SAS Announces the Completion of A Mineral Resource Estimate on the Smoke Deep
Zone and Decision to Commence Underground Exploration Development


TORONTO, June 29 /CNW/ - St Andrew Goldfields Ltd. (TSX:SAS), ("SAS" or the "Company") is pleased to announce the completion of an internal estimate of Mineral Resources for the Smoke Deep Zone at the Holloway Mine, and plans to commence underground exploration development by extending a ramp from the Lightning zone to the Smoke Deep Zone. The Holloway Mine (which recommenced production in October 2009) is located in the eastern portion of the Company's 120 km long land package extending from Timmins to the Quebec border.


  • Inferred mineral resource of 747,000 tonnes grading 5.83 grams per tonne gold ("g/t Au") totaling approximately 140,000 ounces of gold based on a 3.0 g/t Au cut-off grade.
  • Based on these results, the Company plans to advance exploration efforts on the Smoke Deep Zone by extending a 1,250 metre exploration ramp from the 730 level at the Lightning zone to the Smoke Deep Zone.
  • Mineral Resources were estimated based only on the areas that have been drilled to date, and there remains potential to expand the resource base to the east and down dip.

Gold mineralization in the Smoke Deep Zone occurs adjacent to the geological contact of mafic volcanics to the south and ultramafic volcanics to north. Generally, alteration and its associated gold mineralization occur within the mafic volcanics that have experienced significant alteration consisting of silica, sericite, hematite and albite with lesser chlorite, ankerite and carbonaceous minerals.

Gold mineralization, which is directly associated with sulfide content, varies in thickness from less than 1 metre up to approximately 36 metres true thickness, extends approximately 500 metres east-southeast along strike, and dips steeply to the south at approximately 80 degrees over a vertical distance of approximately 350 metres. Several sub-parallel zones of higher grade gold mineralization (i.e. >6 g/t Au) commonly define a moderate east dipping plunge. The mineralized zone remains open along strike, down dip, and eastwards down plunge.

The mineral resources were estimated by SAS using verified data from 32 underground drill holes from primarily three drilling campaigns (2007, Phase I drilling in 2009, and Phase II drilling in 2010). The drill spacing varies from approximately 25 to 75 metres, and averages 40 metres.

In order to estimate the mineral resources, a three-dimensional model was constructed representing various lithologies, including the mafic-ultramafic contact, the sub-parallel alteration zone and the zone of sulfide mineralization. The sulfide mineralized zone (and its attendant gold mineralization) was modeled to include the majority of any sulfide mineralization and extended through holes where only lower values occurred to ensure continuity. The review of the assay data indicated that the grade should be capped at 26 g/t Au. The assays were subsequently length-weighted and composited into 1 metre intervals and interpolated into a three dimensional block model within the mineralized zone using an inverse distance squared weighting.

There is sufficient knowledge of the grade and geometric continuity of the mineralization for the majority of the deposit, given the data density, to determine the grade and tonnage for the majority of the resources to be classified as Inferred Resources. The mineral resources have been tabulated at a 3.0 g/t gold cutoff grade and total 747,000 tonnes grading 5.83 g/t Au, totaling approximately 140,000 ounces of gold.

The Mineral Resource Estimate for the Smoke Deep Zone as of June 24, 2010, is summarized as follows:

Classification     Tonnes      Grade      Ounces Gold
      (000) (g/t Au) (000)
Inferred 747 5.83 140


  1. CIM Definition Standards were followed for Mineral Resources.
  2. Mineral Resources were estimated at a block cut-off grade of 3.0 g/t Au.
  3. Mineral Resources are estimated using a gold price of US$1,100per ounce, and an exchange rate of C$1.00 = US$0.95.

No attempt was made to convert these resources into reserves. This would require that the reserves be converted from contiguous zones of Indicated and Measured Mineral Resources based on an appropriate mine design and mine plan. In addition, although the resources are reported over various mining widths, additional dilution and mining recovery factors must be applied. Furthermore, conversion of the resources to reserves will require an estimate of gold recovery, or essentially gold losses during mining and milling.

With the completion of the inferred mineral resource estimate on the Smoke Deep Zone, the Company has made a decision to advance its exploration efforts at Smoke Deep by driving an underground exploration ramp from the 730 level of the Lightning zone (which lies approximately 1km to the west of Smoke Deep). The ramp is designed to conduct definition drilling and to provide drilling platforms to test the extension of the Smoke Deep Zone down dip, along strike and down plunge, where it remains untested.

Over the next 12 months, $6 million will be invested to excavate a 1,250 metre ramp, establish diamond drilling bays, and initiate phase III of the diamond drilling program.

"We are very happy to have been able to delineate this resource with a limited drilling program. With the drilling conducted to date, the cost to discover these 140,000 ounces is approximately $5/ounce.", said Jacques Perron, President & CEO of SAS. "The completion of the inferred resource gives us the confidence to commence the underground development at Smoke Deep to gain access to the zone with the intention to convert these resources into reserves, and to advance exploration efforts with the objective to expand the resource base in this area."

Qualified Person

The internal estimate of Mineral Resources was completed by the Company under the supervision of Michael Michaud, P.Geo, the Company's Vice President of Exploration, who is SAS' qualified person for this project as defined by NI 43-101, and who has reviewed and approved this news release.

About SAS

SAS (operating as "SAS Goldmines"), is a gold mining and exploration company with an extensive land package in the Timmins mining district, northeastern Ontario, which lies within the Abitibi greenstone belt, the most important host of historical gold production in Canada. SAS is focussed on developing its assets in the Timmins Camp which includes current and near-term gold production, and exploration activities.


This news release contains forward‐looking information and forward-looking statements (collectively, "forward-looking information") under applicable securities laws, concerning the Company's business, operations, condition and prospects, as well as management's objectives, strategies, beliefs and intentions. Forward-looking information is frequently identified by such words as "may", "will", "plan", "expect", "estimate", "anticipate", "believe", "intend" and similar words referring to future events and results, including extending an underground exploration ramp to, and continuing the planned exploration programs at Smoke Deep, and the estimated costs and timing associated with these programs. This forward-looking information is subject to known and unknown risks, uncertainties and other factors that may cause actual results to differ materially from those expressed or implied by the forward‐looking information. Factors that may cause actual results to vary materially include, but are not limited to, uncertainties relating to the interpretation of the geology, continuity, grade and size estimates of the mineral reserves and resources, unanticipated operational or technical difficulties and fluctuations in gold prices and exchange rates. Such forward looking information is based on a number of assumptions, including but not limited to, the assumption that drilling will continue as planned, and that the results thereof will be positive, the availability of drills and personnel, the level and volatility of the price of gold and the accuracy of the resource estimate and of the assumptions on which such estimates are based. Should one or more risks and uncertainties materialize or should any assumptions prove incorrect, then actual results could vary materially from those expressed or implied in the forward-looking information and accordingly, readers are cautioned not to place undue reliance on this forward‐looking information. SAS does not assume the obligation to revise or update this forward‐looking information after the date of this release or to revise such information to reflect the occurrence of future unanticipated events, except as may be required under applicable securities laws.

SOURCE St Andrew Goldfields Ltd.

For further information: For further information:

For more information, please contact

St Andrew Goldfields Ltd.
Suzette N Ramcharan
Manager, Investor Relations
1-800-463-5139 or (416) 815-9855
(416) 815-9437 (FAX)
St Andrew Goldfields Ltd.
Jacques Perron
President & CEO
1-800-463-5139 or (416) 815-9855
(416) 815-9437 (FAX)
St Andrew Goldfields Ltd.
Ben Au
CFO, VP Finance & Administration
1-800-463-5139 or (416) 815-9855
(416) 815-9437 (FAX)

Organization Profile

St Andrew Goldfields Ltd.

More on this organization

Custom Packages

Browse our custom packages or build your own to meet your unique communications needs.

Start today.

CNW Membership

Fill out a CNW membership form or contact us at 1 (877) 269-7890

Learn about CNW services

Request more information about CNW products and services or call us at 1 (877) 269-7890