KWG trading resumes; Alta Paranaiba update
KWG Resources Inc KWGR
Shares issued 74,636,959 Dec 6 close $0.20
Tue 7 Dec 99 News Release
Mr. Michael Newbury reports
The shares of the company are again available for trade reporting on CDN in
Toronto and the company has recently filed a preliminary prospectus with
the appropriate regulatory authorities. Management wishes to take the
opportunity to update its shareholders on the results from the exploration
program being conducted on the Alto Paranaiba diamond project, located in
Brazil.
In recent press releases (Stockwatch Oct. 19 and Nov. 23) project operator
Line Islands Exploration Inc. and Spider Resources announced the discovery
of possibly five new kimberlite pipes, of which three are now confirmed by
diamond drilling while the other two have been detected by shallow auger
drilling only. The three confirmed pipes designated as MK-1, MK-3 and MK-4
will be tested for their macrodiamonds content by processing bulk samples
in the diamond processing plant located on the property. The plant has been
upgraded with a pan concentrator to enable testing of the MK-1 pipe.
Material from the MK-1 pipe is being trucked to the wash plant and
processing is to begin shortly. Bulk sampling of the other two confirmed
kimberlites will follow. Confirmation by diamond drilling of the MK-2 and
MK-5 kimberlites is in progress.
The site of the MK-1 kimberlite, at the headwaters of a small stream, from
which the recovery in the alluvium of a 200-carat stone, as recorded by
Barbosa O., 1991, is considered promising. A ground magnetic survey has
defined a strike length of about 250 metres. Four diamond drill holes have
intersected kimberlite over a width ranging from 30 to 36 metres. Two of
the holes were drilled vertically and encountered weathered kimberlite
starting at four and five metres respectively. A third vertical hole
returned chlorite schist from surface down to 51.6 metres, then continued
in kimberlite to a depth of 82 metres before re-entering schist. The fourth
hole, inclined at 45 degrees, returned 23 metres of schist, followed by 55
metres of kimberlite prior to ending in schist. Preliminary analysis of the
geophysics and drill results indicate a steeply dipping, but non-vertical,
body that is 20 to 30 metres in width and 250 metres in length. A
cross-section of the MK-1 pipe has been stripped by bulldozer and a bulk
sample has been excavated for treatment at the nearby diamond processing
plant. In preparation, a pan separator is being installed at the plant to
improve the efficiency of extracting the concentrates for the X-ray sortex
diamond recovery system.
So far other kimberlite pipes, MK-3 and MK-4, have been delineated by a
ground magnetic survey and identified as kimberlite by auger drilling and
diamond drilling. An interpretation of the magnetic data indicates the
dimensions of the pipes are approximately 50 by 250 metres and 100 by 200
metres respectively. At this stage auger drilling at the MK-5 site suggests
a fifth kimberlite may be confirmed by the diamond drilling program.
At the site of MK-2, the ground magnetic survey and interpretation
identified a linear anomaly with the same magnetic characteristics as MK-1
and a strike length of 300 metres. Auger drill results have identified
abundant indicator minerals and diamond drill testing is planned.
These new discoveries are of special exploration interest for several
reasons. First, they lie within the local watershed of a section of the
Paranaiba River that has historically produced many large diamonds from
alluvial gravels. Second, they are near surface and close to the operating
diamond processing plant. This provides a unique opportunity to extract a
bulk sample and make an early preliminary assessment of their macrodiamond
potential. It is anticipated that at least 100 tons from MK-1 will be
processed before the end of the year.
Currently KWG has a 73-per-cent interest in the Alto Paranaiba diamond
project and Line Islands has an option to earn up to a 40-per-cent interest
in the property.
(c) Copyright 1999 Canjex Publishing Ltd. canada-stockwatch.com |
