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Kay Tanda Epithermal Gold-Silver Prospect: Gold-Silver Resource Delineation
The Kay Tanda epithermal gold-silver prospect occurs on the Archangel Project, a granted Mineral Production Sharing Agreement. Geology of Archangel consists of pervasively altered volcanics intruded by andesitic, dioritic and dacitic intrusives, and overlain by younger cover volcanics to the northwest. A cluster of gold-silver and porphyry copper-gold prospects has been outlined along a strong northeast structural trend of at least six kilometers, which is open to the northeast.
Extensive phyllic, SCC (sericite-clay-chlorite) alteration, characteristic of porphyry copper-gold-related mineralization, along with abundant copper showings, occur along the six kilometer trend. Superimposed on this at higher elevations are areas of advanced argillic and argillic alteration which are interpreted as being "upflow" zones and which may indicate proximity to porphyry centers below. Near-surface zones of low-sulphidation epithermal gold-silver mineralization, including Kay Tanda, have been telescoped into the advanced argillic alteration and are interpreted to reflect especially fertile and metalliferous porphyry systems below.
The main features of Kay Tanda are shown on the Archangel Compilation and in the 3-Dimensional Model on the Archangel Project page. These illustrate the extent of the chargeability anomaly (indicating metal sulphides), plus epithermal gold silver zones as mapped at surface, and zones of advanced argillic alteration. The latter can be especially important guides to porphyry copper-gold systems nearby.
Ongoing Plans
Mindoro has commenced a detailed evaluation of the open-pit, heap-leach potential of Kay Tanda. In March 2007, Mindoro commissioned the highly regarded mining consulting group Golder Associates to carry out a geostatistical (indicator kriging) resource estimate for the near-surface zone at Kay Tanda. This is to give a first pass estimate of gold-silver content defined by drilling to date. This will be followed in the near future by a National Instrument 43-101 resource estimate. In conjunction with this, environmental base line work is in progress and detailed metallurgical studies are well advanced. This work will lead to a scoping study and economic evaluation of the project later in 2007.
Kay Tanda Geology and Mineralization
As drill-defined to date, Kay Tanda, and the contiguous Pulang Lupa sub-zone, are extensive near-surface lobes of epithermal gold-silver mineralization near the southern end of the Archangel trend. Recent drilling has indicated that Kay Tanda and Pulang Lupa are actually connected at depth and form part of a very large area of low-grade, near-surface gold-silver mineralization which extends over at least one kilometer and up to 800 meters wide. Kay Tanda is still open in several directions.
Low sulphidation epithermal gold-silver mineralization at Kay Tanda is associated with extensive and intense quartz stockworks, hydrothermal breccias, with accompanying base metal sulphides, emplaced into permeable flat-lying andesitic and dacitic flows and tuffs and volcanic breccias, and intruded by high-level andesitic porphyry, diorite, quartz dirorite and dacite stocks, dykes and sills. The gold and silver mineralization is associated with quartz veins, stockworks, open space fills and swarms of hydrothermal breccias. The mineralization includes disseminated and veinlet pyrite, chalcopyrite, galena, sphalerite and some molybdenite mineralization. The latter may indicate proximity to underlying porphyry copper-gold mineralization. Total sulphide content is generally less than five %.
The Kay Tanda epithermal mineralization was telescoped into an area of intense, high- temperature advanced argillic alteration, itself telescoped into intermediate argillic, phyllic, and SCC (sericite-clay-chlorite) alteration types, which are believed to be related to a porphyry copper-gold system below. This appears to conform closely to the copper-gold model illustrated here.
Kay Tanda is reflected by an induced polarization chargeability anomaly that is about 1.5 kilometers by 1.4 kilometers in extent, and which forms part of the much larger Archangel chargeability anomalies extending over at least six kilometers along strike. Less than 25 % of the chargeability anomaly at Kay Tanda has been drill-tested to date.
Kay Tanda Drilling Evaluation
Mindoro has completed 162 reverse circulation and twelve core holes, for a total of over 21,000 meters, at Kay Tanda. Almost all holes have encountered near-surface, generally flat-lying to gently-dipping blanket-like low-grade mineralization, which is partially to strongly oxidized to depths of 40 to 60 meters, passing through a mixed (transitional) oxide and sulphide zone, into a sulphide-only zone below.
Drilling, especially at deeper levels, has encountered at least four steeper-dipping and much higher-grade zones, with bonanza grades to 100 g/t gold and over 1,000 g/t silver in places, which are interpreted as structurally controlled upflow, or "feeder" zones. Further drilling and structural studies are in progress to determine the nature and controls of the high-grade zones. The shallower mineralization is thought to be related to swarms of hydrothermal breccias, and prospect-scale quartz stockworking, with the high-grade material occurring preferentially at elevations below 150 meters (ASL) and within a boiling zone. Few holes have penetrated to this depth to date. Such upflow zones can be associated with bonanza mineralization and constitute some of the world's best epithermal gold-silver deposits. In the meantime, the economic potential of the extensive near-surface, low-grade mineralization is being evaluated for its open-pit, heap leach potential.
Location of all drill holes to date is shown on the Kay Tanda Prospect Drilling Results map. This shows distribution of gold values in grams per tonne (g/t) times intercept length in meters for each hole. Using a cut-off of 0.3 g/t gold, mineralization intercepts for each drill hole have been summed and plotted in contour form. Mindoro considers the contoured areas defined by numbers greater than 15 (g/t gold x length of intercept) to be of particular interest. This map format illustrates the distribution of mineralization and provides information on mineralization centers, structural controls, as well as mineralization trends.
Two cross sections are shown below; one of Line 9,350N through the Pulang Lupa sub-zone (section line A to A'), and section line 9,750N through Kay Tanda (section line B to B'). The accompanying table summarizes the most significant drill results to date. The 3-Dimensional Model illustrates the near-surface nature of the Pulang Lupa sub-zone (left) and Kay Tanda and relationship to topography.
Kay Tanda Metallurgy
The metallurgical characteristics of the ore are critical to the success of a mining operation. A comprehensive program of metallurgical testing has been embarked on at Kay Tanda. Preliminary bottle roll metallurgical test work carried out on historic reverse circulation samples, and reported on January 14, 2004, was largely positive. A second round of more extensive testing was carried out on a small bulk sample of oxidized material from a pit at Pulang Lupa. Results, which were reported in December 2005, were excellent, with high and rapid recovery of gold.
This led to more detailed testing of large diameter drill core with the objective of evaluating heap leach characteristics of both near-surface oxide, and deeper mixed oxide/sulphide containing material. Samples were collected by large diameter (PQ) core drilling and submitted to Metcon Laboratories in Australia. The program was designed and supervised by an independent metallurgical consultant, Peter J. Lewis and Associates of Australia.
Two series of testwork were completed on the two composites. The first test was a bottle roll test on composites at 80% passing a sieve at 75um. This test is required to indicate the maximum gold and silver recoveries obtainable and to compare with the recoveries obtained by the later heap leach testing. Very high gold and silver recoveries were obtained from both types of mineralized material. From the oxide material, 93.4% of the contained gold and 83.7% of the contained silver were leached and recovered in 48 hours. From the transition material (mixed oxide and sulphides) 88.6 % of the gold and 87 % of the contained silver were leached. These are unusually high recoveries, especially for the sulphide-containing material. Results to date suggest that the gold and silver occur in cracks and fissures, and not bound with sulphides, and, hence, very accessible to cyanide solutions.
For the second round of testing, column tests (heap leach tests) were performed on a crush size of minus 12.7mm, i.e. 1/2 inch, which is close to the lower size limit normally used for heap leaching. Gold recovery from the oxide material after 17 days of leaching was 81.9%. Gold recovery from the transition material after 11 days was 90.8%. Silver recoveries were 32% and 42% respectively, which is good for silver. Both composites are, therefore, highly amenable to heap leaching.
Because of the very encouraging results, a second test was commenced at a very coarse crush size of 50mm (two inch), since the coarser the crush, the lower the plant costs. This work was in progress at time of writing, and results will be reported on completion. Since the transition sample contained a high proportion of sulphide-related mineralization, and leached very well, a test will also be carried out on deeper, entirely sulphide-related gold and silver mineralization as well.
Mindoro management is most encouraged by the metallurgical results from Kay Tanda to date and considers these a strong basis for further evaluation of the project's economic potential.
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