Laneway Resources (ASX: LNY) has announced an encouraging update from the 42-hole drilling program completed at its Agate Creek project in Queensland.
The company reported that assay results have been received for the 17 holes at Sherwood with several high-grade gold intercepts achieved including 7m at 13.9 g/t; 2m at 53.0 g/t; and 5m at 22.3 g/t.
It may be noted that the drilling program targeted the Sherwood and Sherwood West, as well as several short drilling programs at 5 regional targets. The Sherwood West results along with all regional target drilling assay results are still outstanding due to processing delays at the laboratory in Townsville and will be reported separately once received and interpreted.
The company reported that an updated JORC Resource will now be estimated incorporating these drilling results. The JORC Resource currently stands at 8.2 million tonnes grading 1.46g/t for 381,000 ounces of contained gold
Laneway said that it also intends to utilise the significant historical pulp library stored on site by undertaking detailed litho-geo-chemical & alteration geo-chemical multi element analysis along with alteration zonation deposit modelling.
Agate Creek gold project
Laneway’s 100% owned Agate Creek Gold Project is a large highly prospective epithermal system located approximately 40km south of Forsayth and 60km west of Kidston in North Queensland. The project is comprised of ML100030, MDL402, EPM17788, and EPM26460 which cover over 647km2.
Some of the high priority Regional Targets at Agate Creek include Sherwood, Sherwood West, Jedda Vein, Eastern Bar, and Bald Mountain.
Drilling at Agate Creek
LNY had recently completed a 42-hole drill hole (2,244m) RC drill program at Agate Creek targeting both potential additional high-grade material near the existing open cut pit, as well as first pass drilling at some regional targets.
The program comprised of 17 holes (1,002m) at Sherwood, 5 holes (609m) at Sherwood West and holes (633m) on regional targets.
Drilling was undertaken to investigate how far these zones extend and also to allow calculations of the potential economics and strip ratios required for a possible cut back being undertaken of the recently mined area.
The company announced that assay results have been received for the Sherwood drill holes. Sherwood West and the regional target drill hole assay results are still outstanding due to processing delays at the laboratory in Townsville.
Encouraging drill results from Sherwood
Laneway said that the assay results from the 17 RC holes drilled at Sherwood (CCGC234-CCGC250) totalling 1,002m, have only been just been received due to processing delays at the laboratory, and as such have still to be fully assessed and modelled.
LNY reported that high-grade gold intercepts were achieved from Sherwood including 3m at 9.2 g/t; 7m at 13.9 g/t; 2m at 24.6 g/t; 2m at 53.0 g/t; 5m at 22.3 g/t; 2m at 10.2 g/t; and 3m at 22.6 g/t.
The company said that the drilling results at Sherwood confirm the potential for Laneway to undertake a small cut back on the current open cut pit area to allow for the high grade mineralisation to be mined from deeper mining of the current pit floor, along with extensions into the walls on both sides of the pit and into the northern high wall area. Initial analysis shows potential for additional tonnes to be mined in the near term by Laneway.
Updated JORC resource
The company reported that an updated JORC Resource will now be estimated incorporating these drilling results and will also take into account metal removed by recent mining along with additional information from the RC Grade control drilling programs undertaken during the past 12 months, and the significant additional geological understanding gleaned during mining.
The JORC Resource currently stands at 8.2 million tonnes grading 1.46g/t for 381,000 ounces of contained gold.
Detailed pit designs
LNY said that the full analysis of the potential for additional high-grade mining will be undertaken following the completion of the JORC resource calculations which will then allow for detailed pit designs including determining waste tonnes required to be stripped to access additional high grade material. This is currently underway.
Pulp Library
Laneway said that it also intends to utilise the significant historical pulp library stored on site by undertaking detailed litho-geo-chemical & alteration geo-chemical multi element analysis along with alteration zonation deposit modelling.
The company said that this information will then be incorporated into the existing geological models to generate more comprehensive 3D fluid pathway modelling intended to then significantly expand the current gold inventory of the project.
LNY said that this information should allow for more accurate targeting of main mineralized zones at depth within the Sherwood, Sherwood West and potentially also the Nottingham Prospects. The company said that the results from this will drive further larger drilling programs.
Generating further cash flow
Having achieved material positive cash flow from the recent mining activities at Agate Creek and with the current high A$ gold prices, Laneway said that it will continue evaluating other high grade zones for their potential to be mined economically and create further cash flow for the company.
