Blackham Resources Limited (ASX: BLK) has announced a highly encouraging update on the resource development drilling at the Wiluna Mining Centre in WA.
The company reported high-grade results from recent sulphide resource drilling at Essex and Bulletin lodes. Highlights include 14.45m @ 17.16g/t from 18.95m, incl. 7.45m @ 31.22g/t, 12.4m @ 7.93g/t from 31.4m, 12m @ 7.01g/t from 184m, incl. 4m @ 16.59g/t, 6m @ 53.73g/t from 109m, incl. 1m @ 283g/t, 4m @ 12.08g/t from 107m, incl. 2m @ 21.30g/t, 2m @ 10.92g/t from 133m and 2m @ 5.43g/t from 139m, 4m @ 9.73g/t from 128m, and 8m @ 11.80g/t from 144m, incl. 4m @ 22.10g/t.
BLK said that the results continue to validate the company’s strategy to methodically grow the geological confidence in the high-grade sulphide resources around existing mine infrastructure at Wiluna.
Balcham announced that the initial drilling associated with the Stage 1 Sulphide mining strategy is on track for completion in June 2020 with 7 drill rigs currently in operation at Wiluna. The company said that a Mineral Resource update is due in September quarter.
BLK reported that further drilling beyond June 2020 is planned to continue and further grow resources and reserves and build on the existing 10Moz geological endowment at Wiluna.
The company reported that drilling is also ongoing at Golden Age to continue to extend free-milling cashflow ahead of the implementation of the sulphide concentrate production strategy with results expected in the coming weeks.
Wiluna mining centre
The Wiluna mining centre is located close to the town of Wiluna in Western Australia, approximately 750km northeast of Perth.
Altogether over 4 million ounces of gold have been produced from 20 open pits and 3 underground mines, including the Golden Age mine. All the mines are within 4kms of the Wiluna processing facility.
Golden Age is a high-grade narrow-vein quartz reef deposit that provides supplementary high-grade mill feed along with baseload feed from the Company’s open pit mines.
Wiluna is a large gold system with greater than 10M ounces of gold endowment including current Mineral Resources and historical production. With a combined open pit and underground Mineral Resource of 35.5Mt @ 3.90 g/t for 4.45Moz, including 2.2Moz (49%) in the Inferred category, there are significant opportunities for additional Mineral Resources and life-of-mine extensions.
Resource development drilling
The company had recently commenced resource development drilling at the Wiluna Mining Centre designed to significantly increase the confidence in the sulphide Mineral Resources from Inferred to Indicated category.
Blackham reported that it is on track to complete the initial drilling programme by the end of next month, which is designed to de-risk the company’s indicative gold production guidance with the objective of converting the Inferred Mineral Resource to Indicated Mineral Resources and to also discover additional high-grade ore shoots to extend the sulphide mine life.
Blackham has now reported exceptional high-grade results from resource development drilling.
Outstanding drill results
Blackham announced that high-grade results were reported from the drilling at Essex and Bulletin areas. The company said that the initial drilling is on track for completion in June 2020 with seven drill rigs in operation at Wiluna.
Essex area
The company said that the high-grade results to date at Essex area include WURC0846: 6m @ 53.73g/t from 109m, incl. 1m @ 283g/t, WURC0848: 4m @ 12.08g/t from 107m, incl. 2m @ 21.30g/t, WURC0850: 2m @ 10.92g/t from 133m & 2m @ 5.43g/t from 139m, WURC0851: 4m @ 9.73g/t from 128m, and WURC0853: 8m @ 11.80g/t from 144m, incl. 4m @ 22.10g/t.
BLK said that drilling to convert the existing Inferred Mineral Resources to Indicated Mineral Resources has identified a new high-grade zone and discovered a high-grade parallel lode at Essex. BLCK said that further drilling is planned to the south to follow up these results, while mineralisation is now largely closed off to the north.
Blackham said that these latest results are expected to improve the grade and geological confidence of current Mineral Resources and ultimate conversion to Reserves at Essex, where the original expectation was 38koz @ 4.6g/t.
Bulletin area
The Bulletin zone is located close to surface with existing decline access and minimal mine development required to access ore. Infill drilling has targeted Inferred Mineral Resources along strike to the north and south of previous mine workings company.
BLK said that the initial results from the first drill site located north of the main historical workings have been significant including BULP0025: 14.45m @ 17.16g/t from 18.95 incl. 7.45m @ 31.22g/t, BULP0026: 12.4m @ 7.93g/t from 31.4m, and WURC0835: 12m @ 7.01g/t from 184m incl. 4m @ 16.59g/t.
The company announced that the latest results from Bulletin area, along with historical drilling and Blackham’s previously released results from this zone (4m@ 8.23g/t and 8m @ 10.10g/t) will generate further targeted drilling in the coming months with a view to updating Mineral Resources.
Blackham said that these latest results are expected to improve the grade and geological confidence of current Mineral Resources at Bulletin.
Further drilling planned
BLK said that further infill drilling is planned from underground at four separate Inferred Mineral Resource targets, with a view to updating those Mineral Resources also in the September quarter.
Programme in FY2021
The company announced that a similarly aggressive programme will continue in FY 2021 with the objective to maintain 4 years of Reserves in front of production through progressive infill drilling and conversion of our very large Mineral Resource base.
Part of two-year, five-point strategy
Blackham Resources reported that enhanced Mineral Resources and conversion to Reserves underpin the Company’s 24-month, five-point strategy to strengthen the balance sheet, increase operational cash flow, transition to include gold concentrate production, expand production, and undertake exploration and feasibility studies to fully develop a more than 200kozpa, long life gold operation.
Results validate sulphide strategy
The company reported that the latest outstanding results validate its strategy to drill out high-grade Inferred Mineral Resources to enhance the first years of the Stage 1 Sulphide mine plan.
Blackham said that its initial drilling at Essex and Bulletin areas is designed to methodically increase the geological confidence in sulphide Mineral Resources to underpin Stage 1 production.
The company reported that the preliminary mine plan developed for the Stage 1 Sulphide expansion includes Essex and Bulletin in the first 2 years, and in years 3 to 4 mining extends to include the Calvert and East Lode areas. Consequently, the Company is undertaking aggressive infill and extensional drilling campaign targeted at the Inferred Mineral Resources associated with the initial years of the preliminary mine plan.
BLK said that production aims to ramp up from September 2021 to 100-120,000ozpa, with a subsequent Stage 2 expansion envisaged to increase to +200,000ozpa.
Updates and next steps
BLK said that drilling is now focussed on the Calvert and East Lode zones, which are important ore sources in the first four years of the Stage 1 Sulphides mine plan.
The company said that further drilling results will be reported in due course ahead of an updated Mineral Resource estimate to be published for the Wiluna Gold Project in the September quarter.
BLK said that results are also expected in the coming weeks from ongoing drilling at the high-grade Golden Age mine, with the aim to extend free-milling Reserves for additional cashflow during the transition to sulphides production in September 2021.
Blackham announced that follow-up resource definition drilling is likely, as mineralisation is interpreted to remain open in various directions.
Management comments
Blackham’s Executive Chair, Milan Jerkovic said: “These outstanding results are delivering on our Stage 1 Sulphide strategy as we initially target shallow high-grade sulphides ‘under the headframe’.
Our plan to convert the existing large Inferred sulphide resources at Wiluna into Indicated resources is gathering significant momentum and confidence with every new hole. These results will support further resource and reserve updates and mine planning work scheduled over the coming months.
The current underground sulphide resource at Wiluna averages 4.8 g/t but historically the average grade mined was between 7 to 8g/t, and the Bulletin shoot alone produced 900,000oz @ 8 g/t.
We’re targeting high-grade shoot discoveries because every 1 g/t increase in the grade in the sulphides, could result in an additional 25kozpa of production in Stage 1 and 50kozpa under our Stage 2 scenario, so grade is obviously extremely important to project economics”.