Anaconda Mining reports 26.12 g/t over 3.6 meters and 22.74 g/t over 5.0 meters from historic drilling at Deer Cove

TORONTO, May 7, 2014 /CNW/ - Anaconda Mining Inc. ("Anaconda" or "the Company") - (TSX: ANX) reports historic assay results from 20 previously drilled holes by predecessor property holders from 1986 to 1988 and 2010 on its recently optioned Deer Cove property, which is located approximately 8 kilometers from the Pine Cove mill on the Ming's Bight Peninsula (See Exhibit A for location map).

Highlights:

  • Hole DC86001intersected 5.0 meters of 22.74 grams per tonne ("g/t") gold from 3.2 meters below surface;
  • Hole DC87073 had gold mineralization of 11.97 g/t over 4.1 meters from 89.8 meters to 93.9 meters; 26.12 g/t over 3.6 meters from 97.7 meters to 101.3 meters; 5.80 g/t over 3.4 meters from 105.3 meters to 108.7 meters;
  • DC88100 intersected 29.60 g/t over 1.7 meters from 41.3 meters to 43.0 meters;
  • DC10122 intersected 24.39 g/t over 2.3 meters from 25.9 meters to 28.2 meters.

President and CEO, Dustin Angelo, stated, "The wealth of historic data at Deer Cove helps expedite the development of the project. There has already been 138 holes drilled, an access road put in place and 500 meters of underground development. We will begin a drill program at the end of May to infill and confirm previous drill results, and test down dip below the level of historic drilling. Historic assay results are quite strong and we look forward to expanding the resource and ultimately putting Deer Cove into production to supplement the current ore feed from the Pine Cove pit."

2014 Deer Cove Exploration Program:

Anaconda has completed its compilation and review of the historic Deer Cove exploration data and is progressing with its next phase of exploration. A 2,000-meter diamond-drill program will begin in late May upon receipt of its exploration permit and will focus on both infill drilling and testing down-dip along the Deer Cove Thrust below the level of historic drilling. The program is expected to take about six weeks to complete. The drilling will be carried out by New Valley Drilling of Springdale under the supervision of Silvertip Exploration Consultants. The new data will be incorporated into the historic data to produce a resources estimate for the Deer Cove deposit.

Deer Cove Project Background:

In 1986, Noranda Exploration Company Limited discovered the Deer Cove gold deposit after follow up prospecting and trenching of extensive gold-in-till anomalies near Deer Cove Pond. A Noranda-Galveston Resources Limited joint venture (1987-1989) conducted a detailed exploration program including 138 diamond-drill holes, construction of a 7.2 km access road and 507 meters of underground exploration. Highlights of the Noranda diamond-drill program are presented in Table 1.

Hole ID From
meters
To
meters
Length
meters
Au
grams/tonne
DC86001 3.2 8.2 5 22.74
DC86002 5.2 9.91 4.71 10.24
DC86003 10.75 13.5 2.75 7.08
DC86007 15.4 17.75 2.35 6.57
DC86014 32.8 35.5 2.7 6.74
DC86052 42.5 45.4 2.9 7.33
DC87059 135.6 137.1 1.5 8.05
DC87067 42.5 45.9 3.4 11.13
DC87073 89.8 93.9 4.1 11.97
DC87073 97.7 101.3 3.6 26.12
DC87073 105.3 108.7 3.4 5.80
DC87077 88.5 92.1 3.6 5.26
DC87083 60 62.2 2.2 6.94
DC87091 99.7 105.8 6.1 7.22
DC87094 86 88 2 17.91
DC87095 88.8 90.5 1.7 4.89
DC88100 41.3 43 1.7 29.60
DC88101 105.3 106.8 1.5 5.86
DC10120 7.2 9.5 2.3 7.95
DC10122 25.9 28.2 2.3 24.39
DC10130 26.4 28.2 1.8 15.11
DC10131 37 39.1 2.1 7.83

Table 1. Selected historic diamond-drill assay results, Deer Cove. Results are weighted averages. All historic assay intervals refer to core length and at present true thicknesses of mineralized zones are not known by Anaconda.

No further work was undertaken and the property reverted to Crown Land on November 11, 1998. The area surrounding the Main Zone and the nearby Deer Cove talc resource was made Exempt Mineral Lands. In 1999, a call for proposals to develop the property was issued by the Government of Newfoundland and Labrador and in 1999 it was announced that the mineral rights to the Exempt Mineral Land had been awarded to WMC International Limited. Unfortunately, no further work was completed and the land once again reverted to the Crown.

Between 2001-2002 and 2005-2006, South Coast Ventures Incorporated staked significant portions of the Ming's Bight Peninsula, including Deer Cove, and subsequently digitized much of the historic exploration information including the underground data for Deer Cove. In 2010, Tenacity Gold Mining Company Inc. ("Tenacity") contracted P&E Mining Consultants Inc. ("P&E") to undertake a mining and economic analysis of the Deer Cove project. P&E reported that the Deer Cove deposit, the portion lying above 45 meters above sea level, contained an estimated resource of 12,900 tonnes grading 10.45 grams/tonne ("g/t") gold at a cutoff grade of 6.0 g/t. (This is an historical resource and has not been verified by Anaconda.) The Deer Cove lease reverted to 1512513 Alberta Ltd. ("Alberta") and, in November 2013, Anaconda optioned the Deer Cove lease and other mining licenses around it from Alberta.

Geologic Overview of Deer Cove

The Deer Cove deposit is hosted by ophiolitic rocks of the Point Rousse Complex. It is hosted by mafic volcanic rocks which are faulted against talc-carbonate and serpentinized ultramafic rocks along the Deer Cove Sole Thrust. This south-verging thrust trends roughly east-northeast and dips 50° to 60° to the north-northwest. Gold mineralization is hosted by discontinuous lenses of brecciated quartz developed within an approximately north-south striking, 45°-55° west-dipping structure. The breccia lenses average less than 1 meter in width but locally they may reach up to 3 meters. Pyrite with lessor chalcopyrite and arsenopyrite occur disseminated in the wallrock, breccia fragments and quartz veins. The Main Zone has been traced by trenching and diamond drilling (87 holes drilled from surface) over a 500 m strike length, but is still open along strike to the north and down-dip. Within the Main Zone, the gold occurs both as free gold within the quartz veins and the altered wallrock, and disseminated within the sulphide minerals. There is a direct correlation between gold grades and pyrite concentrations. The best historic gold grades were reported from the most deformed sections of the zone, closest to the sole thrust where the zone abuts a jasper-rich volcaniclastic unit. Noranda reported that the southernmost 32 meters of the zone contained abundant visible gold and averaged 14.25 g/t Au over a width of 2.9 meters. Here the ore zone is crumpled into a series of sharp folds which plunge to the northwest.

While the Company has no reason to doubt the accuracy of the historic results, the existing data should not be relied upon until the Company's own exploration work confirms that the data meet National Instrument 43-101 standards for disclosure. Historic results and the work that generated them predate the enactment of National Instrument 43-101, and may not meet the requirements of that policy.

This news release has been reviewed and approved by David Evans, P. Geo., with Silvertip Exploration Consultants Inc., a "Qualified Person" under National Instrument 43-101.

ABOUT ANACONDA

Headquartered in Toronto, Canada, Anaconda is a growth oriented, gold mining and exploration company with a producing asset located on the Baie Verte Peninsula in Newfoundland, Canada called the Pine Cove mine.

FORWARD LOOKING STATEMENTS

This document contains or refers to forward-looking information. Such forward-looking information includes, among other things, statements regarding growth,  and is based on current expectations and assumptions of management that involve a number of business risks and uncertainties. Factors that could cause actual results to differ materially from any forward-looking statements include, but are not limited to: current and future market trends and growth opportunities and whether the Company will be able to capitalize upon them. Forward-looking statements look into the future and provide an opinion as to the effect of certain events and trends on the business. Forward-looking statements may include words such as "plans," "may," "estimates," "expects," "indicates," "targeting," "potential" and similar expressions. These forward-looking statements are based on current expectations and are subject to significant risks and uncertainties and other factors that could cause actual results to differ materially from expected results. Readers should not place undue reliance on forward-looking statements. These forward-looking statements are made as of the date hereof and the Company assumes no responsibility to update them or revise them to reflect new events or circumstances, except as required by law.

Image with caption: "Exhibit A (CNW Group/Anaconda Mining Inc.)". Image available at: http://photos.newswire.ca/images/download/20140507_C6922_PHOTO_EN_40055.jpg

SOURCE: Anaconda Mining Inc.

For further information:

Anaconda Mining Inc. 
Dustin Angelo
President and CEO 
(647) 260-1248  
Email: dangelo@anacondamining.com 

ProConsul Capital Ltd.
Andreas Curkovic
Investor Relations 
(416) 577-9927
Email:acurkovic@proconsulcapital.com

Company website: www.anacondamining.com


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