White Cliff Minerals (ASX:WCN) is ramping up excitement for its Aucu Gold project in the Kyrgyz Republic with the start of drilling on several targets hosting visible gold at surface.
The visible gold identified at surface occurs in three separate structures, each extending at least 3,000 metres in length. The 2015 drilling program will test each structure in several locations to ascertain the overall scale and tenor of the larger gold bearing mineralised region.
Drilling has commenced at the Southern Gold Zone (SGZ) where visible gold has been identified at three separate locations over a length of 2,500 metres of the SGZ structure. Further drilling will target the upper and lower gold zones and extensions of these zones to the east and west.
The company intends to drill up to 3,000 metres over the next two months consisting of approximately 30 holes with depths ranging from 50 metres to 200 metres.
Assaying is thereafter planned for December and January before a further JORC resource is reported in February 2016. The initial aim here is to delineate a 500,000 ounce to 1 million ounce open pit, then perhaps seek listing in the UK, Hong Kong or Singapore next year to tap demand for gold assets from Asian investors.
Elephant country
The potential to establish a multi-million-ounce resource in this large exploration area (which remains 90% undrilled) is illustrated by the substantial endowment already recorded at Aucu’s comparatively small existing resource area.
Aucu’s initial gold resource was calculated at 1.2 million tonnes grading 4.2 grams per tonne gold for 156,000 ounces over 300 metres of length and 120 metres of depth.
Aucu is part of the Chanach porphyry copper deposit which holds an Inferred Mineral Resource of 10 million tonnes at 0.41% copper containing 40,000 tonnes of copper.
Total project tenure is 83 square kilometres and can be converted to mining permit for 25 years. The site is 25 kilometres from a local village in an uninhabited valley with an elevated access road and a water mill.
A number of operating mines are within 50 kilometres of the site, including Charaat Gold’s (AIM:CGH) 6-million-ounce Charaat mine and Fortune LLC’s 5-million-ounce Ishtamberdy mine.
Chanach is the epicentre of the famed Tien Shan Gold Belt, which hosts to some of the largest gold mines on the planet, including Kumtor at 19 million ounces and Kalmakyr with 93 million ounces.
Murntau, across the border in Uzbekistan, boasts a whopping 110 million ounces.
Southern Zone
Abundant visible gold has been panned from an exceptionally rich mineralised outcrop at surface at the eastern end of the SGZ.
This new outcrop which extends the SGZ to at least 3,000 metres hosts visible gold at three different locations spread along 2,500 metres of the strike length.
Mineralisation occurs as a 3-5 metre wide shear zone and cuts across granodiorite, conglomerate and mafic volcanics. Mineralisation including visible gold occurs in all three rock types.
The SGZ is just 400 metres south of the Inferred Aucu gold resource of 156,000 ounces and is easily accessible from existing tracks.
Lower Gold Zone
Visible gold was panned from a 1 kilogram sample taken from the outcrop at 2,730 metres elevation.
Mineralisation in the LGZ occurs in as a 10 metre wide zone cutting across silicified sandstone and mudstone.
The sedimentary rocks are intruded by late stage granodiorite dykes that have fractured the sandstones allowing substantial gold deposition.
There are several small (<2 metres) mineralised shear zones south of the main zone.
Upper Gold Zone
Visible gold was initially panned from outcropping mineralised zone at 3,200 metre elevation from what is now the UGZ.
The UGZ is laterally persistent along at least 3,000 metres and has potential to host 15 resource blocks.
A second visible gold sample was collected from Trench 21 around 900 metres east of the initial visible gold sample.
The UGZ JORC compliant resource average gold grade is 5.2 g/t.
The best intersection to date is 4 metres at 22.3 g/t gold. Mineralisation occurs as multiple 1-3 metre wide shear zones.
Australian portfolio
Exploration is also ongoing at numerous nickel sulphide targets on White Cliff’s Merolia nickel and copper project in Western Australia, where recent ground electromagnetic MLEM surveys have identified several conductors occurring along the basal contact of interpreted ultramafic units within a layered mafic-ultramafic intrusion.
Merolia is located close to the Windarra nickel mine and associated infrastructure.
White Cliff has identified five high impact nickel targets in a similar setting to Sirius Resources’ (ASX:SIR) Nova-Bollinger nickel-copper-cobalt deposits.
Three of these are untested electromagnetic conductors are on basal contacts with high nickel in-soils.
White Cliff is planning to carry out 1,000 metres of drilling to test two targets on the basal contact within a large ultramafic unit that is 7 kilometres by 1.5 kilometres.
Drill testing is likewise planned down dip and along strike from historical high grade gold intersections at its Ironstone gold project (also in WA).
Ironstone is located within the Laverton Gold Project within the northern Goldfields, providing it with extensive infrastructure in a world class region that includes the 8 million ounce Wallaby and 7 million ounce Sunrise Dam mines.
Earlier this year, the Laverton project area produced two nuggets weighing 248 grams and 310 grams (8 and 10 ounces), respectively, thanks to a local prospector operating under a tribute agreement with the White Cliff.
The area where the gold nuggets were located has had minor previous exploration including two trenches and surface sampling. The quartz reef has not been tested and the company will conduct further exploration to assess the potential for substantial gold deposition.
Red Flag
The economic potential of the Laverton project was enhanced in August by positive drilling results at its Red Flag prospect. Drill results including a 4 metre interval grading 1.33 g/t gold provided encouragement for further drilling along strike and at depth.
The exploration targets at Red Flag are located immediately north of the 3 million ounce Granny Smith Gold Mine, and the goliath 8 million ounce Wallaby Gold Mine. This gives White Cliff potential to swiftly and cheaply monetise a deposit in the area, via the ore processing infrastructure at these existing mines.
Red Flag consists of a series of strongly deformed mafic and felsic volcanics with banded iron and sediment units. Mineralisation is associated with shear zones running along contacts between units and along cross cutting faults which are responsible for the deposition of the 3 million ounce Mt Morgan’s deposit.
The prospect is also related to the regional fault system responsible for the 7 million ounce Sunrise Dam gold.
Analysis
The start of drilling at Aucu is significant in that it is targeting a structure more than 3,000 metres in length that contains visible gold at surface.
Given the dimensions of the area already containing the project’s initial gold resource, this large exploration footprint represents important upside for improving inventory potentially toward a multi-million-ounce level.
Aucu also benefits from a number of infrastructure advantages, including access roads 200 kilometres to rail, power at US$0.02 per kilowatt and support in two regional mining hubs.
White Cliff is continuing to cash up exploration efforts at Aucu and its properties in WA by extending a fundraising drive initiated last month with a share purchase plan.
This will be available on the same terms as a recent oversubscribed placement, which recently generated A$1.2 million for exploration at a price of $0.006 per share to professional and sophisticated investors.
Investor interest in the company’s exploration success at Aucu was demonstrated on September 1, when the identification of abundant visible gold at the site sent shares flying 83% to a 12-month high of $0.014.
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