Alliance Pacific Gold Corp - News Release
Independent audit results of Buduk project
Alliance Pacific Gold Corp APG
Shares issued 8,164,116 Aug 26 close $0.58
Wed 27 Aug 97 News Release
Mr Brian Lueck reports,
An independent audit of the Buduk gold project has been completed by Watts,
Griffis and McOuat, Indonesia. This audit was commenced at the request of
the company to acquire an independent opinion as to the validity of the
resources believed to exist at Buduk. Other risk factors were also analyzed
for the company, allowing for a second opinion as to the company's ability
to profit from the discovery of an orebody.
The following statements are a direct quote from the executive summary of
the audit prepared for the company by Watts, Griffis and McOuat dated
August 10 1997*:
"Watts, Griffis and McOuat's (WGM's) specific tasks were to assess whether
the exploration techniques and procedures met accepted industry standards
generally taken to represent good exploration practices, to assess the
validity of the current Buduk resource estimate and to audit the
laboratories used by MRA (consultants used by Alliance Pacific).
"During January 1997, ongoing exploration drilling was directed towards
increasing the Buduk resource base. At that time, the gold-mineralized zone
having an average grade of 4.3 g/t Au, had been traced over a strike length
of 1,000m with an average width of 13.5m. Drilling indicated vertical
continuity to 150m below surface, but the zone was open below this level.
Surface mapping and sampling has indicated a total strike length for the
mineralized zone in excess of 3,500m.
"WGM has concluded that exploration procedures and techniques employed by
exploration personnel were appropriate and also conform to industry
standards. From our audit of the Indo Assay laboratory in Balikpapan, which
was used by MRA and its client, we concluded that practices at the
laboratory conform to normal industry standards, and that the laboratory as
well as the samples and data contained therein were and remain secure. On
the basis of check sampling and assaying carried out by WGM and under WGM's
sole supervision, we conclude that there is no justifiable reason to doubt
the accuracy of the previously reported gold contents of drill core and
other samples formerly analyzed from the Buduk prospect on the Buduk
exploitation KP. Although we did not check assay the eluvial gold deposit
as this would require a bulk sample, we believe current data adequately
supports the reported resource, and consequently, there is no reason to
discount the validity of the current eluvial resource base at Lim Tian and
Kho San Poi."
This audit also addresses the issues of title and political risk in
Indonesia, in relation to the rights held by Alliance Pacific. Much concern
has been expressed by the media as to these risks on Indonesian projects.
The following quotes from WGM's report address this issue:
"The government has supported the exploration licencing system which has
been in place now for more than 30 years. Despite pressures from both
public and other special interest groups, WGM is aware of no incidents
whereby the government has reneged on the terms of a contract of work or a
KP. WGM has observed several instances where key members of the government
circle have moved arbitrarily to increase their personal stake or the
public's ownership of mineral projects. In each instance, the highest
levels of government have moved quickly and decisively to stabilize the
situation and reassure investors. Recent pronouncements made during the
1997 parliamentary elections have cast uncertainty on the security of even
the most touted contracts of work. However, election-related rhetoric must
be distinguished from the mainstream of government policy. WGM's
conversations with the Canadian Embassy personnel have indicated:
1) the government of Indonesia recognizes that it requires foreign
capital to develop the country; and
2) the government recognizes that, even if the capital to enable
Indonesians to develop the country was available, Indonesians lack the
expertise to carry out the projects.
"It is WGM's opinion, therefore, based on our understanding of APG's
agreements with Ziiaton Investments, that APG is conducting its exploration
having insured that title is secure. We also believe that, should APG
discover economically exploitable mineralization, that APG will be able to
develop and exploit such mineralization subject to the terms of its KP and
its option agreement, subject to certain terms and royalties which are
payable on production, and subject to existing legislation which protects
rights of individual landowners and the environment.
"There are no land use restrictions of which WGM is aware which might
restrict APG's access to the property or its ability to bring the property
into production should an economically exploitable deposit be discovered on
the KP."
In terms of auditing the exploration and field program procedures, WGM's
mandate was to review field procedures, re-sample drill core, and to
discuss the geological environment to gain insight into the abilities of
the local personnel. The following quotes are from the audit on exploration
techniques:
"The most recent diamond drilling program utilized a highly mobile,
man-portable rig. The drilling rig was directly contracted to APG by MRA.
The reasons for this were two-fold. Firstly, APG wanted to expend its
exploration dollars in a prudent manner without the overhead costs that a
larger drilling company might charge as part of its fees. Secondly, the
company wished to minimize the need for expensive earth moving equipment on
site to build drill roads.
"There is little doubt that APG saved money in using the man-portable drill
for the project. All holes were well marked by short sections of PVC pipe
which were cemented into the collars of each hole, with the hole number
inscribed into the cement. This allowed WGM to see clearly the limited
amount of work required to prepare drill sites.
WGM is of the opinion that the drilling carried out to date has been
prudent and has exemplified good overall exploration practices. The aims of
the exploration conducted to date have been conservative and have
accomplished what the exploration was intended to do, mainly, to confirm
the eluvial gold resource, to test the gold-bearing zone over a modest
strike length, and develop a sense of continuity, if possible, within the
mineralized zone."
Reliability has been of great concern on exploration projects in light of
recent industry frauds perpetrated on unwary shareholders. The following
quotes from WGM's audit refer to this subject:
"The WGM geologist saw no evidence to suggest any form of fraudulent
activity on the project site ....A major component of WGM's project audit
concerned the selection of drill core samples for check assaying. These
samples were selected from the halves of drill core which were retained by
MRA after the initial sampling carried out at the time the holes were
drilled. WGM was present for and observed the entire sampling
procedure...The first phase of WGM's check sampling and analysis was
completed on the group of 59 samples on August 1 1997. The original set of
check assays indicated an acceptable and low level variance in the entire
sample population of about 3% in the average gold values. Based on our
experience, WGM believes that the outcome of check sampling is a reasonable
result and that our analyses indicate no evidence for sample tampering or
selective sampling to improve the outcome of sample analyses."
The company is pleased with the results of this audit and the check
sampling, confirming the company's belief in its Indonesian project.
The company acknowledges that these quotes are selective and should not be
viewed as representing the entire opinion of WGM. Please contact the
company if you require a complete copy of this report.
*The results of an audit of the Alliance Pacific Gold Corp Buduk gold
project, KP DU 1580, Sebakuwan KP and Bawand KP, West Kalimantan, Republic
of Indonesia, August 10 1997.
For further information contact investor relations at:
Telephone: (604) 688-2010
Toll free: 1-800-785-3339
Fax: (604) 688-2105
Web site: mineral@mineweb.com |
