ASX RELEASE: 30 July 2010

Wider Zones and High Grade Gold Intercepts at Medinandi

Highlights

• Wider zones and high grade gold intercepts received from second batch of assay results at Medinandi – Fadougou Main Zone including:

                     - 12m @ 8.06g/t Au (FRC350) from 33 to 45m, includes 5m @ 15.9g/t

                     - 7m @ 7.29g/t Au (FRC348) from 55 to 62m

                     - 4m @ 4.72g/t Au (FRC352) from 50 to 54m

• Results received for confirmation infill drilling at the Fadougou Main Zone have demonstrated excellent continuity along a 2km strike length. Mineralisation remains open along strike and at depth, with all significant intersections within 100m of the surface.
• Results for the remaining 70% of the maiden drill programme of 13,100m of Reverse Circulation (“RC”) drilling are awaited. This drilling targets 4 new prospects with potential to add to the Medinandi indicated and inferred mineral resource.
• Future exploration work is expected to result in a resource upgrade and identification of new mineralised zones.

Drilling Programme Objectives and Accomplishments

Papillon Resources Limited (ASX: PIR) (“Papillon” or “the Company”) is pleased to announce the second tranche of drill results from its maiden drilling campaign at its flagship Medinandi Project in Mali, West Africa (Figures 1, 2, and 3). These results compliment the results announced on the 12th July 2010 (ASX Announcement: “Drilling Results Confirm Outstanding Potential – High Grade Intercepts at Medinandi”).

The project is located on the Senegal/Malian Shear Zone, where in excess of 38M oz of gold has been discovered (Figure 4).

The Company’s maiden drilling programme, consisting of 4,320m at Fadougou Main Zone and 8,780m on new exploration targets, totalling 13,100m of RC drilling, was designed to achieve the following:

• Extend and infill existing indicated and inferred mineral resources at the Medinandi Project – Fadougou Main Zone (see Table 2); 
• Test satellite mineralisation at Fadougou North East and Fadougou South South East;
• Test other exploration targets identified by trenching at Tintiba Main (trenches 120m apart returned assay results of 14m @ 5.44g/t and 8m @ 5.54g/t), and dual targets generated by soil geochemistry and co-incident chargeability-resistivity anomalies at Fekola. The Fekola prospect has anomalous geochemical results extending over a 3.5km strike length; and
• Increase the geological understanding of the mineralisation at the Fadougou Main Zone and the other exploration targets.

Results have now been received for 4,290m of the 4,320m infill drilling programme on the Medinandi Project - Fadougou Main Zone. Results from 8,780m of drilling outside the Fadougou Main Zone on new exploration targets within the Medinandi Project are awaited.

Figure 1: Medinandi Project – 2010 RC Drill Hole locations and Assay Results Status 

 

Fadougou Main Zone Assay Results Received

Papillon has received assay results from approximately 30% of the completed drilling. To date the assay results are from the first phase of the drilling campaign which was targeted predominately at the Fadougou Main Zone. These results are extremely encouraging and confirm the outstanding potential to extend resources at Medinandi. 

Table 1: Medinandi Project – Fadougou Main Zone Drill Hole Summary 

 

Status of Assay Results

Assay results from approximately 8,000m of the 13,100m of the completed drilling programme are yet to be received. These drill results will provide information on 4 new potential gold resources at Fadougou North East; Fadougou South South East; Tintiba Main North and South; and Fekola Central and Fekola West Main.

Resource re-modelling will be undertaken once all drill assay results are received.

Figure 2: Medinandi Project: Fadougou Main Zone –Drill holes with significant intercepts

 

Future Exploration Focus

At the Medinandi Project future exploration work will include and focus on the following activities:

• Preliminary metallurgical test work from selected RC drill samples.
• Diamond drilling at the Fadougou Main Zone to test mineralisation at depth.
• Step-out drilling on the Fadougou Main Zone to test extension of mineralisation, which remains open to the north and south along strike.
• Dependent upon results from the recently completed RC drill programme and the channel sampling of trenches completed on exploration targets at Fadougou North East, follow up drilling on the exploration targets at Fadougou North East, Fadougou South South East, Tintiba Main North and South, and Fekola Central and Fekola West Main will be planned.
• Drilling of targets generated from the recently completed ground geophysical (IP survey) and planned magnetic surveys.

Figure 3: Medinandi Project: Fadougou Main Zones Cross Section 1390550mN    

 

Table 2: Medinandi Project - Mineral Resource Statement for Fadougou Main Zone 

 

Figure 4: West Mali - Medinandi Project Location

 

Contact:

Alan Campbell
Managing Director
Papillon Resources Limited
Tel: +61 8 9225 5485
Email: This e-mail address is being protected from spambots. You need JavaScript enabled to view it

Competent Persons Statement
Information in this report relates to exploration results or mineral resources are based on information compiled by Mr Stuart Hall who is a Member of The Australasian Institute of Mining and Metallurgy. Mr Hall has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Mr Hall consents to the inclusion in the report of the statements based on his information in the form and context in which it appears.

Forward Looking Statement
Statements regarding plans with respect to the Company’s mineral properties are forward-looking statements. There can be no assurance that the Company’s plans for development of its mineral properties will proceed as currently expected. There can also be no assurance that the Company will be able to confirm the presence of additional mineral deposits, that any mineralisation will prove to be economic or that a mine will successfully be developed on any of the Company’s mineral properties.

 

Papillon Resources Ltd – Background Information

Papillon (previously Colonial Resources Ltd) is based in Perth Western Australia and listed on the Australian Stock Exchange (ASX: PIR). Papillon's primary focus is the recently acquired gold assets in Mali, West Africa.

The Malian assets consist of 18 prospecting authorizations and research permits spanning circa 1883km² within the Kedougou-Kenieba window, a major Lower Proterozoic Birimian outlier on the NE margin of the West African Shield. The Medinandi Project in western Mali contains an established resource base of 650,000 oz gold (JORC and SAMREC compliant). Papillon completed the acquisition of 80% equity interests in each of Mali Goldfields SARL (“Mali Goldfields”) and Songhoï Resources SARL (“Songhoi Resources”) (collectively referred to as “Malian Assets”) on 17th March 2010.

Mali Project Location Map

Songhoï Resources represents the joint venture vehicle between Papillon (80% equity interest) and Mani SARL (20% equity interest) established in August 2006 for the exploration and development of four exploration permits covering circa 279km2 in the prospective Kéniéba and Kayes districts in West Mali.

Mali Goldfields represents the joint venture vehicle between Papillon (80% equity interest) and Mali Mining House SA (20% equity interest) established in February 2006 for the exploration and development of fourteen exploration permits covering circa 1,533km2 of the prospective Birimian Gold Belt in South and West Mali.

Papillon’s tenements in West Mali are in the Kéniéba Valley, host to AngloGold Ashanti Limited / IAMGOLD Corporation’s Sadiola and Yatela Mines, Randgold Resources Limited’s Loulo-Yalea operations and Avion Gold Corporations’ Tabakoto-Segala mines.

Papillon’s tenements in South Mali are proximal to the Morila gold mine (owned via a joint venture between AngloGold Ashanti and Randgold), the Syama Mine operated by Resolute Mining Limited and the advanced projects Komana (Goldfields Ltd), and Kalana (Avnel Gold Mining Ltd).

The acquisition of the Malian Assets has provided Papillon with a significant portfolio of tenements in a world class gold region.

Detailed information on all Papillon projects can be found on the website: www.papillonresources.com

Appendix 1

Appendix 1 continued

Notes:

1. All results from Reverse Circulation (RC) drill holes.

2. Samples at 1m intervals.

3. Assaying conducted by SGS Analabs, Kayes, Mali using industry standard 50g lead collection fire assay with AAS finish.

4. Reference standards, field duplicates and blank samples are routinely inserted; quality control samples are routinely monitored.

5. NSR – No Significant Results (<1g/t within the hole)