Helio Announces Updated Mineral Resource Estimate at SMP Gold Project, Tanzania.

Measured and Indicated Ounces increase 104% to 1,020,000 ounces at 1.32g/t Au at a 0.5g/t Au Cut off

TSX-V Trading Symbol: HRC    Toll Free: +1 888 955 4728
E-mail: info@helioresource.com   Website: www.helioresource.com

VANCOUVER, Feb. 14, 2012 /CNW/ - Helio Resource Corp (TSX-V: HRC) is pleased to report that it has received an independent NI 43-101 compliant updated Mineral Resource estimate for the SMP Gold Project in Tanzania, effective date February 10th, 2012.

The estimate was completed by SRK Consulting (Australia) Pty. Ltd., of Perth, Australia (SRK). This is an update on the maiden Mineral Resource for the SMP Gold Project, previously reported in the Company's press release dated November 30, 2010.  As required, the full NI 43-101 technical report will be published within 45 days of this news release

Highlights from the Resource Memorandum:

  • SRK recommend the use of the 0.5g/t Au cut off grade when evaluating the Mineral Resource.
  • Measured and Indicated Mineral Resources of 1,020,000 ounces at 1.32g/t Au plus an Inferred Mineral Resource of 240,000 ounces at 1.05g/t Au at a cut-off grade of 0.5g/t.  Compared to the maiden Mineral Resource estimate, these figures represent a 104% increase in metal in the Measured and Indicated category, and an 11% decrease in  metal in the Inferred category.
  • Robust resource - at a 0.9g/t Au cut-off the Measured and Indicated Mineral Resources are 860,000 ounces at 1.54g/t Au and the Inferred Mineral Resources are 170,000 ounces at 1.33g/t Au.
  • The resource is open along strike and at depth in all targets.
  • Initial Whittle pit optimisation for Porcupine and Kenge indicates that a total of 890,000 ounces (approximately 87% of their Measured and Indicated Mineral Resources) are included within the pit shells.

Porcupine Target

  • Some recent shallow drill intersections of higher grade mineralisation at Porcupine (e.g. 7.4m at 6.1g/t Au) could not be confidently correlated with the main bodies of mineralization, and therefore were not included in the resource, but these intersections represent excellent potential to add higher grade material to the resource with further drilling.
  • Additionally, the deepest drilled intercepts at Porcupine (53m grading 2.9g/t Au and 28m grading 5.1g/t Au) demonstrate the strong potential to add ounces at depth, beneath the current resource.

Konokono and Tumbili Targets

  • Only 4% of the resource comes from the Konokono and Tumbili targets.  The ounces from these targets are completely new to the resource base and represent only 100-150m of strike length at each of those targets. In addition, mineralisation at these targets outcrops at surface, and all drilling to date has focussed on mineralisation within 50m of surface.
  • Recent drill testing of the Konokono and Tumbili targets indicate a strike length potential of 3,200m, implying excellent potential to significantly increase the resource base in these areas.

The following table summarizes the Mineral Resource estimate (all contained gold values are rounded to the nearest 10,000 ounces):

Cut off grade
(g/t Au)
Resource
Classification
Mean grade
(g/t Au)
Tonnes
(Millions)
Contained Gold
('000 oz)
0.3 Measured 1.38 14.8 660
0.3 Indicated 1.20 9.5 370
0.3 Measured+Indicated 1.31 24.3 1,020
0.3 Inferred 0.97 8.3 260
         
0.5 Measured 1.38 14.8 660
0.5 Indicated 1.22 9.2 360
0.5 Measured+Indicated 1.32 24.1 1,020
0.5 Inferred 1.05 7.2 240
         
0.7 Measured 1.44 13.8 640
0.7 Indicated 1.30 8.2 340
0.7 Measured+Indicated 1.39 21.9 980
0.7 Inferred 1.18 5.7 210
         
0.9 Measured 1.60 10.9 560
0.9 Indicated 1.43 6.4 300
0.9 Measured+Indicated 1.54 17.3 860
0.9 Inferred 1.33 4.0 170

SRK recommend the use of the 0.5g/t Au cut off grade when evaluating the resource.  The estimate was prepared using the following estimation strategy and assumptions:

  • The drilling was conducted between 2006 and 2011 and consists of both Diamond and Reverse Circulation (RC) drilling completed by Helio;
  • The sample preparation and assaying took place at SGS laboratories in Tanzania;
  • The database was reviewed by SRK using statistical and geostatistical studies. This database was considered acceptable for the estimate;
  • The estimation was carried out in Isatis software using a combination of 2D and 3D Ordinary Kriging; and
  • Classification of the Mineral Resource Estimate was based on the drilling density, estimation quality, confidence in the data and confidence in the geological model.

On a target by target basis, the Mineral Resource is reported as follows:

Porcupine Target Mineral Resource Estimate
Cut off grade
(g/t Au)
Resource
Classification
Mean grade
(g/t Au)
Tonnes
(Millions)
Contained Gold
('000 oz)
0.3 Measured 1.35 12.3 530
0.3 Indicated 1.16 3.1 120
0.3 Measured+Indicated 1.31 15.4 650
0.3 Inferred 0.85 3.6 100
         
0.5 Measured 1.35 12.3 530
0.5 Indicated 1.16 3.1 120
0.5 Measured+Indicated 1.31 15.4 650
0.5 Inferred 0.89 3.3 90
         
0.7 Measured 1.41 11.3 510
0.7 Indicated 1.19 2.9 110
0.7 Measured+Indicated 1.37 14.3 630
0.7 Inferred 1.01 2.3 70
         
0.9 Measured 1.61 8.6 440
0.9 Indicated 1.32 2.2 90
0.9 Measured+Indicated 1.55 10.8 530
0.9 Inferred 1.15 1.4 50

Kenge Target Mineral Resource Estimate
Cut off grade
(g/t Au)
Resource
Classification
Mean grade
(g/t Au)
Tonnes
(Millions)
Contained Gold
('000 oz)
0.3 Measured 1.51 2.6 120
0.3 Indicated 1.22 6.3 250
0.3 Measured+Indicated 1.30 8.9 370
0.3 Inferred 1.07 3.2 110
         
0.5 Measured 1.51 2.6 120
0.5 Indicated 1.25 6.1 250
0.5 Measured+Indicated 1.33 8.7 370
0.5 Inferred 1.28 2.5 100
         
0.7 Measured 1.55 2.4 120
0.7 Indicated 1.36 5.2 230
0.7 Measured+Indicated 1.42 7.7 350
0.7 Inferred 1.45 2.0 90
         
0.9 Measured 1.59 2.3 120
0.9 Indicated 1.49 4.2 200
0.9 Measured+Indicated 1.53 6.6 320
0.9 Inferred 1.55 1.7 90

Konokono Target Mineral Resource Estimate
Cut off grade
(g/t Au)
Resource
Classification
Mean grade
(g/t Au)
Tonnes
(Millions)
Contained Gold
('000 oz)
0.3 Inferred 1.06 1.0 30
0.5 Inferred 1.06 1.0 30
0.7 Inferred 1.09 0.9 30
0.9 Inferred 1.25 0.6 20

Tumbili Target Mineral Resource Estimate
Cut off grade
(g/t Au)
Resource
Classification
Mean grade
(g/t Au)
Tonnes
(Millions)
Contained Gold
('000 oz)
0.3 Inferred 0.99 0.5 10
0.5 Inferred 0.99 0.5 10
0.7 Inferred 0.99 0.5 10
0.9 Inferred 1.08 0.3 10

A plan map showing the locations of the Porcupine, Kenge, Konokono and Tumbili resource areas is represented in the following link: http://www.helioresource.com/i/maps/2012-02-14_NRM1.pdf

All drilling targets are open along strike and at depth.  Helio has confirmed mineralisation at each of the Konokono and Tumbili targets over 1.5km+ strike lengths at 200 - 300m drillhole spacing (see Helio press releases dated January 17, 2012 and January 10, 2012, respectively).  However, only a small proportion (10%) of the strike extents of each target has been sufficiently drilled to allow for the calculation of an NI43-101 compliant resource.  The Company therefore sees excellent potential to quickly increase the size and grade of the resource base.

Helio also sees the potential to add further resource ounces in the near term at the Gap target, where drilling at 100m spacing has likewise confirmed continuity of mineralisation over a 1km strike length, but current drill spacing is insufficient to allow a resource to be estimated.

Whittle Pit Optimisation

Whittle pit optimisation was conducted on the Kenge and Porcupine Mineral Resource block models by Duncan Pratt of SRK.  The parameters of the study, as specified by Helio, are as follows:

  • A gold price of $1,450 per ounce was used (low end range of gold price used by African Barrick for the recent Tusker resource update ($1,400 / ounce), and AngloGold Ashanti for the Tropicana resource ($1,600 / ounce)
  • Gold recovery rate of 95% as per metallurgical work completed by Lakefield on mineralised drill core from both the Porcupine and Kenge resource areas (full reports found at http://www.helioresource.com/s/TechnicalReports.asp)
  • Pit slope angle of 55°  - there is no oxide mineralisation, and the enclosing wallrock is competent granite and diorite;
  • The modelling indicated 600koz Au at 1.21g/t Au are recoverable at a strip ratio of 1:5.2 for Porcupine.  At Kenge, the results indicate 290koz grading 1.30g/t Au are recoverable at a strip ratio of 1:4.8.

The Mineral Resource Estimate for the SMP was completed by Qualified Person Robin Simpson (MSc, MAIG) of SRK Consulting (Australia) Pty. Ltd. who has provided written permission for the release of this resource estimate in the form and context in which it is provided here. The Company will issue a NI 43-101 compliant technical report for this resource within 45 days of the date of this news release. Helio has informed SRK that there are no known environmental, socio-political, marketing or other relevant issues that may materially affect the mineral resource estimate.

Helio's CEO, Richard Williams stated "We are very encouraged by the steady progress the Company has made at our flagship SMP gold Project.  The resource base continues to grow and has excellent potential to double in the near term"

About the SMP Gold Project

The SMP Gold Project covers an area of 238km2.  Gold mineralisation has been identified in 30 targets within the project area.  Four of these targets, Porcupine, Kenge, Konokono and Tumbili have been advanced to the resource stage and all still have potential to grow significantly.  In February 2012, SRK Consulting (Australia) Pty. Ltd. produced an independent NI 43-101 compliant Mineral Resource estimate for the SMP gold project.  The estimate reports 1,020,000 ounces in the Measured and Indicated category (24.1Mt grading 1.32g/t Au), plus 240,000 ounces in the Inferred category (7.2Mt grading 1.05g/t Au).

In November 2010, Golder Associates (UK) Ltd. provided an initial NI43-101 compliant Mineral Resource estimate for the SMP.  The restrained estimate at a 0.5g/t Au cut-off reports 498,075 ounces (10.94MT grading 1.41g/t Au) in the Measured and Indicated category, plus 273,847 ounces (7.06MT grading 1.2g/t Au) in the inferred category.

Mineralisation at all 30 targets outcrops at surface, and varies from narrow, high-grade gold mineralisation hosted in quartz veins and shear zones, to wide zones (up to 110m+ in width) of lower grade, bulk mineable / open pittable mineralisation.

Helio owns a 100% interest in four of five licences, subject to a 2% NSR to the vendors (Tanzanian small mining companies), and the Company is in the process of earning a 100% interest in the fifth licence.

Chris MacKenzie, M.Sc., C.Geol., Helio's COO and a Qualified Person as designated by NI 43-101, supervises the exploration at the SMP project, including the sampling and quality assurance / quality control programmes, and has reviewed and approved the contents of this news release.

ON BEHALF OF THE BOARD OF DIRECTORS

"Richard D. Williams"    
Richard D. Williams, P.Geo  
CEO      
"Chris MacKenzie"
Christopher J. MacKenzie, C.Geol.
COO

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

 

SOURCE Helio Resource Corp.

For further information:

For additional information, please contact Richard Williams or Irene Dorsman at +1 604 638 8007 or by e-mail to richard@helioresource.com or irene@helioresource.com.


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