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KBL Mining on path to resource upgrade with more copper-gold at Red Terror

Last updated: 07:10 03 Apr 2013 BST, First published: 06:10 03 Apr 2013 BST

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KBL Mining’s (ASX: KBL) Red Terror Deposit in New South Wales continues to grow in size with the discovery of further copper-gold mineralisation, which still remains open.

Diamond drilling has uncovered high grades of copper and gold adjacent to the current production source – the Red Terror Southwest Lode, expanding the size of the underground mineralised envelope.

The most notable intercept in terms of grade was 4.2 metres at 5.2% copper and 5.6 grams per tonne (g/t) gold, or 7.8% copper equivalent.

Other highlights included 17.1 metres at 0.8% copper and 6.4g/t gold, or 3.8% copper equivalent; 15.1 metres at 4.5% copper and 0.5g/t gold, or 4.8% copper equivalent; and 4.2 metres at 4.5% copper and 0.4g/t gold, or 4.7% copper equivalent.

These new intersections pave the way for the delivery of an updated JORC Resource at Red Terror, which forms part of the Mineral Hill mine.

Previous drilling in the south-western part of the Red Terror system identified three main, near-vertical lodes – the Southwest Lode, the Central Lode and the DDD Lode.

The Resource for the Red Terror deposit currently only comprises the Southwest Lode. The new Resource will include the Central and DDD Red Terror Lodes.

The vein-style mineralisation varies from copper-rich in the south, to gold-rich in the north. Current mining operations are focused on the Southwest Lode on multiple levels of development.

This latest round of drilling has further defined the western part of the Central Lode as well as expanded the north-south extent of the gold-rich DDD Lode.

Importantly, scope exists for further exploration upside at Red Terror as the underground copper-gold deposit remains open along strike and at depth towards the east.

KBL Mining held around A$2.9 million in cash at the end of December 2012 and recently completed the drawdown of a $10 million debt facility with Capri Trading.

These loan funds will be used to accelerate the development of high grade copper-gold ore from the Red Terror Ore bodies and commence construction of the gold circuit at Mineral Hill to increase gold recoveries from currently mined copper-gold ore.

The funds will also go towards the start of development of the Pearse gold-silver project at Mineral Hill, which will deliver a substantial increase in gold and silver production for KBL Mining in the 2014 financial year.


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