WEEKLY METALS REPORT
This week Commerce Resources has announced the results from a batch of eleven drill holes, part of a larger program completed during the year at its Eldor rare earth elements project located in Quebec. Recent exploration work has focused on the Ashram deposit area of this large property, and extensive zones of this deposit extend almost from surface down to several hundred meters. Once again the company has successfully hit wide intervals of continuous mineralisation with excellent grades. The highlight of this news was hole 64, where grades above 2% total rare earths were encountered over a core interval of nearly 500 meters. Several other chunky intervals with impressive grades were also encountered in this batch. These strong results will contribute to a large tonnage of resources when the new intervals are included in a resource estimate.
Eldor is emerging as a world class discovery, and there is plenty of potential for the total tonnage of this resource to continue to climb as more drilling work is completed. However, rare earth elements have gone off the radar screen for many investors lately. The sector seems to quickly swing from boom to bust but the overall fundamentals remain very strong. Production of this suite of elements has not been able to keep up with demand and even if there is a worldwide economic slowdown ahead, it is unlikely that the market will have to cope with a surplus of these specialty elements that are critical in so many industrial and manufacturing processes. Therefore one may assume that even though the market is not paying attention to successful explorers today, at some point down the road the story should regain some speculative upside.
Asian junior miner Olympus Pacific Resources has released an update on exploration progress at its Bau Project, located in Malaysia. There are several past producing mines on this large property area, and the company has identified numerous high profile targets worthy of exploration as it works to establish at least one new mine in the district. This week the drill results from work at several of these targets were reported, including high grade gold intervals of 11.71 g/t across 11 meters of core, and 7.35 g/t over 15 meters of core. These results are even more notable in that the deposit zones often commence from surface, and many occur within lower grade intervals extending hundreds of meters to depth, all of which is likely to contribute to favourable economics for development.
Olympus Pacific has already established that it is capable of delivering exploration success at two ongoing projects in Vietnam, where the company has been active to increase total gold resources and expand the scope of its operations through new development work and upgrades to infrastructure. This has contributed to organic growth that is padding the balance sheet, allowing the company to fund more than $5 million in exploration work at Bau this year, and even more is budgeted for next year. The next objective is to present an updated resource estimate for Bau, to incorporate all of the latest work, and the company is also in the midst of a scoping study as part of its plan to eventually launch mine development in the next couple of years.
Riverstone Resources has also announced exploration results this week, from its Karma gold project located in the West African country of Burkina Faso. Reverse circulation drilling encountered numerous zones bearing more than a gram per tonne of gold across multi-meter intervals, but the highlight of this news release was a 52 meter hit with 1.33 g/t gold. Riverstone has been able to expand the total tonnage and resource of this deposit with the ongoing drilling work, and this may also contribute to a higher overall grade for the currently established resource that stands at more than 810,000 ounces of gold.
Nevada junior explorer Sniper Resources has published an update on its exploration work at the Guild property. A small drilling program completed in the fall has yielded positive results including a lower grade gold intercept of 70 meters starting from surface. This confirms earlier work from trenching and sampling that indicated the potential for a gold zone to exist at this project. It is of interest because the geology is very similar to other nearby productive gold deposits, and it suggests the possibility for a leach grade gold deposit may exist with bulk tonnage potential at Guild. Sniper has followed up on this early stage success by launching another targeted drill program and is completing further trenching work to try and illuminate the surface extension of this gold zone.
The company also reported that it is in process to secure permitting for drilling work at a second property, the Overland Pass project, also in Nevada. Overland Pass is intriguing due to its close proximity to the Bald Mountain open pit mine operated by Barrick. Again, the geology of Overland Pass is very similar to that observed at Bald Mountain, and may even be an extension of the same trend. Sniper hopes to begin a significant drill program of 22 to 25 drill holes once permitting is in hand.
No weekly synopsis would be complete without mentioning some of the news from Mexico and this week Kootenay Gold provided yet another round of drill results from its ongoing program at the Promontorio project. The defined deposit area continues to expand for this polymetallic discovery zone in the prolific mineral belt of southern Sonora State. Promontorio is characterized by a mineralized corridor that extends across the property for more than a kilometre of strike length, and drilling has encountered numerous resource zones stacked in layers. Some of these zones extend for more than 100 meters of continuous alteration with high grade silver, along with gold, lead, and zinc. The latest news contributed some new resource discovery zones beyond the limit of the previously defined deposit areas, and continuing in some cases to more than 300 meters depth. Kootenay plans to update the resource estimate for the project once all of the results from the planned 25,000 meter drill program are in hand.
Meanwhile, Galore Resources has also achieved some success at the end of the drill bit in Mexico, from the Dos Santos project in Zacatecas State. Zacatecas is famous for having produced over one billion ounces of silver in its mining tradition that continues to this day. Galore has been patiently exploring this highly prospective property area for several years and appears to be getting closer in its objective to define a large deposit. The latest drill results included 9.39 g/t gold across 4 meters, and another interval with 4.47 g/t gold along 12 meters of core. These results are significant in that they demonstrate strong gold grades and commence close to surface. Assays were reported for a total of 15 drill holes, with more assays pending from a total program of 35 holes.
Endeavour Silver is successful junior producer that has been featured in this column in the past, and the company announced further exploration success this week from the Lucero discovery area at its Guanajuato mine complex. This new zone is a vein hosted deposit, which implies the productive mineralisation is subject to pinch and swell laterally and to depth. However the results are notable in that they demonstrate higher gold grades than have been encountered elsewhere in this large mining complex, and across vein widths that are economic to develop and mine efficiently. The most recent results included one interval of 3.7 meters bearing 6.56 g/t gold and 391 g/t silver in an area dubbed the Daniela vein.
Despite mining activity in Guanajuato that has continued for roughly 500 years, Endeavour has been able to outline many brand new resource areas like Daniela vein that were entirely overlooked by former operators of the mine. This discovery represents yet another feather in the cap for the management and geologists at Endeavour Silver, as this little company has been riding a wave of success during the last few years, with plenty of growth in the pipeline, based on its business model of acquiring historic mine projects and establishing new resource zones continue production.
Michael Kachanovsky |
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