New Talisman Gold Mines Ltd (ASX:NTL) has increased its JORC resource by 102% to 312,800 ounces gold grading 21.98 g/t at its 100% owned Talisman Gold Mine in New Zealand.
The substantial upgrade is a result of resource modelling of the Dubbo Zone, the first module pertaining to Talisman Deeps.
Furthermore, JORC resource upgrades are underway at three other modules within the Talisman Deeps zone.
Matthew Hill, CEO, commented: “The grades established of up to 146.2 g/t for an average of 21.98 g/t places this deposit as one of the highest grade mineral resources in New Zealand and ranks in the top 5 worldwide.
“The dramatic increase in Dubbo resources ultimately proves our long-held belief that there is significant remaining ore at depth.”
Background
New Talisman retains a 100% interest in the Talisman Mine and a 20% interest in the Rahu Project which is immediately to the north of the Talisman mine in New Zealand.
A pre-feasibility study for underground mining at the Talisman confirmed an initial phase one life of mine of 5 years to generate NZ$68.2 million in revenues and a cash surplus of NZ$23.4 million.
During August 2016, the company commenced an exercise to quantify gold mineralisation thought to be hosted at depths, which is known as Talisman Deeps.
The company also has an agreement with Newcrest Mining Ltd (ASX:NCM) at Rahu for Newcrest to spend up to $5 million on an exploration permit.
Resource upgrade details
The total JORC 2012 resource for the Dubbo Zone is now 382,971 tonnes grading 21.98 g/t gold for 312,829 ounces of gold.
The majority of the resource currently sits within the Inferred resource category.
This new estimate results in an increase of 102% over the 2004 resource estimate.
A further 95,000 ounces gold equivalent has also been identified at a grade of 23.75 g/t gold as exploration potential.
The resource upgrade at Dubbo Deeps, together with any further resource increases at
Talisman Deeps will be included in an updated pre-feasibility study and ore reserve statement in due course.
An updated pre-feasibility study is the next step in the development of Talisman Deeps.
Fully funded until 2020
Based on current plans the company is fully funded for completion of the Talisman deeps resource modelling and completion of prospecting and bulk sampling through to 2020.
The board will consider acceleration and/or expansion of exploration and extraction plans subject to funding.
Work at the mine site continues to progress underground and is on budget and ahead in project timelines.
The prospecting phase, currently well underway at the Talisman site, has established the site and the refurbishment of underground areas is providing access to the Mystery Vein.
Once underground refurbishment and prospecting is completed, the company will initiate a bulk sampling project.
Analysis
The increased resource estimate for the Dubbo Zone is a significant milestone for New Talisman and demonstrates the potential for increasing the life of the project.
With resource upgrades underway at three other modules within the Talisman Deeps zone of the mine, the project’s potential mine life and value could grow further.
Talisman Deeps also has the potential to enhance the bulk sampling project, which will provide the company with the opportunity to generate short term cash flow.
Furthermore, resource modelling is currently underway on the Talisman-Bonanza and Woodstock sections of the gold mine, which provides more potential for an increase to the current gold resource.
New Talisman shares are up 40% year to date, currently priced at $0.007.