Sumatra Copper & Gold updates Indonesian projects
Friday, January 28 2011 - 09:22 AM WIB
1. Tembang
A comprehensive market update was issued regarding the Tembang project on 14 January 2011. As reported in that release a best drill intercept of 3.9 metres @ 7.73 g/t Au, 269.6 g/t Ag was obtained at Belinau but the limited deep holes in the Berenai, Nuri and Belinau vein systems did not further intercept high grade shoots.
Importantly, it was also announced the Board had decided to proceed with development of the Tembang project based on the current gold resource of more than 1 million ounces. Details of development steps, timeframe and key milestones are expected to be finalised during the next quarter, however, initial planning indicates that production will commence during 2013. Fundamental to the development planning will be finalisation of the JORC resource update which is expected to be published during March 2011 following completion of the current round of drilling and receipt of all assay results.
As previously advised, preliminary indications suggested there will be an increase in the gold content in the vein resources and a significant enhancement of grade and a material reduction of the low grade (0.7 git Au) inferred halo resources. The additional drilling undertaken since these preliminary indications has tended to confirm those observations.
2. Sontang
Details of the current first pass scout drilling were released in a market update on 14 January 2011. The drilling has produced a number of high grade polymetallic intercepts at both East Sontang and Central Sontang. Results are pending from West Sontang and drilling is still continuing.
Drilling has now been completed at both East Sontang (PDD10001 to 10006) and Central Sontang (PDD1 0007 to 10009) for a total of 1052.3 metres.
At North Sontang, pitting is mostly complete and three drill sites are planned to test the widespread copper gold soil anomaly. This is the largest soil anomaly discovered to date sitting on top of limestone.
3. Tandai
The Tandai project is located within the northern part of the Bengkulu Utara IUP, in the Kabupaten of Bengkulu Utara, approximately 100 kilometres north of Bengkulu. Tandai has a long history of formal mining from the early part of the 20th Century until post World War II. The Company?s tenements cOntrol a district in which at least three Dutch companies worked portions of the system. The old Dutch mining town at Tandal still remains, and was re-furbished by PT Lusang Mining Ltd (in a joint venture with CSR, then Billiton) when the mine was redeveloped and worked between 1985 and 1995.
Under the arrangements agreed with Newcrest Mining on 17 August 2010 Newcrest have the right to earn a 70 % interest in the Tandai tenement by spending US$12 million on the project with a minimum spend of $1.75 million. As described in the Corporate section of this report the formal completion of this transaction is close. In the meantime the current exploration program and budget have been agreed with Newcrest and the Newcrest funding will take effect from 1 November 2010.
During the quarter, the Company?s activities have been in the field at both Glumbuk, Toko Rotan and Lusang North. Underground mapping has also been carried out in level 6 and artisanal mine workings.
Glumbuk
Trenching has been completed to follow up spot high Au-in-soil anomalies at this prospect. Three trenches were completed, however, the soil cover is thick and bedrock could not be reached. Channel sampling was conducted along the bottom of the soil horizon with local kaolin + quartz and silica gravel indicative of quartz veining. This horizon is interpreted to be the conglomeratic breccia at the unconformity between the prospective andesite host rocks and overlying post mineral volcaniclastics. No further trenching is planned as the anomalies are most likely related to quartz vein material that has been transported.
Mapping of the veins is largely complete and a further significant result of 1.1 g/t Au was returned from a quartz breccia along the railway access area.
Toko Rotan
The Toko Rotan prospect is located about 1.7 kilometres north of the Company?s base camp. This prospect was outlined by the Company?s consultant geologists as a potential target based on surface manifestation of breccia and veining. The eastern part of the prospect is hosted by andesitic volcanics and the western part is covered by volaniclastics, a similar situation as Tandai.
Geological investigations in the eastern part of the prospect area, close to Dutch dam, have revealed several quartz veins and breccias. In the Lusang River an 8 metre wide zone of hydrothermal crackle breccia occurs hosted by silicified andesite occur and with disseminated pyrite and stains of malachite. About 70 meters north east of the dam silica-clay altered andesitic tuff crops out with zones of quartz and quartz breccia. Results from initial channel sampling have been disappointing, however, the structure is wide and the density of quartz veining quite intense and this zone is being traced to the west.
Geophysics
Planning is now underway for a controlled source audio magnetotelluric technique (CSAMT) survey over the Tandai District to hopefully characterise the signature of quartz/breccia mineralisation. This method could then be used as a tool to explore, especially under cover for shallowly buried vein/breccia systems to the west and north of the outcropping vein systems.
Drilling
The Company is currently sourcing both drilling and helicopter contractors in preparation for an aggressive exploration and drilling program. A first phase program of 4,000 metres of drilling is planned to test the Tandai Lode, Glumbuk and Toko Rotan. The planned budget has been estimated in excess of US$1.75 million and is likely to be helicopter supported which will enable follow up of significant regional anomalies.
4. Musi Rawas/Jambi IUP
Exploration activities have been focused on following up previous vein-style prospects outlined by BTM?s prospective areas at Manggus/Landai and the Upper Minak.
Landai
Follow up trenching at this prospect has not encountered the high grade vein hosted by metasediments. It is believed this vein although high grade has limited strike length and further exploration work has been suspended.
Upper Minak
Mapping has been focused on the Fossil Minak prospect, which is stratigraphically younger and the veins are more likely to be preserved. Rock chip sampling continues to return encouraging but lower grade gold from epithermal veins and there is also the possibility of sediment hosted replacement gold style targets given the high arsenic geochemistry. There have been some non-technical issues that resulted in suspension of exploration activities which will be resolved in the upcoming quarter.
5. Jambi
Exploration has now been focused on follow up of regional gold anomalies within the Jambi IUP where there are extensive alluvial gold occurrences. Two areas, the Meleko and Tembesi areas, have been followed up with systematic stream sediment and reconnaissance exploration. Some very high stream sediment anomalies were returned from The Sungai Meleko up to 1040ppb Au in -80 mesh stream sediments and up to 122 ppb Au for bulk leach extractable (BLEG) gold. These values may be indicative of a potential hard rock gold source hosted by low grade metamorphic rocks.
6. Madina and Kotanopan IUPs
In late October, a reconnaissance sampling and mapping program was carried out in both the Madina and Kotanopan IUPs. A total of sixty nine samples consisted of seventeen -80 mesh stream sediment samples, four BLEG samples, forty four rock chip (float, rock chip and rock channel) samples and four standard samples were collected during the program.
Results have confirmed low to medium level of Au anomaly (9-13 ppb) in the lower to upper part of A. Mais drainage which is located crossing the central part of Kotanopan IUP. Within the Mandailing IUP a low to medium level Au anomaly was detected along the main Aek Sibinael drainage with 10 ppb Au and 14 ppb Au in -80 mesh stream sediment samples.
A series of prospective limestone units, similar to those that host mineralisation in Sontang, from 5 metres to several tenth metres occur intercalated within the metasediments. Clay (?silica)-pyrite altered porphyritic diorite was observed at the Sibinael creek.(end of edited release)