The K1-1 project is located roughly three kilometres to the east of the company's Thierry Mine project in northwestern Ontario, both being within the boundaries of the 11,538 acre Thierry property, occupying only a small portion of the asset.

In late 2011, the company released an initial inferred mineral resource estimate for K1-1 within a Whittle pit shell consisting of 19.89 million tonnes grading 0.10% nickel, 0.42% copper, 2.0 g/t silver, 0.03 g/t gold, 0.05 g/t platinum, 0.15 g/t palladium.

Cadillac also said an exploration target for K1-1 located outside and below the resource pit shell was estimated to contain between 45 to 55 million tonnes grading between 0.08 and 0.12% nickel, and 0.32 to 0.36% copper. But there was not enough "modern data" for the target to complete resource modeling, the company said.

The initial inferred resource reflected the first 16 exploration holes drilled by Cadillac, as well as limited historic data and other exploration carried out on the property.

Within the inferred resource, the company said there were gaps in data, "due simply to lack of drilling to model, which affect the behaviour of the pit, and therefore constrained the resource".

As a result, a 26 hole drill program was designed to address gaps within the pit shell area at K1-1, as well as test for extensions along strike and at depth.

The drilling campaign was also designed to intersect and upgrade mineralization from the exploration target category into the resource statement, and if successful, adding tonnage to both categories using infill drilling.

Cadillac said that including the drill results from the 26 holes in the re-calculation of the resource is expected to boost the estimate by extending the modeled mineralization.

Highlights of these assays included 110 feet of 0.626% copper and 87.5 feet of 0.546% copper.

During the drilling program, there was a total of 20,868 feet drilled over the 26 holes, and a total of 2,590 samples taken.

Cadillac said the update of the K1-1 resource estimate will affect a future production decision at Thierry, as the close proximity of the deposits to each other is expected to result in cost efficiencies - due to the sharing of the infrastructure and processing plant capacity.

"Sharing of facilities between the deposits should enable Cadillac to realize lower production costs, and therefore process material of a lower grade than would be envisioned based upon either deposit operating independently of the other," the company said in a statement.

Cadillac is a development-focused copper company currently advancing its 100 percent-owned Thierry property, near Pickle Lake, Ontario, which consists of the past-producing Thierry Mine and hosts two NI 43-101 compliant resources from the Thierry Mine and K1-1.

The Thierry Mine deposit has a current resource estimate consisting of 8.3 million tonnes measured and indicated grading 1.73% copper and 0.20% nickel, as well as 14.6 million tonnes inferred grading 1.70% copper and 0.16% nickel. The deposit remains open at depth and to the west.

Meanwhile, the K1-1 deposit is a potentially open-pit, large tonnage, low grade deposit located approximately three kilometres from the Thierry Mine.

It follows the payment of US$800,000 to Brandberg, which was set up by Extract Resources (ASX:EXT).   

The company holds exclusive prospecting licences 3327 and 3328, located near the old tin mining town of Uis in the northwest of Namibia.

A horizontal loop electromagnetic survey over the two licences has identified of two uranium target areas. 

Priority target Orawab is interpreted as a palaeochannel at least 14 kilometres long, between 100-1000 metres wide and up to 50 metres deep.

A secondary target, Ringo, appears to include a less prominent but still significant palaeochannel to the southwest of the Orawab target, which is up to 7 kilometres long, 50-500 metres wide and 30 metres deep. 

The Ringo target is considered a possible downstream extension of the Brandberg uranium occurrence identified in historical literature, North River said.

North River said today Brandberg plans a 1,100-metre drill programme, which may be increased to 1,500-2,000 metres following the receipt of new funds.  

It will commence once the radiation management plan is approved by the National Radiation Protection Authority in Namibia.  The RMP was submitted in mid-November. 

David Steinepreis and Luke Bryan of North River will be appointed to the Brandberg board alongside two Extract directors.

New managing director Geoff Laing told Proactive Investors that Exco’s focus is on exploration in Queensland, to maintain the company’s self-sustaining position and replace cash flow from the White Dam gold project.

“For me the focus is very much on exploration in Queensland,” he said.

“We’ll certainly be looking to replace the cash flows that White Dam has brought in for the last 18 months by potentially acquiring a reasonably advanced project that we could start generating cash flow from in the not too distant future.”

In the Eastern Succession of the Mt Isa Inlier, Exco is targeting iron-oxide-copper-gold (IOCG) mineralisation.

This mineralisation bears similarities to Xstrata’s Ernest Henry underground mine, also in North Queensland, and is typified by the coincidence of strongly anomalous magnetic and gravity highs.

Exco has identified three new high priority targets at the Salebury South, Elder Creek and Canteen, which it intends to drill test in 2012.

Weatherley Creek drilling

At the Weatherly Creek project, initial drilling at a number of prospects has produced positive first phase results.

Drilling at the Canteen prospect intersected copper and gold below a small historical open pit, with results including 12 metres at 1.34% copper and 0.56 grams per tonne (g/t) gold from 18 metres depth.

Three holes were drilled at the Victory Prospect where previous drilling defined an inferred resource of 196,000 tonnes at 1.2% copper and 1.4g/t gold.

The latest round of drilling intersected relatively low grade mineralisation beneath the existing drilling, and indicated an increase in gold towards the south of the prospect.

One drill hole intersected 18 metres at 0.28% copper and 1.12g/t gold from 36 metres depth.

At the Bosca and Bosca South prospects, three drill holes tested for oxide copper mineralisation below small historical open pits.

One drill hole at Bosca intersected 24 metres at 0.62% copper while at Bosca South, an intercept of 0.33g/t gold and 8 metres at 1.69% copper and 0.09g/t gold was returned.

Finally, one drill hole of a proposed four hole program was drilled at the Rock Rat prospect to test a line of historical workings and shafts.

The rest of the drilling program was postponed due to the threat of wet weather, and will be continued after the wet season.

The first hole intersected 24 metres at 0.21% copper and 0.51g/t gold from surface.

Other operations

In other company news, work at the Pumpkin Gully syncline has yielded positive results, with drilling at the Salebury, Crow’s Nest and Tanbah North areas returning:

- 14 metres at 1% copper and 0.28g/t gold from 70 metres;
- 32 metres at 0.56% copper and 1.04g/t gold from 74 metres; and
- 10 metres at 1.51% copper and 1.34g/t gold from 98 metres.

Meanwhile resource drilling at the Kangaroo Rat copper gold deposit has been completed, with results returned to date in line with expectations.

Diamond drilling is planned for the project for metallurgical testwork, geotechnical studies and specific gravity determinations.

Well Funded

At the end of the December quarter, Exco Resources had $58.6 million cash in the bank, equivalent to about $0.164 per share.

The company recently paid $135 million, or $0.38 per share, back to shareholders, following the sale of its Cloncurry project to Xstrata for $175 million.

Re-Listed Oro Verde

Upon its commencement of trading this morning, Oro Verde will have around 69.3 million shares on issue.

The secured credit facility is being provided by the Sprott Resource Lending Partnership. 

In September it was agreed that Rambler could draw down up to C$10 million from the credit facility. 

It has already drawn down C$5 million, and today’s transaction takes the tally to C$7.5 million.

Rambler plans to use the money to buyout the royalty that is held over its flagship Ming Mine property, on Baie Verte Peninsula in Canada.

Earlier this month Rambler said it expects to start producing copper concentrate from the mine in the second quarter of this year.

In the meantime, it is generating revenue with continuing gold pours.  The first dore bars were produced last month and to date, Rambler has completed three gold pours for a total of 2,446 ounces.

The next pour is scheduled for January 31 and every two weeks thereafter.

Frontier Mining (LON:FML) told investors that it can now commission all the equipment in the plant at the Benkala copper mine development.

This morning the company reported that all construction approvals and permits have now been received. It will now commission all the equipment on site.

“This represents for Frontier the completion of another key milestone in the Benkala project timeline,” said chief executive Erlan Sagadiev.

“Progress at the site continues at pace as we enter the next stage of commissioning prior to the commencement of production."

Earlier this month Frontier unveiled a new US$29 million financing arrangement that will help support the development of the Benkala mine.

Once the mine is established Frontier plans to expand production, taking it from 7,000 to 10,000 tonnes a year, and later expanding to 20,000 tonnes a year.

The Kalman deposit is an advanced molybdenum-rhenium and copper-gold deposit covering 700 square kilometres in the mineral-rich Mt Isa region.

A review of the existing 60.8 million tonnes at 0.32% copper, 0.05% molybdenum, 1.19 grams per tonne (g/t) rhenium and 0.15g/t gold JORC Resource at Kalman is currently underway.

Importantly, the Kalman deposit has the potential to be a company maker for Syndicated with its significant exploration potential as a result of its sizeable targets.

Thirty two samples were collected within EPM13870, with 10 contiguous samples taken over the strike length returning strongly anomalous copper and gold averaging 0.6 grams per tonne (g/t) gold and 3% copper at what is known as the Pandora’s Gift prospect. 

The Pindora Fault is sub-parallel to the Pilgrim Fault zone which hosts the Kalman molybdenum-rhenium and copper-gold deposit as well as a range of other base metal and gold targets.

The Pindora Fault zone can be traced at surface within Syndicated tenements for approximately 10 kilometres.

Sampling was carried out a nominal 100 metre centres along the northern 2.5 kilometre section of the fault within EPM13870, which is within the Kalman Joint Venture with Cerro Resources (ASX: CJO).

The Pindora copper mine is located about 3 kilometres north of the tenement boundary within the Pindora Fault.

Visible oxide copper mineralisation (malachite) has also been mapped along the southern strike extension of the fault as far as Syndicated’s Dronfield copper-gold prospect within the wholly owned EPM13869. This zone has yet to be sampled in detail.

The mineralised fault zone is believed to hold substantial potential to yield shallow copper-gold mineralisation to further augment resources at the nearby Kalman deposit, as well as being prospective for major discoveries at depth.

Syndicated Metals plans to undertake further sampling in the forthcoming field season.

Coburn is strategically located, with regional infrastructure nearby including a major highway, natural gas pipeline and port, with the project 250 kilometres north of Geraldton, an established mineral sand port with available capacity.

The project is development ready with full permitting and a Definitive Feasibility Study completed.

Gunson is wasting no time as it moves towards the start of construction at Coburn, which the company estimates will take around 85 weeks.

The company awarded a Front End Engineering, Design and Approvals study agreement to DBP Services – an associate entity of the owner of the Dampier to Bunbury Natural Gas Pipeline – which will provide the design, construction and capital cost information for a 110 kilometre long lateral gas pipeline to the proposed Coburn power station.

The pipeline will link to the main Dampier to Bunbury Natural Gas Pipeline to the east of the Coburn power station, and will be built and operated by the owner of the Dampier to Bunbury Gas Pipeline.

Costs will be recouped from Gunson via a transmission charge.

Gunson has selected Cummins Power Generation as the preferred supplier of the natural gas-fired power station, on a build, own, operate, transfer basis under a standard power purchase agreement.

Cummins has proposed to provide a competitive electricity supply solution with forecast unit power costs well below those assumed in the Definitive Feasibility Study that was released in January 2010.


Offtake Agreements
 
Gunson is also advancing the finalisation of offtake agreements for its share of production from the Coburn project.

Final internal approvals for an ilmenite offtake agreement between Gunson and a major chloride grade ilmenite consumer are underway.


Strong Zircon Demand

Supply shortages and rising demand for zircon and titanium dioxide raw materials have improved the financial attractiveness of the Coburn project.

While Iluka Resources (ASX: ILU) recently reported a softening in zircon demand in China, it anticipates more favourable medium to longer term supply/demand of zircon and high grade titanium dioxide feedstocks for the pigment and titanium metal industries.

This leaves Gunson well positioned to take advantage of future increased demand as the company approaches production in 2013.

Booming mineral sands prices are based on supply shortages and higher demand, in part, for tiles, zirconium chemicals and paint in Asia.

Independent consultant TZ Minerals International recently forecast that the highly concentrated global zircon market is expected to face a supply deficit from mid-2012 onwards due to continuing supply shortages and growing demand, especially from China, which would lead to further rises in zircon prices.

Zircon, a product used in ceramic tiles and chemicals, is expected to account for 67% of the revenue from the proposed Coburn mine.

With an expected annual production of 146,000 tonnes per annum of heavy minerals, Coburn would produce about 3% of current global zircon production.


Comment

Gunson’s strategically placed, zircon-rich Coburn heavy mineral sands project in Western Australia is construction ready.
 
Negotiations for offtake contracts for Gunson’s proposed equity share of mine products are advanced. The updated Coburn Definitive Feasibility Study model shows a capital cost of A$179 million and with the latest product price forecasts, an internal rate of return of 28.3% and a net present value (8%) of A$223.7 million.

Bullish for Gunson is that Coburn is one of only a few significant advanced mineral sands projects in the world. Promisingly, it is encouraging that its two peer group companies financed their African mineral sands projects in 2011.  With definition from the East Asian industrial group on the financing front the current valuation of Gunson Resources could look exceedingly light.