Gold Anomaly Limited (ASX:GOA) Announce Encouraging Electromagnetic Anomalies At Sao Chico Gold Project in Brazil

Sydney, Dec 20, 2010 AEST (ABN Newswire) - Gold Anomaly Limited (ASX:GOA) is pleased to report encouraging exploration results from the company's most advanced asset, the Sao Chico Gold Project in Brazil.

Gold Anomaly's wholly owned subsidiary, Gold Aura Do Brasil Mineracao Ltda ("GOAB"), has completed an initial horizontal loop electromagnetic survey (HLEM) over the main vein zone at Sao Chico. The survey has revealed the presence of two large anomalous conductive zones, most likely associated with pyritic mineralised zones in the basement granite. Persistence of the anomalism throughout all frequencies indicates significant depth extent.

Commenting on the results, Gold Anomaly Chairman Mr Greg Starr said, "the results are promising, providing excellent data for our current trenching and upcoming drilling programs. The timing is ideal, at a time when gold is above US$1,350 an ounce and with mining operations set to commence in early 2011.

"Cashflow from Sao Chico will assist in advancing our flagship asset, the Crater Mountain project in PNG, where the commencement of our maiden 2,500 metre drilling programme is imminent," Mr Starr added.

The HELM survey was undertaken along a series of 50 metre spaced N-S orientated lines over the main Sao Chico gold vein area. Several regional traverse lines were also surveyed and were randomly selected within the AP to the east (1.0km, 1.5km and 4.5km) of the main prospect area.

The larger of the two conductivity anomalies was delineated immediately south of the main vein along which a drive was developed from the Waldimiro shaft on Sao Chico Vein No 1. From what is currently known of the area, it would appear that the anomaly is associated with base metal sulphides. Two composite rock grab samples of pyritic granite obtained from an old garimpeiro shaft on the northern edge of this area returned encouraging assay results of 36.03 g/t and 1.61 g/t gold and as previously reported, similar samples from the nearby Vein No. 1 drive returned an average assay result of 15.0 g/t gold (based on some 100 rock samples).

Further south into the anomalous zone, a recent trench (21) area intersected old garimpeiro workings and a 4.45m zone of stockwork veining. Three channel samples from within this zone returned assays of 1.02 g/t gold, 2.89 g/t gold and 11.34 g/t gold. Given that it is known that there is a nuggetty gold sampling problem at Sao Chico, these results are considered to be significant and all samples found to be in excess of 1.0 g/t gold are being targeted as potential feed material for the plant as it is interpreted that mined bulk grades will approach the targeted grade of 20 g/t gold. While a grade of 20g/t gold is being targeted and both test work and mining to determine if this is achievable will be undertaken, it should be noted that this grade is conceptual in nature and that there has been insufficient work undertaken to date to define a Mineral Resource and it is uncertain if further exploration will result in the determination of a Mineral Resource.

A large conductive anomaly was also delineated some 100 metres to the east of the main zone (where veins are known) and discrete conductive anomalies were also detected on the two traverse lines 1.0 and 1.5 km to the east. The latter two areas require follow-up as there are no veins known in these areas.

Follow-up induced polarisation (IP) surveying has been undertaken and the data is currently being interpreted to further define the conductivity anomalies and to select targets for trenching or drill testing.

Work at Sao Chico is currently focussed on preparing the site for installation of the processing plant with commissioning anticipated early 2011.

The plant has a design capacity of over 100,000 tonnes per annum (20 hours per day, 30 days per month). The design capacity provides GOA with the opportunity to considerably ramp up production with further exploration success, as open pit mining of gold bearing veins is targeting 50 tonnes of ore per day before progressing towards the planned production rate of 100 tonnes per day (30,000 tpa). At the targeted grade of 20g/t, it is anticipated that production of gold at low cost will be 20,000 recovered ozs per annum. While a grade of 20g/t gold is being targeted and test work to determine if this is achievable will be undertaken, it should be noted that this grade is conceptual in nature and that there has been insufficient work undertaken to date to define a Mineral Resource and hence, it is uncertain if further exploration will result in the determination of a Mineral Resource. GOAB recently advised that it has commenced a Feasibility Study (FS) on the economics of underground mining of the gold vein shear systems at Sao Chico on behalf of the owner, Waldimiro Martins. A major component of the FS is the recently completed Induced Polarisation (IP) survey of the main vein area following electromagnetic (EM) surveying. Other work will include stream sediment sampling, drilling, soil sampling, rock sampling, geological mapping and petrology. More detailed follow-up will be undertaken on delineated IP and EM anomalies. If as expected the FS indicates a commercial operation would be economic, a Mining Lease will be applied for.

Trenching work undertaken to date has exposed significantly more veins than the original five identified in the main prospect area and it is expected that further veins will be located by the ongoing trenching program and the recently completed IP surveying.

For the complete Gold Anomaly announcement including location maps, please refer to the following link:

http://www.abnnewswire.net/media/en/docs/64849-ASX-GOA-227578.pdf

Contact

Ken Chapple Executive Director Mob: +61-418-758-301 Greg Starr Executive Chairman Mob: +61-2-9241-4224 Emial: info@goldanomaly.com.au http://www.goldanomaly.com.au