Newly listed Red Mountain Mining (ASX:RMX) has kicked off a second drill program in China at the Zhongqu project, following intersections of 31 metres at 4.61 g/t gold in the first campaign.
Red Mountain listed on the ASX in September, following an extensive period of project evaluation before acquiring the Zhongqu project, an operational gold mine since 2005.
It has binding acquisition agreements to acquire 51% of the Zhongqu project, plus operating gold mine and infrastructure.
The premise behind the listing of Red Mountain was to bring Australian mining methods and efficiencies to projects such as Zhongqu and its second project in northern China, the Diebu Project.
Zhongqu has in fact been operational since 2005, but was using labour intensive manual mining methods and has a modern gold treatment plant with a 400,000 tonne per annum capacity.
Interestingly, Zhongqu has a Chinese resource but not yet a JORC inferred resource.
Drilling seeks to convert a further Exploration Target of 400,000 to 550,000 tonnes at 7.0 to 9.5 g/t of gold into a JORC classified resource. The project looks to have some significant exploration potential as well.
Previous intersections from first stage drilling at Zhongqu included 14.3 metres at 4.50 g/t gold, including 6 metres at 7.14 g/t gold and 3 metres at 6.27 g/t gold.
These were highly encouraging results are located below the current operating mine.
Red Mountain looks to have an interesting future, based on its listing premise and ability to execute on its strategy and bring western mining and exploration methods to Chinese gold projects.
Initial results from drilling are expected in 6-8 weeks.