Drilling shows potential of sulphide resource at Sadiola — More drilling required for resource calculation

An 11-hole program, carried out to assess primary sulphide mineralization below the oxide ores at the Sadiola Hill gold mine in western Mali, has confirmed that several broad mineralized zones exist at depths of 100 to 400 metres.

The program, operated by South African-based Anglo American and jointly managed with its partner Iamgold (IMG-T), tested areas where previous drill holes had intersected some unoxidized gold mineralization at depths of around 250 metres. The drilling occurred along the north-south Sadiola Fault zone, which is believed to control gold concentration at the property.

All the holes intersected mineralization over core lengths ranging from 5 to 115 metres, and six of the holes intersected multiple zones of mineralization. Gold grades in the sulphide zone range from 1.9 to 7.1 grams per tonne, with some narrower drill intervals (5 to 7 metres long) grading more than 8 grams.

The initial cross-sections show that gold zones with a steep westward dip and horizontal widths of 10 to just over 50 metres extend from the planned floor of the mine’s open pit to depths of 400 to 450 metres. The gold-bearing structures line up from section to section, forming a coherent mineralized body in three dimensions. Most of the gold is in the contact-metamorphosed calc-silicate rocks that host Sadiola’s main oxide deposit.

A large part of the gold mineralization is in a relatively broad (about 60-metre-wide) zone immediately below the floor of the planned pit. Iamgold suggests that much of the sulphide gold resource can be mined by expanding the boundaries of the current pit. As it is currently configured, the pit could be expanded to a depth of around 350 metres.

Two of the holes also intersected more sulphide mineralization at a vertical depth of more than 500 metres, with SSD-001 cutting 15 metres grading 3.5 grams gold per tonne and SSD-011 cutting 3 metres grading 4.3 grams. These deeper intersections have not yet been lined up with any other drill-indicated structures.

The partners have already received results of mineragraphic studies on the gold, which show the gold is fine-grained and held mainly as inclusions in silicate minerals, rather than sulphides. It is clear that material will have to be ground finely to recover the gold, but the lack of inclusions in the sulphide minerals suggests the mineralization will not be difficult to leach once the rock is finely ground. Both Anglo American’s in-house metallurgical lab and Lakefield Research have been engaged to conduct initial metallurgical tests.

A second phase of drilling is testing lateral and downdip extensions of the mineralized zones. The program is also expected to provide a better understanding of the structural form of the zone, which is believed to plunge about 20 to 25 to the south. Anglo will calculate a resource figure for the new zones as soon as a sufficient quantity of drill data is gleaned.

The partners’ Malian exploration company, SADEX, of which Iamgold and Anglo each own half, has expanded its land package around the Sadiola property by buying the Yatela exploration concession from Australian-based Eltin. Also, SADEX has defined a preliminary resource at Kourketo, on the northern end of its Alamoutala concession, about 25 km north of the Sadiola mine. Across the property line, Eltin had been defining the northern extension of the same mineralized zone. The combined resource is estimated to be 9.9 million tonnes of oxide material grading 2.9 grams per tonne. There is also some potential for deeper unoxidized mineralization.

The resource at Kourketo is in addition to a 2.5-million-tonne resource defined at Alamoutala, in the middle of the SADEX concession, which grades 2.3 grams per tonne.

Under the terms of the deal, SADEX can acquire the Yatela concession in return for US$7.5 million. The agreement calls for a 90-day due diligence period, during which time SADEX will drill 15 core holes on the Eltin property.