TORONTO – Centerra Gold Inc. (TSX:CG) has increased its 2011 exploration budget by 18 per cent to $40 million, with a portion of that additional money going towards its “significant” gold and silver discovery in Mongolia.
The company said about $4 million of the funds will be dedicated to further drilling at the property.
To date, Centerra has spent $6.5 million on the on the Altan Tsagaan Ovoo property since acquiring it in May 2010 from Cogegobi, a wholly-owned subsidiary of Areva.
From May 2010 to May 2011, Centerra drilled 124 holes for a total of 21,753 metres. This work identified four closely spaced breccia pipes, three of which carry significant precious and base metal mineralization, Centerra said Monday.
Gold grades in upper and lower parts of the pipes are similar with grades ranging from 0.1 grams per tonne of gold to as high as 160 g/t gold. Silver contents generally are 10 to 30 g/t, but range as high as 500 g/t silver.
The deposits also have lead and zinc mineralization.
“We are very excited about this new discovery in what we view as a new emerging mineral district,” said Steve Lang, Centerra’s president and chief executive.
“In the past thirteen months, our exploration group has identified initial targets, drilled those targets with very strong results and identified other potential targets within our license package. Our board of directors has recognized the potential of this project and has expanded our 2011 exploration budget to continue the rapid advancement.”
The ATO property is 60 kilometres east-northeast of Ulan Bator, the capital of Mongolia.
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