Monday, March 2, 2009

Southern Gold Commences Drilling For Gold, Base Metals In Cambodia

Southern Gold (ASX:SAU) has advised that the Company’s maiden reverse circulation (RC) drilling campaign has commenced on its Cambodian gold and base metals tenements.

The objective of Southern Gold’s first RC drilling program in Cambodia is to confirm the scale and grade of gold and base metal mineralisation identified at surface through work undertaken over the last few field seasons by Southern Gold. Additional drill targets are expected to be prioritised as results are received from current trenching exploration programs.

The RC drilling campaign on the joint venture tenements is fully funded by the Japanese Government‐backed JOGMEC pursuant to a Joint Venture agreement whereby JOGMEC can fully fund exploration activity to a total of US$4.5 (~A$7) million over 3 years to earn a 51% interest in three tenements – Phnum Khtong (Kratie North Project), and two adjoining blocks, Preak Khlong and O’Kthung (Kratie South Project), all to the northeast of Phnom Penh. Southern Gold will fund a small drill programme on its 100% owned Anchor Prospect.

Key targets of the current programme are summarised as follows:

Oh Tron Prospect – Kratie North JV

Six RC drillholes totalling 400m are following up trench gold intersections including 32m @ 2.7g/t gold, and also targeting multiple gold, arsenic and copper anomalies over a 1,000m x 3,000m area defined by detailed soil sampling. Additional trenching activity is currently underway on this prospect area which will further define drill targets.

Central Prospect ‐ Kratie North JV

Three RC drillholes totalling 320m are targeting zinc, nickel & copper soil anomalies over an area of 2,000m x 3,000m associated with a layered mafic intrusive identified by Southern Gold’s detailed airborne magnetic surveys in 2008.

Anchor Prospect – Snoul EL (SAU 100%)

A total of 400m of RC drilling is targeting the source of significant gold trench intersections, including 32m @ 0.22 g/t gold, 8m @ 2.8g/t and 16m @ 0.8g/t.

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