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Azarga Metals New Assays Indicate Potential for Multiple Horizons of Significant Mineralization at Unkur

October 6, 2016 Download PDF

AZARGA METALS CORP. ("Azarga Metals" or the “Company”) (TSX-V:AZR) announces additional assay results from deeper sections in previously reported diamond core drill-hole AM-001 together with assay results for hole AM-011 at its Unkur Silver-Copper Project in the Zabaikalsky administrative region of eastern Russia.

The Company’s President and CEO Dorian (Dusty) Nicol said, “The assays from the remainder of AM-001 raise the intriguing possibility of additional horizons of significant mineralization that had not been identified in historical works at Unkur. In addition to continuing to explore the recognized mineralized zone, we will look to test the ‘multiple mineralization horizon’ idea across the deposit because confirmation of such could lead to a substantial increase in our views of the potential scale of any deposit at Unkur.”

ADDITIONAL ASSAYS FROM DRILL-HOLE AM-001

At 401 meters in length, Drill-hole AM-001 is the longest hole drilled by Azarga Metals to date at Unkur. Assays from the upper sections of the hole were made public in the Company’s news release on 19 September 2016. The main intersection announced was 40 meters at 65.9g/t silver and 0.74% copper from 82.5 meters to 122.5 meters together with two higher grade subsections (refer Table 2 in the Drilling Update Section of this news release).

Azarga Metals has now received assays from the remainder of drill-hole AM-001, including a second intersection of significant mineralization, being: 18 meters at 70.0 g/t silver and 0.81% copper (ie, 137.6g/t silver equivalent or 1.65% copper equivalent using US$17.83/oz silver price and US$2.17/lb copper price and assuming 100% recoveries) from 314.5 meters to 332.5 meters. That intersection includes seven meters at 137.7g/t silver and 1.51% copper (ie, 263.7g/t silver equivalent or 3.16% copper equivalent using US$17.83/oz silver price and US$2.17/lb copper price and assuming 100% recoveries) from 320.5 meters to 327.5 meters. In addition, a third intersection of highly anomalous, though lower grade, mineralization was identified, being: five meters at 49.2g/t silver and 0.32% copper (ie, 75.9g/t silver equivalent or 0.91% copper equivalent using US$17.83/oz silver price and US$2.17/lb copper price and assuming 100% recoveries) from 339.5 meters to 344.5 meters.

AM-001 is the first hole from Azarga Metals’ first phase exploration program at Unkur to establish multiple distinct horizons of significant mineralization. Such a feature was not observed in the shorter drill holes that have returned assays to date nor from historical exploration records. The Company plans to test for the presence of multiple layers of significant mineralization at other locations at Unkur.

ASSAYS FROM DRILL-HOLE AM-011

Assays have also been received from drill-hole AM-011. This hole, which was drilled to a total length of 179 meters, contained one significant intersection, being: 13.7 meters at 38.7g/t silver and 0.59% copper (ie, 87.9g/t silver equivalent or 1.05% copper equivalent using US$17.83/oz silver price and US$2.17/lb copper price and assuming 100% recoveries) from 140.2 meters to 153.9 meters, including 5.9 meters at 86.4g/t silver and 1.25% copper (ie, 190.7g/t silver equivalent or 2.29% copper equivalent using US$17.83/oz silver price and US$2.17/lb copper price and assuming 100% recoveries) from 148.0 meters to 153.9 meters.

Drill-hole AM-011 extends strike length approximately 600 meters to the south east of previously reported drill-hole AM-007.

Note: Drill intercepts are reported as drilled and may not be representative of true widths. Drill holes have been sited to attempt to intersect mineralization as close to perpendicular as possible, but there is not sufficient information about geometry of the mineralization at this time to estimate true widths. A Quality Assurance / Quality Control program is part of the sampling program at Unkur. This program includes chain of custody protocols as well as systematic submittals of standards, duplicates and blank samples into the flow of samples produced by the sampling including check assays of approximately 10% of the samples by another certified laboratory. Samples were analyzed at SGS Vostok Limited in Chita, Russia. Check assays will be analyzed at ALS Geochemistry in Chita, Russia.

DRILLING UPDATE

Azarga Metals has now completed ten holes and has drilled approximately 2,400 cumulative linear meters (of a planned 5,000 meters, recently expanded from the original 3,000 meters) at its Unkur Silver-Copper Project as per the table below.

Table 1: Location details for Unkur phase one drilling program completed holes to date

Hole ID East
(UTM)
North
(UTM)
RL Dip Azimuth
(magnetic)
Hole type EOH Recovery
AM-001 56.84 118.57 929m 70° 253° DD 401m 95%
AM-003 56.84 118.57 931m 70° 254° DD 96m 95%
AM-004 56.84 118.57 931m 70° 244° DD 383m 95%
AM-005 56.84 118.57 930m 70° 242° DD 160m 95%
AM-007 56.83 118.58 928m 70° 239° DD 80m 95%
AM-009 56.82 118.58 976m 70° 236° DD 225m 95%
AM-011 56.82 118.59 960m 70° 234° DD 179m 95%
AM-013 56.82 118.59 1,000m 70° 231° DD 100m 95%
AM-015 56.82 118.60 1,044m 70° 230° DD 196m 95%
AM-017 56.83 118.78 913m 70° 242° DD 278m 95%

Drill Holes AM-008 and AM-016 are currently being drilled.

Table 2: Unkur phase one drilling program assays reported to date (incl. this report)

Hole ID Intersection From To Silver grade Copper grade
AM-001 (IS 1) 40m 82.5m 122.5m 65.9g/t 0.74%
- AM-001 sub-section 22m 82.5m 103.5m 111.9g/t 1.13%
- AM-001 sub-section 7m 85.5m 92.5m 244.1g/t 1.95%
AM-001 (IS 2) 18m 314.5m 322.5m 70.0g/t 0.81%
- AM-001 sub-section 7m 320.5m 327.5m 137.7g/t 1.51%
AM-001 (IS 3) 5m 339.5m 344.5m 49.2g/t 0.32%
AM-003 16m 56.5m 72.5m 84.0g/t 0.79%
- AM-003 sub-section 5m 59.5m 64.5m 200.4g/t 1.39%
AM-007 10m 49.0m 59.0m 20.2g/t 0.29%
AM-011 13.7m 140.2m 153.9m 38.6g/t 0.5%
- AM-011 sub-section 5.9m 148.0m 153.9m 100.7g/t 1.35%

Notes: = full reported intersection and = sub-section contained within the relevant full reported intersection.

UNKUR SILVER-COPPER PROJECT

Azarga Metals owns 60% of the Unkur Silver-Copper Project along with the right to acquire the remaining 40% in the future.

Sediment-hosted copper and silver mineralization has been identified across the 5,390 hectare project license area, in outcrops, trenches and by historical diamond drilling. The prior exploration outlined a large area of high-grade shallow stratiform sediment hosted copper-silver 20 to 50 meters thick over an area four to six kilometers long.

Further details concerning Unkur Silver-Copper Project are contained in a technical report filed by the Company as per its news release of 5 April 2016.

Qualified Person

The Company’s President and Chief Executive Officer, Dorian L. (Dusty) Nicol, B.Sc. Geo, MA Geo, a Qualified Person as defined by NI 43-101, has reviewed and approved the exploration information disclosures contained in this Press Release.

About Azarga Metals Corp.

Azarga Metals is a mineral exploration and development company that owns 60% of the Unkur Silver-Copper Project in the Zabaikalsky province in eastern Russia.

AZARGA METALS CORP.

"Dusty Nicol"

Dorian L. (Dusty) Nicol, President and CEO

For further information please contact: Doris Meyer, at +1 604 536-2711 ext 6, or visit www.azargametals.com.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Cautionary Statement:

This news release contains forward-looking statements that are based on the Corporation's current expectations and estimates. Forward-looking statements are frequently characterized by words such as "plan", "expect", "project", "intend", "believe", "anticipate", "estimate", "suggest", "indicate" and other similar words or statements that certain events or conditions "may" or "will" occur. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that could cause actual events or results to differ materially from estimated or anticipated events or results implied or expressed in such forward-looking statements. Such factors include, among others: the actual results of current planned exploration activities; conclusions of economic evaluations; changes in project parameters as plans to continue to be refined; possible variations in ore grade or recovery rates; accidents, labour disputes and other risks of the mining industry; delays in obtaining governmental approvals or financing; and fluctuations in metal prices. There may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. Any forward-looking statement speaks only as of the date on which it is made and, except as may be required by applicable securities laws, the Corporation disclaims any intent or obligation to update any forward-looking statement, whether as a result of new information, future events or results or otherwise. Forward-looking statements are not guarantees of future performance and accordingly undue reliance should not be put on such statements due to the inherent uncertainty therein.