VANCOUVER — Explorer NovaCopper (TSX: NCQ, NYSE-MKT: NCQ) has reason to be pleased with results of a busy 2013 field season at its Bornite copper deposit in northwestern Alaska’s Ambler mining district.
As a result of 8,000 metres of drilling and a comprehensive re-sampling program that incorporated 11,000 metres of core, the company has just increased Bornite’s indicated and inferred copper resources by 87% and 73%.
Bornite lies 26 km southwest of NovaCopper’s feasibility stage Arctic deposit — where the company released a preliminary economic assessment (PEA) in July 2013 — and is comprised of two main zones: Ruby Creek and South Reef. Ruby Creek’s mineralization occurs as a pair of discrete strata-bound lenses classified as the Lower and Upper Reefs. Ruby Creek joins up with South Reef to create a broad zone that runs 1 km wide to the northeast and east.
NovaCopper’s goals during the past year were twofold: first, the company expanded open-pit potential in Ruby Creek’s Lower Reef area. Second, chased higher-grade underground potential northward through both Ruby Creek and South Reef. In a bid to tack on more open-pit resources NovaCopper also re-sampled 33 drill holes to identify historic lower-grade material at shallow depths that may have sat below previous cut-off levels.
As a result, the in-pit copper resource expanded: Bornite now hosts 14 million indicated tonnes grading 1.08% copper for 334 million contained lb., with inferred resources adding 110 million tonnes averaging 0.94% copper for 2.26 billion contained lb.
All in-pit resources assume a 0.5% copper cut-off grade and a US$3 per lb. copper price, with the pit covering shallow mineralization across the Upper and Lower Reefs.
Meanwhile, deep drilling along the Lower Reef and South Reef extensions have shown grades that lend support to an underground mining scenario. Bornite’s “below-pit” resources — at a 1.5% copper cut-off grade — now total 56 million inferred tonnes grading 2.81% copper for 3.4 billion contained lb.
President and CEO Rick Van Nieuwenhuyse noted in the release that the company’s exploration team has increased Bornite’s scale sixfold over the past three years, and added that “the project could have great flexibility in mining selectivity during future mine planning.”
Bornite’s mineralized zone is 1.5 km along strike and 2 km downdip. The resource remains open along the 1 km wide northern margin of the deposit, as well as the updip projection of South Reef.
NovaCopper is working with the Alaska Industrial Development Export Authority (AIDEA) to study infrastructure projects that could boost the viability of its Bornite and Arctic projects — which are jointly referred to as the Upper Kobuk portfolio.
The company is looking at an industrial access road and a liquid natural gas plant that could power a processing facility at Arctic.
NovaCopper spent US$8.9 million on exploration in 2013, and reported US$5.4 million in cash and equivalents at the end of January 2014. The company says it will likely have to raise more money to keep advancing Upper Kobuk.
NovaCopper shares have traded within a 52-week range of $1.35 and $2.20, and rose 5.5% after news of Bornite’s updated resource, en route to a $1.54-per-share close at press time. The company has 53 million shares outstanding for an $82-million market capitalization.
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