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Continental Gold provides Buritica geochemical results

2010-08-09 08:11 ET - News Release

Ms. Naomi Nemeth reports

CONTINENTAL GOLD'S SOIL GEOCHEMICAL ANOMALIES ADD SIGNIFICANTLY TO THE EXPLORATION UPSIDE OF ITS BURITICA GOLD PROJECT, COLOMBIA

Continental Gold Ltd. has provided results of soil geochemical studies on the company's 100-per-cent-owned Buritica gold project, Antioquia province, Colombia.

Highlights

   * Gold and pathfinder element anomalies in Buritica soils significantly expand the footprints of gold mineralized systems in the company's tenements.
   * High-level gold (up to 9.73 grams per tonne (g/t)) base metal soil anomalies indicate subcropping mineralization in largely undrilled areas:
         o To the north and east of vein- and breccia-hosted gold deposits in the Yaragua mine area;
         o Southwest of this in the vicinity of the partially delineated Veta Sur vein system;
         o In the La Estrera area, farther to the south and southwest.
   * These anomalies indicate excellent potential for the discovery of new areas of vein, breccia and disseminated gold mineralization, and will be tested during the 2010 drill campaign;
   * The southeast quarter of the Buritica grid (from which there was extensive Spanish colonial gold production from colluvial deposits) will also be surface sampled in 2010 and this, along with further tightening of soil geochemistry elsewhere, is expected to provide additional drill targets.

"The anomalies illustrated in these soil geochemical results will be the basis of near future drill programs and represent significant advances in our technical knowledge of this complex, but highly prospective, carbonate base metal gold vein system," commented Ari Sussman, chief executive officer.

Details

Continental's surface and underground mapping and drilling at Buritica have outlined a base-metal-carbonate-type vein system with gold mineralization in sets of high-grade veins and also in breccias bodies. This work (2007 to 2009) has focused on the Yaragua mine area where 17,600 metres of diamond drilling plus underground sampling have partially delineated the high-grade auriferous vein sets through horizontal and vertical extents respectively of around 500 metres and 350 metres. Five drills are currently operating in the Yaragua mine area, targeting the vein sets and breccias as well as the Veta Sur vein system along an about-400-metre strike length to the southwest of Yaragua, as part of the 2010 Buritica exploration program. Stream and rock chip sampling and remnants of historical colluvial and underground Spanish colonial operations, however, suggest that gold mineralization gold is more widespread in the 18,000-hectare Buritica property, hosted by the Tertiary-age Buritica intrusive complex and also Cretaceous metasediments around its margins.

To clarify the distribution of near-surface mineralization Continental undertook a soil geochemical program over a 2.5- by 1.5-kilometre area of the Buritica property. One thousand four hundred sixty soil samples were collected (100-metre-line by 20-metre-sample spacing) and assayed for gold, silver, lead and zinc plus broad suite of additional elements, the base metals as pathfinders. Gold values range from 0.02 gram per tonne (g/t) to 9.73 g/t, 8 per cent of all samples returning in excess of 0.5 g/t. Gold, silver, lead (which reaches per cent levels) and zinc are generally strongly correlated, as in the Yaragua mineralization, the base metals exhibiting broader more continuous patterns than the precious metals. Plots of the soil anomalies for these metals are available on the company's website and these also show the soil grid, surface traces of 2008 to 2009 drilling and the location of underground workings.

The main multielement geochemical anomaly area is about 1,500 by 700 metres and trends northeasterly. Within this area high-level gold and base metal anomalies indicate subcropping mineralization in three largely undrilled subareas:

   * To the north and east of vein- and breccia-hosted gold deposits in the Yaragua mine area. The eastern anomalies appear to represent surface expressions along strike extensions of the Yaragua vein system whereas as those to the north may represent newly discovered vein and/or breccias systems;
   * Southwest of Yaragua in the vicinity of the Veta Sur system. These anomalies are open to the east and may represent the extensions of the Veta Sur as well as new vein systems;
   * Up to a kilometre southwest of Yaragua over large area underlain largely by Cretaceous metasediments and basalts. The broad base metal-gold anomalies may be indicative of more disseminated styles of mineralization but encompass the La Estrera auriferous vein system which was subject to some historical development. The southern soil anomalies are also open to the east into an area not yet soil sampled.

Over all, the soil geochemical anomalies significantly expand the footprints of gold mineralized systems in Continental's Buritica tenements. The company considers that there is excellent potential for the discovery of new vein, breccia-hosted and disseminated gold mineralization in the anomalous areas. Following on more closely spaced soil sampling and trenching Continental will drill the resulting priority targets during 2010.

The southeast quarter of the Buritica grid, which exhibits extensive colluvial workings and some underground developments dating to the Spanish colonial period, will also be soil sampled during 2010. This work, together with surface geological mapping, may be expected to yield additional drill targets.

Technical information

Soil samples were a composite of the well-developed B soil horizon and were taken from pits averaging 1.5 metres in depth. Samples were prepared in Colombia by ACME analytical laboratory and analyzed at its Vancouver laboratory. Multielement analysis including gold was done by ICP methods. ACME is an industry leader in the analysis of gold by ICP. A sequence of standards and blank samples was inserted into the soil sample stream with every batch submitted and all data reported in this release meet Continental's rigorous quality assurance/quality control (QA/QC) standards.

Stuart Moller, PGeo, is the qualified person for the information contained in this press release and is a qualified person within the meaning of National Instrument 43-101.

We seek Safe Harbor.

Buriticá is the company's highest priority property and is located in the Antioquía Department of Colombia, 75km northwest of Medellín. The project boasts excellent infrastructure with power and water readily available and accessibility guaranteed with paved roads.

Situated in a mineral-prolific region consisting of 18,000 hectares of high-grade gold veins and disseminated mineralization in breccias and sediments, Buriticá has a history of small-scale gold production and a bulk-sample operation continues to date. This property is characterized by a +500 meter 'Main Vein Zone' in a gold vein/breccia system located predominantly between two regional faults. Recent drilling by Continental Gold in the main vein zone has returned intersections of up to 79.09 g/t gold over 19.2 meters and 91.99 g/t gold over 7.0 meters. Continental Gold has also intersected a second, previously undetected, gold vein zone outside the Main Vein Zone which it refers to as the Veta Sur system. Initial results indicate this area contains the same type of high grade material as the main zone, returning results such as 12.18 g/t of gold over 38.1 meters and 12.01 g/t gold over 34.9 meters. Additional drilling is planned for this new Veta Sur system to determine its extent.

Continental's Progress at Buriticá
The mineralization at Buriticá consists of a porphyry-related carbonate base metal and gold vein and breccia system that has yielded numerous important areas of mineralization and several additional targets to be tested. Since the first discovery-hole in late 2007, Continental has completed over 17,000 metres of diamond drilling and over 1,200 metres of underground development at this project.

However, despite the significant drilling already undertaken at the property, the company believes Buriticá has more to offer. The project is now at the resource definition stage and, as well as planning an NI 43-101 mineral resource estimate within the next 12 months, Continental intends to complete 30,000 to 60,000 meters of drilling to explore the significant additional high grade vein potential and the lower grade disseminated gold potential they believe exists in several areas on the property. During the second and third quarters of 2010, Continental will have a minimum of four drills operating on the Buriticá property to complete a program of step-out drilling around the main vein corridor, to test areas outside this corridor

The Berlin Gold Project
Berlin is a drill-ready gold project located approx. 90 km north of Medellín. Another past-producing property in an area known for its historical gold production, the Berlin concessions cover 28,000 hectares and include the historical Berlin mine which operated from 1930 to 1946 and produced 413,000 oz of gold from a 20-metre thick lens with a production grade of 16 g/t Au and recoveries of 94%.

To date, surface mapping and sampling indicate excellent potential for large-scale mesothermal veins contained within a large, orogenic gold system. With over 80% of the known mineralized trend undrilled, more than 11 km of favorable vein trend in two subparallel belts have been outlined with a minimum of 4,000 metres of drilling planned in 2010.

Dominical, Dojura and Santander
While Buriticá and Berlin are Continental's highest priorities, the company also has several other promising projects simmering on the back burner, including a joint venture with AngloGold Ashanti on the Dojura project. Located in the Choco Department of Colombia and covering 37,235 hectares, Dojura constitutes a large area of porphyry-style alteration with significant historical alluvial gold production. The JV states that AngloGold Ashanti can earn up to 75% interest over three years by spending US$6.9 million in combined option payments and on exploration and development.

Also worth keeping an eye on are the Dominical and the Santander gold projects. The 100%-owned, 6,500 hectare Dominical property is a grass roots discovery of epithermal vein systems with strike extents of 400 – 1,500 meters. Chip samples produced 1.15 grams per tonne of gold at 12 meters, 1.00 grams at 24 meters and 0.86 grams at 30 meters.

The 100%-owned Santander project covers 6,000 hectares of concessions and is located near Ventana Gold's La Bodega property. Known, yet again, for historical high-grade production; Santander is situated on a belt in which the most prominent global gold rush is now occurring.

Why Columbia?
When asked, why Colombia? Continental was ready with a veritable arsenal of reasons:

   * Columbia has the 5th largest economy in Latin America (GDP US$242 Bn);
   * The country has the steadiest growth rate in Latin America 1970 – 2007 (WB);
   * Lowest average inflation in Latin America 1998 – 2008 (DANE);
   * FDI (Foreign Direct Investment) increased 400% 2002 - 2008 (Colombia Central Bank);
   * 2nd Best business climate in Latin America (World Bank);
   * 2nd Best investor protection in Latin America (Forbes);
   * 3rd Largest population in Latin America: 44.5 million people;
   * 4th Largest market cap. total in Latin America, and;
   * US$8.8 billion infrastructure investment through 2012;
   * Mining royalties to government of 3.2%.

With its corporate amalgamation now complete, Continental Gold Ltd., and its international management team with over 40 years combined Colombian experience, is now focused entirely on the exploration and development of its significant Colombian portfolio. Continental Gold has approximately 71 million share outstanding (96 million fully-diluted and has a solid cash position.

Follow Continental's drill program and mine development progress at www.continentalgold.com.

DISCLOSURE:
A fee has been paid for the production and distribution of this article and as such should be viewed in the context of advertising.

SOURCE: www.midasletter.com/news/...Back-in-business-gold-colombia.php

Previously, Mr. McKay has served as Vice President and CFO for Aurelian Resources Inc. and Senior Vice President Financial Operations for an international engineering and project management services firm and as Controller at Rio Algom Ltd., a Canadian based mining company that produced copper, gold, uranium, molybdenum, and coal in North and South America. Mr. McKay has also served as Vice President, Finance for Potash Company of Canada and has worked with the Bank of Montreal. Mr. McKay obtained his Chartered Accountants designation with Coopers & Lybrand. In addition to his role as CFO of Continental gold, Mr. McKay also serves as the CFO of Dalradian Resources Limited and is the CFO for Andina Minerals Inc. until September 30, 2010.

Continental Gold is also pleased to announce the appointment of Mr. Gustavo Koch to the newly-created position of Executive Vice President from his previous role with Continental as General Counsel.

"Gustavo has been a key member of Continental's management team since 2007 and his experience, counsel and personal drive have contributed significantly to the forward movement Continental Gold has experienced to date," commented CEO Ari Sussman. "In the newly-created role of executive vice president, Gustavo will give oversight to general administration for the Medellin office, provide management of operational activities in Colombia and continue to act as liaison between the Colombian and Canadian offices. We are fortunate to benefit from Gustavo's expansive knowledge of Colombian law and specific knowledge of Colombia mining law."

Mr. Koch has been a director and General Counsel of Continental Gold (the private company prior to amalgamation with Cronus Resources to become the public entity which is now called Continental Gold) since September 2007. From 1994 to 2007 Mr. Koch held various positions with Grupo de Bullet as Manager, Colombian Division Officer and Operating Manager. From 1993 to 1994 Mr. Koch was an Associate with the International Law Institute in Washington. Between 1992 and 1993 he was an Associate at the Latin American Mining Institute where he was responsible for editing The South American Investment and Mining Guide and The Mexican and Central American Investment and Mining Guide. Mr. Koch has a L.L.M in International Trade and Banking from the Washington College of Law and also attended the University Nacional Del Litoral, School of Law (J.D. Equivalent) in Argentina. He has been admitted to practice law in Argentina.

About Continental Gold Limited

Continental Gold Limited is an advanced-stage exploration company with eight gold projects covering 200,000 hectares in Colombia. Spearheaded by a management team with over 40 years of exploration and mining experience in South America, the Company has begun an aggressive exploration program on its extensive portfolio of properties with a focus on its flagship high-grade gold project, Buritica and Berlin, a second project with an aggressive exploration mapping and drilling program underway. Additional details on the Buritica project and the rest of Continental Gold's suite of gold exploration properties are available at www.ContinentalGold.com.

Forward-Looking Statements

"This press release contains or refers to forward-looking information, including statements regarding the estimation of mineral resources, exploration results, potential mineralization, exploration and mine development plans, timing of the commencement of operations and estimates of market conditions, and is based on current expectations that involve a number of business risks and uncertainties. Factors that could cause actual results to differ materially from any forward-looking statement include, but are not limited to, failure to convert estimated mineral resources to reserves, capital and operating costs varying significantly from estimates, the preliminary nature of metallurgical test results, delays in obtaining or failures to obtain required governmental, environmental or other project approvals, political risks, uncertainties relating to the availability and costs of financing needed in the future, changes in equity markets, inflation, changes in exchange rates, fluctuations in commodity prices, delays in the development of projects and the other risks involved in the mineral exploration and development industry. Forward-looking statements are subject to significant risks and uncertainties, and other factors that could cause actual results to differ materially from expected results. Readers should not place undue reliance on forward-looking statements. These forward-looking statements are made as of the date hereof and the Company assumes no responsibility to update them or revise them to reflect new events or circumstances other than as required by law."

Contacts: Continental Gold Limited Naomi Nemeth Vice President, Investor Relations +1 416.643.7638 info@continentalgold.com www.continentalgold.com

SOURCE: Continental Gold Ltd.

mailto:info@continentalgold.com www.continentalgold.com

“Gustavo is an important member of the management team of Continental since 2007 and his experience, advice and personal drive have contributed significantly to the forward movement Continental Gold has experienced so far,” says CEO Ari Sussman. “In the newly created position of executive vice president, Gustavo will provide oversight to the general administration of the Medellin office, provide the management of operations in Colombia and continue to serve as liaison between the Colombian and Canadian offices. We are lucky to benefit from extensive knowledge of Gustavo Colombian law and specific knowledge of Colombia mining law. ”

Mr. Koch is a director and General Counsel of Continental Gold (the private company before merging with Cronus means the public entity is now called Continental Gold now) since September 2007. From 1994-2007 Mr. Koch held various positions with Grupo de Bullet as a manager, Colombian Division Officer and manager. From 1993-1994 Mr. Koch was an associate with the International Law Institute in Washington. Between 1992 and 1993 he was an associate at the Latin American Mining Institute, where he was responsible for editing the South American Investment and Mining Guide and the Mexican and Central American Investment and Mining Guide. Mr. Koch has an LLM in international trade and finance at the Washington College of Law and also studied at the University Nacional del Litoral, School of Law (JD equivalent) in Argentina. He was admitted to the Bar in Argentina.

About Continental Gold Limited

Continental Gold Limited is an advanced-stage exploration company with eight gold projects that 200,000 hectares in Colombia. Led by a management team with over 40 years of exploration and mining experience in South America, the company has begun an aggressive exploration program on its extensive portfolio of properties with a focus on its flagship high-grade gold project, and Berlin Buritica , half project with an aggressive reconnaissance mapping and drilling program underway. Further information about the project Buritica and the rest of the suite Continental Gold’s gold exploration properties are available on www.ContinentalGold.com.

Forward-Looking Statements

“This press release contains or refers to forward-looking statements, including statements regarding the estimation of mineral resources, exploration results, potential mineralization, exploration and mine development plans, timing of commencement of operations and estimates of market conditions, and based on current expectations That a number of business risks and uncertainties. factors that could cause actual results to differ materially from the forward-looking statement to include, but are not limited to, failure to convert estimated mineral resources to reserves, capital and operating costs significantly varying from estimates, the preliminary nature of metallurgical test results, delays in obtaining or failures to obtain required governmental, environmental or other project approvals, political risks, uncertainties about the availability and costs of financing needed in the future, changes in equity markets , inflation, changes in exchange rates, fluctuations in commodity prices, delays in project development and other risks involved in mineral exploration and development of the industry. Forward-looking statements are subject to significant risks and uncertainties and other factors that could cause actual results to differ from anticipated results. Readers should not unduly rely on forward-looking statements. These forward-looking statements be made of the date hereof and we undertake no responsibility to them update or revise to reflect new events or circumstances other than as required by law. ”

  14:05:23         T      5.04      0.15     1,000§83 Mackie 124 Questrade K
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