Sumatra Copper & Gold updates Tembang project
Monday, March 28 2011 - 01:17 AM WIB
The drilling programs at Belinau and Berenai targeting and encountering higher grade zones have resulted in an overall more robust and higher grade resource of 23.54 Mt @ 1.32 g/t Au and 17.3 g/t Ag. This represents a 39% increase in grade from the 2009 resource estimate by Snowden.
The Belinau deposit, by itself, represents a potential underground resource of 0.49 Mt @ 8.24 g/t Au and 71.8 g/t Ag. This makes Belinau broadly comparable to Kingsrose Mining?s Way Linggo mine also in Sumatra. Drilling in 2010/11 has added 99,700 ounces Au and 746,400 ounces Ag at an average grade of 9.17g/t Au and 68.7g/t Ag. A recently commissioned scoping study by Mining Plus has confirmed the potential viability of mining Belinau by underground means.
The vein component is now 79% of the total resource mainly due to the decrease in the halo resource. This better reflects the most important style of mineralisation in the deposit. The Measured and indicated categories have also increased from 47% of the total resource to 76%. As presaged in our Tembang drilling update announcement on 12 October 2010 the inferred halo mineralisation has been materially reduced to 12.18 Mt @ 0.54 g/t Au and 7 g/t Ag due to a more rigorous review of the geological model.
The following is an extract from a review by Hellman and Schofield of the methodology and results of the resource modelling which is the work of the Company?s Consulting Resource Geologist, Mr David Stock:
?Sumatra Copper and Gold (?Sumatra?) commissioned Heliman & Schofield Pty Ltd (?H&S?) to review the process used by Sumatra for their updated March 2011 resource estimates. In addition, H&S was asked to comment on the differences between these results and the previously released May 2009 estimates that were completed by an external consulting group. H&S has not assessed the underground potential of Sumatra?s resources.
H&S regards the Sumatra estimation methodology for the primary vein mineralization as being appropriate.
H&S recommends that a different estimation methodology be used for the halo mineralization for the Definitive Feasibility Study. This highly variable and discontinuous mineralization style requires a technique that accounts for the short scale continuity of the higher grade veinlets as well as the longer continuity of the lower grades in order to minimize over-smoothing of higher grades into large volumes of low grade material. H&S concludes that the 2011 estimates are within the meaning of Indicated and Inferred and a change of methodology is unlikely to materially affect these estimates.
There is broad agreement between Sumatra?s 2011 resource estimates of the vein mineralization and the corresponding 2009 results. The total Sumatra 2011 vein resource above a 0.5 g/t Au cutoff is 11.4 Mt of 2.2 g/t Au and 29 g/t Ag (74% of Au ounces is Measured and Indicated) compared with the 2009 estimates of 12.0 Mt of 1.9 g/t Au and 29 g/t Ag (75% of Au ounces is Measured and Indicated). There is an increase of total gold ounces of 9% in the 2011 estimates compared with those of 2009.
The 2009 resource for the halo mineralization above a 0.35 g/t Au cut-off totals 0.9 million ounces (25% Indicated, 75% Inferred) compared with the current estimates above a 0.3 g/t Au cut-off of 0.2 million ounces (85% Indicated, 15% Inferred), a reduction of 77% (i.e. 23% of the 2009 ounces). There is also a 70% reduction in Ag ounces.
H&S concludes that the much larger 2009 halo estimates have primarily resulted from the use of extremely large search radii of up to 600 metres for Inferred Resources coupled with other significantly different estimation parameters. These include variogram models that have lower nuggets and longer ranges of their first structures.?
A 5,000 metre in-fill drilling program is in progress and on its completion Hellman and Schofield will be commissioned to undertake and sign off on the resource estimates which will be the basis for the definitive feasibility study to be carried out in the second half of 2011.
Sumatra?s Managing Director, Jocelyn Wailer, said the updated resource estimates at Tembang underpin the Company?s decision to advance the Project into production.
?We now have an overall higher grade resource dominated by vein style mineralisation, and certainly a robust foundation on which to base the mine development. At Belinau we have a new high grade resource which looks like lending itself to underground exploitation to supplement and sweeten the open pit feed. It?s now all systems go to take this through feasibility into production.? Said Wailer. (ends)