Luiri Gold Mines Limited (Luiri Gold), a Zambian registered company, was awarded the large scale Mining License for the Dunrobin and Matala gold mines, and approximately 2500km2 of exploration tenements in southern Zambia near the town of Mumbwa, in the latter part of 2003.
Luiri Gold has proposed a strategy for investment in the region by confirming and expanding the current resources to allow the recommencement of sustainable mine development and production at Dunrobin and Matala. Historical resources1 of almost 300,000 ounces have been defined based on exploration analysis and drilling completed in the 1990's at these deposits.
A further focus is to expand the exploration program to other local deposits and regional targets. Zambia has recently started to receive attention from the major gold companies as a result of the reassessment of regional gold models and the improvement in the political and fiscal regime in Zambia. The Ministry of Mines and Development is extremely cooperative, and it is Luiri Gold's opinion that Zambia will soon receive similar attention for gold exploration as its neighbour, Tanzania, in the east.
In September of 2004, Luiri Gold successfully raised US$500,000 in a placement to an individual investor. The company will use these funds on confirmatory drilling commencing in November of 2004 and will seek to raise further funds by listing on the UK Alternative Investment Market in the first or second quarter of 2005. Monies raised will fund a feasibility program on the recommencement of a sustainable mine development and expand the exploration programme to other local and regional targets as mentioned above.
The Mining License is located 120 km west-northwest of Lusaka, the capital of Zambia, and principal access is via a recently upgraded sealed regional road to Mumbwa.
After acquiring the License, Luiri Gold immediately commenced an exploration program which included a preliminary geological assessment (Aster image analysis and site mapping), data collection and soil sampling programmes over the Dunrobin and Matala mine areas. The assessment of the available drill hole data at Dunrobin and Matala show significant potential in the area. The drilling results at Dunrobin show a consistent relationship between the distribution of gossan and mineralization.
The drilling data shows mineralisation below the current pit and most likely extending beyond the limit of the current drilling. Historical intersections have returned downhole intercepts including 17.46m averaging 3.46g/t Au and 51m averaging 3.1g/t Au.
At Matala, the drilling shows an orebody with significant gold grades to the west of the previously mined deposit and open at depth. Historical intersections returned downhole intercepts including10m averaging 13.0g/t Au and 9m averaging 10.0g/t Au. The angle of intersection between the drill holes and the veins is approximately 30 degrees.
The soil sampling programme, which was completed in January 2004, also gave encouraging results and has identified additional targets immediately adjacent to the existing deposits. The current exploration programme will include 3,000 to 4,000 metres of resource drilling over the Dunrobin and Matala Deposits. Once the drilling is completed, an updated resource estimate will be undertaken to upgrade the resources to JORC compliant classifications, and to plan further drilling of the extensions to these two deposits.