Xanadu Mines has uncovered a new gold zone below its Golden Eagle deposit at the company’s Kharmagtai copper-gold project in Mongolia with a follow-up drill campaign already underway to test the area.
Promisingly, a diamond drill hole at the deposit returned results with a significantly higher grade than what was used to define the mineral resource at the operation in 2021.
Assays from the diamond hole show a 205.3m intercept at 0.44 grams per tonne gold and 0.14 per cent copper from 37.7m including 31m grading 1.21g/t gold and 0.24 per cent copper. The 31m hit includes 4m going 2.58g/t gold and 0.52 per cent copper from 100m and a 6m section reading 2.58g/t gold and 0.49 per cent copper from 119m.
Xanadu has also received results from 20 infill holes drilled at Golden Eagle with grades generally better than, or equal to the figures used to define the mineral resource at the site. Following the results of the recent campaign an additional five infill holes are being sunk at the site to expand the recently discovered gold zone.
Management says three diamond drill rigs are currently focussed on both shallow and deep exploration drilling while further exploration drilling at Kharmagtai is targeting additional porphyry copper-gold deposits outside the currently defined mineral resource.
Kharmagtai has a mineral resource estimate of 1.1 billion tonnes for 3 million tonnes of contained copper and 8 million ounces of gold. Management expects to provide an updated mineral resource before the end of this year, while its prefeasibility study (PFS) is due to be completed during the second half of next year.
Xanadu Mines executive chairman and managing director Colin Moorhead said: “The discovery of a significant zone of shallow gold mineralisation hosted in the cupola of a porphyry intrusion below previously recognised oxide gold mineralisation is a significant step that not only adds to previously known gold resources, but it also should improve the economics of the planned Golden Eagle open pit.”
Earlier this year, the company completed two phases of its strategic partnership with Chinese copper giant Zijin Mining, giving it access to funding for its current round of exploration.
The deal saw Zijin invest US$35 million (AU$52 million), funds which will also be used to complete the Kharmagtai prefeasibility study. A 50-50 joint venture has been created between the two partners at a project level, with Xanadu the operator on the ground.
The partnership has allocated 18 months to knock over its PFS, while an earlier scoping study identified several upside opportunities that could materially upgrade the economics of the project.
Xanadu also has a 100 per cent share in its Red Mountain project in southern Mongolia where early exploration has defined broad zones of strong quartz stockwork, veining and associated high-grade gold mineralisation of about 0.5 to more than 5g/t gold and 0.3 to 1.5 per cent copper.
Xanadu says Mongolia hosts great, large-scale mining operations with two world-class mines to the south – the Oyu Tolgoi copper-gold project and the Tavan Tolgoi coking coal operation. The region offers ideal infrastructure to be able to deliver product next-door to the world’s biggest copper and gold consumer, China.
With cash in the bank and a monster resource on its hands that looks to be growing larger still, Xanadu could soon be adding its name to that list of large-scale mining operations perched on China’s doorstep.
Is your ASX-listed company doing something interesting? Contact: matt.birney@businessnews.com.au
By Michael Philipps
