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UPDATE - Savannah Resources finds more gold indications at Gaddamah in Oman


-- adds broker comment --

Savannah Resources (LON:SAV) has found more strong indications of gold during its exploration programme at Gaddmah West in Oman.

Trench work produced some notable samples including bonanza grades of 60.7 g/t, 48.4 g/t and 9.3 g/t over 1m to 3.7m sections.

Savannah will do more trench work to define the extent of the mineralisation before deciding where to drill.

David Archer, Savannah’s chief executive, said the results appear to be the gold-rich part  of a volcanogenic massive sulphide (VMS) system that bears similarities to the major Rakah gold deposit, located south of Block 4, which was successfully mined in the 1990's. 

Gaddamah is also part of a major VMS cluster that includes the Lasail, Lasail West, Aarja and Baydh copper mines, he said.

Block 4 is one of three blocks in Oman Savannah is exploring, primarily for copper. It completed an airborne magnetic (EM) survey over the area at the start of April.

Latest drill results on Block 4 and 5 of targets identified by that survey confirmed the presence of VMS mineralisation intersecting both massive and disseminated copper sulphides, said Archer.

Best results included 1.15m at 3.6% copper from 35.5m at one hole in Block 4, though drilling at Sarami West on Block 5 failed to locate the targeted EM anomalies, but intersected a strong alteration system similar to those seen around the margins of VMS deposits.

Archer said he was pleased to confirm VMS mineralisation at Ghayth (Block 4), which continues to provide strong indications that an economic copper deposit could be present.  

Broker RFC Ambrian said the gold results looked impressive given the high grades and apparently mineable widths of the mineralisation. 

At Sarami West, the down-hole EM survey should enable it to locate the anomalies identified in the recent airborne EM survey and allow it to re-target the drill programme. 

Shares fell 2% to 2p.

Quick facts: Savannah Resources PLC

Price: 2.05 GBX

Market: AIM
Market Cap: £26.63 m

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on 08/04/2016

2 min read