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DAILY NEWS Dec 19, 2013 4:21 PM - 0 comments

Continental releases drill results, stays mum on artisanal situation

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While it offered no update on the contentious removal of illegal miners from its flagship property, Continental Gold (TSX: CNL) released some promising drill results from the site.

The latest results come out of its now complete 2013 drill program at its wholly owned Buritica project in the Antioquia Department of central Colombia. In late November reports surfaced that a conflict between police and illegal miners at Buritica had resulted in the death of two artisanal miners.

The company has not issued any press releases related to the matter nor has it responded to The Northern Miner’s request for comment on the situation.

As for exploration results the latest come out of 17 holes and underground sampling on the Yaragua and San Agustin vein systems.

Yaragua is one of the two primary deposits at Buritica, the other being Veta Sur, which is to the west of Yaragua. San Agustin is situated on the northern side of a mountain that hosts Yaragua at its southern base. San Agustin is roughly 1-km from the Yaragua resource envelope.

The good news from Yaragua was that four step-out drill holes hit mineralization as far as 200 metres to the west of the outlined deposit. Highlights from the holes included: 119 grams gold and 166 grams silver over 0.5 metres; 10.8 grams gold and 5 grams silver over 3.5 metres; and 33.8 grams gold and 134 grams silver over 1.5 metres. The deposit remains open to the west and at depth.

BMO Capital Markets analyst Brian Quast, however, points out that the grades encountered this time around at Yaragua weren’t as impressive as those found in the past.

“The average results of the drill holes reported was 6.2 grams gold over 1.7 metres, which compares poorly to the Yaragua measured and indicated resource grade of 14.5 grams gold and the inferred resource grade of 8.9 grams,” Quast wrote in a research note.

He also points out that the results don’t stack up well against the last batch of results from the same area that averaged close to 16 grams gold.

Drilling in the San Agustin area also returned high-grade results.

Two drill holes intersected high-grade veins, returning highlight intercepts of 23.9 grams gold and 301 grams silver over 1.4 metres and 14 grams gold over 2 metres.

With the 2013 drill program now complete Continental will push on getting its much anticipated resource update out by the first quarter of next year. Its stated aim is to grow the resources and upgrade inferred resources to M&I.

The project currently hosts measured and indicated resources of 3.7 million tonnes grading 13.6 grams gold, 38 grams silver and 0.7% zinc. It also has inferred resources of 13.3 million tonnes grading 8.8 grams gold, 33 grams silver and 0.5% zinc.

The bulk of those resources come out of Yaragua, which has been drill-outlined along 900 metres of strike, and Veta Sur, which has been drill-outlined along 700 metres of strike.

Both systems are characterized by multiple, steeply-dipping veins and broader, more disseminated mineralization and both remain open at depth and along strike, at high grades.

In Toronto on Dec. 19 Continental’s shares were off 2%, or 6¢, to $2.69 on 797,000 shares traded.

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Continental's coreshack at the Buritica project in Colombia. Credit: Continental Gold
Continental's coreshack at the Buritica project in Colo...

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