Ivanhoe looks for next big thing in Australia

Ivanhoe Mines (IVN-T, IVN-N, IVN-Q) is looking to add to its already impressive copper and gold portfolio — but this time in a country without the political baggage.

Ivanhoes Oyu Tolgoi copper and gold deposit in Mongolia is the worlds largest undeveloped copper project, but the project has won and lost favour with investors over the years thanks to the inconsistent and at times opaque policies of the Mongolian government.

Now Ivanhoe is looking to strike it big again in the notoriously mineral rich area of Australia known as Mount Isa.

We think if were going to do it again were going to do it in Australia, Ivanhoe chairman Robert Friedland recently told a crowd at the Denver Gold Forum.

Friedland said its Cloncurry project which sits between Barrick Gold‘s (ABX-T, ABX-N) Osborne gold and copper mine, and Xstratas (SXRAF-O, XTA-L) Ernest Henry copper gold mine — is identical in age, mineralogy, genesis and geologic setting to BHP Billitons (BHP-N, BLT-L) massive Olympic Dam mine.

Of course were looking for a blue whale, wed like another Olympic Dam, he said, but if we find a zebra or a hippopotamus that will be fine with us.

On Oct.3 Ivanhoe announced the discovery of a new zone at the project. The zone sits on the western margin of the SWAN Iron Oxide Copper Gold (IOCG) project which is part of the 2,400 sq. km that make up Cloncurry.

The most recent program was highlighted by:

• Hole 1130 — 90 metres grading 2.02% copper and 1.3 grams gold from 582 metres to 672 metres, including 54 metres grading 3.04% copper and 1.89 grams gold.

The result represents the first high-grade copper and gold zone intercepted at SWAN which remains open in all directions.

High-grade sections within the 90-metre intercept are associated with one to three metre wide veins of chalcopyrite, magnetite, pyrite and calcite Ivanhoe says.

While assays are pending for one hole — hole 1118 — Ivanhoe says it hit a 150-metre wide intersection of visibly strong chalcopyrite-dominated mineralization roughly 100 metres up-dip from hole 1130. Visually, the core seems to indicate broad zones of disseminated copper with regular, narrow high-grade veins.

The deposit is still open at a depth of 1,200 metres and in several other directions, including to the northwest, to the northeast and to the south.

The zones could represent feeder zones to the main body of mineralization or be crosscutting, late-stage mineralization. The style and structure of the mineralization intersected in the new zone indicates that repeat structures with similar grades and thicknesses are possible within the SWAN system, the company says.

Back in January Ivanhoe hit upon a series of IOCG systems at Cloncurry.

The ongoing drill campaign is composed of six rigs turning in the area around the high-grade zone. The program is seeking to determine if four separate IOCG systems are connected at depth.

Recent drilling in the area between SWAN and another deposit, SWELL, intersected mineralization that indicates a genetic link between the two zones.

SWAN and the three other deposits composing the Mt. Elliott IOCG system are the first to undergo intense drill testing by Ivanhoe. Nearly 60 holes have been drilled so far at the project.

Ivanhoe acquired its 100% stake in Cloncurry back in 2003. The claims cover much of the historic Selwyn Mining District which produced roughly 950,000 oz. of gold and 175,000 tonnes of copper.

Ivanhoe holds 12% of Exco Resources (EXS-A), which has 4,700 sq km in the Cloncurry region. The companies have a joint venture on 712 sq km of tenements that are contiguous with Ivanhoe’s Cloncurry tenements.

In Toronto on Oct. 3 Ivanhoe shares finished off 7 at $12.98 on 868,063 shares traded.