Viceroy expands resources

In the process of completing the first phase of drilling at its wholly owned Bounty mine in Western Australia, junior Viceroy Resource (VOT-T) expanded resources by 167,000 oz., or 30%.

Situated 360 km east of Perth in the Forrestania-Southern Cross Archean-aged greenstone belt, the mine is a combined underground/ open-pit operation equipped with a 750,000-tonne-per-year carbon-in-leach plant.

The new resources are in the southern ore zone extension, which plunges 40-50 to the south and averages 400 metres in strike length and 8-15 metres in thickness. Viceroy reports that some of the drill intersections were the best ever achieved at Bounty. Highlights include:

15.91 metres grading 8.25 grams gold per tonne at the 48 level (1.075 km depth);

25.5 metres grading 5.8 grams gold, including 15.91 metres averaging 10.01 grams gold at the 50 level (1.135 km depth); and

6.61 metres grading 12.09 grams gold and 10.5 metres grading 7.34 grams gold.

“The initial objective of our underground exploration campaign has been achieved,” says Viceroy President Clynton Nauman. “We have demonstrated the continuation of the southern ore zone at a depth of 1.3 km, about 250 metres below current production levels, where the orebody remains unconstrained both at depth and to the south.”

After producing 70,000 oz. gold during the first seven months of this year, Viceroy reported a net gain of 97,000 oz. gold in reserves and resources. At July 31, the resource estimate at the Bounty mine stood at:

1.6 million tonnes grading 5.4 grams gold, or 276,000 contained ounces, in the proven and probable category;

1.1 million tonnes grading 6.07 grams gold, or 214,000 contained ounces, in the measured and indicated category; and

720,000 tonnes grading 7.50 grams gold, or 173,000 contained ounces, in the inferred category.

The total resource tallies to 3.4 million tonnes grading 6.06 grams gold, or 663,000 contained ounces. Viceroy’s average cost of discovery was A$5.25 per oz., based on the A$870,000 it has invested. The miner completed 11,000 metres of underground exploration drilling during the first seven months of 2000.

The focus will now be on exploring untested ore-grade mineralization immediately south of the existing deposit, between levels 25 (625 metres deep) and 37 (925 metres deep).

The Bounty mine produced 24,581 oz. gold in the second quarter at a cash operating cost of US$271 per oz. First-half production totalled 58,089 oz. at a cash operating cost of US$248 per oz., representing an increase of 11% over year-ago figures.

Viceroy acquired the mine last year from Toronto-based LionOre Mining International (LIM-T) for US$24.6 million in cash and shares.