Xanadu Mines is on track to produce a prefeasibility study (PFS) resource update for its Kharmagtai copper-gold project in Mongolia before the end of the year after completing phase-one infill drilling at the site.
Management says the infill program has defined and expanded the volume of higher-grade mineralisation within its Stockwork Hill pit, indicating both grade uplift and resource expansion potential.
The latest results from holes sunk into its Stockwork Hill deposit delivered impressive assays including a massive 424m intercept grading 0.36 per cent copper equivalent from 126m. The hit includes 72.2m at 0.41 per cent copper and 0.6 grams per tonne gold from 126m. A deeper 30.2m section from the same hole going 0.5 per cent copper and 0.76g/t gold for 0.89 per cent copper equivalent was also returned.
The company says the 30.2m zone significantly exceeds the 2021 mineral resource estimate block model of 0.3 per cent copper equivalent. It adds that the intercept is about 120m above the closest high-grade tourmaline breccia drilled in the area, showing significant potential for a grade boost compared to its current resource.
Kharmagtai already hosts an impressive mineral resource estimate of 1.1 billion tonnes for 3 million tonnes of contained copper and 8 million ounces of gold. Additional results from Stockwork Hill show a 421.25m hit going 0.48 per cent copper equivalent from 152.75m, including 62m at 1.05 per cent copper equivalent from 196.75m.
Xanadu Mines executive chairman and managing director Colin Moorhead said: “Hole KHDDH649 is extremely encouraging, intersecting a high-grade steeply dipping tourmaline breccia, adding at least 120 m vertical extension of known higher grade zones. Not only does it highlight potential for significant grade boosts relative to the existing MRE, but also has dragged high-grade mineralisation closer to surface.”
Phase-one infill drilling is now complete at the Stockwork Hill, White Hill and Copper Hill deposits, with assay results for the latter two sites expected this month. The company drilled 80 holes for 33,212m, with results to provide the basis of an interim mineral resource update that is scheduled to be released early next quarter.
Second-phase drilling is now underway, with four diamond rigs at Xanadu’s Golden Eagle, Zephyr and White Hill West deposits. The program is set to be completed before the end of this month.
Exploration drilling is also continuing at Kharmagtai with two diamond rigs. Management expects to provide additional shallow results from the work, in addition to its first ever deep drilling results as soon as next month.
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.
With an interim mineral resource estimate update expected early next quarter, ahead of a predicted PFS resource upgrade before the end of the year, Xanadu could soon garner more market attention by growing its Kharmagtai project once all phases of infill and exploration drilling are complete.
Is your ASX-listed company doing something interesting? Contact: matt.birney@businessnews.com.au
