KGL Resources (ASX:KGL) ongoing reverse circulation drilling program has extended high‐grade mineralisation at the company's Jervois copper-silver-gold project in the Northern Territory.
Simon Milroy, managing director, commented: “The polymetallic nature of parts of the Jervois mineralisation is adding value to the economics of the project as a whole.
"In addition to the copper, lead and zinc we are typically seeing much higher silver and gold grades than the predominantly copper parts of the resource."
A plus for KGL is that recent metallurgical test work on the lead-zinc-silver ore has shown that it can be batch processed through the copper plant to produce a high grade mixed lead-zinc concentrate.
This means that the additional capital that was planned to be spent in the third year of operations to construct separate lead and zinc circuits will no longer be required.
Latest drilling highlights
Marshall:
- 14 metres at 2.53% copper, 0.18% lead, 1.71% zinc, 27.8g/t silver, 0.22g/t gold from 263 metres, including 5 metres at 6.12% copper, 0.2% lead, 2.42% zinc, 31.4g/t silver and 0.48g/t gold.
- 4 metres at 0.51% copper, 7.91% lead, 4.4% zinc, 163.3g/t silver and 0.13g/t gold from 393 metres.
Reward:
- 19 metres at 0.6% copper, 3.36% lead, 2.26% zinc, 104.2g/t silver and 0.11g/t gold from 235 metres, including 6 metres at 0.96% copper, 8.37% lead, 4.64% zinc, 162.9g/t silver and 0.16g/t gold.
Drilling is now completed with additional geological mapping, soil sampling and research work planned.
Jervois
Drilling is part of a study to optimise the economics of Jervois, with results to increase the resource and the size of the pit shells, and targets to fill in gaps in the top 350 metres of the resource.
The resource upgrade, targeted for completion in July, will include the results of all drilling completed since June 2014 totalling approximately 20,000 metres.
Jervois currently hosts 25.3 million tonnes at 1.1% copper and 22.1g/t silver, for 280,000 tonnes copper and 18 million ounces silver.
There is an additional exploration target of 50,000 to 150,000 tonnes copper and 2 to 7 million ounces silver, together with 120,000 tonnes lead/zinc and 113,000 ounces gold.
Analysis
The latest drilling results at Jervois are expected to add value to the economics of the project as a whole.
A resource upgrade expected in July 2015 will include the results of all drilling completed since June 2014 totalling approximately 20,000 metres.
When the resource update is complete, KGL Resources will then use all of the revised inputs to conduct pit optimisation, design and scheduling leading up to a revised financial model for the project.
Further assay results from the drilling are anticipated over the next three weeks with results from over 3,000 samples still outstanding.
Well-funded
KGL Resources is well-funded with $7.5 million in cash at the end of March 2015, which equates to around $0.09 a share.
The company last traded at $0.165.
Milroy recently told Proactive Investors that the current cash position is sufficient to fund all of the planned work this year and retain a healthy balance while the company brings a project partner on board.
Proactive Investors Australia is the market leader in producing news, articles and research reports on ASX emerging companies with distribution in Australia, UK, North America and Hong Kong / China.