Northern Dynasty tags new zones at Pebble

Vancouver — Large alteration zones associated with copper-gold porphyry deposits often host a wide array of mineralizing styles and the 89-sq-km Pebble system in southwest Alaska has proved to be no exception. A newly completed 5,300-metre scout drill program by Northern Dynasty Minerals (NDM-V) has cut porphyry, skarn and bonanza-grade gold mineralization to the south of the historic deposit.

Located 380 km southwest of Anchorage, Pebble was discovered by Cominco, now part of Teck Cominco (TEK-T), in the late 1980’s. The major initially set its sights on the gold potential of the area, but a review of regional geochemical results indicated greater prospects for copper porphyry style mineralization. In 1989, the last hole of the drill program cut copper-gold mineralization. By 1993, the company had drilled over 100 holes defining the inferred resource of 1 billion tonnes grading 0.3% copper and 0.34 gram gold per tonne with a higher grade core containing 54 million tonnes of 0.54% copper and 0.46 gram gold

In 2000, the management team behind the Hunter Dickinson group of companies (HD) recognized the prospects for additional discoveries within the large alteration system and inked a deal with Cominco. The group then staked additional ground southwest of the original claims and ran a geophysical survey, which outlined the anomaly over a 21-by-9-km area. The accumulated data enabled company geologists to define six large coincidental geochemical and geophysical target areas over the 258-sq.-km project. Pebble is the largest and northernmost anomaly. With the ground tied up and the targets in place, HD assigned the project to Northern Dynasty in late 2001.

Under the deal, the junior can purchase the 36 claims covering the Pebble deposit by paying Teck Cominco US$10 million in cash or stock by Nov. 30, 2003, and purchasing HD’s 20% interest in shares at its independently appraised value. Once the purchase is complete, the junior can earn a 50% stake in the surrounding property by completing 18,290 metres of drilling before Nov. 30, 2004. A two-year extension is available at a cost of 100,000 shares per year. At that time, Teck Cominco can elect to enter into a 50-50 joint venture or sell its remaining half-interest to Northern Dynasty for US$4 million and a 5% net profits interest.

New Discoveries

The Hunter Dickinson-led junior recently punched 41 widely spaced holes into the alteration system with four of them returning significant mineralization.

The first new discovery lies 12 km southwest south of the Pebble deposit, where hole 34 cut 64 metres grading 0.3% copper and 0.2 gram gold per tonne from 21.3 metres downhole. Moving 450 metres to the north, hole 38 hit 160 metres grading 0.32% copper and 0.33 gram gold from 35.4 metres downhole.

“The program was designed to find a new porphyry deposit within the overall system and we achieved that,” says HD’s Co-chairman, Robert Dickinson.

The holes show classic copper-gold-molybdenum porphyry style mineralization but lack the sills and dykes commonly observed in the Pebble deposit.

“It’s a totally different beast,” Dickinson tells the Northern Miner. “This is batholithic in proportions and there is k-spar, quartz vein sheeting, which should lead to a high-grade core.”

The zone lies within a 10-sq.-km covered area and is associated with an induced polarization geophysical anomaly.

Moving 5-km west of hole 38, hole 37 tested a 1-km long gold-copper soil geochemical anomaly and cut a broad zone of chalcopyrite-pyrrhoitite skarn style mineralization yielding 0.4% copper and 1 gram gold over 79 metres from 14.9 metres downhole. Included in this section was a higher-grade portion running 1.7% copper and 3.6 grams gold over 6.5 metres.

“The skarn could be tied in or to the outboard of the new discovery,” adds Dickinson, “but clearly it is part of the same mineralizing system.”

Some 5 km south of the Pebble deposit, hole 25 tested an 800-by-800 metres gold-in-soil anomaly and returned an impressive 28.9 grams gold over 6.1 metres. The mineralization is hosted in a biotitic pyroxenite and lies 350 metres southwest of a previous Teck Cominco (TEK-T) hole, which returned 33.9 grams gold over 1.5 metres.

“It is not a vein but it could be lithologically controlled,” says Dickinson “at this point we need to go back to the core racks and look at the two holes.”

The varying styles of mineralization occur within a 22-by-6-km multi-phase intrusive corridor at the southeastern edge of the Kaskanak batholith and are typically centered on a late Cretaceous intrusive complex.

“There are lots of different intrusive phases,” says Dickinson, “from mafic pyroxenites through to rhyo-dacites.”

Based on the promising results, the junior aims to begin delineation drilling over the new discovered early next month. Using two rigs, grid-style drilling will be completed over the copper-gold-molybdenum find along with step out drilling along the east-west geochemical anomaly covering the skarn style zone. Field evaluations will be carried out over the high-grade gold area in order to develop a drill plan to delineate the extent of this zone.

Northern Dynasty has $1.2 million in working capital and 13.2 million outstanding shares.