Xanadu Mines Ltd (ASX: XAM, TSX: XAM) announced that diamond drill hole KHDDH559B has intersected a broad zone of high-grade bornite mineralisation at the Stockwork Hill deposit within its Kharmagtai porphyry copper and gold project in the South Gobi region of Mongolia, expanding the high-grade bornite zone beyond the defined resources.
Significant intersects included 226.2m @ 0.68% Cu and 1.43g/t Au (1.41% eCu) from 611.8m including 175m @ 0.84% Cu and 1.83g/t Au (1.78% eCu) from 615m, including 61m @ 1.43% Cu and 3.76g/t Au (3.36% eCu) from 651m.
The company said that intercepts were the highest density of bornite mineralisation encountered at Kharmagtai to date.
Diamond drill hole KHDDH559B
XAM had commenced drilling of DD hole KHDDH599B to test extensions of Stockwork Hill at depth to inform the second phase of drilling focused on higher grade targets.
KHDDH599B was drilled from the northern edge of Stockwork Hill southwards across the deposit and was designed to expand the northern edge of the tourmaline breccia mineralisation and then expand the high-grade bornite zone towards the south.
Xanadu reported that KHDDH559B intersected two zones of mineralisation, an upper tourmaline breccia zone, and a lower high-grade bornite zone.
Broad zone of high-grade bornite mineralisation
XAM announced that KHDDH559B entered tourmaline breccia mineralisation at 288m widening the main tourmaline breccia zone by 25m to the north. The company said that the drill hole entered high-grade bornite mineralisation at 617m, encountering a wide zone of very high-grade gold rich copper sulphide mineralisation and expanding the bornite zone by 100m in total (50m to the north and 50m to the south).
Upper tourmaline breccia zone
The upper tourmaline breccia zone in KHDDH559B intersected 280m @ 0.46% Cu and 0.36g/t Au (0.64%eCu) from 284m including 14m @ 2.36% Cu and 1.23 g/t Au (2.99% eCu) from 346m, and 22m 0.73% Cu and 0.74g/t Au (1.11% eCu) from 392m.
Lower high-grade bornite zone
The lower high-grade bornite zone in KHDDH599B intersected 226.2m @ 0.68% Cu and 1.43g/t Au (1.41% eCu) from 611.8m including 175m @ 0.84% Cu and 1.83g/t Au (1.78% eCu) from 615m including 20m @ 1.09% Cu and 2.09g/t Au (2.16% eCu) from 617m, and 134m @ 0.89% Cu and 2.04g/t Au (1.93% eCu) from 649m including 61m @ 1.43% Cu and 3.76g/t Au (3.36% eCu) from 651m and 7m @ 1.07% Cu and 1.67g/t Au (1.92% eCu) from 756m.
Similar to Hugo Dummett deposit
Xanadu noted that the mineralisation is similar to that seen at the high-grade Hugo Dummett deposit within the giant Oyu Tolgoi mine, highlighting the potential of Kharmagtai.
The company noted that the highest grades were located on the margins of the tourmaline breccia, where larger fragments allow for more space for copper and gold to precipitate. XAM said that this combined with the advancing structural framework has defined a clear drill target to the south and below White Hill.
Updates and next steps
XAM announced that Phase 1 drilling at Kharmagtai is nearing completion, having significantly increased the scale of mineralisation at Zaraa and having identified a new zone of higher-grade mineralisation beneath Stockwork Hill.
To date this included 33 diamond drill holes for approximately 22,933 metres, testing extensions to higher grade mineralisation at Stockwork Hill, Zaraa, and Copper Hill, and five new prospects for shallow mineralisation. The company said that assay results have been returned for 21,404 metres with 1,529 metres of assays still pending.
Phase 2 drilling
XAM announced that Phase 2 will commence with interim drilling to follow up findings at KHDDH559B, and in parallel a detailed program will be designed to target and define higher grade zones.
Red Mountain project
Xanadu said that at its Red Mountain project, drilling has recommenced with two diamond drill rigs targeting large scale copper gold porphyry mineralisation. This drilling program totals 4,300m and is expected to be completed by mid to late-March.
The company said that upcoming milestones include Drilling Phase 1 Program Results (February 2021); Exploration Target Update (February 2021); Mineral Resource Estimate Update (March 2021); Red Mountain exploration drilling results (March 2021); Drilling Phase 2 Program Structure (March 2021); and Kharmagtai and Red Mountain exploration drilling results (April 2021).
The company noted that the mineralisation is open at depth and along strike. XAM said that the current estimates are restricted to those expected to be reasonable for open pit mining. Xanadu said that limited drilling below this depth (-300m RLl) shows widths and grades potentially suitable for underground extraction. XAM reported that exploration on going.
Xanadu’s Chief Executive Officer Dr. Andrew Stewart said: “KHDDH559B is a very significant drill hole for the Kharmagtai project. This is the first time we have seen this density of bornite mineralisation at Kharmagtai. This hole provides a snapshot of what the lower zones of mineralisation at Kharmagtai could look like with increasing gold to copper ratios.
The tenor of gold within the bornite is impressive, containing two to four grams of gold for every percent copper. This hole materially expands the width of the high-grade bornite zone and will help guide drilling for additional high-grade extensions. Our team is currently designing follow up drilling to test this exciting new target”.