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Xanadu Mines Ltd trenches bonanza gold from Oyut Ulaan in Mongolia

Xanadu Mines Ltd (ASX:XAM) has received gold assays of up to 589.96 g/t from its trenching work at its 90% owned Oyut Ulaan copper-gold project in Mongolia.

Trenching results at the Stockwork II and Bavuu zones within Oyut Ulaan continue to increase the scale and potential of the system.

Multiple near-surface, shallow-dipping lodes have produced high grades of 1 g/t to >30 g/t gold.

Following the previously reported discovery of multiple zones of potentially significant outcropping mineralisation, the company continues its program of systematic and cost effective exploration work.

This work is designed to understand the geological controls on high-grade mineralisation within this large system before drilling is planned.

Andrew Stewart, CEO, commented: "We are delighted that detailed trench sampling of these newly discovered quartz-sulphide veins continues to deliver outstanding gold results with multiple bonanza grade assays confirming the existence of continuous shallow high-grade gold mineralisation with remarkable continuity along the strike.

"Now we have received all results from the first part of the trenching program we are now developing plans for accelerated exploration of this exciting new discovery at Oyut Ulaan."

Background

The Oyut Ulaan project is strategically located within the South Gobi Copper Belt, which hosts the world class Oyu Tolgoi copper-gold project, and 260 kilometres east of Xanadu's flagship Kharmagtai copper-gold project.

The recent discovery of potentially significant gold vein mineralisation broadens the range of targets at Oyut Ulaan and opens up a whole new area for exploration.

The results of this first part of the trenching program are encouraging and indicate Oyut Ulaan is developing into one of the most prospective districts in the South Gobi.

Furthermore, copper grades within the samples from the Stockwork II zone average 0.3% which supports the possibility of a buried porphyry copper mineralisation.

Analysis

Given the bonanza grades and significant strike; we expect the ongoing field work to continue to produce high grade results.

Xanadu maintains broker support from Bell Potter who have a $0.35 price target and Speculative Buy rating.

The share price is up circa 100% year to date trading around $0.23.

These results are further confirmation of the existence of sub-outcropping high-grade gold mineralisation at Oyut Ulaan.

Furthermore, these assays demonstrate that the host rock is also carrying gold mineralisation and the gold is not only being carried by the quartz veins.

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