Bulls N’ Bears Big Hits this week examines some notable drill intercepts revealed on the ASX, including Mithril Silver and Gold Limited’s 4.95-metre intercept in Mexico that assayed 20.5 grams per tonne (g/t) gold and 1833g/t silver.
Variscan Mines’ San Jose Mine in Spain and Redcastle Resources’ Queen Alexandra project in Western Australia’s Eastern Goldfields also reported interesting drill hits.
Let’s dive in.
Mithril Silver and Gold (ASX: MTH)
La Soledad, Copalquin Au-Ag district, Durango State, Mexico.
Hit: 20.5g/t gold, 1833g/t silver over 4.95m
Mithril’s latest diamond core drilling results from its La Soledad Target 1 resource expansion program in Mexico has reported some significant drill intercepts. One hole produced an impressive run of precious metal grades, comprising an overall run of 4.95m at 20.5g/t gold and 1833g/t silver from 107m.
The stand-out intercept includes 0.55m at 110g/t gold and 7530g/t silver from 110m, 0.56m going 22.8g/t gold and 1425g/t silver from 130.49m, and 3.77m running 1.42g/t gold and 100.8g/t silver from 136.78m.
The last run also contained a 0.92m long section assaying 4.97g/t gold and 296.4g/t silver from 136.78m.
Four other drill holes reported significant gold and silver grades up to 15g/t gold and 1130g/t silver.
The company expects a second drill rig to start onsite shortly. This will enable it to drill up to 35,000m this year to advance the two main target areas and contribute to the overall geological understanding of a 10-kilometre-wide epithermal gold-silver system within its 70 square kilometre project area.
The project is within the Copalquin mining district, which has 100 historic underground gold-silver mines and workings and almost 200 open surface workings and pits – many identified by LiDAR scanning. The company has identified several target areas in the district.
One target in the centre of the concession area encloses the El Refugio deposit which, combined with La Soledad, already hosts a maiden high-grade gold-silver JORC-compliant resource totalling 2.4 million tonnes (mt) at an average gold grade of 4.8g/t and silver averaging 141g/t, for a total of 529,000 gold equivalent ounces at an average gold equivalent grade of 6.81g/t.
Mineralisation in the indicated category comprises 28.6 per cent of the resource.
The El Refugio resource is further supported by a conceptual underground mining study completed on the maiden resource in early 2022. Metallurgical testwork was also undertaken in 2022.
Six holes were completed and reported in February at La Soledad, further expanding the footprint and structural knowledge of the north-west trending silver and gold-rich structure. Mithril notes the area exhibits “considerable strike and depth potential”.
Drilling at La Soledad, on the northeastern side of the Target 1 resource area, has returned excellent intercepts ahead of the planned resource update and is ongoing. A further seven holes have been completed and samples from four of the holes have been sent for assays.
Target 1 also contains the La Cometa mineralised zone, where initial drilling identified multiple shallow intercepts. The El Cometa area features broad mineralisation with cross-cutting structures that host high-grade gold and silver, including a 2024 drill hole that intercepted 33m going 31.8g/t gold and 274g/t silver from surface.
The district lies within the renowned Sierra Madre gold-silver trend that extends north-south along the western side of Mexico and hosts many world-class gold and silver deposits.
Multiple mineralising events, young intrusives thought to be heat sources driving mineralisation, widespread alteration, extensive surface vein exposures and dozens of historic mine workings all serve to characterise the Copalquin district as a major epithermal gold-silver centre.
Mithril has successfully delivered a maiden JORC mineral resource estimate within 15 months of kicking off drilling in the Copalquin district and has resoundingly proven its high-grade gold-silver resource potential.
Variscan Mines Ltd (ASX: VAR)
La Caseta (Central) zone, San Jose mine, Novales-Udias project, Spain.
Hit: 15.3m at 17.42 per cent zinc and 4.4 per cent lead
Perth-based Variscan Mines released an impressive base-metal headline result from underground infill drilling at its San Jose mine in Spain, with its best-ever intercept from one hole at the mine.
Variscan Mines’ north-south zone of high-grade sulphides in the northern part of its La Caseta project at the San Jose mine comprises a feeder zone with abundant iron sulphides and high-grade zinc and lead sulphide mineralisation. Credit: File
The headline drill hole is part of a focussed diamond coring program to identify possible feeder zones adjacent to existing measured and indicated resources in the La Caseta (Central) area of the San Jose mine at its more northerly Novales project area.
The program returned exceptional results from all three drill holes put into La Caseta, including the headline intercept that features massive sphalerite in dolostone from 0m to 16.95m.
The result is supported by other excellent responses. A second hole intercepted 14.30m going 8.09 per cent zinc and 1.28 per cent lead, while a third hole jagged 15.25m running 6.10 per cent zinc and 0.46 per cent lead.
The underground infill drilling is believed to have successfully identified one of the mine’s key mineralising feeder systems.
Dolostone or dolomite rock is a magnesium calcium carbonate rock type, while dolomite is the dominant mineral making up the rock. The carbonate rock forms when magnesium and calcium carbonates precipitate from water.
Carbonate-hosted lead-zinc ore deposits are important and highly valuable concentrations of lead and zinc ores hosted within carbonate formations that may contain limestone, marl or dolomite or a combination of the mineral types.
These ore bodies may range from 0.5mt of contained ore to more than 20mt of ore and may grade from 4 per cent combined lead and zinc to more than 14 per cent. The ore bodies tend to be compact, fairly uniform plug-like or pipe-like replacements of their host carbonate sequences and can sustain extremely profitable mines.
San Jose’s mineralisation style is classified as Mississippi Valley-type (MVT) hosted within a stratiform dolomitic unit.
The company’s nearby Novales and Udias projects are separated by about 5.2km along a 12km long north-east/south-west striking prospective trend within the company’s tenure, with the San Jose mine at Novales being the northernmost of the two locations, about 3km south of Spain’s northern coastline.
The projects lie within the Basque-Cantabrian basin, which is one of Europe’s premier zinc-lead regions. The San Jose mine is only 9.5km northwest of the world-class Reocin zinc deposit endowed with 62mt at a grade of 9.7 per cent zinc and 1 per cent lead.
An additional important strategic consideration is that the San Jose mine is 145km east-southeast of Glencore’s Asturias de Zinc smelter, which is one of the biggest such smelters globally.
The combined 2012 JORC-compliant mineral resource estimate for the formerly-producing San Jose mine at Novales and the company’s more southerly Udias deposit is classified within the measured, indicated and inferred categories.
In December last year, Variscan announced an update to its combined mineral resource estimate for both operations, totalling 3.4mt at 7.61 per cent zinc and 0.88 per cent lead, making it the highest-grade zinc development project currently on the ASX. It offers the company strong basis upon which to launch any mine re-start studies.
Measured and indicated resources represent 67 per cent of the San Jose mine resource. The company says its measured grades are higher than any other category or deposit at 9.18 per cent zinc and 1.8 per cent lead.
The core for the headline drill hole was cut mostly on 1m intervals, yielding a best single 1m interval of 34.1 per cent zinc and 12.45 per cent lead. The interval is no orphan, for across the 15.3m intercept, there are six 1m intervals grading above 20 per cent zinc.
At this stage, the Udias deposit carries mineralisation only in the inferred resource category, with exploration work ongoing. Maiden underground drilling at Udias only kicked off in mid-November, following the completion of the underground infill drilling at San Jose.
The style of zinc mineralisation at Udias is identical to that found at the San Jose mine and consists of multiple stacked lenses of high-grade zinc sulphide mineralisation occurring at the same elevations as at San Jose, suggesting there is no vertical offset.
The 12km-long zone features numerous scattered historic workings that appear to be most prolific in the San Jose Central zone.
Variscan is exploring within only about 4.5km of a 12km strike trend featuring abundant historic evidence of extensive, metallurgically simple, MVT-style zinc-lead sulphide mineralisation at shallow depths ranging from 170m to 240m.
The company says the results reported from both Udias and San Jose are significant, producing five of its best-ever 20 drill holes and confirming the quality of the Novales-Udias project and the effectiveness of its drilling program.
Variscan is the only active explorer-developer in Cantabria and with little more than a passing assessment, the company can be seen to command considerable potential for a resource expansion within its extensive tenure.
Redcastle Resources (ASX: RC1)
Queen Alexandra project, Eastern Goldfields, Western Australia
Hit: 4m at 10.94g/t gold from 6m
Redcastle Resources has jagged some strong hits from its recent 6500m reverse circulation drilling program at its Queen Alexandra gold show, about 58km east/southeast of the Gwalia Gold mine at Leonora in Western Australia’s Eastern Goldfields.
The shallow, high-grade results nicely spiced up the program, which Redcastle also managed to knock off under budget, giving it a further 3200m of drilling to play with for a total of 99 holes over 9700m.
The drilling highlights include high-grade intercepts at shallow depths in an undrilled northern area, with a best intercept of 4m at 10.94g/t gold from just 6m depth in one hole and a second hole nailing 4m at 4.79 g/t gold from 8m.
The company kicked off the program in early December last year to expand its existing resources and identify new targets within or near known gold mineralised zones.
The plan also included drilling at nearby Redcastle Reef and was later extended to include the Morgan’s Castle East prospect further east. All three prospects are disposed along an 860m north-west/south-east trend.
The infill pattern at Queen Alexandra was planned to comprise 34 holes each about 80m deep for a total of 2720m on a nominal 25m by 25m grid spacing to follow up on successful drilling program completed in July last year,
Other drilling results from the company’s newly named Kestrel Lode at the Queen Alexandra project include the next three top gold intercepts, with 7m going 10.16g/t from 42m, 3m assaying 6.43g/t from 15m and 2m running 7.78 g/t from 77m.
Three more holes from Kestrel produced intercepts between 2m and 3m long carrying gold grades ranging from 4.09g/t to 5.26g/t. The string of six holes – in concert with previous drilling results - defines locally continuous mineralisation in multiple directions.
Drilling at Queen Alexandra has revealed a new zone of high-grade gold which may represent a near-surface, free-dig, free-milling, high-grade secondary gold resource amenable to carbon-in-leach processing.
Redcastle says the zone justifies further follow-up drilling with a further 17 holes as part of the original program metres and that it is planning bulk sampling of the shallow high-grade mineralisation.
Bulk sampling will further inform a scoping study towards possible toll treatment of the resource, which will follow updating of last year’s maiden mineral resource for the north-dipping stacked shoots at Queen Alexandra, where mineralisation is open in both directions.
Improving the grades with increasing depth represents significant upside potential for Queen Alexandra.
The prospect’s current mineral resource comprises 107,800t at an average grade of 3.06g/t gold for a total of 10,600 ounces of gold. It predominantly comprises material within the oxide and transitional profiles, with minimal fresh material included, to a depth of 50m below surface. That is nominally the maximum depth of drilling.
Redcastle says it now envisages an extensive east-west gold corridor, with the Queen Alexandra project at its core, stretching eastwards to Coronation and possibly further to its Redcastle Reef and Morgan’s Castle East prospects.
With continued exploration, it figures the corridor could extend even further, possibly up to 2.5 km.
Management says the recent results have helped develop a good understanding of the mineralisation, its extent and potential, prompting it to believe that 2025 will be a breakout year for the company.
Confirmation of the extent of shallow, high-grade mineralisation at Queen Alexandra now warrants initiation of the bulk sampling exercise to support a scoping study for an open pit development, which could extend to potential underground development.
Additionally, drilling results from the company’s nearby Redcastle Reef and Morgan’s Castle deposits point to the possibility of satellite open pit developments that could further drive commercial expansion, underpinned by favourable gold prices and available third-party toll treatment.
Is your ASX-listed company doing something interesting? Contact: matt.birney@businessnews.com.au
By Doug Bright
