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The Laogouxi Gold Project is located in the Daxing’anling Region that covers an area of over 600,000km2 bordering Russia and the province of Inner Mongolia. Sinovus' interest in the region is derived through a 70%-owned co-operative joint venture ('CJV'), which holds an exploration licence over the Laogouxi Property. The Laogouxi Exploration LicenceThis Licence is located at the northern end of the Daxing’anling Range and is only 100km from the border with Russia. The gold anomalies at this licence were discovered by regional stream geochemical surveys, but the region is well-known for alluvial gold mining. The licence, which covers an area of approximately 39.5km2, contains two exploration prospects, known as Laogouxi and Sendiaokunanshan. |
Laogouxi Project, Regional Map Click on Image for bigger version |
The Laogouxi Prospect is comprised of several widespread low-grade gold zones, which contain several patches of elevated gold at potentially economic grades. Previous exploration included soil surveys, trenching, limited drilling, and shaft and underground drive exploration.
The soil surveys identified 29 anomalous gold targets, 9 of which also showed composite anomalies with silver, arsenic and antimony. Some significant mineral intersections have been discovered during the exploration work, including 22m at 2.3g/t gold, and 17m at 2.5g/t gold.
At the Sendiaokunanshan Prospect, soil surveys during 2001 and 2002 identified 18 anomalous gold targets. Surface trenching revealed one alteration zone that contained one mineralised vein; the controlled length of this vein is 68m, with an average thickness of 4.4m and an average grade of 1.8g/t gold.
Centerra Gold Inc ('Centerra') has signed an agreement with Sinovus' CJV, in which Sinovus has a 70% indirect interest, to farm into the CJV entity that holds the exploration licence over the Laogouxi Property. Under the agreement, Centerra will fund exploration and development expenditures to a maximum of US$5 million over a 5 year period to earn a 70% interest in the CJV entity.
Should the proposed agreement continue for its full term, Sinovus' effective interest will be reduced to 21%.
Centerra Gold (TSX: CG) is a TSX-listed gold mining and exploration company that owns two major gold producing mines in Central Asia. The Kumtor Mine (100% CG) in the Kyrgyz Republic produced about 568,000 ozs of gold in 2010, while the Boroo Mine (100% CG) in Mongolia produced about 111,000 ozs of gold. As at the end of 2010 Centerra's total gold resources and reserves stood at 8.4 million ozs of gold and 6.3 million ozs of gold respectively.
