The Kwahu Praso Concession ("Praso") is approximately 109 square kilometres in size and lies on the north eastern end of the Ashanti Gold Belt, just 30 kilometres northeast of Newmont Mining's Akyem gold deposit. Contiguous to Praso (and surrounded by Praso on three sides) is our 50 square kilometre gold property, Sian, which is a past gold producer with a renewable 30 year mining lease, an existing CIL plant and all the infrastructure in place.
The Sian property contains Esaase and Ampeha, two previously producing open pit gold mines with significant growth potential. Kwahu Praso, which was once part of Sian, contains extensions of the Esaase and Ampeha trends.
Sian was in production from 2000 until the end of 2003 under previous owners, when the low price of gold at the time together with management issues caused the previous owners to cease operating. Midlands was able to acquire the property and immediately commenced geochemical surveys on both properties.
Sian and Praso together form a 160 square kilometre prime gold district broadly delineated by a 16 kilometre gold mineralized corridor. Drilling to date has increased the indicated resource on Sian/Praso from 2.6 million tonnes grading an average of 2.3 g/t to 5.4 million tonnes grading 1.87 g/t. The Company's goal is to reach 1 million ounces within the initial 20,000 metre Reverse Circulation (RC) and Diamond Drilling (DDH) program in 2010.
Drilling is ongoing on Sian and Praso and results to date show that drill assays confirm a northern extension of the Sian gold deposit, with significant potential to increase the resource on Sian/Praso.
There are eight highly ranked target zones, as indicated on the map below, which all fall within the mineralized corridor. Of the delineated priority target zones, A1 is one of three selected priority zones which were given a "very high priority" rating because the airborne interpretation coincided with gold-in-soil geochemical anomalies.
Priority target A1 was delineated by Geotech Airborne Limited from a compilation of airborne results with gold in the soil geochemistry and underlying geology, with ground observations from Midlands' geologists. RC drilling on priority target A1 will run concurrently with ongoing diamond drilling at the Sian open pit area, where drilling has been focused on testing the north eastern extension of the Sian gold deposit, with the objective of increasing the current resource to the Company's initial target of 1 million ounces of gold.
Priority drill targets delineated by the Airborne survey are within a broad northerly trending zone with a high potassium to thorium ratio in the radiometrics, with possible demagnetization as demonstrated by the aeromagnetics, forked aeromagnetic lineaments, and discontinuities in VTEM resistors/conductors. These zones, in the volcanic rocks, are also associated with known gold mineralization and geochemical anomalies.
The integrated geophysical interpretation of the Sian/Praso helicopter borne versatile time domain electromagnetic (VTEM) survey was carried out by Qualified Geophysicists from Geotech Airborne Limited, under the leadership of Dr. Magdel Combrinck, PhD, Senior Geophysicist. The ongoing geological interpretation to more closely define specific targets within target zones is being carried out by the Midlands team.
In order to interpret the bulk of the geochemical data resulting from soil surveys, MMI surveys and Induced Polarization (IP) surveys, an analytical method called percentile rank was used. This normalizes the data thus making it possible for the data to be analyzed on the same platform. As a result, the anomalous threshold for Praso and Sian data is selected at the 50th percentile, with the strong anomaly ranging between 90th-100th Rank percentiles. The anomalous gold sites in the subsequent maps were therefore plotted using the percentile ranking.
The soil sampling was conducted along lines spaced at 200 metres with samples taken at 40 metre stations. A total of 8,630 samples and duplicate samples for laboratory and field sampling verification were sent to the SGS Laboratory at Tarkwa in Ghana. Preparation of each sample consisted of drying and sieving at - 80 mesh, from which a split of at least 1000g of the sample was pulverized to - 200 mesh in a homogenizing mill. 50g portions of each sample were analyzed for gold by Fire Assay. During the last quarter of 2009, an infill soil programme was undertaken on the Praso South area and Praso North-East area on a grid of 200 x 40. Results from this survey were merged with previous results using the percentile ranking statistical method. Even though the previous anomalous trends were obtained using raw assay values in plotting, trends delineated by the percentile ranked values confirmed and enhanced the previous anomalous trends. The highest and most pronounced 90th percentile anomaly for both Sian and Praso is located on the Praso north and south anomalies and the Praso north main sulphide anomalous trend appears to be the direct north extension of the Sian mineralized structure.
The northern and southern sector anomalies of the Praso concession appear to be the northern and southern extensions of the Sian anomaly. The soil anomalies for the 75th percentile ranking have also defined a mineralized corridor along the boundary with Newmont's Nkoko property. The Praso soil and MMI anomalies have defined drill targets for the current drilling programme.