Eldorado tests prospects in western Turkey

Preliminary drilling in the Biga peninsula of western Turkey has returned mixed results for Eldorado Gold (ELD-T).

The reverse-circulation (RC) program focused on two showings, Keditasi and Yatiktas. A third, Subeylidere, is now being tested.

At Keditasi, 748 metres were sunk in a northeasterly trending siliceous ridge in which a high-sulphidation surface target some 600 metres long by 150 metres wide has been identified. No significant results were obtained from the eastern end, but one of the three holes sunk in the western end intersected a flat-lying silica structure carrying 1.37 grams per tonne over 6 metres of a 16-metre intercept that averaged 0.73 gram.

Gold mineralization is associated with vuggy quartz and advanced argillic alteration. None of the RC holes penetrated the vuggy zone proper, so three core holes are planned for early 2004. The holes also will test mineralization to the north, beyond the surface anomaly.

The Yatikas showing is an epithermal vein system that extends for 1,200 metres along the contact of a basement schist and a granitic dyke. Drilling tested 700 metres of the system’s strike length, with seven of the eight holes sunk pulling up an average of 10 metres of vein material, as well as 2-15 metres of surrounding but lower-grading stockworks.

Results include 7.3 grams over 4 metres at the footwall contact. The average grade over the full width of the main vein was 1.5 grams, which drops to 1.17 grams when the stockwork system is included.

So far, one of the five holes planned for the Subeylidere target has been completed. The hole yielded 6.8 grams over 1 metre of quartz veining, starting 6 metres below surface.

The Subeylider prospect is hosted by volcanoclastic rocks in andesitic flows. At surface, gold mineralization is associated with chalcedonic and quartz-vein structures; a second target characterized by stockworking lies along strike, beneath a zone of opaline silica flooding.

Eldorado also is exploring seven recently acquired permits and has relinquished an option on the KS prospect in central Turkey. The new properties include epithermal-vein and porphyry targets, and the KS prospect is part of a larger joint venture with a private company.

Meanwhile, Eldorado has obtained the Turkish government’s approval for its water, effluent and medical treatment plans at the proposed Kisladag open-pit mine. The company still requires operating and construction permits before it can proceed with development.

In August, Eldorado tabled a revised operating plan that called for a doubling of production capacity in the first year of operations and the assumption of mining in the third year. Under a previous plan, the plant was to have been expanded in the fifth year of operation, when contract mining had been scheduled to end.

The ultimate volume of ore to be pushed through the plant remains unchanged, though mining now lasts 12 years instead of 14. Hence annual production rates are higher: a total of 155,000 oz. will be produced in the first year and an average of 246,000 oz. in each year thereafter.

Life-of-mine cash costs ring in at US$149 per oz. and total production costs at US$201 per oz. Both are better than original projections.

At last report, Kisladag hosted 135 million tonnes of reserves grading 1.16 grams gold per tonne. The estimate is based on a cutoff grade of 0.35 gram for oxides and 0.5 grams for primary material, plus a gold price of US$325 per oz.

In all, Kisladag hosts 214.8 million tonnes of measured and indicated resources averaging 1.04 grams gold. Another 45.5 million tonnes at 0.75 gram are classified as inferred.

The resource estimates are based on a cutoff grade of 0.4 gram.