An Update on the Butia Prospect Drill Program, Lavras do Sul

Amarillo Gold Corp. (TSX-V: AGC) (“Amarillo”, the “Company”) is pleased to announce the following update for our Lavras do Sul project in the State of Rio Grande do Sul.

The Company is currently conducting a drill program on the Butia prospect, one of the many areas within the Lavras do Sul project that has returned significant gold intersections from previous drilling. This news release reports the assay results for 5 of the 9 holes completed to date, LDH145, LDH 146, LDH147, LDH148 and LDH 150. Drill hole LDH 144 was reported in an earlier news release. The assays results are listed in Table 1.

Table 1: Composite Assay Results

Drill hole From To Interval Composite Gold assay
LDH 145 133.3m 149 15.7m 0.39 g/t*
LDH 146 50m 91m 41m 0.49g/t
128m 167m 140m 181m 12m 14m 0.44g/t 9.51g/t
LDH 147 183m 189m 6m 1.85g/t
362m 376m 14m 0.32 g/t
LDH 148 187m 197m 10m 0.51 g/t
345m 353m 8m 0.33 g/t
LDH 150 0m 21.25m 21.5m 0.53 g/t
LDH 150a 77m 148m 71m 0.54 g/t
215m 238m 23m 0.3 g/t
282m 290m 8m 2.64 g/t
331m 335m 4m 0.82 g/t

Notes:  All drill hole samples shown here consist of split HTW and NTW diamond drill core. The samples were sent to Acme Laboratories in Goiania, Brazil, and Vancouver, Canada, Samples are first subjected to an multi-element ICP assay that includes Au. Those samples that are greater than 0.2ppm Au are then sent to fire assay using 30g aliquots with an ICP finish.  If the grade is higher than 5 g/t  a gravimetric method is used.  All samples are subject to a chain of custody and are submitted with standards and blanks to check the assay results. The laboratories also use internal standards and repeat analysis. For the results reported in this release all the standards, blanks and repeats delivered acceptable results. Intercepts were calculated using a minimum of a 0.3 g/t cut off at the beginning and end of the intercept and allowing for no more than 10 consecutive metres of less than 0.3 g/t Au. The drilling is exploratory and designed to cut a fence perpendicular to the most elongated direction in the alteration hosting the mineralization. The true width of the mineralization is not yet known. * LDH145 are ICP-MS, Fire assay results are awaited. Table 2 lists the intervals that assayed above 5 g/t gold.

Table 2: High Grade Assay Results

Drill hole From To Interval Gold assay
LDH 150 0m 1m 1m 6.94 g/t
LDH 146   146 Interval  cut to 10g/t 168m  167m 169m  181m 1m  14m 110.3 g/t (3.54 troy ounces per tonne) 2.35 g/t
LDH 147 188m 189m 1m 7.47 g/t

The location of the drill holes can be found on the plan map given at the end of this news release in figure 1 and table 3.  Figures 2, 3 and 4 show the cross sections that contain these holes, and these can be viewed by following these links:

The high grade gold intercept of 3.54 oz/t in drill hole LDH 146 coincides with a zone where visible gold was noted in the logging of the core. The majority of greater than 5 g/t gold zones  occur within veins of grey silica with galena. These veins in turn are hosted within a larger episyenite alteration zone that carries the broader intercepts of elevated gold values. Drilling is presently to widely spaced to determine if the high grade zones encountered are continuous.

The episyenite altered gold mineralized zone at Butia appears to have a “L” or “Hockey Stick” shape in plan view and we currently interpret this to be caused by the intersection of an E-W structure that carries gold mineralization for 250m along its strike and a N-S structure that carries gold for 200m along strike. To confirm this and to obtain the true widths of the mineralized zones within these structures, in particular the N-S structure, the Company is currently drilling a series of drill holes to the west.

In section the mineralization appears to become more restricted and narrows at depth. It broadens out towards the surface from 150m deep to 70m deep then becomes more restricted from 70m to the surface. Testing these structural features at depth for possible high grade zones beneath the episyenite hosted mineralization is a prime exploration target. To date most of the gold reporting in the drill assays is located near surface and would be accessible by open pit methods should studies support the economics. The Company plans  to commission a 43-101 compliant report after completion of the next few drill holes at Butia. This interim study will provide a first past determination of the gold resource at this prospect. The drilling will then progress to the Cerrito prospect which has the next highest priority amongst the 19 known prospects within the Lavras do Sul project.

Buddy Doyle the CEO of Amarillo said, “After completing of the next few holes we will have enough data to conduct an initial 43-101 compliant resource estimate for the Butia prospect, which we anticipate  will be  the first of many. We have recently solicited tenders to start the first study. Our expectation is that the multiple areas of historic mine  workings that occur within the Lavras do Sul project area will host multiple zones of gold mineralization. Our previous drilling has already demonstrated that such mineralization occurs in four separate prospects. Producing an interim resource estimate at Butia and then Cerrito will enable the Company to demonstrate the initial potential at Lavras. If Butia and Cerrito are representatives of gold mineralization in the other known occurrences at Lavras, then systematically testing of the other 17 prospects, should create a growing resource base.”

Table 3: A list of the drill holes completed in the current drill program

Drill Hole Azimuth Dip Total Depth (metres) Samples Easting SAD69 Northing Elev m
LDH144* 200 55 364 307 218144 6586763 379
LDH145** 200 60 257 166 218089 6586719 359
LDH146** 200 80 290 202 218162 6586638 375
LDH147** 200 60 433 307 218203 6586698 372
LDH 148** 200 60 383 265 218355 6586702 377
LDH 149 45 60 292 253 218100 6586450 386
LDH 150** 200 60 21.25 9 218225 6586619 379
LDH 150 A** 200 60 408 274 218241 6586653 377
LDH 151 290 60 276.8 191 218326 6586453 381
LDH 152 290 65 In progress 218156 6586575 383
TOTALS 2725m 1974

Note: Samples include standards, blanks and duplicates, inserted at approximately every 30th drill core sample. The entire length of core is sampled, those that look possibly mineralized are sampled at 1m intervals, other areas at 2m

* Reported in an earlier News Release    ** Reported this news release.

LDH150 was abandoned @ 21.25m as the hole intersected old mine workings.

This press release was reviewed by Buddy Doyle (B. App. Sc.), a member of AusIMM, with 28 years experience and a qualified person in compliance with National Instrument 43-101.


Amarillo Gold Corp. is a Company focused on the acquisition, definition and discovery of gold resources in Brazil. Its principal projects are the Mara Rosa project in the state of Goiás and the Lavras do Sul project in the state of Rio Grande do Sul. The Posse Deposit at Mara Rosa was found by an independent 43-101 compliant preliminary economic assessment study carried out by CCIC to contain 643,000 ounces indicated from 13.5MTonnes @ 1.48 g/t Au, 538,000 ounces inferred from 13.0MTonnes @ 1.26 g/t Au at a 0.5g/t cut-off grade and the project is in the economic evaluation stage.  The Posse deposit is located in an area of excellent infrastructure located some 35 km NE of Yamana’s Chapada open pit Cu-Au operation, 105 km NE of Serra Grande’s underground Au mine, 105 km NNW of Anglo American’s nickel laterite project (in construction), 95 km NW of Votarintim’s Niquelandia nickel laterite mine and approximately 60 kms NE of Yamana’s Pilar Au project (in feasibility). Grid power to the site was established during the previous open pit mining operation and the Serra da Mesa hydro-electric dam lies 35 km to the east.

The Lavras do Sul project is in the advanced exploration stage with over 15000m of drilling with encouraging gold mineralization being discovered and defined, also in an area of excellent infrastructure.  The Company also has a portfolio of earlier stage projects. All properties under Amarillo’s management are located in areas of good infrastructure and robust community support.


Per:  “Buddy Doyle”
Buddy Doyle, President


Amarillo Gold Corp.

+ 1-604-689 1799 (Canada)

+55-31-3261 5974 (Brazil)

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.


This news release contains Forward Looking Statements regarding our intentions and plans. Various factors may prevent or delay our plans, including but not limited to, contractor availability and performance, weather, access, mineral prices and success and failure of the exploration and development carried out at various stages of the program. Readers should review risk factors applicable to junior mining exploration companies generally to understand the variety of risks that can affect the Company.