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St George Mining intersects gold mineralisation at higher elevation at Pine Creek

Gold explorer St George Mining (ASX: SGQ) has completed its diamond drilling program for 2011 at the Pine Creek Property in the Northern Territory which has intersected gold mineralisation at a higher level than the discovery hole.

The multi-phase 2011 exploration program was designed to confirm the known gold mineralisation at Pine Creek, as well as test the broader area for extensions of the mineralisation.

The first diamond drill hole has been completed to a depth of 550 metres and visual inspection of the drill core indicates that the marker unit and the target formation for mineralisation were intersected at a higher elevation than encountered with the older angled discovery hole.

St George Mining executive chairman John Prineas commented, “We believe the 2011 exploration program will add substantial value to the company’s project by improving the definition of the large gold system at Pine Creek and confirming the potential for the establishment of a significant gold resource.”

So far St George has completed a combination of orientated diamond drilling and a multi-element MMI soil geochemical to:

- Confirm the high grade intersections in the existing discovery hole;
- Gain a better understanding on the local orientation of the gold mineralisation; and
- Test for vertical and lateral extensions from the higher grade zone.

Once the diamond drill core has been processed it will be transported to Darwin to be analysed using the CSIRO HyLogger – a hyperspectral logging unit.

Due to the early onset of the wet season, St George has suspended the drilling program until the 2012 field season.

Previous Pine Creek Exploration

A previous MMI soil geochemical orientation survey carried out by Homestake Gold Australia, which made the original gold discovery at the Pine Creek Property, identified a prominent gold anomaly over the higher grade discovery drill intersection.

Homestake Gold also carried out a successful regional diamond drilling program over a broad area of the Fenton shear zone that included EL 27732, a tenement that now forms part of St George Mining’s Pine Creek Property.

Carbon and sulphide-rich gold mineralisation was intersected by Homestake Gold within the extensive and highly mineralised Koolpin Formation, which also hosts the Cosmo Howley gold mine about 30 kilometres to the northeast.

Cash Position

As of 30 September 2011, St George had A$2.276 million cash. The company launched a one for five non-renounceable entitlements issue to raise up to $1.575 million in early August which closed fully subscribed.