Amarillo Gold Provides Update on Mara Rosa Project Permitting
Process
VANCOUVER, BRITISH COLUMBIA--(Marketwired - Jan 28, 2014) -
Amarillo Gold Corp. (TSX-VENTURE:AGC) ("Amarillo" or the "Company")
is pleased to deliver the following update on the permitting
process at the Mara Rosa Project, Goias state.
In May 2012, Amarillo filed an application for a preliminary
license for permit to mine on the Mara Rosa project. (See News
Release dated June 4th 2012). Since that time the Licensing process
has been put on hold, whilst a review of the impact of the historic
mining activity at the Posse Deposit, was carried out. (see MD
& A Q1 2013). The review was instigated in response to request
from the Ministério Público ("MP" or Justice Department).
The company is now pleased to report that it has delivered the
preliminary IPA report, (IPA:- Investigação de Passivo Ambiental -
Investigation into Environmental Damage) to the respective
authorities. The IPA report is the result of 18 months of
monitoring and measuring the quality of the surface and ground
waters in the catchment around the Posse deposit, soil sampling,
and monitoring the aquatic biota.
It is the opinion of the company and it's environmental
consultant, that the work in the IPA report shows no lasting
environmental effect from the past mining work. The company now
expects the permitting process to move ahead once the authorities
have had time to review.
The company has applied applied for a preliminary license
("LP"). In Brazil mine permitting is governed and administered by
each state, however the States tend to keep the same standards so
the process is very similar throughout Brazil. The process has
three stages, the preliminary license ("LP,"), the installation
license ("LI"), and finally the license to operate ("LO"). The
application for an LP is accompanied by an Environmental base-line
report called the EIA ( Estudo de Impacto Ambiental which
translates to Environmental Impact Statement) and an environmental
mitigation report, or RIMA ( Relatório de Impacto Ambiental). The
department that administers the permitting in Goias state is called
SEMARH. The application is also subject to review by the MP and it
is noteworthy that in recent years all large engineering and mining
projects in Brazil, have seen the MP play a much more active
role.
In late 2011 the MP instigated an investigation into possible
contamination of waters in the Mara Rosa district by historic
mining, based on a public complaint lodged in 1998. The Posse
deposit is not the only suspended mine in the district and the area
also was the focus of widespread artisanal working in the 1980's.
This investigation showed that there were acidic waters in the
district, and although and although they were not from the Mara
Rosa project the issue concerned the MP enough to ask for
suspension of the LP until Amarillo could measure the environmental
impact of the historic mining at Posse. The old mine at Posse was
operated by Mineração Genipapo, (owned by Western Mining at the
time), which shut down operations in 1995, and in 2003 the state
authorities issued a certificate that indicated that the area was
considered remediated, however the MP considers that the previously
filed complaint had not been correctly addressed.
In April 2013, Amarillo submitted an initial response to the
MP's concern about acid waters by showing several assays of the Pit
waters at Posse, which indicate they were not acidic (Ph 7.4) and
suitable for aquatic life. The MP did not consider this adequate
and requested a larger study. The preliminary IPA report now
submitted by Amarillo is the summary of this study. It includes
several sets of water analysis in the two small Open Pits (now
filled with water) as well as surface water from surrounding
streams. Ground waters were checked from existing underground wells
and from auger holes drilled by Amarillo. These analyses (carried
out at three monthly intervals) showed that there were no low ph
waters and no significant presence of heavy metals with values all
below the limits published by CONAMA (National Council for the
Environment) in Resolution 357 of 2005.
The two Open Pits are now the home of a quantity of fish with at
least four species identified including tilapia (a fish not
indigenous to Brazil), lambari (a small fish known as bio-indicator
because of its' requirement for high quality water), piaba and
caranha (specimens of up to 5 kg. can be found in the larger Open
Pit). The report includes analyses of two different types of the
fish found in the Open Pits, (tilapia and piaba) and showed that
levels of heavy metals in the fish were below the limit of
detection though copper values were detected in low quantities (but
within the limits allowable according to the World Health
Organisation, WHO). Similar small quantities of copper were also
found in six other samples of fish from surrounding rivers and
streams and would seem to be the norm for the area.
The IPA was of a preliminary investigative nature and concluded
that there was no chemical contamination caused by previous
mining.
The company awaits a response from the MP, but once a
satisfactory review is received the LP process will recommence and
the permitting process should move forward. An LP is only granted
after a public hearing held in the municipal and the company
intends to hold this in April. There is great public support for
the implantation of the mine in the area (a traditional mining
district).
The company expects to obtain the LP before the end of the 2nd
Quarter 2014.
Frank Baker, a metallurgist with over 30 years experience and
also a member of the AUSIMM and IOM3 is the qualified person for
this news release as per the guidelines of the NI-43-101. Mr. Baker
is the manager of the Mara Rosa Project.
About Amarillo Gold Corp.
Amarillo Gold Corp. is focused on acquisition, discovery, and
definition of gold resources in Brazil. The Company's principal
projects are the Mara Rosa Project in the state of Goias, and the
Lavras do Sul Project in the state of Rio Grande do Sul. The Posse
Deposit at Mara Rosa contains 1,174,900 ounces of measured and
indicated gold contained in 20.85 MT at 1.75 g/t Au, and 156,400
ounces of gold inferred from 3.63 MT at 1.38 g/t Au (0.5 g/t
cut-off grade) (NI 43-101 compliant resource as independently
determined by Australian Exploration Field Services Pty. AEFS). The
Mara Rosa Gold Project has received a positive economic assessment
from a Pre-feasibility study and is preparing to proceed to a
bankable feasibility study. Should this continue to be positive it
would be possible to commence mining by 2015.
The Posse Deposit was successfully mined by Western Mining
Company (WMC) during the 1990s (mined areas are excluded from the
above-stated resource figures), and is located in an area of
excellent infrastructure: approximately 35 km NE of Yamana's
Chapada open pit Cu-Au operation, some 80 km NE of Yamana's Pilar
Au project (in Feasibility), 95 km NW of Votarintim's Niquelandia
Ni laterite mine, 105 km from NE of Serra Grande's underground Au
mine, and 105 km NNW of Anglo American's Ni laterite project at
Barro Alto.
The Lavras do Sul Project is an advanced exploration stage
property (190 sq. km.) comprising more than 19 prospects centred on
historic gold workings, with encouraging gold mineralization
discovered and defined by more than 16,000 metres of drilling. The
initial resource estimate at the Butia prospect reported 215,000
ounces of gold indicated from 6.4 MT at 1.05 g/t Au, and 308,000
ounces of gold inferred from 12.9 MT at 0.74 g/t Au using a0.3 g/t
cut-off grade in a NI 43-101 compliant resource as independently
determined by Atticus Consulting 2010. Lavras do Sul is also
located near excellent infrastructure. The Company also has a
portfolio of earlier stage projects and all properties under
Amarillo's management are located in areas of good infrastructure
and mining-friendly communities.
ON BEHALF OF THE BOARD OF DIRECTORS
AMARILLO GOLD CORP.
Buddy Doyle, President
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.
FORWARD LOOKING STATEMENTS:
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. Permission from the Government
and community is also required to proceed with future mining
production. In the case of this news release the timing and
response of the MP and SEMARH are not in the companies control and
could differ from our expectations causing further delay to our
permitting process. Readers should review risk factors applicable
to junior mining exploration companies generally to understand the
variety of risks that can affect the Company.
Amarillo Gold Corp.+ 1-604-689-1799 (Canada)+ 1-604-689-1799
(Canada)+55-31-3261-5974
(Brazil)info@amarillogold.comwww.amarillogold.com
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