Kiena mine. The average cost per oz. was $626 in 2009, a drop from the 2008 average of $666 per oz. The company reopened the mine in 2006.

Falconbridge originally developed the Kiena mine in 1981, with roughly 1.56 million oz. gold produced between 1981 and 2002. The Kiena complex contains a total of eight former underground operations which have together produced over 2.5 million oz.

The company continues to explore other deposits in the area and recently decided to drive a tunnel to the Dubuisson zone, 3 km due east of the Kiena shaft. Wesdome will extend an existing exploration drift on the 330-metre level by a kilometre to reach the zone. Drill access should be established in about a year with direct access possible in two.

Wesdome also owns the Eagle River mine in Wawa Ontario where it produced 60,754 oz. gold last year.

In its recent annual filings the company reported earnings of $32.2 million or 32¢ per share in 2009, compared with $9.2 million or 9¢ per share in 2008.

Wesdome’s share price was up 8¢ on the latest drill results to close at $2.11. The company has a 52-week share price range between $1.20 and $2.89 and 100 million shares outstanding.