Sihayo reports N. Sumatra gold project update
Thursday, August 1 2013 - 02:07 AM WIB
REVIEW OF OPERATIONS
1. Definitive Feasibility Study (?DFS?)
During the quarter, DFS related work focused on revising mine designs to incorporate the updated Resource model from Hellman and Schofield Consultants Pty Ltd (H&SC) and development of associated mine schedules for the proposed Staged Development approach, the project permitting activity, metallurgy studies and QA/QC review of the JORC Resource.
Detailed modelling that has been completed on the ?Staged Development? approach for the project indicates a significant increase in site cash operating costs, particularly. This is primarily due to the necessity to undertake a substantial amount of early waste stripping in the pit which is required to sustain production at the proposed 1.0-1.3Mtpa of ore throughout the mine life.
Based upon the above, and given challenging market conditions, the Company considers it is necessary that the project is re-examined and potentially re-configured to identify the optimum project development path.
Mining schedules, process plant configuration, overhead cost and productivities will now focus on the near surface mineralisation only, with the objective of improving project economics and minimising the payback period on initial capital.
Capital requirements are expected to be altered accordingly to match alternative throughput rates that may result.
Sihayo Resource Modelling
A 32-hole infill drilling program designed to upgrade the near surface mineralisation within the Sihayo Resource from Indicated to Measured status has been completed. The drilling program covered all the material expected to be mined in the initial years of the project.
An updated Sihayo-Sambung Mineral Resource Estimate has been reported in accordance with the JORC guidelines and code and containing 16.9Mt at 2.6 g/t Au containing 1.4Moz.
This update includes all remaining infill drill results at the Sihayo and Sambung deposits and is based on Mineral Resource Estimates review and work undertaken by H&S Consultants Pty Ltd. Permitting & Approvals
Permitting & Approvals
Presentations continued at Central Government level in relation to the AMDAL Permit (Environment and Social Impact). Work continues on the preparation of the Government of Indonesia Feasibility Study and the Closure & Reclamation Plans, which are all requirements under the Contract of Work system.
Metallurgy
Testwork is in progress on metallurgical samples that have been prepared at the ALS laboratory in Sydney, Australia. Priority is being given for samples associated with near surface mineralisation.
2. Hutabargot Prospect Drilling
The Hutabargot Julu prospect is located on the south eastern portion of the 11.5km long SihayoHutabargot mineralised trend. The prospect is about 10 km southeast from the Sihayo-Sambung Resource. In the future, an access road could be constructed linking the Hutabargot Julu prospect to the Sambung Resource.
The Hutabargot Julu prospect is underlain by a dacitic dome complex and dissected by the Trans Sumatran Fault Zone, Dacitic stratigraphy has been hydrothermally brecciated and magnetite destructive clay-silica-pyrite altered defining an approximate 6km * 2km intermediate epithermal gold complex footprint. Significant mineralisation is structurally controlled veining within hydrothermal breccias and veins. A major North-South dislocation structure hosting high grade gold- silver mineralisation has been identified in Western Hutabargot . Historic drilling was focussed in Eastern Hutabargot and yielded a best intercept of 5m @ 36.7 g/t Au from 47m from Quartz-Sulphide veining.
A recent data synthesis and field visit by Australian-based consultant, Ben Nicolson, culminated in a scout drilling program targeting three areas along the approximate 4 km North-South mineralised structure for gold-silver mineralisation. This structure has the potential to host high grade gold ore shoots within 10 km of the proposed Sihayo-Sambung CIL processing plant. The potential size of the gold/silver shoots ranges from smaller satellite zones to larger standalone targets. Scout drilling of these targets commenced on the 1st November 2012 and was completed on the 17th of January 2013. Three targets have been tested by 15 drill holes for 1626.45m of drilling. Following data compilation of the final drill results an additional two holes were drilled in the Sihorbo vein with the aim of establishing an initial inferred resource in this area. Results for these holes are pending with modelling and resource estimation work planned to be progressed in the next quarter. Subject to these results further exploration activities in the area will be planned.
The Hutabargot Julu regional structure (dislocation along a major structural zone adjacent to a 100km long pull apart basin); geology (Dacitic volcanics intruded by diorite over a carbonate basement); vein textures (evolution relationships / boiling zone textures); and vein mineralogy / geochemistry (gold & silver, trace base metals, adularia, rhodocrosite, mineral zonation) are all consistent with known major epithermal deposits around the world, including Newcrest?s Gosowong / Kencana deposit in Indonesia. (end of edited excerpt)