•             Results from infill drilling continue to confirm the continuity and high grade nature at the rich Koka Gold Deposit at the Zara Project in Eritrea.

•             Close to 80% of infill drilling program now completed with further assays pending.

•             Geotechnical drilling program about to commence.

•             Planning of follow-on drill programs at Koka East and Koka South underway.

Chalice Gold Mines Limited (ASX: CHN) is pleased to advise that the further results from infill drilling at its Koka Gold Deposit in Eritrea continue to confirm the robust nature of the ore body.

The new results come from diamond drill holes ZARD 129, 130, 131, 132 and 134 which all achieved significant intersections of quartz stockwork mineralisation within the Koka Main Zone. Better intersections included:

•             8 metres grading 9.47 grams of gold per tonne in ZARD 129;

•             6 metres grading 26.92 grams of gold per tonne in ZARD 130;

•             11 metres grading 4.68 grams of gold per tonne in ZARD 131;

•             18 metres grading 29.30 grams of gold per tonne in ZARD 132, and;

•             11 metres grading 8.29 grams of gold per tonne in ZARD 134.

 A complete tabulation of results is provided in Table 1.

Assays have now been received from six holes (ZARD 128 having been previously reported) from a planned 31 hole, 5,000 metre infill diamond drilling programme designed to bring further confidence to the high grade mineralisation of the Koka Main Zone and to be used as part of the final resource estimation for the Koka Bankable Feasibility Study. A total of 25 diamond drill holes have now been completed and further assay results will be released to the market as they become available (Figure 2).

Following completion of this infill drilling program the drill rigs will focus on exploration of nearby targets, particularly the Koka South and Koka East zones, detailed planning for which has commenced. In addition, a five hole geotechnical programme designed to provide data on ground conditions in the pit highwall will commence shortly.

Koka, which is the flagship deposit at Chalice's 80 per cent-owned Zara Project, has JORC compliant Indicated and Inferred resources of 944,000 ounces.

About the Zara Gold Project

The Zara Joint Venture comprises four Exploration Licenses and two Prospecting Licenses covering an area of 615km2 situated in northern Eritrea, approximately 160km northwest of Asmara city (Figure 1). Chalice holds an 80% interest in the project with the remaining 20% held by Dragon Mining (ASX: DRA). The Koka Gold Deposit within the project contains an estimated resource of 5 million tonnes of ore containing 944,000ozs gold, grading 5.8grams of gold per tonne.  Metallurgical test work indicates +95% recovery with ~60% recovered by gravity. (mineweb.net)