Amarillo Gold Corp. (TSX VENTURE:AGC) (“Amarillo or the Company”) is pleased to announce encouraging assay results from 5 of the first 6 holes completed on its Mara Rosa project in the state of Goias, Brazil, (see table below). The best results to date are from drill hole SPETI-06 that intercepted 30m @ 2.51 g/t from 104m to 134m including a 6m section that assayed 5.7 g/t. The drill holes where spaced about 50m apart beneath the previously defined South Posse deposit and were designed to fill in gaps in the knowledge in the upper 150m of this mineralization. The results show the mineralization to be continuous and have enhanced our knowledge at the South Posse deposit.
After completing the 6 holes described in table 1, the drill was moved to the Posse North Area. The drilling here is designed to look for the structural feeder to the shallow mineralization present there. Four holes have been completed to date. These holes are spaced approximately 50m apart and assays are awaited. This is a previously untested target and any positive gold assays results would be encouraging and add to the resource.
The results from the drilling from the South Posse and North Posse deposits have been encouraging enough to expand the drilling program from the previously announced 11 holes to 17 drill holes. Further drilling will target possible new zones of mineralization and fill in greater than 50m gaps in the known mineralization.
In addition to the drilling program described above, Amarillo is completing 5 trenches into the prominent gold-in-soil geochemical anomaly that extends to the north of the Posse deposits. This soil anomaly follows the structural trend of the gold mineralization at Posse. The trenches will total 1300 meters in length (500m completed to date). These will be channel sampled and sent for gold assay. If these samples return anomalous gold results, a series of drill holes will be utilized to test the down dip extensions.
To update those new to the Company, Amarillo is a new explorer in Brazil staffed by industry professionals familiar with discovery and Brazil. The intent is to grow the Company by acquisition and discovery. As part of this strategy, Amarillo purchased the Mara Rosa Project from Metallica Resources Inc., for $US450, 000. The transaction was completed in November 2005. There has been a large body of work done within the project area on the Posse Gold Deposit. After discovery and definition work by BHP/Billiton the deposit was sold to Western Mining. Western Mining conducted open pit mining operation on this deposit ceasing operations in 1995. Metallica, who purchased the property from Western Mining, hired independent consultant Pedro Gusman of Santiago Chile, in 1996 to determine the remaining resource at the Posse Deposits. This consultant’s estimates must be considered an historic resource, as it was done prior to the implementation of the 43-101 National Instrument. He estimated the gold content down to 300m below surface to be 6.3million tonnes of 1.81g/t measured, 4.9million tonnes @1.67 g/t indicated and 1.42 million tones @ 1.94 g/t inferred, using a 1 g/t cut-off using Krieging methods and industry standard guidelines of the time. Amarillo considers this resource estimate as still relevant there has been no changes since the estimate was made, except that gold prices have moved to higher levels. The Company has commissioned a 43-101 compliant estimate of the resource, the results of which are awaited.
Details about the historic work are available in our news releases dated 15-Feb-2005 and in the 43-101 report prepared by Terrence Hennesey of Micon International Inc., and filed on January 15 2004.
The exploration potential on 42,000 Ha Mara Rosa property is also held in high regard by the Company as it encompasses large portions of the eastern and central greenstone belts, which are the hosts to the gold mineralization, harbours numerous galimpero workings and untested gold geochemical anomalies.
This news release was written by Buddy Doyle and reviewed by Rick Brown, the Country Manager, Brazil and COO. Both are qualified persons for the Mara Rosa Project, as such term is defined by the National Instrument 43-101.