An initial resource estimate for the Murray Brook polymetallic massive sulphide deposit in New Brunswick’s Bathurst mining camp has confirmed the property’s historical resource — but with better grades — and confirms that the deposit is the fifth-largest in the district, El Nino Ventures (ELN-V) says.
The maiden resource estimate is based on a drill program last year of 60 vertical holes totaling 10,300 metres. The deposit remains open to the northwest and the company’s management believes there is potential to expand the resource size with continued drilling.
Measured and indicated resources stand at 18.68 million tonnes grading 2.61% zinc for 1.07 billion contained lbs. zinc, 0.95% lead for 391.2 million contained lbs. lead, 0.42% copper for 172.96 million lbs. copper, 39.3 grams silver per tonne for 26.61 million oz. silver and 0.51 gram gold per tonne for 300,400 oz. gold, at a $20-per-tonne net smelter return cut-off.
Inferred resources measure 3.02 million tonnes grading 1.83% zinc for 121.84 million lbs. zinc, 0.75% lead for 49.94 million contained lbs. lead, 0.62% copper for 41.28 million lbs. copper, 35 grams silver for 3.4 million oz. silver and 0.75 gram gold for 72,900 oz. gold, at the same net smelter return cut-off.
On a zinc-equivalent basis, the resource measures 8.17% zinc equivalent in the measured and indicated category and 8.47% zinc equivalent in the inferred category. The zinc-equivalent numbers were based on a total NSR value of the constituent metals plus smelting and shipping charges divided by $14.05, the recovered value of 1% zinc.
“It’s a good start,” Bill Stone, the company’s executive vice-president of exploration, says of the resource estimate. “The perception about a lot of these older districts is that they’ve seen their heyday and are slowly winding down, but with modern exploration and modelling techniques and the commodity price environment, what happens is that they continue going, like the Energizer Bunny. They have their ups and downs but never shut down. Flin Flon is one example of that and the Bathurst mining camp is another, and in five years’ time the district is going to look very different than what it does now.”
Stone also points to the latest survey by the Fraser Institute that has ranked New Brunswick as the world’s most attractive jurisdiction for exploration and development. “It was an unexpected but very pleasant surprise,” he says. “New Brunswick is a great place to work, and in terms of being overlooked, this is going to help the Bathurst mining camp and New Brunswick in general in the mining community.”
El Nino’s management is planning a $3-million exploration program for 2012–2013 that includes $2.5 million earmarked for drilling measured resources at the Murray Brook deposit and $500,000 budgeted for the Murray Brook and Camel Back exploration claims defined in an option agreement with Murray Brook Minerals, a private company.
“The deposit is open to the northwest, so part of the plan is to drill over that area to see if we can increase the resource further,” Stone explains. “Most of the drilling will be devoted to converting all the indicated resource into the measured category, and that will be the resource that goes into the scoping study that will begin next year.”
The company says the exploration campaign is designed to look for large, volcanogenic massive sulfide deposits that might occur at depths 150 metres below surface. The exploration area targeted is between the Murray Brook massive sulfide deposit and the nearby Caribou deposit. “It will be the first time the property has been evaluated with modern exploration techniques,” Stone says.
The Murray Brook deposit is 60 km west of Bathurst, which sits on Bathurst Harbour, an estuary at the mouth of the Nepisiguit River at the southernmost part of Chaleur Bay.
The Gossan zone overlying the volcanic-hosted massive sulfide deposit was mined for gold and silver during the early 1990s, when Novagold Resources operated an open pit.
The operator of the Murray Brook project is Votorantim, which has an option and joint-venture agreement with Murray Brook Minerals and Murray Brook Resources to earn a 50% interest in the properties by spending $2.25 million on exploration and making payments totalling $300,000 over a three-year period, which started on Nov. 1, 2010.
Votorantim can earn an additional 20% interest in the properties by funding $2.25 million in exploration over a two-year period.
El Nino has a participation agreement under which it can earn half of Votorantim’s interest by paying 50% of the costs that Votorantim incurs under its option and joint-venture agreement.
The company has no debt and holds $600,000 in its treasury. It is raising another $2.5 million and expects to wrap that up in the coming weeks.
At presstime El Nino Ventures traded at 14¢ per share within a 52-week range of 8.8¢–46.3¢. The junior has 51 million shares, fully diluted.
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