VANCOUVER, BRITISH COLUMBIA -- (Marketwire) -- 03/20/13 -- Channel Resources Ltd. ("Channel" or the "Company") (TSX VENTURE: CHU) is providing an update on the Company's Tanlouka gold project in Burkina Faso, West Africa ("Tanlouka") as well as its plans to advance the project.
Channel has made significant progress in advancing Tanlouka since it first began exploratory drilling activities in 2010. After making its initial gold discovery, the Company delineated a sizeable initial resource (425,000 oz gold Indicated, 729,000 oz gold Inferred - see table below) at Tanlouka's Mankarga 5 deposit in only two years and at a discovery cost that is one of the lowest in the industry.
Exploration work conducted to date indicates excellent potential to expand the resource at Mankarga 5. The 2,000 metre long Whittle pit shell that constrains the resource has an average depth of only 160 metres, with the mineralized structures remaining open to depth. It is anticipated that additional drilling below the current resource blocks will result in an increase in resource gold ounces, as it has for a similar nearby gold deposit in Burkina Faso whose planned pit depth exceeds 450 metres. The Mankarga 5 structure also has potential for along-strike extensions, presenting additional opportunities to increase resources.
The free-milling nature of the gold in Mankarga 5's oxide and sulphide mineralization indicates that there is a high degree of flexibility with respect to processing technologies that can be applied including gravity recovery, heap-leach extraction and CIL processing. Approximately 21% of Mankarga 5's total resource ounces are contained in weathered oxide-type mineralization. These ounces appear to be amenable to low-cost heap-leach extraction methods based on preliminary metallurgical testing, offering opportunities for low initial capital costs in a staged development of the project.
The Company has also recently outlined compelling new exploration targets in the Manesse and Tanwaka zones, located within five and ten kilometres to the north of Mankarga 5 on the Tanlouka permit. The new targets, which have been defined by extensive 100 metre by 25 metre soil sampling grids and high resolution airborne magnetic and radiometric surveys, are now ready to be drill-tested and indicate excellent potential for new discoveries.
Channel has developed detailed short and medium-term plans for drill programs on all three target areas - Manesse, Tanwaka and Mankarga 5 extensions - as well as programs to advance the Mankarga 5 deposit to the pre-feasibility stage. These programs will be supported by infrastructure that the Company has developed at its exploration 'base' in the town of Mogtedo, just north of the project permit, as well as at a drilling camp constructed proximal to the Mankarga 5 deposit.
"The recent downturn in resource-related market sectors, most pronounced in the junior mineral exploration group, has resulted in a significant erosion of the Company's market capitalization to a level where the gold ounces within the Mankarga 5 deposit have been valued at well under $5 per ounce," said Colin McAleenan, Channel's President and CEO. "With working capital of $1.2 million as at December 31, 2012, the Company continues to take measures to manage its operating expenditures and to prioritize its corporate objectives. Channel remains confident in the quality and potential of the Tanlouka asset, and is considering various strategies that will facilitate the continued growth of the project and the release of its value to shareholders."
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