A slew of new drill results and an ongoing campaign are keeping
Situated 70 km east of Val d’Or, Que., Croinor was discovered in 1940 and subsequently explored by numerous operators. By the late 1980s, with
From 1996 to 1997, Goldust Mines (now
South-Malartic entered the picture in mid-1997 when it inked a deal with Huntington to earn a 70% interest in return for cash and $1.4 million in expenditures, which it has since covered. Huntington retains a 30% interest and recently forked over $283,888 to cover an upcoming cash call.
At first, South-Malartic had as little luck as others, with its first holes returning “inconclusive” results. Then, in early 2000, the tide began to turn in its favour following the discovery of flat-lying tension veins perpendicular to the known, north-dipping shear zones.
By early 2002, the discovery, inspired by the similar technical successs of
So far, about 18,000 metres have been completed in 118 holes. The holes were oriented toward the north and south, and about 70% infilled less-defined areas of the deposit.
By 2005, South-Malartic hopes to begin open-pit production at the rate of 50,000 oz. per year. Run-of-mine ore would be trucked to a refurbished 1,500-tonne-per-day Chimo mill, about 20 km to the southwest. The mill was purchased from Cambior in 2001 for $375,000 plus the assumption of environmental liabilities.
Metallurgical tests are under way to determine what upgrades the mill may need in order to process Croinor material. Preliminary indications put refurbishment costs at $5 million.
Mineralization consisting mainly of chalcopyrite, pyrite and native gold occurs in three related structures:
n shallow, sub-vertical quartz-tourmaline shear veins in an altered diorite sill;
n flat-lying quartz-tourmaline tension veins perpendicular to the shear zones; and
n tectonically brecciated diorite.
Ankerite and sericite are the main alteration minerals, and the former serves as a beacon to the prospective tension veins.
Last winter, South-Malartic sunk 17 holes on each side of the deposit to test the lateral continuity of mineralization. All but one from the western series cut mineralized intervals carrying more than 3 grams and up to 32 grams, 0.3-6.7 metres long; six of the eastern series had similar results.
According to South-Malartic, the western holes confirm the association between gold mineralization and carbonate (ankerite) alteration envelopes in the tension fractures. They also highlight the occurrence of rich shoots at the contact of a porphyry dyke that cuts the host diorite at a shallow angle in that area. The western holes were collared on lines 1275W-1450W (measured in feet).
Significant results from the eastern series varied from 3 to 11 grams gold per tonne over 0.3-1.4 metres. The holes were collared 300 metres from the resource limit, on lines 3175E-3700E, and therefore add 160 metres of new strike length for further exploration.
During the winter program, South-Malartic drilled seven holes in a showing uncovered during the summer, about 600 metres north of Croinor, outside the diorite sill. Five of the holes yielded significant results: from 2 to 13 grams over 0.3-1.5 metres of core.
Like Croinor, the zone is close to surface, sitting 61 metres down, and extends 91 metres in an easterly direction. Gold mineralization also is associated with quartz-tourmaline veining and disseminated pyrite but is hosted by a quartz-feldspar porphyry dyke. The minerlization extends into the surrounding volcanics and other intrusions.
In the summer, South-Malartic moved the drill back to infill detail and proceeded to sink 26 holes on lines 220W to 710W (here, the grid is measured in metric units, using an old shaft as the origin). Fourteen yielded more than 1.5 grams and up to 17.3 grams over true widths of 0.4-12.5 metres, and several cut more than one zone of mineralization — a trait that seems typical of the deposit as a whole.
Since then, another 51 holes have been sunk on lines 230E-720W and stations 125N-115S, from which selective results were recently released. The best result came from hole hole 130, collared on line 380W, which averaged 9.76 grams over 16 metres true-width (from 163 metres), including 53.4 grams over 3 metres.
The mineralized interval lies 30 metres north and at depth of two others (3.6 grams over 8.6 metres and 4.4 grams over 3 metres) intersected earlier. When connected, the three form a tabular lens that remains open to the west, north and at depth.
Also, several of the holes were drilled deep enough to cross the southern contact of the diorite — an area historically ignored for its mining potential. South-Malartic first considered the area prospective after hole 74, drilled in the summer, pierced 9.5 metres (true-width, from 188 metres) grading 5.6 grams. Recent highlights include:
n hole 123, which cut 8 metres (from 73 meters) grading 6.5 grams;
n hole 133, which cut 9 metres (from 116 metres) grading 2.4 grams;
n hole 134, which cut 6.4 metres (from 9 metres) grading 2.9 grams; and
n hole 135, which cut 2.6 metres (from 119 metres) grading 17 grams.
Hole 74 was collared on line 540W, and the new holes, on lines 200W to 360W.
South-Malartic has outlined a coincident geophysical anomaly extending from the shaft to line 600W. A separate anomaly was detected to the east and may reflect the deposit’s extention in that direction. The anomaly extends from line 400E to line 1000E.
According to South-Malartic, the infill holes should allow it to bump up portions of the inferred and indicated resource to the measured category. Measured resources account for 46% of the estimaged 518,442 contained ounces. The entire resource is based on a cutoff grade of 0.5 gram for the portion extending to a depth of 150 metres and 1 gram for deeper-lying mineralization, though most of the gold sits no deeper than 107 metres.
As part of its long-term goal, South-Malartic has tied up more ground in the region: 22 claims were tacked on to Croinor’s southern boundary, expanding the property to 48.8 sq. km; 20.3 sq. km were staked in surrounding townships; and the nearby 3-sq.-km Robinson property was purchased from a local vendor for $10,000 in cash and 100,000 warrants that can be exchanged for shares until mid-2004 at 40 apiece.
Situated 55 km from the Chimo mill, Robinson is the most advanced of the bunch, hosting some 227,000 tonnes that are considered amenable to open-pit mining methods. The resource grades 3.08 grams and had been tested by 4,850 metres of drilling, a 157-metre-deep shaft, and two drifts driven on the 30- and 152-metre levels. It also was exposed at surface.
Mineralization extends 150 metres below surface, in the Pascalis-Tiblemont batholith, near its northern contact with mafic volcanics of the Harricana group. A deformation corridor passes through the rocks and played a role in the deposit’s formation.
Next comes Tavernier and Vauquelin, both of which host two prospects. Historic drilling at the former yielded 26.6 grams gold, 9.9% zinc and 4% copper over 7.3 metres, plus 14.6 metres grading 32.6 grams of massive sulphide mineralization. At Vauquelin, the Boycon-Pershing prospect yielded 41.4 grams gold over 0.3 metre and 33 grams gold over 0.2
metre, while the Baie des Aviateurs prospect averaged 1 gram over 0.4 metre.
The Tiblemont property hosts two showings, dubbed Anaconda-3 and Realore. Chip sampling at the former yielded 26.5 grams over 0.6 metre of massive sulphide mineralization, while a grab sample from the latter returned 21 grams.
The Bel-Rive property, immediately northwest of the Croinor property, has no showings. Its geological position in relation to the northwesterly strike of the Croinor sill is what caught South-Malartic’s attention.
South-Malartic says the new ground bodes well for an incremental expansion to its resource base and may keep the Chimo mill fed down the road. At Chimo alone, there remains a surface resource of 600,000 tonnes grading 1.9 grams.
Crews are compiling all of the historical data in preparation for summer field programs. The cost will be partially covered by Huntington, which has been given 30% interests in the new properties.
South-Malartic has roughly $2.2 million in working capital, having recently sold 2,191 units at $1,000 apiece. A unit consists of 2,666 flow-through shares priced at 30 each, 667 common shares, also priced at 30, and 667 warrants that can be exchanged for common shares until mid-2004, priced at 40 each.
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