Maiden Inferred Gold Resource of 600,000 Ounces at Mandiana-Magana in Guinea

22 October 2013

Sovereign Mines of Africa Plc
(“Sovereign Mines” or “the Company”)
Maiden Inferred Gold Resource of 600,000 Ounces at Mandiana-Magana in Guinea

Sovereign Mines of Africa Plc (AIM:SMA) and its subsidiary Sovereign Mines of Guinea Ltd (“SMG”) are pleased to announce that a maiden  Mineral Resource Estimate has been completed for the Mandiana-Magana gold project located in eastern Guinea. The Mineral Resource Estimate was prepared by SRK Consulting UK Limited (Cardiff) (“SRK”) in collaboration with SMG’s technical team. The estimate has been reported according the guidelines and terminology given in the 2004 JORC Code and will be supported by an independent technical report which will be published in due course.

SRK considers it important to highlight the existence of higher grade structures in the deposit which might be mined and milled selectively. These higher grade parts of the resource account for 420,000 ounces of gold contained within six million tonnes of resources averaging 2.3g/t gold. The lower grade subtotal of 10 million tonnes averaging 0.6g/t containing 190,000 ounces of gold could potentially be stockpiled for later processing when the opportunity arises.

The maiden Mineral Resource Estimate for the Mandiana-Magana gold project has been classified as “Inferred” at this stage due to some uncertainty over the geometry and continuity of mineralisation in places and the density determination methods. The Mineral Resource is summarized in Table 1 below:

Table 1

Mandiana-Magana Inferred Mineral Resource

Grade Category

Tonnage (Mt)

Gold Grade (g/t)

Gold (t)

Gold Metal (Koz)

High Grade  >1g/t

5.7

2.3

13

420

Low Grade  0.3-1.0 g/t

10.3

0.6

6

190

Total

16

1.2

19

610

Table footnotes:
Mineral Resources are not Ore Reserves and do not have demonstrated economic viability.
All figures are rounded to reflect the relative accuracy of the estimate; any apparent errors are due to rounding and are not considered material to the estimate.
All composites have been capped where appropriate.
Exploration on the concession is operated by the Company.

The Mineral Resource Statement is dated 21 October 2013. The tonnage and grade is considered to have reasonable prospects for economic extraction since it has been confined to optimistic pit shells using reasonable extraction efficiencies, costs and gold revenues.

John Barry, SMA’s Exploration Director, stated “This is a great return for the amount of metres drilled on this property. It is a major milestone and delivers a gold inventory which is a tangible asset for the Company. What is particularly important is that the bulk of the gold resource averages above 2g/t gold within deeply weather rocks.  Now that we have achieved this critical mass we look forward to increasing the resource base at Mandiana to provide economies of scale. The extraordinary depth of weathering present on this gold property down to depths of 200 metres should translate to lower-cost mining of relatively soft material, with consequent lower cost crushing and grinding.  Within the oxide zone we can also expect relatively higher gold recoveries than deeper in the unweathered rocks.”

The deposits and resource blocks are open along strike to the north and at depth and only constrained to the south of Yagbelen and Wyondjian by the concession boundary.”

SRK has worked with the SMG field-team and advisors to develop 3D wireframes representing 3D geological interpretations of mineralised structures at the property. SRK has reviewed drilling survey information, down-hole logging, sampling and assaying information and density data and has used these to create a 3D block model for four deposits in three main drilling areas.

The estimate is based on some 15,593 metres of mostly reverse circulation and some diamond drilling which has mostly been completed in three areas, Yagbelen-Foulinibe, Woyondjian and Damantere where deeply oxidised gold mineralisation has been intersected beneath artisanal workings. 85% of the resource is at Yagbelen-Foulinibe.

The Mineral Resource is principally contained within the Yagbelen and Foulinibe deposits which are adjacent to each other and intersect each other at their northern ends.  The majority of material >1g/t  which has been reported separately in SRK’s Mineral Resource statement occurs within the relatively coherent footwall structures of the two deposits. The closer spaced drilling at the south end of Yagbelen indicates that some of these high grades have good continuity between drill sections. Additional closer spaced drilling along strike and at depth is recommended to test this continuity.

An example of one of these high grade zones is the intersection in drill hole RCY_114_3, which cut an impressive 43 metres averaging 5.91g/t from 168 metres depth at the extreme north of the Yagbelen deposit.  This high-grade zone is open to the north and at depth and interpreted to be coincident with the intersection of the Yagbelen and Foulinibe structures.

The highest drillhole sample grades have been restricted in the grade interpolation process (ordinary kriging) by restricting the influence of grades greater than 20g/t to 20m. This has the effect of retaining the high grade intersections but restricting their influence until such time as additional infill drilling can verify the extents of such grade.

It is important to stress from that the drilled areas and resource blocks represent only 15 to 20 percent of the Yagbelen and Wyondjian mineralised trends.
Table 2

Mandiana-Magana Inferred Mineral Resource by area

Grade Category

Tonnage (Mt)

Gold Grade (g/t)

Gold Metal (Koz)

High Grade  >1g/t
Yagbelen

4.7

2.3

350

Foulinibe

0.28

1.8

15

Woyondjian

0.59

2.0

40

Damantere

0.18

2.7

15

Sub Total

5.7

2.3

420

Low Grade  0.3-1.0 g/t
Yagbelen

8.6

0.6

160

Foulinibe

0.4

0.7

10

Woyondjian

1.3

0.6

20

Damantere

0.05

0.5

Sub Total

10.3

0.6

190

 

 

 

 

Low Grade & High Grade combined > 0.3g/t
Yagbelen

13.0

1.2

510

Foulinibe

0.7

1.1

25

Woyondjian

1.9

1.0

60

Damantere

0.2

2.2

15

Total

16

1.2

610

Table footnotes:
Mineral Resources are not Ore Reserves and do not have demonstrated economic viability.
All figures are rounded to reflect the relative accuracy of the estimate; any apparent errors are due to rounding and are not considered material to the estimate.
All composites have been capped where appropriate. Exploration on the concession is operated by the Company.

A copy of the full technical report that accompanies this Mineral Resource statement will be posted on the SMA website within 45 days.

The Competent Person responsible for the technical data provided in this announcement is Mr Martin Pittuck, C.Eng, MIOM3, a Corporate Consultant (Resource Geology) and Director of SRK Consulting (UK) Ltd. Mr. Pittuck has reviewed and approved the contents of this announcement.

ENDS

Enquiries:

Sovereign Mines of Africa PLC:
David Pearl F.C.A. – Chairman +353 696 8961
david.pearl@sovmines.com
John Barry – Exploration Director +353 8 7669 5608
Nathan Steinberg – Finance Director +44 20 7269 7680

Shore Capital – Nominated Adviser & Broker
Toby Gibbs / Bidhi Bhoma – Corporate Finance
Jerry Keen – Corporate Broking +44 20 7408 4090

Square 1 Consulting Limited
David Bick / Mark Longson +44 20 7929 5599

Newgate Threadneedle
Graham Herring / Richard Gotla +44 20 7653 9858

About SMA:
Sovereign Mines of Africa Plc is a mineral exploration company incorporated in England and Wales and headquartered in London. At the end of 2007, the founders of the Company saw an opportunity to pool their collective expertise and experience in order to form joint ventures for mineral exploration with governments in Africa. The Republic of Guinea in West Africa was identified as the first target and this ultimately gave rise to the establishment of the Company in 2010.

The Company has entered into a cooperative joint-venture with the Government of Guinea (the “Sovereign Partnership Structure”), pursuant to which the Government was granted a 40 per. cent. equity stake in Sovereign Mines of Guinea, the operating company of the group. The Directors believe that this collaborative approach gives the Company unusual advantages compared with other small exploration companies and as a result it has been able to acquire early stage substantial and highly prospective properties, any of which could, in the Directors’ opinion, become a significant gold asset.