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Havilah Resources finds drill success at West Kalkaroo, outside open pit

Havilah Resources’ (ASX: HAV) drilling has identified a potential economic extension to the current cooper-gold resource at its West Kalkaroo conceptual open pit in South Australia.

A drillhole had tested a new interpreted anticlinal structural position south of the open pit with assays returning 30 metres at 0.72% copper and 0.63 grams per tonne gold from 79 metres.

It indicates that economic grade copper-gold mineralisation continues southwards beyond the current resource into the interpreted anticlinal axis zone and opens up a new structural zone for discovery of additional mineralisation.

Should this be proven, it could require a redesign of the conceptual starter open pit in order to capture the new mineralisation.

“We have always known that Kalkaroo is a large mineralised system, and a characteristic of big systems is that mineralisation typically occurs in a variety of structural settings and rock types,” chairman Dr Bob Johnson said.

“Apart from copper-gold mineralisation in the Kalkaroo fault and replacement style mineralisation in the prospective sequence, we now find evidence of strong mineralisation in an anticlinal structure, where brittle fracturing is likely to be concentrated. We are very excited at the exploration upside possibilities this presents for Havilah.”

Havilah’s technical team are currently focussed on completing the mining lease proposal (MLP) document for submission to DMITRE in support of a mining lease application over the Kalkaroo copper-gold deposit.

Tailings storage facility and process plant design is being advanced by specialists in the field.

New drilling and mining data will also help measure the financials of the starter open pit.

West Kalkaroo

The company is currently incorporating results from the successful shallow aircore drilling program into a new resource and mining model for West Kalkaroo.

This drilling has outlined shallow tertiary gold mineralisation and confirming expected gold and copper grades in the gold saprolite and native copper zones.

Notably, at the end of the program, several reverse circulation drillholes were completed on deeper bedrock targets, one of which tested the new potential southern extension.

Kalkaroo has a Measured and Indicated Resource of 124 million tonnes at 0.5% copper and 0.39g/t gold in the main copper-gold deposit and 18.6 million tonnes at 0.74g/t gold in the gold cap on top of the copper-gold deposit.

The free milling, soft gold cap contains 446,000 ounces of gold with better than 97% recoveries while copper and gold recoveries of up to 91% and 87% respectively are expected from the chalcopyrite sulphide material, which forms about 66% of the deposit.

Analysis

An extension of the current open pit mineralisation could add substantially to the economics of the West Kalkaroo project, which is already to have low capital expenditure and a stage development that would allow the company to increase production in stages.

While this means that a ramp up to full production would take longer, it also raises the likelihood that expansions would be funded by operating surplus, which would reduce dilution and risk.

The company has long term production targets of 70,000 tonnes per annum of copper and 100,000 ounces per annum of gold.

 

Proactive Investors Australia is the market leader in producing news, articles and research reports on ASX “Small and Mid-cap” stocks with distribution in Australia, UK, North America and Hong Kong / China.

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