LionOre Mining International (LIM-T) has cut a new zone of nickel sulphide mineralization on the Waterloo prospect, part of its Wildara joint venture with Australian-listed Dalrymple in Western Australia’s northeastern goldfields.
The first hole, LWDD 452, was drilled at 60 to the east to test an electromagnetic anomaly delineated in the second half of 2001. The anomaly is coincident with known ultramafics at Wildara.
The hole encountered high grade, disseminated to matrix nickel sulphides at the base of a high-magnesium ultramafic unit. A 10.68-metre core section (beginning at 153 metres downhole or 140 metres below surface) returned 4.83% nickel and 0.49% copper. Included is a 5.82-metre, higher-grade zone of matrix sulphides (about 50-70% sulphides) running 7.68% nickel and 0.81% copper from a downhole depth of 157.86 metres.
A second hole 50 metres to the west was designed to test for a down-dip extension to the new nickel sulphide zone. The hole was abandoned due to structural complexities.
LionOre plans a program of electromagnetic surveying to aid in further drilling at depth. Drilling aimed at determining the geometry and dip of the new mineralized zone continues.
LionOre manages the Wildara joint venture, in which it has a 60% interest. Dalrymple holds the remainder.
Waterloo lies about 6 km from the recently green-lighted Thunderbox gold project, which is covered by the same joint venture.
Construction at the US$33-million Thunderbox is expected to begin this month and should take around nine months. The partners have all necessary statutory approvals in hand and have negotiated a 4-year limited recourse debt finance facility for the project with Macquarie Bank in Australia.
A proposed open-pit operation at Thunderbox is expected to begin production during the fourth quarter of 2002; initially at the annual rate of 220,000 oz. for the first year of operations and declining to about 150,000 oz. per year thereafter. In all, the operation is expected to produce more than 800,000 oz. gold. Life-of-mine cash costs are projected at US$157 per oz. (US$110 per oz. in the first year, owing to the higher grades and softness of the oxidized material).
About half the mine’s production over its 5-year life has been hedged through Macquarie Bank at a flat forward price of US$293 per oz. — about US$35 per oz. better than assumed in the bankable feasibility study.
Thunderbox’s reserves are pegged at 10.9 million tonnes running 2.43 grams gold per tonne at an assumed gold price of US$254 per oz. and a cutoff grade of 0.7 gram for oxidized material and 1.1 grams for primary material. (T.N.M. Dec. 17-23/01)
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