Angkor Resources Corp. press release

Unexplored Cambodia Shines For Angkor Gold

2012-10-17

TSXV - TSX Venture Exchange · Oil · Natural Gas · Natural Gas Liquids · Gold · Copper · Canada

SOURCE: VantageWire.com — Long forgotten amidst the instability of past political forces, the Kingdom of Cambodia ("Cambodia") has been slow to shake off the dark moments of its recent history. Yet with a landmass of 181,035 square kilometres, a young population, vast natural resources and a shared border between booming Thailand, Laos and Vietnam, the country's emergence into the international mining scene will likely be swift.

For the last decade, Cambodia has had one of the best economic records in Asia, with average annual GDP growth above 6%. This impressive figure makes Cambodia one of the world's top ten growth countries.

On top of impressive growth, the Royal Government is opening the country to international investment. Starting in 2003, foreign investors began to show great interest in the country's natural resources. This led to the discovery of oil and natural gas deposits beneath Cambodia's territorial waters in 2005. Production of these deposits, set for 2013, could dramatically increase the fortunes of the already rapidly growing nation.

As for mining: the country is now open for international business. The stable, democratic government passed anti-corruption laws in 2011 and has dedicated itself to working with private business. From tourism to manufacturing and now mining-Cambodia is on the path to explosive growth and, with the introduction of investment capital from China and the potential for huge discoveries, investors are taking note.

FIRST IN: ANGKOR GOLD

The vast majority of Cambodia has seen no modern exploration, yet the country has a long history of traditional mining for various metals, such as gold and silver. This local knowledge, combined with untapped mineral wealth, has set the stage for junior explorers.

The most active exploration company in Cambodia is Angkor Gold (TSXV: ANK). Having worked for over three years in the northeast Ratanakiri Province, Angkor Gold is the second largest resource exploring landholder, with 2,875 square kilometres of assets on eight tenements. The company has developed a strong relationship with the Ministry of Industry, Mines and Energy, has numerous, active projects and employs over 125 Khmer on its projects.

The company recently announced "a significant gold discovery" on its Phum Syarung Prospect in its Oyado South tenement. Drilling on this tenement outlined a strike of 275m open at depth to the north and south. Of 8 holes drilled this season, 6 returned positive results. These results include a 20cm section in PS12-013D (below), which demonstrates a considerable hit for the exploration team: an impressive 16.65 g/t Au over 4.05 metres, as well as appreciable silver, copper, and lead.

Scott Donahue, Vice President of Operations for Angkor Gold, says the recent drilling of Phum Syarung has helped push the once quiet nation into the mining spotlight.

"Cambodia's opportunities have been a secret to the North American market, and Angkor Gold is discovering what other European and Asian countries have known for some time. In an exploration sense, the country feels 20 years behind more established regions, which is precisely why we will see it boom."

Cambodia has no producing gold mine and no commercial mining history. While this may present a dilemma for investors who want to observe past successes to predict future potential, it also presents almost limitless opportunity.

Renaissance Minerals (ASX:RNS) currently holds the most advanced project in the nation: the Okyau Workings deposits. The Okyau has inferred resources of 729,000 ounces of gold, and is open in all directions. The company continues to expand this resource and is targeting two million ounces. With further exploration coming from Renaissance Minerals and rumours circulating about whether they will hit the numbers needed, the anticipation of a project has given Cambodia a PR boost in the mining world.

ACTIVE EXPLORATION

Angkor Gold works with an aggressive exploration strategy that incorporates diverse holdings in a mineral-rich region. With $12 million invested directly into its mining operations, 10 drill-ready targets and a board that brings decades of experience, the company is in an enviable position.

"We have multiple targets and significant experience, which significantly increases our opportunity to discover a large-scale deposit," says Donahue.

Of the company's more than 30 prospects, Angkor will focus on three. Border has 4 epithermal vein deposits, both open at depth and to the west. Okalla is a large gold-copper-molybdenum porphyry system that is structurally controlled over 1500m; target potential is 200 to 300m thick. The last focus includes the Phum Syarung high-grade discovery.

Prior to the Phum Syarung discovery, Angkor drilled over 7,000 metres in 69 holes on its focus property, which is the Border Prospect. Located in the Oyadayo Tenement, the Border Prospect contains encouraging gold values. Recent results from drill hole OY12-066D, for instance, recorded 29.9 g/t gold over 0.54 metres. To follow up, Angkor will continue with geochemical sampling, detailed mapping, trenching and diamond drilling.

The positive results continue Angkor's progression of active exploration on the company's concessions. This exploration has included stream sediment geochemical sampling, low level aeromagnetic surveys, drilling of almost 18,000 metres in over 143 holes, and the collection of over 20,000 "C" zone soil samples in 8 centres of interest in addition to numerous trenching and detailed geological field mapping.

"Now that the monsoon season is coming to an end, we plan on getting back into the exploration of our properties," says Donahue. "We will focus our drilling program in Phum Syarung and plan on doing regional work between our prospects to explore the continuity between key areas. The exploration work completed to date has created several opportunities and we are weighing our options for the future, whether they be JVs, production, or a strategic partner."

INVESTING IN CAMBODIA

"Our company perspective is quite simple: invest in Cambodia, invest in Angkor Gold," says Donahue.

This motto carries a lot of weight in a country that is still struggling with the effects of rapid growth among a poor population. When asked about humanitarian and development assistance, Angkor points to a number of initiatives including charity, investment and employment.

One of the most unique circumstances is Angkor's cooperation with local miners. These miners provide the knowledge that a modern exploration company should capitalize on. As Donahue points out, "these miners are easily our best explorers."

On top of its employment of traditional miners, Angkor also provides education to local villages, has invested in clean water initiatives and proper facilities, and makes sure to offer higher than average wages.

Says Donahue, "our community development projects are funded by management. We are seeing a healthy, committed workforce that appreciates every aspect of working for Angkor Gold."

THE BOTTOM LINE

Although Cambodia is quickly becoming a leading investment opportunity, the potential carries risk. When dealing with Cambodia, investors face a country that lacks a strong body of mining policies. With the possibility of producing mines in the near future, the government is stepping into new territory, which could bring various forms of regulation, taxes and conflicts.

However, the Royal Government of Cambodia wants to create a world-class mining sector and knows that in order to do this incentives must be put in place. Cambodia is modeling its mining policies after Australia, which has put considerable investment and expertise into the growing nation.

Another area of concern is infrastructure. The country suffers from a lack of developed roads and facilities, which could slow future projects as the communities race to catch up with modern mining. Donahue claims that the infrastructure has improved significantly over the past 5 years and has not presented any challenges for Angkor. "We have power, water, and paved roads creating easy access to the majority of our prospect locations."

With no debt, strong management, numerous charitable activities and a dedication to shareholders, Angkor Gold is in a strong position. Employing over 90% Cambodians, the company capitalizes on a strong labour force and local knowledge, while utilizing modern techniques to tap unexplored regions. Angkor also puts considerable weight on its relationship with the Ministry of Industry, Mines and Energy and works with the Cambodian Mine Action Centre (CMAC) to clear potential landmines ahead of exploration teams.

Overall, the recent results from Phum Syarung have helped bring both Angkor Gold and Cambodia into the junior mining spotlight. With an active exploration season about to kick off and promising results thus far, Angkor presents an opportunity to invest in a company with big ambition in a country that is developing at an impressive rate. Angkor Gold, like Cambodia, is at an exciting stage of growth.

Chris Devauld

for the Bottom Line Report

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