Dana Resources Acquires 1.17 Million Ounce Advanced Stage Collota Gold Deposit in Peru

Dana Resources Acquires 1.17 Million Ounce Advanced Stage Collota Gold Deposit in Peru

Dana Resources, a US-based precious metals exploration and development company, is pleased to announce that it has successfully acquired the advanced stage Collota Gold Deposit in Peru. Dana Resources currently owns and operates seven mining projects located in Peru’s most prolific mining regions.

The Collota Gold Project is located in Northern Peru in the region of Ancash on the eastern side of the Cordillera Negra, (Black Range Mountains). It is 45km south of the city of Huarez. Elevation ranges from 4,100m to 4,600m.

The Collota Gold Project is a high-sulphidation type epithermal gold deposit, positioned in the same trend as Barrick’s world famous Pierina mine (originally hosting over 5.2 million ounces of gold and producing as much as 500,000 ounces of gold in 2006). Barrick’s Pierina mine is near the end of its resource base. Dana Resources’ Collota Gold Project consists of six claims for a total of 4,695 acres.

The Collota Gold Deposit is defined by 83 drill holes completed by Buenaventura Mining for a total of 5,500 meters of reverse circulation and diamond core drilling, identifying an initial gold deposit in 281.7 acres. The target area is characterized by intense vuggy silica, quartz-alunite and argillic alteration. The alteration is hosted in the Calipuy group, a suite of volcanic rock characterized by basal andesitic lavas overlying rhyodacitic pumic and lithic tuffs. This particular geology is associated with epithermal gold deposits similar to Pierina and Yanacocha mines. This host rock is identical to Barrick’s Pierina deposit. Drilling has indicated attributable resources of 112 million tonnes, defined in two blocks:

Oxide Zone – 65 million tonnes with 0.375g/t gold, containing 780,000 oz gold.
Sulphide Zone – 47 million tonnes with 0.26 g/t gold, containing 390,000 oz gold.

The current estimated resource totals 1,170,000 ounces of gold, equivalent to a current gross in-situ value in excess of $1 Billion. Dana Resources plans to mine the Collota Gold Project as an open-pit mine to a maximum of 50m in depth. The estimated operation costs are approximately $400 per ounce. Further, this geological belt typically hosts economically significant silver resources.

Dana Resources is very pleased and excited to complete the acquisition of such a substantial and prolific gold project. The Board of Directors commented, “This is a significant milestone for the Company. Our plan is to simultaneously increase the deposit at Collota and continue permitting the project for production. With only 10% of the Collota Project explored, Dana is confident that there exists a multimillion ounce gold deposit. Dana Resources is confident that this acquisition will yield a significant positive cash flow for Dana Resources and its shareholders upon commencement of commercial production.”

With some of the richest mineral reserves in the world, Peru is one of the highest producing countries of precious & base metals in Latin America. Previously inaccessible regions are now becoming available through modern technology and equipment, making the high diversity of marketable minerals an extremely attractive prospect. In total, Peru holds about 16 percent of the world’s known mineral reserves.

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