GIBRALTAR’S JUST SCRATCHED THE SURFACE: Theory becomes

Gibraltar mine exploration geologist George Barker was mildly optimistic when he hopped into his company pickup on a Saturday morning late in the summer of 1990. He was off to check core from a diamond drill on Gibraltar property. In eyeballing early results the night before, he had noticed alteration appearing as the drill went deeper. A hopeful sign.

“On my way home Friday night, I stopped in at the drill rig. There was a hint of something starting to come (alteration after about 300 ft. of barren core),” recalls Barker. Where there’s smoke, there’s fire and at Gibraltar, the smoke is chlorite and quartz sericite pyrite alteration.

That Saturday morning, there were about 30 boxes of NQ core stacked in piles of eight beside the rig. Having run through all the boxes up to No. 15 the previous night, Barker immediately set to work on the third stack.

The top few boxes contained core laced with chalcopyrite, and Barker excitedly pulled box after box off the stack.

“I kept wondering how far it would go. I kept half expecting the next box to be out of it (chalcopyrite).” It wasn’t. All the remaining core glittered with chalcopyrite. In fact, the L.D.S. Diamond Drilling crew only finally drilled through the zone by that afternoon.

The assayed hole returned 360 ft. (from 410 ft. to 770 ft. in depth) grading 0.71% copper. A second, step-out hole 250 ft. south returned 400 ft. at 0.72%-0.73%. The exploration department couldn’t have conjured up a more thoughtful, timely gift, coming as it did on the eve of Gibraltar’s 20th year of near-continuous mining.

Gibraltar, about 16 km. northeast of McLeese Lake, B.C., forms the primary asset of Gibraltar Mines, in turn a 68.1%-owned subsidiary of Placer Dome Inc. Based on a copper price of US$1.00 per lb. and a cut-off grade of 0.20% copper, proven and probable ore reserves as at Jan. 8, 1992, were 165.8 million tons grading 0.312% copper and 0.0088% molybdenum. The strip ratio is 1.42-to-1. Based on the 13.1 million tons processed in 1991, ore reserves are sufficient for at least 12 years.

Current reserves are divided into three separate zones — Gibraltar East, Pollyanna and Granite Lake. They do not include any estimates for the newly discovered Gibraltar North zone — the exploration department’s discovery — or any of the company’s dump leaching operations.

Not only does the North zone offer the potential to expand reserves, but its higher grade may help improve Gibraltar’s overall grade. Drilling to date (mid-September, 1992) on the North zone has returned values up to 1.29% copper over 80 ft. and averages perhaps about 0.4%.

A boost in grade would be welcome news for Bill Myckatyn, mine manager. He noted during a visit by The Northern Miner Magazine that the mine’s head grade, averaging 0.31% copper in 1991, is probably the lowest in North America. As a result, the company is constantly searching for measures to bring costs down (please see accompanying story).

Although the new deposit has not been fully delineated, most of its known extent lies on ground subject to a 30% net profits interest payable to Newcoast Silver Mines.

Following the discovery of the North zone, Gibraltar managed to renegotiate the NPI, giving it the right to deduct exploration, capital and interest costs as well as direct operating costs before the 30% royalty payout. (In essence, Gibraltar won’t pay Newcoast anything until it recoups its capital outlays.) As part of the renegotiation, Newcoast received an advance royalty payment of $100,000.

Myckatyn said the renegotiated agreement was a key factor in Gibraltar’s committing additional exploration dollars to the project.

Myckatyn attributed the original North zone find to “a fine piece of geological work.” The events leading up to the find began unfolding in 1990 when Barker’s exploration team drilled, prior to dump expansion, near the toe of the waste dumps northeast of the Gibraltar East pit. This drilling was strictly for condemnation purposes.

The program did not intersect ore-grade mineralization, but it returned enough “sniffs, one little zone of 20 ft. grading 1.3%,” Barker said, to convince management additional money would be worthwhile for a few more holes and an accelerated pace of exploration in areas Barker had earlier earmarked as targets. The condemnation drilling did not lead to the North zone find, Barker said, trying to dispel misconceptions that the discovery had been pure fluke. “It essentially accelerated a program we had already planned.”

In the winter of 1989, Barker dusted off drill records from the late 1960s and early 70s. Deeper holes to 500-600 ft., he found, regularly bottomed in ore-grade copper mineralization. It had been thought irrelevant in the past because of the depth. This “deep-ore” theory, propounded by both Barker and Senior Geologist Garry Bysouth, gained more credence when condemnation drilling under a potential dump area in 1990, hit similar mineralization at a similar depth.

A thorough geological understanding of the mined area as well as the known occurrence of a small copper-mineralized pod drilled by Coast Silver (predecessor to Newcoast) in the late 1960s led the discovery team about 1,600 ft. to the northwest of the condemnation hole. And that is where Barker positioned the discovery drill.

The old Coast drilling, about 600 ft. southeast of the discovery hole, had probed a small, shallow 3-million-ton reserve of 0.36% copper, bottoming at 300 to 400 ft. Rather small potatoes for an operation Gibraltar’s size.

Since the 1990 find, Gibraltar has drilled over 80,000 ft. About 7,000 ft. remain in the current program. The drilling has outlined a large, essentially tabular body of porphyry copper mineralization measuring about 3,000 ft. long, 400 to 500 ft. wide and 300 to 350 ft. thick. Gibraltar staff has politely declined to offer any reserve estimate yet, but in the neighborhood of at least 45 million tons might be a good guess. Of course, with a dozen years left of known reserves, Gibraltar need not hurry the evaluation either.

The zone strikes to the northwest with a plunge of about 8deg and dips to the southwest. Barker said the deposit is quite different from those in the mining area to the southeast in that the ore-waste contact on the down-dip side of the North zone is very defined; in the mining area the mineralization generally decreases in grade from a central core.

Barker said there is some indication that the mineralization is folded in a tight, tilted anticline with both limbs tilted in the dip-direction to the southwest. There is also a possibility the lower limb folds back on itself and may extend toward surface to the northeast of current drilling. Barker said a weak IP anomaly over that area may support the theory, adding that there is an IP signature over the Gibraltar North zone.

A hole was drilled earlier this year to test the area, and although it hasn’t been assayed yet, main zone mineralization was encountered. But the main zone dips down and not up, as originally hoped. A small, near-surface zone was encountered which may have caused the IP expression.

For the time being, Barker said, the company plans to concentrate on delineating current reserves on the North zone, with future work centred on infill drilling. This will allow Gibraltar to determine if the mining schedule should be changed to include the North zone. The zone remains open along strike, although it appears to get progressively deeper to the northwest while grades drop to the southeast. Of principal importance to project economics is the depth of the mineralization, which averages perhaps 300 ft. and ranges up to 700 ft. The resulting relatively high strip ratio, compared with current operations, must be weighed against the zone’s higher grade.

A further disadvantage of the North zone is its location. The zone sits under the mine access road, the main power line and the water line, all of which, if moved, will add to development costs. In addition, the mine’s perimeter water collection system will have to be moved and expanded to in
clude the new zone.

Now isn’t that an appropriate way to end the first 20 years of production.