Hanoi, Vietnam — With their eye on the Ban Phuc nickel-copper deposit as a potential development project,
The New Zealand company, Asia Mineral Resources (AMR), holds a 70% interest in the Ta Khoa concession through its wholly owned subsidiary, AMR Nickel. The remaining 30% is held by Vietnamese government agencies. Falconbridge has an option to acquire 51% of AMR Nickel’s interest by spending US$5.5 million on exploration before May 2003.
“To justify mine development in a new country, Falconbridge is looking for plus-twenty million tonnes at two per cent nickel or better,” said Terry Bates, AMR’s managing director, who spoke with The Northern Miner on the property site.
Although AMR would prefer to participate in the development of a large resource at Ban Phuc and other nearby targets, it says it will also consider developing a smaller, high-grade resource.
“If Falconbridge doesn’t find what it wants and backs off, we’ve still got a nice project,” said Bates. One of AMR’s immediate objectives it to obtain a listing on a recognized stock exchange, such as the Canadian Venture Exchange.
The 600-sq.-km Ta Khoa concession is 160 km west of Hanoi. The Hanoi-Son La Highway passes by the southwestern margin of the concession, and two secondary roads bisect the property.
Topography is steep and mountainous, with elevations ranging from 100 to 1,550 metres above sea level. The climate is hot and humid for most of the year, with the wet season occurring between May and October.
The Ta Khoa property hosts ultramafic intrusives with associated nickel sulphides. The most developed prospect is Ban Phuc, though nine others have been identified. In the Ban Phuc area are six prospects, including the Ban Phuc deposit itself. The others are: King Snake; Ban Khoa; Ban Trang; Ban Tao; and Ban Trang South.
Other prospects include Ban Mong, Ban Nguon and Hong Ngai.
AMR negotiated a joint venture with Vietnamese interests in 1989 and acquired a foreign investment licence. In return, it was required to complete a prefeasibility study of a small mining operation in the Ban Phuc area. AMR defined a diluted minable resource of 890,000 tonnes grading 3.35% nickel, 1.26% copper and 0.1% cobalt.
A 1993 attempt to explore the area with geophysics proved unsuccessful as a result of equipment failure, though subsequently, a low-level aeromagnetic survey and stream-sediment-sampling program were performed. In 1996, a 27-hole, 4,000-metre drill campaign evaluated disseminated cumulate sulphides in the ultramafic rock.
Falco entered the scene in 1999 and set about identifying other targets in the area by means of airborne and ground geophysics. Drilling was carried out in late 2000, and results to date suggest that the King Snake zone has particular exploration potential. One hole returned 3 metres grading 2.5% nickel, 0.86% copper and 0.1% cobalt, plus 0.83 gram platinum, 0.92 gram palladium and 0.41 gram gold per tonne.
Meanwhile, low-grade nickel associated with anomalous platinum and palladium has been encountered on the Hong Ngai prospect, with one 0.15-metre section assaying 2.65% nickel, 0.22% copper, 0.07% cobalt, 0.14 gram platinum, 0.14 gram palladium and 0.07 gram gold.
History
Nickel was first discovered in the Ta Khoa area in 1959 during regional prospecting for copper. Over the next three years, the Vietnamese, with Chinese assistance, identified several small mafic and ultramafic intrusions, including Ban Phuc, Ban Khoa, Ban Trang, Ban Tang, Ban Mong, Hong Ngai and Ban Bo.
Adits were driven to investigate mineralization on the Ban Phuc prospect, and about 15,000 metres of drilling was completed on the Ban Phuc, Ban Khoa and Ban Trang targets. This work defined two types of mineralization: massive and semi-massive sulphides in shear zones, and disseminated nickel and copper sulphides. Most of the exploration was focused on the Ban Phuc target, where 54 holes and 3.5 km of underground development helped define the initial resource.
Resources
The only well-defined resource is at Ban Phuc, where data from drilling on 50-metre sections is supported by crosscuts through shear-hosted massive sulphide zones. The resource comprises three lenses — A, B and C — that plunge toward the west at minus 30.
The shear-hosted resource was calculated using a minimum width of 1.5 metres and a cutoff grade of 1.5% nickel-equivalent.
Proven reserves in lens A weigh in at 581,300 tonnes grading 2.49% nickel, 1.19% copper and 0.08% cobalt. The indicated resource for this lens is 101,000 tonnes of 1.96% nickel, 0.73% copper and 0.08% cobalt.
The resources in lens B are about 237,650 tonnes grading 2.11% nickel, 1.22% copper and 0.05% cobalt, whereas the lens C resources are pegged at 501,210 tonnes of 2.18% nickel, 1% copper and 0.10% cobalt.
The total shear-hosted resource is 1.4 million tonnes grading 2.28% nickel, 1% copper and 0.08% cobalt. The resource remains open along strike and to depth.
The cumulate sulphide mineralization at Ban Phuc was calculated using a minimum width of 3 metres, a 1% nickel cutoff for indicated resources, and 0.7% for inferred. The indicated resource is estimated at 1.2 million tonnes grading 1.26% nickel, 0.15% copper and 0.03% cobalt, whereas the inferred resource stands at 8.5 million tonnes grading 1% nickel, 0.1% copper and 0.03% cobalt. The cumulate sulphide mineralization is not expected to exceed 15 million tonnes, and AMR believes that some higher-grade zones may still be found.
Using a nickel price of US$3-per-lb. and a copper price of US$1 per lb., the company proposes that a minable resource of 890,000 tonnes grading 3.38% nickel, 1.24% copper and 0.14% cobalt be mined at the annual rate of 100,000 tonnes. This model yields a net present value of US$14.9 million, using a 20% discount rate.
Another model envisions a 500,000-tonne-per-year, mixed-grade operation that draws from both the massive sulphides and cumulate sulphide mineralization. Using a minable resource of 1.5 million tonnes grading 2.3% nickel, 1% copper and 0.08% cobalt and 3.5 million tonnes grading 1.26% nickel, 0.15% copper and 0.03% cobalt, the model calls for annual mining rates of 150,000 and 350,000 tonnes, respectively. The net present value in this case is US$23.5 million. AMR has not made any allowance for the possibility of platinum- or palladium-rich zones.
Geology
The property is in the Da River mobile belt that strikes northwest across Vietnam and into southern China, and southeast into the South China Sea. The belt represents a crustal suture between the Indo China Plate and the South China Plate and varies in width from 70 km in the north to 130 km near Hanoi.
The Ta Khoa concession encompasses an elongate, northwest-trending dome of early-to-mid-Paleozoic metamorphic rocks flanked by phyllites, marbles and volcanics, as well as shales, sandstones and conglomerates that range from Permian to Triassic in age. To the north lie Jurassic-aged volcanics. Numerous small intrusions have been mapped as dykes, sills, plugs and lenses, and these range, in composition, from pegmatites to gabbros to ultramafics. The ultramafic intrusions are 0.5-40 metres thick and are usually concordant with the sedimentary bedding.
The original sequence of rocks that hosts many of the intrusions is a sedimentary package of quartzites, sandstones, shales and marbles. The lithology of this sequence changes laterally and frequently repeats itself vertically. Geologic mapping of specific-time stratigraphic units, or marker horizons, is difficult. Numerous faults and local folding add to the complexity of the geology.
Several styles of nickel sulphide mineralization are found associated with the ultramafic rocks in the Ta Khoa concession. At Ban Phuc, nickel and copper mineralization is hosted in massive and semi-massive sulphides associated with a sub-vertical shear zone and highly altered ultramafic rock. The sulphide content ranges from 20% to 95% and consists of pentlandite, pyrrhotite and some chalcopyrite. Grades spanning 1-metre intervals vary between 1% and 8.5% nickel, 0.5-2.5% copper and 0.05-0.25% cobalt. This type of mineralization can also be found at the Ban Mong and Ban Trang prospects.
A few of the deeper holes at Ban Phuc intersected a zone of stratabound chalcopyrite mineralization that was separate from the massive shear-hosted nickel sulphides. The zone measured 15 metres thick and averaged up to 1.5% copper with no other significant base metals. It is hosted in thinly bedded metasediments, in which the dominant rock type is shale.
Massive pyrrhotite can be found at the Ban Mong prospect as float, and contains up to 4.5% nickel, 0.19% cobalt and minor copper. Up to 5 grams combined platinum and palladium per tonne have been found associated with this style of mineralization, and it may be derived from cumulate sulphide horizons in the ultramafic rocks.
Another recognized style of mineralization is in the form of cumulate sulphides. It is widespread and can be found occurring at the Ban Phuc, Ban Khoa, Ban Mong, Ban Trang, King Snake and Hong Ngai prospects. The disseminated sulphides occur as pentlandite, pyrrhotite and chalcopyrite in various combinations and abundances.
Limited metallurgical work has been performed on the massive sulphides at Ban Phuc. Initial recovery rates for nickel were only 84%, though more recent tests recovered up to 93%.
In the early 1960s, Vietnamese work identified platinum group elements (PGEs) in the Ban Phuc ultramafics. Samples from pits and trenches assayed up to 2.5 grams combined platinum and palladium per tonne over widths of up to 1.5 metres. In 1993, AMR outlined a PGE-rich zone (0.8-2 grams combined PGEs) associated with low-grade cumulate nickel mineralization. No significant values were ever found in the massive sulphides at Ban Phuc.
A study by S.G. Barns in 1993 suggested that the massive sulphides at Ban Phuc were deficient in PGEs and stated that the ultramafic rocks at Ban Phuc represent a secondary mobilization from a magma chamber that was already depleted in PGEs.
Falconbridge recently discovered significant PGE mineralization at several known sites. The King Snake prospect returned 6.5 grams combined PGEs associated with the disseminated sulphides. Samples taken from a shear in the host rock (peridotite) assayed 17 grams combined PGEs
At Ban Mong, a small lens of massive sulphides grading 4.5% nickel and 0.13% copper yielded 5.5 grams combined platinum and palladium. Sampling also recorded PGE occurrences of up to 2 grams at Ban Trang and Ban Tao.
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