Asamera makes significant find at Cannon mine

A significant new gold discovery has been made by Asamera Minerals at its Cannon mine property near Wenatchee, Wash.

Word of the find comes fresh on the heels of a takeover offer for Asamera Inc. by Gulf Canada Resources which was rejected as being “financially inadequate and not in the best interests of Asamera or its shareholders.” Asamera confirms the discovery “culminates several years of intensive exploration with over 60 holes drilled to date.” So far, three separate target areas have been identified by widely-spaced drill holes over a strike length of at least 9,000 ft.

Asamera is reported to be searching for a white knight to counter Gulf’s $456-million takeover offer which is contingent upon more than 50% of Asamera’s stock being tendered. As a defensive measure, the company is apparently reviewing its options, including an acquisition in either the petroleum or metals sector.

Rumored to be after Asamera’s Indonesian oil holdings, Gulf might consider selling off the former’s minerals division to defray acquisition costs. In general (Asamera being one exception) oil companies are uncomfortable in the mining business and vice versa. But (ironically) if Asamera’s White Knight turned out to be a mining company the oil division might be the one for sale.

Although drill hole densities are low, Asamera confirms the results are “considerably better than the comparable early stage, closer- spaced drilling which led to the discovery of the B North orebody and the eventual development of the Cannon mine.”

Forty-two of the holes intersected gold and silver values in a silicified section of arkosic sediments (a feldspar-rich sandstone). Mineralized intervals are frequently in excess of 200 ft within the arkose and each of these zones has returned ore grade mineralization in excess of 0.25 oz gold per ton, Asamera notes.

Bruce Kennedy, senior vice- president minerals, explains to The Northern Miner that the geology and mineralogy of the deposit are almost identical to the Cannon mine two miles to the northwest. The lowest working level there is approximately 200 ft above sea level and the new discovery is about 500 ft higher, suggesting good reserve potential both at depth and along strike.

The mineralized zones are capped by about 1,000 ft of basalt so holes have been quite deep and definition drilling prohibitive, given the cost. As a result, Asamera has decided to drive a $3-million(US) decline into the discovery which should commence about mid-year and be completed in mid-1988.

When the decline reaches target, some 6,000 ft of drifting will be completed along the mineralized trend. Extensive diamond drilling and bulk sampling are planned in conjunction with the program.

Kennedy points out that the Cannon mine grade improved significantly with tighter drill hole spacing and he sees no reason why this won’t happen in the new area.

The discovery extends over at least 150 acres which is about six times larger than the acreage covered by the Cannon orebodies; this prompts him to conclude the discovery could constitute a reserve of one million tons or more.

Asamera is operator and 51% owner of the Cannon mine property which produced 136,913 oz gold and 184,660 oz silver in 1987. Vancouver-based Breakwater Resources has a 49% interest in the property.