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Phoenix Gold (ASX: PXG) has extended gold mineralisation at the company's Castle Hill Project in Western Australia's Goldfields region.

A drilling program comprising 28 reverse circulation holes for 2,380 metres was completed in the March quarter, testing areas to the west and east of the current JORC Resource.

Highlight intercepts from the drilling program include:

- 52 metres at 1.38 grams per tonne (g/t) gold from 40 metres, including 12 metres at 2.54g/t gold;
- 29 metres at 0.79g/t gold from 51 metres; and
- 26 metres at 0.75g/t gold from 31 metres.

Results from the recent program have identified new broad zones of mineralisation and demonstrated continuity between previously defined systems.

Data from this program will be combined with drill results from late 2011 to update the geological model and JORC Resource at Castle Hill in the June quarter.

Castle Hill hosts a JORC Resource of 10.99 million tonnes at 1.6g/t gold for 559,000 ounces of contained gold.

Phoenix managing director Jon Price said the drilling program showed the potential for expansion at Castle Hill.

"The latest results again demonstrate the size and quality of the deposit, and we have to remember that the current Resource only goes down to 80 metres from surface.

"The next round of drilling at Castle Hill will test depth extensions and we are looking forward to testing new areas of this highly mineralised system."

Drilling in 2012

Phoenix is planning several drilling programs in a 50,000 metre drilling campaign in 2012. The company's initial focus is on increasing the resource base at the Castle Hill and Broads Dam Projects, with a combination of deeper reverse circulation and diamond drilling.

Early stage exploration targets will also be tested, focussing on identifying new discoveries, primarily within the Ora Banda - Grants Patch and Kunanalling gold projects.

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