‘Tis the season to be repetitive.
New precious and base metals discoveries all but failed to make headlines in 2002, with most explorers remaining firmly attached to known deposits. Still, the tactic was repaid in volume, if not speculation, which, in and of itself, casts the year in a better light than recent ones.
By September, Barrick had 11 rigs turning on the property, six on stepout or infill duty and the rest on condemnation detail. If all goes as planned, a feasibility study will be tabled in early 2003 and construction will begin by year-end.
Barrick expects Alto Chicama to add 500,000 oz. to its annual production profile at a cost of US$300-350 million. The prediction excludes any expansion of known resources (mineralization remains open to the south and southeast).
Cash costs are expected to fall to the low US$130-per-oz. range.
Barrick also was instrumental in enlivening a rather quiet year in Africa. At the Tulawaka project in Tanzania, the major and partner
At last report, the zone extended over a strike length of 400 metres, a width of 50 metres and an average thickness of 20 metres. The highest grade reported, 30.5 grams, came from a 10-metre section of hole 815, whereas the longest section, 16 metres, came from hole 813 and averaged 3.4 grams.
The zone comprises mostly weathered rock with quartz veining and is associated with a metamorphosed gabbroic rock extending for several hundred metres outside the drill grid area. It remains open to the west and at depth.
The West zone is 3 km from the East zone, which is the subject of an ongoing feasibility study. The partners were expected to have wrapped up the study by mid-year, whereupon a production decision was to have been announced.
Mineralization in the East zone is hosted by three gold-bearing quartz veins which, combined, have a strike length of about 1 km. At last report, the East zone, which extends no deeper than 150 metres below surface, had a resource of 1.6 million tonnes running 18.96 grams gold per tonne.
Barrick, the operator, holds a 70% interest in the property. Minires du Nord holds the remainder.
Well, that pretty much sums up the new discoveries. So on to expansions:
Among the more noteworthy was Turquoise Hill in the South Gobi region of Mongolia, owned and operated by
By July, Ivanhoe had sunk 10 holes in the Central Oyu zone to extend primary chalcopyrite mineralization over an area of 1.8 sq. km. Two months later, hole 270, the third to be sunk in the virgin Far North Oyu zone, returned the best results yet: 638 metres running 1.61% copper and 0.07 gram gold per tonne, beginning just 190 metres below surface.
A higher-grade section of hole 270, which was angled at 60 to the north, ran 3.58% copper and 0.23 gram gold over 114 metres of core, starting at a down-hole depth of 576 metres. The hole bottomed out in mineralization at 860 metres down-hole, with the final 8.9 metres running 0.71% copper.
Ivanhoe also met with success at its Kharmagtai project, about 120 km north of Turquoise Hill. The first three holes cut upwards of 102 metres of porphyry grading 2.09 grams gold and 1.05% copper, confirming earlier drilling and historic work done by Mongolian, Russian and Japanese geologists.
Exploration continues at both properties, and preliminary economic and operational studies have begun at Turquoise Hill. Production rates of between 50,000 and 10,000 tonnes per day are envisaged.
Ivanhoe’s efforts did not go unnoticed by others, especially mining bigwig
Junior
QGX also sank three holes some 2 km to the northeast, where earlier trenching had returned up to 15.6 grams gold over 6 metres. All intersected inter-bedded limestone, shales and intrusions, some of which were altered and mineralized.
So far, the company has drill-tested 500 metres of the targeted 3-km-long system. The system is characterized by a series of geological and geophysical anomalies thought to reflect a low-sulphidation mineralizing environment.
QGX has not revealed the exact location of the property for fear of attracting competition; however, it divulged enough to catch the eye of Octagon Capital. The firm bought $3.9 million worth of QGX treasury shares, more than enough to satisfy the junior’s earn-in requirements. QGX must spend US$450,000 over three years to earn an 80% stake. It can buy the remainder for US$1 million.
Expansion of known mineralization also underscored the efforts of
Highlights from recent drilling include:
o 508 metres grading 0.28% copper and 0.47 gram gold per tonne in hole 49;
o 590 metres grading 0.51% copper and 0.66 gram gold in hole 50; and
o 579 metres grading 0.36% copper and 0.6 gram gold in hole 51.
Many holes carried higher grading sub-intervals.
Still, as with most mineral projects around the world, North has had its setbacks. Eight reconnaissance holes failed to cut what was thought to be a second porphyry system to the south, though exploration will continue in the new year, given the alteration and mineralization patterns that were observed.
Anglo and Philex each own a half-interest in North, though the major can increase its stake to 80% by tabling a feasibility study. It also must pay Philex as much as US$5 million if the metal content of the deposit (or of any others found in the surrounding claims) exceeds 7.96 billion lbs. copper-equivalent.
Partners
Over the next three months, the pair will spend US$2.9 million infilling the shallow gold mineralization at the Akivik, Aurora, 400, Acma and South Acma zones on 50-by-50 metre fences. At last report, indicated resources on the property stood at 73.2 million tonnes grading 3.51 grams.
NovaGold owns a 70% interest in Donlin Creek, though Placer has until mid-February to exercise a back-in right for another 30%. If it does so, the major must then, among other things, spend US$30 million on project development and build a mine capable of producing no fewer than 600,000 oz. per year.
Here at home, at the Red Lake mine in northwestern Ontario,
In the process, Goldcorp spent $12 million on exploration, making 2002 its most expensive year yet. An updated reserve and resource estimate is scheduled f
or release in mid-February 2003.
In Nunavut,
One exploration highlight of the summer program was the confirmed discovery of a sixth deposit. Following up work done in 1999 and 2000, Cumberland sank 18 holes into the PDF prospect to recover upwards of 80 grams per tonne over half a metre, all near surface.
The zone has been defined almost 200 metres downdip to a vertical depth of 70 metres below surface and more than 150 metres along strike. Mineralization remains open in both directions.
PDF sits about 10 km north of the Vault deposit, which itself is roughly 4.5 km northeast of the closely spaced Third Portage, North Portage, Goose Island and Bay zones. The Third Portage and North Portage zones, previously considered separate, were connected by summer drilling.
At last report, Meadowbank hosted 7.8 million tonnes in the measured and indicated categories at a grade of 5.79 grams gold. Another 10.9 million tonnes averaging 4.4 grams were classified as inferred; however, neither estimate includes 2002 drill results.
Meanwhile, back in northern Ontario, partners
The pace of development even prompted the South African major to double the size of the exploration budget to roughly $5 million. Among next year’s targets is a 5.4-million-tonne resource that averages 0.82 gram palladium and 0.29 gram platinum, plus gold, nickel and copper values.
By also focusing on platinum and palladium,
At the Mesamax zone, drilling has defined high-grade, near-surface mineralization varying from 25 to 70 metres in width along a strike of 150 metres. The zone is hosted, or lies adjacent to, pyroxenite and is characterized by disseminated, net-textured and massive sulphides in the form of pyrrhotite, pentlandite and chalcopyrite.
Recent drilling also returned tantalizing results from the TK area, about 3.5 km west of Mesamax. Hole TK-21 averaged 2.28% nickel, 2.01% copper, 0.15% cobalt, 2.87 grams palladium and 0.45 gram platinum per tonne, while TK-22 assayed 2.14% nickel, 1.24% copper, 0.13% cobalt, 1.88 grams palladium and 0.3 gram platinum.
Results for 14 other core holes are pending, as are those for an additional 12 holes drilled west of the Expos prospect, or 10 km west of Mesamax.
Canadian Royalties owns a 70% stake in Expo-Ungava and can increase this to 80% by completing a bankable feasibility study. All of the new drilling was done northeast of a known resource of 17 million tonnes grading 0.6% nickel and 0.8% copper.
Canadian Royalties is trying to raise $9 million by way of a private placement. The financing coincides with a run-up in the company’s shares, which soared to a new 52-week high of $3.08 in mid-November 2002. At presstime, the shares had receded to $2.01.
Expo-Ungava lies about 15 km south of the Raglan mine of
Of course, no year would be complete without some speculation, which brings us to
The rally follows Southwestern’s recovery of multi-ounce gold and silver grades from the Boka project in China’s Yunnan province. While re-sampling old adits dug by a government agency, crews recovered upwards of 374 grams of the yellow metal and 117 grams of silver in chip samples.
A 2,000-metre drill program is under way. Holes are aimed at the favourable Boka 1 zone and at an area between that and the Boka 8 prospect, 3 km to the east.
Mineralization is associated with quartz-pyrite alteration and with ductile-brittle shearing caused by regional faulting. The host stratigraphic horizon consists of calcareous shales and siltstones of the Middle Proterozic Heishan formation.
Southwestern can earn a 90% stake by spending US$4 million over the next four years and paying US$1.7 million in the final year. China Yunnan Nuclear Industrial Team 209 retains a 10% carried interest.
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