News Column

Sovereign Gold Company Limited - Activity Update, Mount Adrah Gold

July 1, 2014



ENP Newswire - 01 July 2014

Release date- 27062014 - Sovereign Gold Company Limited (ASX: SOC) is pleased to provide shareholders with an update on the current activities of Mount Adrah Gold Limited.

Recent drilling at the Mount Adrah Gold Project (MAGP), in southern NSW, tested peripheral high-grade gold reefs, both proximal and distal, to the main Hobbs Pipe resource. The initial program using the Company's own Mac200 scout rig comprised three short holes drilled at the Hobbs SE, Arcadia and Crown Reef prospects.

This was followed by a two-hole wedge drilling program to ascertain the geometry and extent of high-grade gold reef style mineralization in close proximity to the Hobbs Pipe gold deposit with a Mineral Resource of 770,000 oz of gold at various cut-off grades with Indicated - 440,000 oz from 12.1 Mt at 1.1 g/t gold and Inferred - 330,000 oz from 8.4 Mt at 1.1 g/t.

Exploration Drilling (MAGD001-3)

Hobbs Southeast (MAGD001)

Hobbs Southeast prospect is located 800m SE of the Hobbs Pipe deposit

The prospect is on a rounded knoll with extensive but irregular outcropping monzodiorite lithologically similar to Hobbs Pipe, also carrying some gold values

A breccia of unaltered monzodiorite and hornfels was intersected, with minor sections of silica and sericite alteration similar to the Hobbs Pipe style

1m @ 2.6 g/t Au from 14m was the peak value recorded, corresponding with the most altered section of the core

Results indicate potential for an underlying auriferous monzodiorite pipe Arcadia (MAGD002)

Arcadia prospect is located 400m south of the Hobbs Pipe deposit

Targeted a sheared quartz vein hosted in hornfels

1m @ 14.7 g/t Au from 6m, associated with shear-hosted quartz veins

Result illustrates additional potential for higher grade peripheral reefs to contribute to resources

Crown Reef (MAGD003)

Crown Reef prospect is located 100m northeast of the Hobbs Pipe on Mount Adrah

The prospect is characterised by brecciated quartz reefs in quartz-muscovite schist

7m @ 1.0 g/t Au from 21m, in veined and altered hornfels

2m @ 1.1 g/t Au from 33m, in hornfels-hosted quartz reefs

6m @ 0.9 g/t Au from 43.1m, in hornfels-hosted quartz reefs

Represents mineralization within the 'waste rock' volume modelled in open cut mining scenarios considered for the upper section of the Hobbs Pipe Resource

Wedge Drilling - Castor and Procyon Reefs

Previous drilling by Mount Adrah intersected three reefs in two zones of high-grade gold mineralization peripheral to (and north of) the main Hobbs Pipe Resource. The Company recently completed two wedge holes from the parent hole GHD009 wedged from 450m downhole, to determine the orientation and continuity of these reefs.

Wedge holes successfully intersected three reefs within a downhole distance of 56m; one Procyon Reef and two Castor Reefs

Strong nugget effect observed, with visible gold in GHD009B at Procyon Reef

Orientation of the three reefs now determined from drill hole correlation and structural analysis

New orientation allows for plausible correlation of gold mineralization in adjacent drill holes

Second half of the core is currently being re-assayed (screen fire), over the visually mineralized intervals, to get a better statistical determination of the likely grade of the reefs.

The nuggetty nature of gold within these reef systems has proved problematic for sampling. For example, the sample of Procyon Reef from GHD009B (473.4 - 474.1m) that was sent for assay returned a value of 1.96 g/t Au. However the grade is potentially much higher as visible gold was observed in the half core that was retained in the core trays.

Investor Contact:

Henry Kinstlinger

Sovereign Gold Company Limited

Tel: +61 2 9251 7177


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Source: ENP Newswire


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