Phoenix Copper (ASX:PNX) has started drilling at the Mount Bonnie prospect within the Hayes Creek Project in the Northern Territory. Drilling will target new mineralised positions and extensions to existing high-grade massive sulphide mineralisation.
This will be followed by a downhole electromagnetic survey to provide additional information for refining future drill programs.
During 2015 the company aims to define sufficient resources at the Hayes Creek project to provide inputs to complete a Scoping Study in mid-April 2016.
This will be used to demonstrate the potential viability of the project.
In January, the company intersected a thick zone of massive sulphide mineralisation with its first hole at the Iron Blow deposit, also within the Hayes Creek Project.
This returned 50.39 metres at 10.12% zinc, 2.66 grams per tonne gold, 132.9g/t silver, 0.57% copper and 1.39% lead from 155.72 metres including 19.45 metres at 15.48% zinc, 2.65g/t gold, 158.2 g/t silver, 0.56% copper and 2.56% lead from 156.5 metres.
In April, Phoenix Copper started electromagnetic surveys to identify any potential new massive sulphide zones, and to assist drill targeting. Results are expected shortly.
The reverse circulation drilling at Mount Bonnie comprises 11 holes totalling 1,250 metres that will target new mineralised positions and extensions to existing high-grade massive sulphide mineralisation.
This is expected to take approximately two weeks to complete with assays available in June 2015.
These assay results will be a key component of an initial resource estimate to be developed later in the year.
Historical exploration at Mount Bonnie returned 9.6 metres at 2.41 grams per tonne gold, 287g/t silver, 10.31% zinc. 2.65% lead and 0.54% copper from 75.2 metres.
Iron Blow and Mount Bonnie are polymetallic base-metal deposits that form part of Hayes Creek Project, and are situated on 100% owned mining leases located close to infrastructure, including rail, road, HV power and water.
The deposits are located approximately 180 kilometres south of Darwin and were first discovered in the late 1800’s.
Limited open pit and underground mining occurred around that time.
During the mid-1980’s, oxidised ore was mined by open pit for its gold and silver content, but the primary sulphide orebodies that are the focus of exploration by Phoenix Copper remain.
In November 2014 the Iron Blow deposit was upgraded to a JORC 2012 Inferred Resource of about 200,000oz of gold, 10.7 million ounces of silver and 125,000 tonnes of zinc at potentially mineable grades.
Down hole electromagnetic work will assist with the assessment for the potential for parallel zones at depth in both deposits.
Regionally, there are also a significant number of late stage VTEM anomalies in prospective lithology, and untested geochemical anomalies.
Testing of some of the more prospective regional targets will commence in July subject to government approvals.
The company is well positioned to take advantage of the forecast zinc price rise and stronger gold price.
Any additional zinc and/or gold defined within Hayes Creek project area will add significant value.
Phoenix Copper has completed QEMSCAN and optical examination of Iron Blow composite material.
Initial sighter flotation and diagnostic metallurgical test work has also been completed with results expected shortly.
This information will be used to design a more comprehensive and optimised flotation program which will commence once the company estimates sufficient resources at Iron Blow and Mount Bonnie to underpin an economic project.
Phoenix Copper’s current drill program at Mount Bonnie is expected to define additional shallow resources at the Hayes Creek project which will be complimentary to the Iron Blow deposit.
This drill program will be followed by a downhole electromagnetic survey to provide additional targeting information for future drill programs.
At the Iron Blow deposit a resource of 200,000oz of gold, 10.7 million ounces of silver and 125,000 tonnes of zinc at potentially mineable grades exists, an initial resource estimate at Mount Bonnie, and testing of additional exploration targets to come, the Hayes Creek Project is looking better and better.
Both deposits are on granted mining leases, and a significant portion of resources defined to date are amenable to open pit mining.
As well, the Hayes Creek Project is situated close to infrastructure, including rail, road, HV power and water; the Scoping Study should reflect these advantages.
There is also further work planned at Iron Blow, significant gold zones exist at depth that have not been included in the existing resource, and there is good potential for further resource growth.
Regional exploration to test a number of areas with base metals and gold potential is also due to commence shortly.
Discovery of additional zinc and gold will take advantage of the forecast zinc price rise and stronger gold price.
Share Price Catalysts
- Drill Results from Mount Bonnie;
- Results of downhole EM;
- Results from regional exploration work; and
- Move to drill test regional targets.
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