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 Mon Feb 28, 2011
Drilling, Geochemical and Geophysical Surveys Commence on the Damara Gold Project, Namibia

 
Vancouver, February 28, 2011

Helio Resource Corp (TSX-V: HRC) is pleased to report it has begun a planned 5,000m+ drill programme and geochemical and geophysical surveys on its 100%-owned Damara Gold Project (DGP), in Namibia

The DGP comprises four licences (covering 318,500ha or 3,185km2) and is situated 25km - 130km east of Anglogold-Ashanti's (AGA) Navachab gold mine (see attached licence map). The Navachab mine, has currently mined over 1.5M oz of gold and still contains resources / reserves of approximately 3.7M oz of gold. The same geology and styles of mineralisation at Navachab have been discovered at the DGP.

Data review of historical work (mapping, soil sampling, rock chip sampling, percussion, reverse circulation (RC) and diamond drilling) conducted by AGA and other companies, and recent field work conducted by Helio has delineated several high priority targets within 2 of the 4 licences that make up the DGP: Wilhelmstal and Otjimbojo .

Initial Focus of Diamond Drill Programme

The initial drilling is designed to develop a strong understanding of the structural controls on mineralisation and guide the future exploration programme on the Wilhelmstal licence in the southern part of the DGP. Helio has identified a number of targets displaying Navachab-style mineralisation and has begun a diamond drill programme to collect oriented drill core from these targets, including Cheshire Cat and Bird's Nest (refer to attached Wilhelmstal Basin map)

Previous drilling of these targets by AGA subsidiaries in the early 1990s intersected up to 17m grading 2.8g/t Au and 6m grading 3.6g/t Au (open), respectively.

The Cheshire Cat target is an arcuate, 1.5km long, Au ± Cu soil anomaly overlying a tremolite-altered zone of dolomitic marble with discordant quartz veining and sulphidation. Rock grab sampling recently conducted by Helio over the central portion of the Cheshire Cat anomaly, 300m SE of where AGA drilled, has recorded grades of up to 6.5g/t Au and 0.48% Cu.

Re-assaying RC Drill Chips

Helio has conducted selective check sampling from a 20m section of reverse circulation (RC) drill samples from a drill programme conducted by Desert Minerals ("Desert") in late 2008 on the Otjimbojo licence at the Gold Kop target. Check sampling was conducted using screen fire assay techniques, due to the suspected presence of coarse gold, to give a more accurate reflection of the gold content.

Desert's analysis of the 20m section graded 0.6g/t Au. Helio has re-assayed the same section by screen fire assay and this returned an intersect of 20m grading 1.2g/t Au.

A complete re-sampling exercise is due to be finished shortly. Results will be reported once they are available.

Geophysical and Geochemical Surveys

The company has also commenced geophysical and geochemical surveys programme on the Wilhelmstal licence

A stream-sediment sampling programme, covering 40km2, has been completed over the main target areas on Wilhelmstal. Results are expected within the next month and will identify prospective drainages for follow-up soil sampling.

A detailed soil sampling programme, using 50m x 25m sample spacing has been initiated over the Leatherman target, covering an area measuring 1,000m x 450m. Leatherman is an area where rock- and channel-sampling by AGA previously returned grades of up to 11.3g/t Au over 5m, and anomalous gold-in-rock sample values were found over a 1,000m+ strike extent. Follow-up rock sampling by Helio has confirmed the presence of bedrock gold mineralisation in altered marbles with grades up to 2.6g/t Au being recorded. The mineralisation has a Au + Ag + Cu + Fe ± As ± Bi ± Sb association, similar to AGA's Navachab gold mine.

Geophysical surveys (ground magnetics and induced polarisation [IP]) are being conducted over the Cheshire Cat and B1 targets.

On the adjoining Ojtimbojo licence, Helio has been conducting geological mapping over the Gold Kop target, the most advanced target on the licence (see attached map). Gold Kop is a 4km-long Au ± As ± Cu soil anomaly which was drilled in a number of places by AGA in the late 1980s and early 2000s. Drilling results from the AGA campaigns include:
  • 1m at 71g/t Au;
  • 7m @ 5.6g/t Au (open);
  • 4m @ 8.6 g/t Au (open);
  • 8m @ 3.0g/t Au;
  • 31m @ 0.9 g/t Au.
Significant drill intercepts (>3m @ >2.0g/t Au) were received from drill holes over a 2.2km strike extent of altered marble. The mineralisation is open along strike to the northeast and southwest and to depth.

Helio has conducted rock sampling over the Gold Kop anomaly, and confirmed the same Au + Ag + As + Bi + Cu + Fe ± Sb association that is found at both the Navachab gold mine and on the Wilhelmstal licence. The mineralisation often has a high silver content: one chip sample returned 5.6g/t Au and 68.0g/t Ag.

Diamond and RC drilling plus geophysical surveys (detailed magnetics and IP) over the Gold Kop target will commence once the work at Wilhelmstal is finished.

The DGP Gold Project

The DGP comprises four licences (covering 318,500ha or 3,185km2), namely Etjo South, Okakango, Wilhelmstal and Otjimbojo. Helio holds a 100% interest in the project.

The DGP is located between AGA's Navachab Mine to the southwest and Auryx Gold Corp.'s Otjikoto Project to the northeast.

The Navachab mine has been in production since 1989 and, as of December 2009, has produced approximately 1.5 Moz of gold and has a non-NI 43-101 compliant resource of 3.73 Moz grading 1.13g/t Au (source AngloGold Ashanti Mineral Resource and Ore Reserve Report 2009).

Auryx's Otjikoto Gold Project, located approximately 150km northeast of Helio's licences has a NI43-101 indicated resource of 28Mt grading 1.34g/t Au and an inferred resource of 17.1Mt grading 1.28g/t Au for total of 1.93 Moz.

Chris MacKenzie, M.Sc., C.Geol., Helio's COO and a Qualified Person as designated by NI 43-101, supervises the exploration at the Damara Gold Project, including the sampling and quality assurance / quality control programmes, and has reviewed the contents of this news release.

For additional information, please contact Richard Williams at +1 604 638 8005 or by e-mail to richard@helioresource.com or Chris MacKenzie at +44 789 4237424 or by e-mail to chris@helioresource.com.

ON BEHALF OF THE BOARD OF DIRECTORS

"Richard D. Williams"
Richard D. Williams, P.Geo
CEO
"Chris MacKenzie"
Christopher J. MacKenzie, C.Geol.
COO

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

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