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DAILY NEWS Jan 10, 2013 7:39 PM - 0 comments

NGEx continues big run with Josemaria resource

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VANCOUVER — It has been a stellar six months for Vancouver-based explorer NGEx Resources (NGQ-T) and its portfolio of copper-gold prospects that lie along the Chilean-Argentine border.

NGEx has seen its share price rocket 109% or $1.80 since early August on the back of promising results from the company’s Los Helados and Josemaria copper-porphyry discoveries, capping off its run at a 52-week high of $3.44 per share at the time of writing.

The company continued to fuel share momentum on Jan. 10 when it released a significant resource update on Josemaria along with a series of sulphide copper-gold metallurgical results that indicated the deposit was amenable to standard flotation concentration.

NGEx's sulphide resource at Josemaria now hosts 656 million indicated tonnes grading 0.36% copper and 0.26 gram gold per tonne for 5.2 billion lbs. contained copper and 5.6 million oz. contained gold.

The deposit is overlain by an oxide layer averaging roughly 60 metres in depth that carries 44 million tonnes averaging 0.22% copper and 0.33 gram gold. Additional inferred sulphide resources are notable at 326 million tonnes grading 0.33% copper and 0.19 gram gold, with all resources calculated under a 0.3% copper equivalent cut-off.

"We successfully converted all the previous inferred resource to the [indicated category] plus added a significant amount to both [categories]," commented president and CEO Wojtek Wodzicki. "Furthermore, the deposit is still open in several directions, and we believe that there is excellent potential to add to the current resource through additional drilling. [Josemaria] has a number of natural advantages that will work in its favour — should further work show potential to develop an open pit mining operation.”

NGEx's metallurgical test work focused on sulphides at Josemaria and included eight individual drill-core samples. Preliminary results returned an average head grade of 0.56% copper at an 85% recovery rate, while gold recoveries clocked in at 69% at an average grade of 0.46 gram gold per tonne.

"Although Josemaria has been somewhat overshadowed by the outstanding recent results from Los Helados, today's results confirm it as a very significant deposit in its own right and an important part of [our] growing copper-gold resource base in the region,” added Wodzicki.

In mid-October NGEx release a maiden resource at its Los Helados prospect, which sits next to Josemaria along Chile's prolific Region III copper trend. Los Helados hosts 1.1 billion indicated tonnes grading 0.42% copper and 0.19 gold for 10.3 billion lbs. contained copper and 6.7 million oz. contained gold at a 0.3 copper equivalent cut-off.

NGEx continues to operate Josemaria under a joint-venture agreement with Japan Oil and Gas, while Los Helados and the nearby Fil del Sol copper properties are held under a joint-venture that includes Japanese mega companies JX Nippon Mining & Metals and Mitsui Mining. NGEx holds a 60% interest in all three projects.

NGEx is currently running drill campaigns at all three targets. The company plans to complete 28,000 metres at Los Helados, which is focused on pursuing mineralization to depth and converting current inferred resources to the indicated category. The company is also conducting a number of step-outs to potentially expand existing resources.

Meanwhile, NGEx is chasing potential resource extensions along Josemaria's northern boundaries. Drilling is scheduled to step-out roughly 100 metres based on hole JMDH-49, which intersected 172 metres grading 1.33% copper and 0.36 gram gold, as well as hole JMDH-50 that included 182 metres carrying 1.06% copper and 0.31 gram gold. The program is budgeted at roughly 5,000 metres.

NGEx has an additional rig collared at its Filo del Sol property, which is focused on a zone that the company suspects is a flat-lying, high-sulphidation copper-gold-silver target over an established strike length of roughly 1,000 metres. Previous results of note include holes FSDH02, which intersected 36 metres averaging 0.53% copper, 0.38 gram gold, and 393 gram silver; and FSDH03, which cut 98 metres grading 1.45% copper, 0.27 gram gold, and 16 grams silver.

"We are very pleased that this season's exploration program on the core South American Projects is underway and progressing very well," Wodzicki concluded. "Improvements that we made to our field camps last year paid off and allowed us to start drilling about two months earlier than we had in the past. We feel that we have excellent additional exploration potential at all three projects and we have an aggressive drill program planned to test that potential over the next six months."

NGEx shares rose 2.7%, or 9¢, following news of the Josemaria resource on Jan. 10. The company maintains 159 million shares outstanding for a $545 million press-time market capitalization.

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