Copper

[Tackler]

KLG Kalimantan cuts 1.28% Cu, 34 g/t Au over six m at Baroi

2006-02-15 08:17 ET - News Release

Ms. Doris Meyer reports

KALIMANTAN DRILL UPDATE - MINERALIZATION CONTINUING TO DEPTH

Kalimantan Gold Corp. Ltd.'s current drill campaign at its Baroi porphyry copper-gold-silver prospect, in central Kalimantan, Indonesia, is progressing well.

The drill program is testing three separate anomalous areas within the Greater Baroi area toward intercepting porphyry copper mineralization at depth.

The first area is the Far East zone (FEZ) where three geologic diamond drill holes are being drilled to depths of up to 600 metres. Two holes targeting low magnetism anomalies are complete and the third hole is under way, assays pending. These drill holes are giving the company its first look at the rocks and mineralization contained within the induced polarization anomalies that have been identified at these depths. Both holes intercepted zones of strong proplylitic and argillic-altered andesite volcanics that are weakly mineralized with lead, zinc and copper, and are clearly marginal to a mineralizing source. This was confirmed by the fact that near the bottom of one of these holes, 10 metres of dacite porphyry was intercepted that has been described as a potassically altered intrusion. Although this was barren of any mineralization other than magnetite, it is the right type of rock environment to host the mineralization responsible for the widespread high-grade mineralization found at Baroi.

The third hole is testing a different geophysical model at the FEZ. The target is more central to what is considered to be the main northwest-trending mineralized structure at the FEZ as defined by mineralization in drill holes BF 4, 5, 34, 8, 25, 9, 10, 11, 37 and 38. In addition to the structure location, IP anomaly and surface mineralization, the target is characterized by a vegetation anomaly. A vegetation anomaly is sometimes found over hydrothermal convection systems, where they form because of mineralization. Vegetation anomalies cannot be directly attributed to a causal agent; however, in concert with other geological, geophysical, geochemical data one can add a greater degree of certainty to possible exploration targets. The vegetation anomaly combined with the high-grade veins of BF5 and BF9 located to the north and south of it has long been a prime deep drill target. The location of hole four will be dependent on the results of hole three.

The Central and East zones of the Greater Baroi remain excellent targets for porphyry and high-grade polymetallic deposits. In this current campaign, using the company-owned drill; BC 08 was drilled into the Central zone to 290 metres to test a deep and very large IP anomaly. The phyllic alteration and mineralization progressively intensified to depth and may be followed by a deep hole depending on finances. The second and third 290-metre holes, BB 3 and BB 4, were drilled into the East zone geochemical and shallow IP anomaly. BB3 produced six metres at 1.28 per cent copper, 34 grams per tonne (g/t) silver; 13 metres at 0.4 per cent copper and seven g/t silver, and 15 metres at 0.19 per cent copper and seven g/t silver. BB 3 and BB4 finished at depth in very strong chlorite alteration with minor dissemination chalcopyrite. In addition three shallow holes, using the company's scout drill rig, have been drilled in the same East zone south of BB 03, all three holes intersected mineralization -- assays pending.

The drill program is confirming the company's belief that the Greater Baroi is a huge low-grade bulk tonnage target. The current drill program is upgrading and preparing the way for a major mining company to negotiate a favourable joint venture agreement.

Qualified person

All data, as disclosed in this press release, including sampling, analytical and test data, have been verified by the company's qualified person, Brad Wake, Baroi exploration manager.

Quality assurance

The company, in addition to its normal laboratory work with PT Indoassay Laboratories from Balikpapan, has established quality assurance procedures for sampling and assaying. This includes duplicate and reassay checks of samples with PT Intertek Utama Services, Jakarta, an internationally recognized laboratory.