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Continental Gold Announces New High-Grade Sampling Results from Buriticá Project in Colombia

Continental Gold Inc.("Continental" or the "Company") is pleased to announce new high-grade channel sampling results from development cross-cuts and drifts from level 1B of the Yaraguá mine at the Company's 100% owned Buriticá project in Antioquia, Colombia. Following completion of the trial long-hole stope (see Company press release dated May 3, 2016), approximately 300 metres of new underground development measuring 3.5 metres X 3.5 metres on level 1B has been completed to date, which will allow the Company to begin additional mechanized mining in the Yaraguá vein system. Assay results presented below have not only confirmed that vein orientation and geometries are as modelled in the current Feasibility Study ("FS") mine plan but have also outlined a significantly wider zone of high-grade precious metal mineralization that may be amenable to wider, more productive extraction than currently envisioned.

Cross-Cut Results (Table 1 and Figures 1-3)

Figure 1 - Plan View of the Yaraguá Cross-Cuts and Drifts showing the projection of veins in the current Yaraguá mineral resource model on geology-topography and underground developments. The gold grades of composited channel sample results are color-coded according to the legend: http://www.marketwire.com/library/MwGo/2016/6/27/11G104487/Images/RY_crosscuts_grades_20160623_edit_small_500px-df69edb22f6e8709b6ac17aabb76532e.jpg

  • Continuous channel sampling of three cross-cuts on Level 1B at an elevation of 1,540 metres have intersected 5 master veins in the current Yaraguá minable reserve estimate as well as widespread intervening mineralization in the form of veinlets oblique to and between the master veins. Mineralized intervals, over true horizontal widths include:
    • 22 metres @ 10.9 g/t gold and 25 g/t silver (CAM 9540S)
    • 30 metres @ 9.3 g/t gold and 26 g/t silver (EST9519S)
    • 29 metres @ 8.6 g/t gold and 23 g/t silver (EST9510S);
  • Cumulative mineralization in the three cross-cuts located between the 5 master veins (which is deemed dilution in the minable reserve estimate) yielded a weighted average of 3.4 g/t gold and 18 g/t silver over 68.92 metres;
  • This zone, which covers an area measuring approximately 50 metres along strike X 30 metres across X 20 metres vertical, confirms excellent continuity to the zone of widespread mineralization encountered approximately 20 metres above on Level 0 (elevation of 1,558 metres) (see Company press release dated January 7, 2015). Given the strong vertical continuity, this zone may be amenable to wider, more productive extraction, and remains open at depth, as well as along strike to the east and west; and
  • Based on the Company's continued success in identifying broad areas of mineralization with underground development, which tend to be located proximal to contact zones between andesitic intrusions, sediments and breccias, a 3,000 metre underground drilling program has been planned for late Q3, 2016 targeting similar zones in the Yaraguá deposit.

Drift Results (Table 2 and Figures 1-3)

  • Systematic channel sampling across new drifts in the San Antonio Vein and the NWSE vein has demonstrated continuity of high-grade gold mineralization through substantial strike lengths over true horizontal widths approximating those proposed for mining in the FS as follows:
    • 2.7 metres @ 21.6 g/t gold and 41 g/t silver along 37.5 metres (San Antonio Vein)
    • 2.71 metres @ 18.4 g/t gold and 41 g/t silver along 72.5 metres (NWSE vein)

"Underground development sampling at Yaraguá continues to deliver high-grade results over significant true widths," commented Ari Sussman, CEO. "Combining these broad and high-grade channel sampling results with the excellent results encountered in our long-hole trial mining test stope announced on May 3, 2016 provides us with reason to be optimistic about the possibility of introducing wider, more productive extraction methods to certain areas within the FS mine plan. We look forward to completing environmental permitting later this year and commencing project financing and development shortly thereafter."

Table 1: Cross-Cut Results
Cross-Cut From (m) To (m) True Width (m) Gold (g/t) Silver (g/t) Elevation (m) Vein
EST9510S 0.00 28.86 28.86 8.63 23 1539.73
incl. 0.00 1.41 1.41 12.22 44 1541.94 NW
1.41 11.18 9.77 7.73 24 1540.34 off vein
11.18 11.73 0.55 74.79 61 1539.59 FW
11.73 15.76 4.03 2.85 13 1539.95 off vein
15.76 16.41 0.65 92.90 84 1540.57 SA
16.41 22.88 6.47 0.69 10 1539.33 off vein
22.88 23.39 0.51 19.66 50 1539.44 HW1
23.39 26.69 3.30 3.84 25 1539.35 off vein
26.69 27.16 0.47 27.20 44 1538.95 HW2
27.16 28.86 1.70 2.46 20 1538.90 off vein
CAM9540S 0.00 21.98 21.98 10.92 25 1540.95
incl. 0.00 0.55 0.55 5.52 17 1540.17 FW
0.55 5.12 4.56 1.53 11 1540.91 off vein
5.12 6.11 1.00 88.42 69 1541.81 NW
6.11 6.86 0.75 126.07 305 1541.72 SA
6.86 13.76 6.90 0.48 4 1540.91 off vein
13.76 14.88 1.13 2.00 11 1540.75 HW1
14.88 20.86 5.97 3.61 18 1540.88 off vein
20.86 21.98 1.13 18.14 41 1540.90 HW2
EST9519S 0.00 29.95 29.95 9.28 26 1539.62
incl. 0.00 3.12 3.12 0.21 10 1541.13 off vein
3.12 3.59 0.47 11.17 64 1541.23 NW
3.59 8.24 4.65 2.33 18 1540.05 off vein
8.24 8.79 0.55 28.95 37 1540.06 FW
8.79 14.21 5.42 5.27 23 1539.77 off vein
14.21 15.27 1.05 106.85 79 1541.58 SA
15.27 23.10 7.83 2.47 18 1539.08 off vein
23.10 23.77 0.67 18.61 51 1538.91 HW1
23.77 26.67 2.90 9.79 44 1539.14 off vein
26.67 27.62 0.95 41.62 54 1539.29 HW2
27.62 29.95 2.33 1.96 21 1538.93 off vein

Channel samples are taken continuously along the walls of the underground cross-cuts and across the face of the underground drifts. Faces are nominally spaced every 3 metres along the drift and face composites average six length-weighted channel samples. Widths are true horizontal metres at 0 g/t gold grade cut-off.

Table 2: Drift Results
Vein Segment Length (m) Average Width (m) Gold (g/t) Silver (g/t) Elevation (m)
SA VEIN VTN9523S 37.50 2.70 21.60 41 1541.08
NW-SE VEIN GA9534W 72.50 2.71 18.35 41 1542.02

Channel samples are taken continuously along the walls of the underground cross-cuts and across the face of the underground drifts. Faces are nominally spaced every 3 metres along the drift and face composites average six length-weighted channel samples. Widths are true horizontal metres at 0 g/t gold grade cut-off.

Geological Description of Buriticá
Continental's 100%-owned, 61,784-hectare project, Buriticá, contains several known areas of high-grade gold and silver mineralization, of base metal carbonate-style ("Stage I") variably overprinted by texturally and chemically distinctive high-grade ("Stage II") mineralization. The two most extensively explored of these areas (the Yaraguá and Veta Sur systems) are central to this land package. The Yaraguá system has been drill-outlined along 1,100 metres of strike and 1,700 vertical metres and partially sampled in underground developments. The Veta Sur system has been drill-outlined along 1,000+ metres of strike and 1,800 vertical metres and has been partially sampled in underground developments. Both systems are characterized by multiple, steeply-dipping veins and broader, more disseminated mineralization and both remain open at depth and along strike, at high grades.

Technical Information
The technical information in this press release has been supervised, reviewed and approved by Mauricio Castañeda, Vice-President, Exploration of the Company and a qualified person for the purpose of NI 43-101.

Channel samples are taken continuously along the walls of the underground cross-cut and across the face of the underground drift. Faces are nominally spaced every 3 metres along the drift, and face composites average six length-weighted channel samples. Widths are true horizontal metres at 0 g/t gold cut-off grade. The Company utilizes a rigorous, industry-standard QA/QC program.

Rock samples have been prepared and analyzed at Continental Gold's Yaraguá mine laboratory at Buriticá, Colombia. Blanks, duplicates and certified reference standards are inserted into the sample stream to monitor laboratory performance. Crush rejects and pulps are kept and stored in a secured storage facility for future assay verification. Although historic correlation between analytical results from the Company's internal laboratory and certified independent laboratories for gold and silver analysis have been within acceptable limits, the Company's internal laboratory is not independent or certified under NI 43-101 guidelines and as such, results in this release should only be taken by the reader as indicative of future potential.

For additional information on the Buriticá project, please refer to the Feasibility Study technical report, prepared in accordance with NI 43-101, entitled "Buriticá Project NI 43-101 Technical Report Feasibility Study, Antioquia, Colombia" (the "Technical Report"). The Technical Report, with an effective date of February 24, 2016 and dated March 29, 2016, was prepared for the Company by JDS. A copy of the Technical Report can be accessed under the Company's SEDAR profile at www.sedar.com, or on the Company's website at www.continentalgold.com.

Source: http://www.continentalgold.com/

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