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Ocean Equities says Nyota Minerals’ Tulu Kapi resource may dwarf the broker’s initial estimate

In a note to investors, London based independent stockbroker Ocean Equities Ltd said that exploration results from Ethiopian operating gold junior Nyota Minerals (ASX, AIM: NYO) made good reading. Furthermore the broker claimed the report contained two headline grabbing results, consequently they believe that the Tulu Kapi gold resource may dwarf Ocean’s initial 1 million ounce (Moz) estimate.

Drilling results from Tulu Kapi project opens the possibility of a third unit of mineralization below currently defined zones and an entirely new and distinct area of mineralisation immediately north of Tulu Kapi, Ocean said.

Today, Nyota said further exploration at Tulu Kapi has increased the known extent of the ore body and, in addition, identified a new zone of mineralisation below the previously discovered Zones 1 and 2. The trenching programme these findings are based on was undertaken in five locations within the Tulu Kapi licence and was designed to test extensions to the known mineralisation at surface and depth.

Peak trench results include intersections of 1 metre 5.49 grammes per tonne of gold, 1 metre at 10.35 g/t Au, 1 metre at 4.58 g/t Au and 1 metre at 7.84 g/t Au. These results increase the known extent of the Tulu Kapi ore body both to the north east and contiguous to the maiden ore resource of 690,000 oz gold.

According to Ocean, the trenching results seem to confirm Nyota’s geologists’ theories about another zone of mineralisation lower in the sequence. Additionally, the stockbroker believes that trenches 4 and 5, striking east-west and dipping to the south, could be a separate orebody which could hold potential for many more tonnes of ore.

The stockbroker thinks the updated resource statement, which is expected in H1 2010, will extend the Tulu Kapi resource beyond one million ounces. Ocean Securities concluded that its own short-term estimate of one million gold-ounces may be dwarfed by the eventual resource that is defined at Tulu Kapi.

Disclosure: The author holds no positions in the company