Site office construction is under way at PNG Gold’s Imwauna project and nearby Sehulea property on Normanby Island in eastern Papua New Guinea. The 68sqkm licence covers both projects in the Milne Bay province, about 80km northeast of the provincial capital of Alotau. NI 43-101 compliant mineral resource estimates for the projects are on track for announcement by June.

The company wants to transfer ownership of the licences to its PNG subsidiary, Normanby Mining PNG, with renewal applications submitted to extend the exploration licences on both properties for another two years.

During 2011 PNG Gold completed 71 drill holes over 12,089 metres to provide additional information in shallow depths of the mineralized zone, while exploring the extension of the vein system at depths below 100 metres from the surface. Assay results for 38 of the holes were announced in October and November last year, and the rest are imminent. Highlights from the earlier holes included 17.75 grams/tonne gold over 0.6 metres and 5.13 grams/tonne gold over 1.8 metres

Further drilling is planned at Imwauna, as well as about 5000 metres of first phase drilling at the Kela’s vein system. This system is about 650 metres west of Imwauna and has only been explored using soil and rock geochemistry and surface trenching with results demonstrating an extensive gold-in-soil anomaly.

Three holes of the planned 4-hole program were completed at Sehulea, which is about 10km northeast of Imwauna. Once the last hole has been drilled, the rig will return to the Imwauna and Kela’s prospects.

Pre-fabricated accommodation, kitchen and dining buildings have been sought for improved facilities for project staff.

PNG’s Civil Aviation Authority has inspected the nearby Sehulea aerodrome and declared it safe for aircraft operations, greatly increasing the transportation options open to PNG Gold and also improving the logistical efficiency of transporting both staff and supplies to the Imwauna and Sehulea properties.

Preliminary engineering analysis has discovered the potential for an open pit along the strike of the Imwauna vein system in conjunction with underground mining. However, PNG Gold says it will fully evaluate the size, scope and location of an open pit prior to initiating any underground work which will be reassessed as part of the preliminary feasibility study to be completed alongside the NI 43-101 resource estimate.

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