Isambara Gold Mine, Tanzania

The Isambara licence falls within the Simba project, a 70-15-15 joint venture between MDN Northern Mining (as operator), Lakota Resources and Jope Business Associates, covering a territory of 40km² located 28km north of the Tulawaka Gold Mine.

Initially identified by soil geochemistry surveys over a length of 5km, the Isambara target has subsequently undergone detailed soil geochemical and gradient induced polarisation (IP) surveys and a series of drilling phases throughout 2007.

GEOLOGY

The geology is principally gold-bearing quartz with other gold intersections of mainly granite with pyrite. Mineralisation of the eastern target area is in shear zones through granodiorite intrusions, while the western target is a volcanic host at contact with the batholith. The best sections lie within pyrite-rich quartz veins, with most being hosted by sheared granite containing associated minor sulphides.

These shear zones themselves appear to be delineated by a succession of high-grade gold lenses and low-content areas, characterised by multiple injections of quartz, strong alterations and sulphide deposits, dominated by pyrite.

DRILLING RESULTS

In September 2006, 39 reversed circulation (RC) holes were drilled for a total of 1,713m, to investigate initial drill intersections from the previous year and one hole in particular – ISRAB-21. This intersected 8m at 14.54g/t Au, with a check analysis of 13.49g/t Au from 45 to 53m within a pyrite-rich quartz vein lying in a shear corridor; and 5m at 14.93g/t Au, with a check analysis of 13.22g/t Au from 1 to 6m in the ferricrete. Four phases of drilling were subsequently planned for 2007.

Concentrating on a number of features identified by the earlier surveys as favourable to gold mineralisation, the first of these confirmed the extension of the gold structure over a length of 1.3km, laterally open over a possible distance of 5km. Completed in May, this involved 25 RC holes being drilled for a total of 1,487m, though the drilling techniques used did not allow the true width and orientation of the mineralised intersections to be accurately determined.

Holes were drilled at a spacing of 50m to either side of ISRAB-21, as well as a twin and a scissor hole, but all failed to intersect the mineralised quartz structure that the earlier drilling had revealed.

As a result, it was postulated that the vein might be held within a tension fracture, itself running at a high angle to the direction of the main shear, probably lying sub-parallel to the initial drill fence. To test this, two additional scissor holes (ISRC-49 and 50) were then drilled at near-right angles to the original fences, which successfully intersected the gold-bearing quartz seam.

The second phase, which concluded in September 2007, comprised nearly 4,000m of reversed circulation drilling and over 2,000m of diamond drilling. This enabled the gold mineralisation context of the east target to be specified. In addition, it also led to the discovery of a new mineralised zone 2km north of previously known targets.

The results of the diamond drilling also highlighted similarities with the gold deposits of the Bourlamaque batholith found at the mining camp of Val d'Or (Abitibi) and with the Ferderber gold deposit at the Belmoral Gold Mine. This produced over 355,000oz of gold with an average grade of 6.46g/t; the Isambara find shares many details of geology and mineralisation with the old Belmoral workings.

The second phase yielded broadly similar findings to preceding investigations and in the eastern target area, where the exploration efforts were chiefly concentrated. Results indicated 17.40g/t of gold over 1m or 9.13g/t of gold over 1m and 2.40g/t of gold over 4m.

Eight diamond and seven RC drill holes produced a total of 26 gold intersections with gold grades higher than 1g/t, ranging from 0.5–4m in thickness.

In addition, a total of 600m of RC drilling was carried out on the newly indicated deposit, one hole returning 1.66g/t gold over 1m to a depth of 2m, while another yielded seven gold intersections with grades greater than 1g/t of gold. In particular, it returned results of 5.54g/t gold over 2m at a depth of 64m and 2.84g/t of gold over 5m at a depth of 119m.

All samples underwent fire assay analysis at the SGS laboratories in Tanzania and were certified in accordance with the necessary international standards, 12% control samples being included in MDN's rigorous programme of analytical grade verification.

THE FUTURE

Phases 1 and 2 successfully confirmed the presence of gold mineralisation within distant zones of the identified ground anomaly and at more important depths than those that earlier RC drill holes had tested. Results remain pending on seven drill holes on this licence, which follow up on another earlier intersection 900m to the west of ISRAB-21. The original RC drill hole – ISRC-21 – intersected 3m at 8.63g/t Au, with a check analysis of 6.95g/t Au from 40 to 43m.

A third phase of drilling began in early October 2007, which is intended to explore mineralisation within the previously unexplored zones of the structure, while also establishing the extent of the richest and most consistent sectors with greater precision.

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