Mandalay Resources Corporation Expands the High Grade Mineralized Zone in the Alison Vein Discovery at its Costerfield Gold-Antimony Mine, Australia

TORONTO, Jan. 10, 2012 /CNW/ - Mandalay Resources Corporation ("Mandalay" or the "Company") (TSX: MND)(TSX: MND.WT) is pleased to announce the results of follow-up drilling on the emerging Alison vein discovery at its 100% owned Costerfield Gold-Antimony Mine in Victoria, Australia. A seven hole diamond program, still in progress, is building on the first intercepts (MB-007 and AD-002) previously announced in a press release dated August 24, 2011.

Brad Mills, CEO of Mandalay, commented, "Brownfields exploration to unlock upside potential in assets acquired by the Company is one of our fundamental strategies. We expect that the Alison discovery, which demonstrates this strategy in action, will materially impact the value of Costerfield. These intercepts have confirmed the general high grade nature of Alison mineralization, and are starting to define its continuity along strike, and down-dip. While these results are preliminary, they appear to indicate that the Alison vein may be both higher grade and wider than the W- and E- lodes we are currently mining. We expect a maiden resource estimate on the Alison vein to be included in our updated reserves and resources statement for the Costerfield asset later in the first quarter of 2012.  We are accelerating the drilling of Alison, now with two surface rigs, in order to expediently test the size potential, and we are undertaking a scoping study on extending the Augusta mine infrastructure to Alison. We anticipate that we will have sufficient information on Alison to produce a preliminary economic assessment on this deposit by mid-year 2012."

The new Alison discovery is situated within 500 metres of Mandalay's currently operating Augusta Mine (click here to view Figure 1 - Alison Drilling Map).

Mineralized intersections generally consisting of massive stibnite veins plus or minus quartz with visible free gold were encountered in four of seven follow-up holes to date (AD-005, AD-006, AD-008, and AD-001). One hole (AD-007) yielded a lower grade intercept, and two holes (AD-003, and AD-004) have defined the location of the large, low angle fault which Mandalay believes has offset the new Alison discovery from the shallower historic Alison deposit. In addition, AD003 intersected a gold mineralized zone within the known area of historic workings above this fault.

The drill assay results are tabulated below in two tables, as raw assay data (see Table 1 below), and as composite summary data to support interpretation of the mineralisation for mine planning (see Table 2 below):

Table 1

Raw Assay Data
Hole id Samp id Depth from Depth to Interval (m) Au (g/t) Sb (%)
AD001 650376 270.3 270.8 0.52 5.3 0.2
AD001 650377 270.8 271.2 0.43 0.3 0.0
AD001 650378 271.2 271.5 0.30 26.9 8.1
AD002 606565 256.8 257.1 0.25 2.2 1.9
AD002 606566 257.1 257.4 0.35 20.4 38.3
AD002 Core Loss 257.4 257.8 0.40 0.0 0.0
AD002 606567 257.8 258.1 0.30 10.2 60.1
AD002 606568 258.1 258.3 0.20 1.3 43.3
AD002w1 650319 255.8 256.1 0.26 105.1 33.0
AD002w1 650320 256.1 256.4 0.30 1.4 0.3
AD002w1 650321 256.4 256.5 0.10 0.8 5.9
AD002w1 650322 256.5 256.8 0.30 0.3 0.1
AD002w1 650323 256.8 257.4 0.60 4.5 17.4
AD002w1 650324 257.4 257.7 0.30 4.3 5.7
AD005 694812 257.4 258.1 0.70 109.2 7.0
AD005 694813 258.1 258.5 0.40 82.6 12.6
AD005 694815 258.5 258.8 0.32 62.3 43.1
AD005 694816 258.8 259.1 0.23 2.7 49.6
AD006 649925 396.6 396.7 0.15 52.5 7.4
AD006 649926 396.7 396.8 0.09 47.4 43.7
AD006 649927 396.8 397.1 0.28 48.0 8.9
AD006 649928 397.1 397.2 0.12 2.3 2.1
AD006 649929 397.2 397.4 0.18 30.8 13.7
MB007 667398 185.0 185.2 0.15 5.4 16.2
MB007 667399 185.2 185.4 0.20 1.6 48.7
MB007 25901 185.4 185.5 0.15 2.2 40.0
MB007 25902 185.5 185.9 0.35 3.3 25.2
MB007 25903 185.9 186.0 0.15 6.0 4.2
MB007 25904 186.0 186.3 0.30 0.7 6.2
MB007 25905 186.3 186.6 0.25 2.7 4.2
MB007 25906 186.6 187.1 0.50 6.2 2.9
AD007 650243 367.3 367.5 0.25 0.6 0.0
AD007 650244 367.5 367.8 0.25 0.2 0.0
AD007 650245 367.8 368.2 0.45 0.1 0.0
AD008 772068 317.0 317.2 0.17 79.2 27.8
AD008 772069 317.2 317.6 0.43 89.3 19.4
AD008 772070 317.6 317.8 0.20 88.6 65.9
AD008 772072 317.8 318.0 0.15 328.0 44.9
*AD003 650495 123.2 123.4 0.15 5.6 3.7
*AD003 650496 123.4 123.7 0.30 1.1 0.1
*AD003 650497 123.7 123.9 0.25 1.4 0.1
*AD003 650498 123.9 124.5 0.60 2.1 0.0
*AD003 650499 124.5 124.8 0.25 0.4 0.1
*AD003 650500 124.8 125.1 0.30 10.7 9.7
*AD003 576201 125.1 125.2 0.15 3.2 61.5
*AD003 576202 125.2 125.4 0.20 5.4 3.5
*AD003 576203 125.4 125.7 0.30 1.1 0.3
*AD003 576204 125.7 126.5 0.80 0.1 0.2
*AD003 576205 126.5 127.2 0.70 0.1 0.0
*AD003 Not Sampled 127.2 127.6 0.40 0.0 0.0
*AD003 576206 127.6 127.9 0.30 3.9 3.3
*AD003 576226 149.0 149.2 0.15 2.7 0.0
*AD003 576227 149.2 149.7 0.55 8.5 0.0
*AD003 576228 149.7 150.1 0.35 1.4 0.0
*AD003 576229 150.1 150.4 0.30 3.7 0.0
*AD003 576230 150.4 150.5 0.17 0.8 0.0
*AD003 576231 150.5 151.0 0.48 0.6 0.0
*AD003 576232 151.0 151.5 0.50 0.7 0.0
*AD003 576233 151.5 152.1 0.60 0.5 0.0
*AD003 576234 152.1 152.5 0.40 1.6 0.0
*AD003 576235 152.5 153.3 0.80 0.8 0.0
*AD003 Not Sampled 153.3 153.7 0.40 0.0 0.0
*AD003 576237 153.7 154.6 0.85 1.5 1.1
*AD003 576238 154.6 155.0 0.45 0.8 0.2
*AD003 576239 155.0 155.8 0.80 2.0 0.9
*AD003 576240 155.8 156.2 0.40 0.3 0.1
*AD003 576241 156.2 157.0 0.80 0.1 0.0
*AD003 576242 157.0 158.0 1.00 0.1 0.0
*AD003 576243 158.0 158.8 0.80 0.1 0.0
*AD003 576244 158.8 159.1 0.30 0.1 0.0
*AD003 576245 159.1 159.7 0.60 0.0 0.0
*AD003 576246 159.7 160.5 0.80 0.0 0.0
*AD003 576247 160.5 161.5 0.95 0.0 0.0
*AD003 576248 161.5 162.1 0.65 0.1 0.0
*AD003 576249 162.1 163.1 0.95 0.0 0.0
*AD003 576250 163.1 163.5 0.45 0.0 0.0
*AD003 576251 163.5 164.2 0.65 0.0 0.0
*AD003 576252 164.2 165.0 0.85 0.0 0.0
*AD003 576253 165.0 166.0 1.00 0.0 0.0
*AD003 576254 166.0 166.4 0.35 3.7 0.0
*AD003 576255 166.4 166.5 0.15 175.8 0.0
*AD003 576256 166.5 166.9 0.43 1.5 0.0
*AD003 576257 166.9 167.9 1.00 1.3 0.0
*AD003 576258 167.9 168.1 0.20 4.4 0.0
*AD004 650302 175.0 175.6 0.60 5.2 0.0
* Sample is not part of the targeted continuous reef

Table 2

Cuffley Lode Drill Results
Hole ID Hole
Completion Date
Hole
Completion Depth (m)
Intercept
Northing (Mine Grid)
Intercept
Easting (Mine Grid)
RL True Width (m) Gold Grade (g/t) Antimony Grade (%) AuEq (g/t) over 1.8m
MB007 28/06/2011 353.9 5028.9 15184.2 1030.1 0.93 3.7 15.6 20.8
AD001 2/09/2011 392.8 5081.6 15191.6 976.1 0.89 8.7 2.1 6.7
AD002 5/08/2011 343.5 4988.4 15179.9 965.5 0.73 7.3 27.0 28.9
AD002 Wedge 11/08/2011 296.6 4989.0 15179.9 967.0 0.94 17.2 11.5 23.2
*AD003 13/09/2011 375.7 1522.8 15262.9 1096.4 **4.70 2.0 7.4 NA
*AD003 13/09/2011 375.7 1522.1 15239.2 1073.4 **19.13 2.3 0.1 NA
*AD004 17/08/2011 320.6 4933.7 15165.7 1043.1 **0.60 5.2 0.0 NA
AD005 29/09/2011 370.7 4938.8 15172.8 974.3 0.82 78.8 21.3 58.9
AD006 24/10/2011 494.6 4945.6 15187.8 862.7 0.42 38.3 12.5 15.9
AD007 18/11/2011 482.1 4886.2 15179.7 919.4 0.62 0.3 0.0 0.1
AD008 6/12/2011 366.3 5015.7 15192.8 913.7 0.56 125.0 34.7 64.3
* Interval is not part of the targeted continuous reef

** Down-hole interval not true width

The broad geological relationships, together with locations and grades of Mandalay's drill intercepts at Alison are displayed on the accompanying long section of the vein (click here to view Figure 2 - Alison Long Section and here to view Figure 3 - Alison Schematic Section 4900N).

On the long section, it can be seen that the drill hole intercepts define a mineralized body that is at least 150 m from north to south and 175 m in depth extent, with AuEq g/t (see definition below) grades diluted to 1.8 m (Augusta minimum mining width) ranging from 6.7 to 64.3 g/t Au Eq.

The mineralized body is open at depth, and to the north. Based on the pinch and swell nature of the known veins in the Costerfield mineral district, potential also remains for expansion of the body southwards, beyond AD007.

Drilling and Assaying

Drilling on the Alison vein at Costerfield is currently contracted to Starwest Drilling, with two surface diamond drill rigs using HQTW coring systems. Core is logged, split, and sampled on site by Mandalay personnel. Samples are sent to Onsite Laboratory Services Labs, where they are prepared and assayed (atomic adsorption for antimony and fire assay for gold). Mandalay maintains a quality control program which includes incorporation of blanks and standards with samples for assays as well as duplicate assays of selected samples. The detailed process of drilling through sampling, assaying, and quality control is described in the Company's independent NI-43-101 technical report entitled "Mandalay Resources  Corporation: Costerfield (Augusta) Gold-Antimony Mine: Mineral Resource and Mineral Reserve Estimate" filed on June 2, 2011.

The gold equivalent grade ("AuEq g/t") of each assayed interval was calculated according to the formula:

Price per 10 kg Sb * Sb Recovery(%)

AuEq(g/t) = Au(g/t) + Sb(%) * Price per 1g Au * Au Recovery (%)

using a gold price of US$1,275/oz, an antimony price of US$11,625/t, and total metallurgical recoveries of 71% for gold and 59.4% for antimony.

Qualified Person:

Chris Gregory, General Manager of Australasian Corporate Development and Exploration for Mandalay Resources, a Member of Australian Institute of Geoscientists (AIG) and a Qualified Person as defined by NI 43-101, has reviewed and approved the technical and scientific information contained in this release.

About Mandalay Resources Corporation:

Mandalay Resources is a Canadian-based natural resource company with production and exploration assets in Australia and Chile. The Company is focused on executing a roll-up strategy, creating critical mass by aggregating advanced or in-production gold, copper, silver and antimony projects in Australia and the Americas to generate near-term cash flow and shareholder value.

Forward-Looking Statements:

This news release contains "forward-looking statements" within the meaning of applicable securities laws, in particular with respect to the significance of reported drill intercepts at the Costerfield mine on the Company's operational plans and expectations. Readers are cautioned not to place undue reliance on forward-looking statements. Actual results and developments may differ materially from those contemplated by these statements depending on, among other things, changes in commodity prices, general market and economic conditions, and success of future drilling. The factors identified above are not intended to represent a complete list of the factors that could affect Mandalay. A description of additional risks that could result in actual results and developments differing from those contemplated by forward-looking statements in this news release can be found under the heading ―"Risk Factors" in Mandalay's annual information form dated March 31, 2011, a copy of which is available under Mandalay's profile at www.sedar.com. In addition, there can be no assurance that any inferred resources that are discovered as a result of additional drilling will ever be upgraded to proven or probable reserves. Although Mandalay has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements.

 

 

 

PDF with caption: "Figure 1 - Alison Drilling Map". PDF available at: http://stream1.newswire.ca/media/2012/01/10/20120110_C2877_DOC_EN_8743.pdf

PDF with caption: "Figure 2 - Alison Long Section". PDF available at: http://stream1.newswire.ca/media/2012/01/10/20120110_C2877_DOC_EN_8744.pdf

PDF with caption: "Figure 3 - Alison Schematic Section 4900N". PDF available at: http://stream1.newswire.ca/media/2012/01/10/20120110_C2877_DOC_EN_8745.pdf

SOURCE Mandalay Resources Corporation

For further information:

Bradford Mills
Chief Executive Officer

Greg DiTomaso
Investor Relations
Contact: 647.260.1566
Email: g.ditomaso@mandalayresources.com
Company website: www.mandalayresources.com

Profil de l'entreprise

Mandalay Resources Corporation

Renseignements sur cet organisme


FORFAITS PERSONNALISÉS

Jetez un coup d’œil sur nos forfaits personnalisés ou créez le vôtre selon vos besoins de communication particuliers.

Commencez dès aujourd'hui .

ADHÉSION À CNW

Remplissez un formulaire d'adhésion à CNW ou communiquez avec nous au 1-877-269-7890.

RENSEIGNEZ-VOUS SUR LES SERVICES DE CNW

Demandez plus d'informations sur les produits et services de CNW ou communiquez avec nous au 1‑877-269-7890.