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AGG Announces Drill Results Including 39.48 G/T AU Over 3M

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TORONTO, Feb. 02, 2021 (GLOBE NEWSWIRE) -- African Gold Group, Inc. (TSX-V: AGG) (“AGG” or the “Company”) is pleased to announce that it has successfully completed Phases 3A and 4A of its drilling program at the Kobada Gold Project aimed at upgrading the oxide resources in the inferred category to indicated and measured (Phase 4A) and to initially prove mineralisation at the neighbouring Gosso shear zone (Phase 3A).

New Drill Intersects:

• 39.48 g/t Au over 3.00 m (Drill hole KB20_PH4A_34)
  • Including 17.90 g/t Au over 1.0 m and 94.00 g/t Au over 1.0 m
• 1.87 g/t Au over 13.00 m (Drill hole KB20_PH4A_38)
  • Including 20.10 g/t Au over 1.0 m

Previously Announced Highlights:

• Phase 3A: Confirmed gold mineralization at the Gosso target and delineated ~750 m of initial strike length. Drill intercepts include:
  • 1.15 g/t Au over 12.50 m (Drill hole G20_PH3C_16)
    • Including 7.19 g/t Au over 1.30 m
  • 4.25 g/t Au over 3.10 m (Drill hole G20_PH3A_20)
    • Including 10.40 g/t Au over 1.20 m
  • 1.55 g/t Au over 5.20 m (Drill hole G20_PH3A_20)
    • Including 6.38 g/t Au over 1.00 m
• Phase 4A: 38 holes were drilled to upgrade the inferred oxide resource immediately to the north of the planned open pit at the Kobada concession (see NI43-101 Technical Report on Kobada Gold Project dated June 17, 2020 (the “2020 DFS”). Drill intercepts include:
  • 1.44 g/t Au over 68.00 m (Drill hole KB20_PH4A_6)
    • Including 6.73 g/t Au over 1.0 m and 24.60 g/t Au over 1.0 m
  • 1.98 g/t Au over 60.90 m (Drill hole KB20_PH4B_8)
    • Including 22.10 g/t Au over 1.0 m and 10.80 g/t Au over 1.5 m
  • 4.86 g/t Au over 17.00 m (Drill hole KB20_PH4A_16)
    • Including 46.10 g/t Au over 1.0 m
• Proven up mineralisation along the northern extent of the prolific Kobada Shear zone, which will be followed up along its strike by Phase 5 drilling.
• High-grade gold mineralisation drilled in numerous intersections to the east and to the west of the reported mineral resource estimate in the 2020 DFS will be incorporated in the next mineral resource estimate update for early 2021.

Danny Callow, Chief Executive Officer of AGG, commented:

“It is very pleasing to have completed the initial 6,300 m phased infill drilling programme along our Kobada main shear zone and the step-out drill campaign at the nearby Gosso shear zone. The results from Gosso show that our regional focus that has identified up to 55 km of shear zones on the property which have the potential to be mineralised is bearing fruit, which can be converted into future resources. This is extremely encouraging for significant near-term resource upside potential. In addition, our thesis of deeper oxides within the current resource shell, with holes extending the oxides in saprolite down to 180m, and additional mineralised zones outside of our current ore resource envelopes gives us confidence in a positive improvement in resource and reserves as we update this information into our geological model.

We believe that 2021 will be a transformational year for AGG, and whilst this is still early days in the evolution of understanding the full Kobada potential, our short-term target still remains to hit 1 million ounces of mineable reserves as soon as possible.”

Overview of Drilling Programme

The Company’s exploration drilling programme is focused on the following targets:

• Increase resource from newly identified shear zones at Kobada, Faraba and Kobada Est concessions (Phase 3)
• Conversion of the inferred resources to measured and indicated category, with the goal of expanding the reserve base to over 1 Moz (Phase 4A B C) in the short term
• Strike extension of the main shear zone at Kobada concession (Phase 5)

Exploration activities at the Kobada Gold Project were focused on continuing to define new mineral reserve base across the four-kilometer main shear zone, as well as advancing and evaluating several new regional targets. Building on the success of the 2019 drilling program and the additional high-grade mineralization that was defined throughout 2020, the Company has drilled 6,257.50 metres, or approximately 63% of the total planned drilling program, of combined Diamond Drilling (“DD”) and Reverse Circulation (“RC”) with encouraging results continuing to show deeper than anticipated extensions of the orebody. A significantly larger regional exploration program is planned in 2021. The focus will be on evaluating and advancing exploration targets outside the main shear zone area on the recently delineated Gosso target along with several other newly identified targets.

The Company has completed Phase 4A drilling aimed at upgrading the inferred resource in oxides at the northern extension of the current pit design at Kobada concessions. After evaluating the results over the next couple of months, the Company intends to continue with planned Phase 4B and 4C drilling. The technical team is encouraged with the large number of high-grade intersections at very shallow levels, as well as at deeper levels, but still in the “soft-rock” oxidic saprolite, which extends deeper than originally anticipated, thereby increasing the volume of the known orebody.

The Company’s key internal goal for Q1 and Q2, 2021, is to further demonstrate the substantial potential for an increased resource base at the Kobada Gold Project. The Company expects to incorporate the results of the drilling programme in the next mineral resource estimate update on track for early 2021.

Phase 3 - Increase resource from newly identified shear zones at Kobada, Faraba and Kobada Est concessions

The Company has successfully confirmed gold mineralization at the Gosso target and delineated ~750 m of initial strike length. Diamond drilling program at Gosso target shows highly mineralized gold ore body with similar traits to the parallel striking Kobada shear zone (total resource of 2.3 Moz over 4 km). Four diamond drill holes (522 m) have been completed and were drilled through the saprolite (soft rock) to intersect the abundant auriferous quartz-veins. We believe that there is significant extension along strike, and further drilling will seek to delineate this.

Confirmed high grade gold mineralization, close proximity to the existing resource base (4 km east of Kobada shear zone) and significant upside potential, further reinforce managements view of the Gosso shear zone as a highly prospective target for further development of the Kobada Gold Project. Definition of a mineral resource at the Gosso target is seen as a crucial upside potential for further increase in mine life and production profile of the Kobada Gold Project.

Drill intercepts from Gosso shear zone include:

• 1.15 g/t Au over 12.50 m (Drill hole G20_PH3C_16)
  • Including 7.19 g/t Au over 1.30 m
• 4.25 g/t Au over 3.10 m (Drill hole G20_PH3A_20)
  • Including 10.40 g/t Au over 1.20 m
• 1.55 g/t Au over 5.20 m (Drill hole G20_PH3A_20)
  • Including 6.38 g/t Au over 1.00 m

Phase 4 - Conversion of the inferred resources to measured and indicated category, with the goal of expanding the reserve base to over 1 Moz

A significant proportion of the 10,000 m drilling campaign has been allocated to the conversion of the 575,000 oz inferred oxide resources to measured and indicated category. The drilling of the inferred resources in oxides concentrated around the highlighted area (blue = inferred resource, plan view) to increase the level of confidence in the continuity of the mineralized zones and the confidence in the grade of the deposit.

https://www.globenewswire.com/NewsRoom/AttachmentNg/2f794b64-2618-49b6-80f9-f7707d986a23

Figure 1: Plan view of the resource.

The drilling program has successfully extended the depth of the oxide-sulphides boundary from an anticipated 110 m to 180 m, representing ~60% increase. Results from the drilling program indicate good correlation of expected grades of inferred resource. New mineralized zones outside of the 2020 DFS resource model have been discovered during the drilling program and indicate further resource upside potential. The Company intends to continue to test new mineralized areas.

Andy Rompel, VP Exploration of AGG, commented:

“We are thrilled by the results of Phase 4A with the high-grade results from several of its boreholes and from the fact that we will gain volume for mining at depth through a deeper than expected soft rock / hard rock boundary. The latter will allow us to “free-dig” in our scheduled open pit deeper than projected. Furthermore, we are now assured that our prolific Kobada shear zone extends further north and most importantly it is mineralised. We will continue to pursue the Kobada shear northwards during our next campaigns.”

Drill intercepts from Phase 4 drilling campaign include:

• 1.24 g/t Au over 11.00 m (Drill hole KB20_PH4A_4)
• 1.44 g/t Au over 68.00 m (Drill hole KB20_PH4A_6)
  • Including 6.73 g/t Au over 1.0 m and 24.60 g/t Au over 1.0 m
• 1.17 g/t Au over 34.00 m (Drill hole KB20_PH4A_7)
  • Including 10.60 g/t Au over 1.0 m
• 1.22 g/t Au over 7.90 m (Drill hole KB20_PH4B_8)
  • Including 6.13 g/t Au over 1.0 m
• 1.98 g/t Au over 60.90 m (Drill hole KB20_PH4B_8)
  • Including 22.10 g/t Au over 1.0 m and 10.80 g/t Au over 1.5 m
• 1.04 g/t Au over 37.00 m (Drill hole KB20_PH4A_11)
  • Including 8.41 g/t Au over 1.0 m and 7.85 g/t Au over 1.0 m
• 1.09 g/t Au over 43.50 m (Drill hole KB20_PH4A_12)
  • Including 9.10 g/t Au over 1.0 m and 9.93 g/t Au over 1.0 m
• 4.86 g/t Au over 17.00 m (Drill hole KB20_PH4A_16)
  • Including 46.10 g/t Au over 1.0 m
• 3.50 g/t Au over 14.00 m (Drill hole KB20_PH4A_20)
  • Including 38.20 g/t Au over 1.0 m
• 1.21 g/t Au over 10.00 m (Drill hole KB20_PH4A_27)
• 11.95 g/t Au over 4.00 m (Drill hole KB20_PH4A_31)
  • Including 41.80 g/t Au over 1.0 m
• 39.48 g/t Au over 3.00 m (Drill hole KB20_PH4A_34)
  • Including 17.90 g/t Au over 1.0 m and 94.00 g/t Au over 1.0 m
• 1.87 g/t Au over 13.00 m (Drill hole KB20_PH4A_38)
  • Including 20.10 g/t Au over 1.0 m

Phase 5 - Strike extension of the main shear zone at Kobada concession

A detailed study of the airborne magnetic and radiometric survey has led to a reinterpretation of the structural inventory and resulted in a delineation of 55 km of mineralized shear zone structures across the Kobada, Faraba and Kobada Est concessions, representing ~80% increase to the previously identified shear zones.

https://www.globenewswire.com/NewsRoom/AttachmentNg/371dff31-8138-4f7e-a255-7453575e9a50

Figure 1: Plan view of drilling campaign at Kobada. Significant drill intersections and cumulative mineralization.

The Kobada Gold Project

The Kobada Gold Project is an advanced stage gold development project located in Mali, Africa’s 4^th largest gold producing country. The property is located 126 km south-west of Bamako, the capital city of Mali, in the Birimian Greenstone Belt, with excellent transportation links to the capital and excellent logistics routes via other West African ports.

In July 2020, the Company released an updated definitive feasibility study that showed Kobada’s potential as a highly profitable standalone mine, delivering IRR of 45.5% and NPV of US$284 m, with an AISC of US$788/oz Au.

The Company continues to advance the Kobada Gold Project through an exploration drilling programme in parallel to negotiations on securing the financing for the construction of the project. Advanced discussions with several institutional investors are underway.

About African Gold Group

African Gold Group is a TSX Venture Exchange (TSX-V: AGG) listed exploration and development company with a focus on building Africa’s next mid-tier gold producer. The Company has a highly experienced board and management team with a proven track record in the African mining sector operating mines from development through to production. AGG’s principal asset is the Kobada Project in southern Mali, which is in an advanced stage of development having completed the 2020 DFS and is targeting gold production of 100,000 oz per annum by Q2 2022. As well as the initial Kobada Gold Project, other exploration locations have been identified on the Kobada, Farada and Kobada Est concessions, offering potential for an increase in resource. For more information regarding African Gold Group visit our website at www.africangoldgroup.com.

Qualified Person

The scientific and technical information contained in this press release has been reviewed, prepared and approved by Dr. Andreas Rompel, PhD, Pr. Sci. Nat. (400274/04), FSAIMM, Vice President Exploration of AGG, who is a “Qualified Person” as defined by National Instrument 43-101 - Standards of Disclosure for Mineral Projects (“NI 43-101”) and by Mr. Uwe Engelmann (BSc (Zoo. & Bot.), BSc Hons (Geol.), Pr.Sci.Nat. No. 400058/08, MGSSA), a director of Minxcon (Pty) Ltd and a member of the South African Council for Natural Scientific Professions.

For more information:

Danny Callow
President and Chief Executive Officer
+(27) 76 411 3803
[e-mail]

Scott Eldridge
Non-Executive Chairman of the Board
[phone]
[e-mail]

Daniyal Baizak
VP Corporate Development
[phone]
[e-mail]

Camarco (Financial PR)
Gordon Poole
Nick Hennis
[phone]
[e-mail]