Xanadu Mines Ltd (
ASX: XAM, TSX:
XAM)
(Xanadu or the
Company) is pleased to provide an exploration
update for the Red Mountain copper-gold district (
Figures 3
and 4), a joint venture with the Japan Oil, Gas and Metals
National Corporation
(JOGMEC JV).
Highlights
- Target program
completed following recent high-grade, shallow intercepts at the
Stairy prospect, including geophysics and trenching
- Geophysics was
completed via a Moving Loop Electromagnetic (MLEM)
survey and identified numerous conductive anomalies
- Trenching is
completed, with assay results expected in the first week of
August
- Drilling program
of approximately 2,450 metres to commence in early August 2021 to
follow up targets identified via MLEM, trenching and previous
high-grade results including:1
- 4m @
15.85% Cu from 55m within
- 16m
grading 4.09% Cu from 54m
- Progressing the
Red Mountain district as a standalone shallow high-grade copper
project, complementing the advanced large-scale Kharmagtai
copper-gold district
Xanadu’s Chief Executive Officer, Dr
Andrew Stewart, said “With our drill targeting program
complete, we’re ready to follow up high-grade drill results from
March. The MLEM survey demonstrated that sulphide mineralisation in
historical trenches coincides with conductive anomalies, and it has
provided us numerous new anomalies to target in our coming drill
program. We believe Stairy has potential to deliver a low capital,
high-grade copper mine in the Red Mountain district, operating in
parallel with a larger porphyry exploration program. We consider
Stairy comparable to other high-grade massive sulphide copper vein
deposits, where very-high grade copper occurs in structures above a
larger porphyry system. Drilling will commence in early August, and
we look forward to further demonstrating the potential of Stairy
and the Red Mountain district.”
Stairy MLEM
The Stairy prospect contains massive sulphide
lenses that coincide with high-grade copper, which are identifiable
using MLEM. A detailed MLEM survey was completed at Stairy,
designed to map the structures that contain the most significant
accumulations of massive sulphide. This data will be used to focus
the drilling program, scheduled to start in two weeks’ time.
The survey is split into two areas, a northern
area and a southern area. Data from both grids have been received
and results can be seen in Figure 1. These results
show moderate to strong Electromagnetic (EM) responses in the late
time channels for known lenses of massive sulphide, but more
importantly show numerous stronger responses in along strike from
known lenses in areas untested by trenching or drilling.
Figure 1. The Stairy Prospect MLEM
plan map (combined 28 Channels) showing conductive
anomalies is available
at https://www.globenewswire.com/NewsRoom/AttachmentNg/6ccfe79f-efeb-407b-854a-9c803862c8d6
Stairy Trenching
In parallel with the MLEM survey, approximately
1,000 metres of trenching was completed at Stairy (Figure
2), designed to obtain geological (structural) data
relating to the zones of mineralisation associated with previous
company trenches.
This data will be used to model these lenses of
mineralisation and target drilling. Assay results for the trenching
is expected in the first week of August.
FIGURE 2: The Stairy Prospect
historic trench results and location of recent XAM
Trenching 2 is available
at https://www.globenewswire.com/NewsRoom/AttachmentNg/a8bde189-268b-43b0-b514-288c0a51e6af
Stairy Drilling Program
MLEM and trenching results will inform a planned
2,450 metre drilling program in the Red Mountain district, to be
completed in August and September 2021. The program will focus
primarily on the massive sulphide mineralisation at Stairy, with an
objective to delineate a near surface, low tonnage, high grade
copper deposit.
This will build on recent drilling at Stairy
which returned significant shallow high-grade copper in drill hole
OUDDH100 with 16m @ 4.09% Cu from 54m, including
4m @ 15.85% Cu from 55m. 3
About Stairy
The Stairy prospect consists of a 1.5km by 1km
zone of sheeted mineralised structures hosted within the Stairy
Intrusive in the central east of the Red Mountain Mining Lease
(Figure 3). These structures are interpreted to be
sub-vertical, up to twenty-four meters wide and can extend for over
a kilometre.
Copper mineralisation at Stairy consists of
massive bornite and chalcopyrite sulphide with quartz carbonate
fill. The current geological interpretations suggest these sheeted
structures may be linked to a large-scale porphyry system at
depth.
FIGURE 3: The Red Mountain Mining
Licence showing ground Landsat data and the location of the
priority targets including Stairy is available
at https://www.globenewswire.com/NewsRoom/AttachmentNg/07348fe3-8238-4df8-8220-f8ea27a11c14
About Red Mountain
The Red Mountain district is located within the
Dornogovi Province of southern Mongolia, approximately 420
kilometres southeast of Ulaanbaatar (Figure 4) and
is a joint venture between Xanadu and JOGMEC, in which JOGMEC may
earn up to 51% beneficial interest in the project by sole funding
up to $US7.2 million in exploration expenditure over the next 4
years.
Red Mountain covers approximately 57 square
kilometres in a frontier terrane with significant mineral
endowment, and it has a granted 30-year mining licence. Red
Mountain comprises a cluster of outcropping mineralising porphyry
intrusions which display features typically found in the shallower
parts of porphyry systems where narrow dykes and patchy
mineralisation branch out above a mineralised stock. This includes
multiple porphyry copper-gold centres, mineralised tourmaline
breccia pipes copper-gold/base metal skarns and high-grade
epithermal gold veins.
FIGURE 4: Location of the Red
Mountain JOGMEC JV Project in the South Gobi porphyry copper
belt is available
at https://www.globenewswire.com/NewsRoom/AttachmentNg/765d6965-d7ea-4404-98b4-3d063b14adba
About Xanadu Mines
Xanadu is an ASX and TSX listed Exploration
company operating in Mongolia. We give investors exposure to
globally significant, large scale copper-gold discoveries and
low-cost inventory growth. Xanadu maintains a portfolio of
exploration projects and remains one of the few junior explorers on
the ASX or TSX who control an emerging Tier 1 copper-gold deposit
in our flagship Kharmagtai project. For information on Xanadu
visit: www.xanadumines.com.
For further information, please contact:
Andrew StewartChief Executive OfficerT: +61 2 8280 7497
M: +61 409 819 922E:
Andrew.stewart@xanadumines.com
W: www.xanadumines.com
This Announcement was authorised for release by
Xanadu’s Board of Directors.
Appendix 1: Drilling Results
There have been no new drilling results at Red
Mountain. Assay results from recent trenching are expected in the
first week of August 2021.
Appendix 2: Statements and Disclaimers
Competent Person Statement
The information in this announcement that
relates to exploration results is based on information compiled by
Dr Andrew Stewart, who is responsible for the exploration data,
comments on exploration target sizes, QA/QC and geological
interpretation and information. Dr Stewart, who is an employee of
Xanadu and is a Member of the Australasian Institute of
Geoscientists, has sufficient experience relevant to the style of
mineralisation and type of deposit under consideration and to the
activity he is undertaking to qualify as the “Competent Person” as
defined in the 2012 Edition of the Australasian Code for Reporting
Exploration Results, Mineral Resources and Ore Reserves and the
National Instrument 43-101. Dr Stewart consents to the inclusion in
the report of the matters based on this information in the form and
context in which it appears.
Copper Equivalent
Calculations
The copper equivalent (eCu)
calculation represents the total metal value for each metal,
multiplied by the conversion factor, summed and expressed in
equivalent copper percentage with a metallurgical recovery factor
applied. The copper equivalent calculation used is based off the
eCu calculation defined by CSA in the 2018 Mineral Resource
Upgrade.4
Copper equivalent (eCu) grade
values were calculated using the following formula:
eCu = Cu + Au * 0.62097 * 0.8235,
Where Cu = copper grade (%); Au
= gold grade (gold per tonne (g/t)); 0.62097 =
conversion factor (gold to copper); and 0.8235 = relative recovery
of gold to copper (82.35%).
The copper equivalent formula was based on the
following parameters (prices are in USD): Copper price = 3.1 $/lb
(or 6,834 $ per tonne ($/t)); Gold price = 1,320 $
per ounce ($/oz); Copper recovery = 85%; Gold
recovery = 70%; and Relative recovery of gold to copper = 70% / 85%
= 82.35%.
Forward-Looking Statements
Certain statements contained in this
Announcement, including information as to the future financial or
operating performance of Xanadu and its projects may also include
statements which are ‘forward‐looking statements’ that may include,
amongst other things, statements regarding targets, estimates and
assumptions in respect of mineral reserves and mineral resources
and anticipated grades and recovery rates, production and prices,
recovery costs and results, capital expenditures and are or may be
based on assumptions and estimates related to future technical,
economic, market, political, social and other conditions. These
‘forward-looking statements’ are necessarily based upon a number of
estimates and assumptions that, while considered reasonable by
Xanadu, are inherently subject to significant technical, business,
economic, competitive, political and social uncertainties and
contingencies and involve known and unknown risks and uncertainties
that could cause actual events or results to differ materially from
estimated or anticipated events or results reflected in such
forward‐looking statements.
Xanadu disclaims any intent or obligation to
update publicly or release any revisions to any forward‐looking
statements, whether as a result of new information, future events,
circumstances or results or otherwise after the date of this
Announcement or to reflect the occurrence of unanticipated events,
other than required by the Corporations Act 2001 (Cth) and the
Listing Rules of the Australian Securities Exchange
(ASX) and Toronto Stock Exchange
(TSX). The words ‘believe’, ‘expect’,
‘anticipate’, ‘indicate’, ‘contemplate’, ‘target’, ‘plan’,
‘intends’, ‘continue’, ‘budget’, ‘estimate’, ‘may’, ‘will’,
‘schedule’ and similar expressions identify forward‐looking
statements.
All ‘forward‐looking statements’ made in this
Announcement are qualified by the foregoing cautionary statements.
Investors are cautioned that ‘forward‐looking statements’ are not
guarantee of future performance and accordingly investors are
cautioned not to put undue reliance on ‘forward‐looking statements’
due to the inherent uncertainty therein.
For further information please visit the Xanadu
Mines’ Website at www.xanadumines.com.
Appendix 3: Red Mountain Table 1 (JORC
2012)
Set out below is Section 1 and Section 2 of
Table 1 under the JORC Code, 2012 Edition for the Red Mountain
project. Data provided by Xanadu. This Table 1 updates the JORC
Table 1 disclosure dated 18 September 2017.5
1.1 JORC TABLE 1 -
SECTION 1 - SAMPLING TECHNIQUES AND DATA
Criteria |
JORC Code explanation |
Commentary |
Sampling techniques |
- Nature and
quality of sampling (e.g. cut channels, random chips, or specific
specialised industry standard measurement tools appropriate to the
minerals under investigation, such as down hole gamma sondes, or
handheld XRF instruments, etc). These examples should not be taken
as limiting the broad meaning of sampling.
- Include
reference to measures taken to ensure sample representivity and the
appropriate calibration of any measurement tools or systems
used.
- Aspects of the
determination of mineralisation that are Material to the Public
Report.
- In cases where
‘industry standard’ work has been done this would be relatively
simple (e.g. ‘reverse circulation drilling was used to obtain 1 m
samples from which 3 kg was pulverised to produce a 30 g charge for
fire assay’). In other cases, more explanation may be required,
such as where there is coarse gold that has inherent sampling
problems. Unusual commodities or mineralisation types (e.g.
submarine nodules) may warrant disclosure of detailed
information.
|
- The EM survey
was conducted on 25m spaces stations on 50m spaced lines.
- The EM loop used
is a 50m by 50m loop.
- The average
current used is 25-30Amps.
- The EM
transmitted being used is a Zonge GGT-30.
- The EM Receiver
being used is a Zonge GDP-30.
- The EM Antenna
being used is a Zonge ANT/6.
- The exploration
results are based on diamond drill core samples, reverse
circulation (RC) chip samples and channel samples
from surface trenches.
- Representative ½
core samples were split from PQ, HQ & NQ diameter diamond drill
core on site using rock saws, on a routine two metre sample
interval that also honors lithological/intrusive contacts.
- The orientation
of the cut line is controlled using the core orientation line
ensuring uniformity of core splitting wherever the core has been
successfully oriented.
- Sample intervals
are defined and subsequently checked by geologists, and sample tags
are attached (stapled) to the plastic core trays for every sample
interval.
- RC chip samples
are ¼ splits from 1m intervals using a 75%:25% riffle splitter to
obtain a 3kg sample.
- RC samples are
uniform 2m samples formed from the combination of two ¼ split 1m
samples.
- Trench samples
are collected as 2m composite from 30m above the trench toe.
- Sampling
generally honors lithological contacts.
- Trench samples
are continuous along the length of the trench
|
Drilling techniques |
- Drill type (e.g.
core, reverse circulation, open-hole hammer, rotary air blast,
auger, Bangka, sonic, etc.) and details (e.g. core diameter, triple
or standard tube, depth of diamond tails, face-sampling bit or
other type, whether core is oriented and if so, by what method,
etc.).
|
- The exploration
results are based upon diamond drilling of PQ, HQ and NQ diameters
with both standard and triple tube core recovery configurations, RC
drilling and surface trenching with channel sampling.
- All drill core
drilled by Xanadu has been oriented using the “Reflex Ace”
tool.
|
Drill sample recovery |
- Method of
recording and assessing core and chip sample recoveries and results
assessed.
- Measures taken
to maximise sample recovery and ensure representative nature of the
samples.
- Whether a
relationship exists between sample recovery and grade and whether
sample bias may have occurred due to preferential loss/gain of
fine/coarse material.
|
- Diamond drill
core recoveries were assessed using the standard industry (best)
practice which involves: removing the core from core trays;
reassembling multiple core runs in a v-rail; measuring core lengths
with a tape measure, assessing recovery against core block depth
measurements and recording any measured core loss for each core
run.
- Diamond core
recoveries average 97% through mineralization.
- Overall, core
quality is good, with minimal core loss. Where there is localized
faulting and or fracturing core recoveries decrease, however, this
is a very small percentage of the mineralized intersections.
- RC recoveries
are measured using whole weight of each 1m intercept measured
before splitting
- Analysis of
recovery results vs grade shows no significant trends that might
indicate sampling bias introduced by variable recovery in
fault/fracture zones.
|
Logging |
- Whether core and
chip samples have been geologically and geotechnically logged to a
level of detail to support appropriate Mineral Resource estimation,
mining studies and metallurgical studies.
- Whether logging
is qualitative or quantitative in nature. Core (or costean,
channel, etc.) photography.
- The total length
and percentage of the relevant intersections logged.
|
- All drill core
is geologically logged by well-trained geologists using a modified
“Anaconda-style” logging system methodology. The Anaconda method of
logging and mapping is specifically designed for porphyry Cu-Au
mineral systems.
- Logging of
lithology, alteration and mineralogy is intrinsically qualitative
in nature. However, the logging is subsequently supported by 4 Acid
ICP-MS (48 element) geochemistry and SWIR spectral mineralogy
(facilitating semi-quantitative / calculated mineralogical,
lithological and alteration classification) which is integrated
with the logging to improve cross section interpretation and 3D
geological model development.
- Drill core is
also systematically logged for both geotechnical features and
geological structures. Where drill core has been successfully
oriented, the orientation of structures and geotechnical features
are also routinely measured.
- Both wet and dry
core photos are taken after core has been logged and marked-up but
before drill core has been cut.
|
Sub -sampling techniques and sample
preparation |
- If core, whether
cut or sawn and whether quarter, half or all core taken.
- If non-core,
whether riffled, tube sampled, rotary split, etc and whether
sampled wet or dry.
- For all sample
types, the nature, quality and appropriateness of the sample
preparation technique.
- Quality control
procedures adopted for all sub-sampling stages to maximise
representivity of samples.
- Measures taken
to ensure that the sampling is representative of the in-situ
material collected, including for instance results for field
duplicate/second-half sampling.
- Whether sample
sizes are appropriate to the grain size of the material being
sampled.
|
- All drill core
samples are ½ core splits from either PQ, HQ or NQ diameter cores.
A routine 2m sample interval is used, but this is varied locally to
honour lithological/intrusive contacts. The minimum allowed sample
length is 30cm.
- Core is
appropriately split (onsite) using diamond core saws with the cut
line routinely located relative to the core orientation line (where
present) to provide consistency of sample split selection.
- The diamond saws
are regularly flushed with water to minimize potential
contamination.
- A field
duplicate ¼ core sample is collected every 30th sample to ensure
the “representivity of the in-situ material collected”. The
performance of these field duplicates is routinely analysed as part
of Xanadu’s sample QC process.
- Routine sample
preparation and analyses of DDH samples were carried out by ALS
Mongolia LLC (ALS Mongolia), who operates an
independent sample preparation and analytical laboratory in
Ulaanbaatar.
- All samples were
prepared to meet standard quality control procedures as follows:
Crushed to 75% passing 2mm, split to 1kg, pulverised to 85% passing
200 mesh (75 microns) and split to 150g sample pulp.
- ALS Mongolia
Geochemistry labs quality management system is certified to ISO
9001:2008.
- The sample
support (sub-sample mass and comminution) is appropriate for the
grainsize and Cu-Au distribution of the porphyry Cu-Au
mineralization and associated host rocks.
- Trench samples
by previous explorers between 2001 to 2007 were prepared and
assayed by SGS Mongolia.
|
Quality of assay data and laboratory tests |
- The nature,
quality and appropriateness of the assaying and laboratory
procedures used and whether the technique is considered partial or
total.
- For geophysical
tools, spectrometers, handheld XRF instruments, etc, the parameters
used in determining the analysis including instrument make and
model, reading times, calibrations factors applied and their
derivation, etc.
- Nature of
quality control procedures adopted (e.g. standards, blanks,
duplicates, external laboratory checks) and whether acceptable
levels of accuracy (i.e. lack of bias) and precision have been
established.
|
- All XAM samples
were routinely assayed by ALS Mongolia for gold.
- Au is determined
using a 25g fire assay fusion, cupelled to obtain a bead, and
digested with Aqua Regia, followed by an atomic absorption
spectroscopy (AAS) finish, with a lower detection
(LDL) of 0.01 ppm.
- All samples were
also submitted to ALS Mongolia for the 48-element package ME-ICP61
using a four-acid digest (considered to be an effective total
digest for the elements relevant to the MRE). Where copper is
over-range (>1% Cu), it is analysed by a second analytical
technique (Cu-OG62), which has a higher upper detection limit
(UDL) of 5% copper.
- Quality
assurance has been managed by insertion of appropriate Standards
(1:30 samples - suitable Ore Research Pty Ltd certified standards),
Blanks (1:30 samples), Duplicates (1:30 samples - ¼ core duplicate)
by XAM.
- Assay results
outside the optimal range for methods were re-analysed by
appropriate methods.
- Ore Research Pty
Ltd certified copper and gold standards have been implemented as a
part of QC procedures, as well as coarse and pulp blanks, and
certified matrix matched copper-gold standards.
- QC monitoring is
an active and ongoing processes on batch-by-batch basis by which
unacceptable results are re-assayed as soon as practicable.
- Prior to 2014:
Cu, Ag, Pb, Zn, As and Mo were routinely determined using a
three-acid-digestion of a 0.3g sub-sample followed by an AAS finish
(AAS21R) at SGS Mongolia. Samples were digested with nitric,
hydrochloric and perchloric acids to dryness before leaching with
hydrochloric acid to dissolve soluble salts and made to 15ml volume
with distilled water. The LDL for copper using this technique was
2ppm. Where copper was over-range (>1% Cu), it was analysed by a
second analytical technique (AAS22S), which has a higher upper
detection limit (UDL) of 5% copper. Gold analysis
method was essentially unchanged.
- Trenching
samples from 2001 to 2007 were analysed for 6 elements (Cu, Ag, Pb,
Zn, As and Mo) by SGS Mongolia using a three-acid-digestion of a
0.3g sub-sample followed by an AAS finish (AAS21R). Samples were
digested with nitric, hydrochloric and perchloric acids to dryness
before leaching with hydrochloric acid to dissolve soluble salts
and made to 15ml volume with distilled water. The LDL for copper
using this technique was 2ppm. Where copper was over-range (>1%
Cu), it was analysed by a second analytical technique (AAS22S),
which has a higher upper detection limit (UDL) of
5% copper. Gold analysis method was essentially unchanged.
|
Verification of sampling and assaying |
- The verification
of significant intersections by either independent or alternative
company personnel.
- The use of
twinned holes.
- Documentation of
primary data, data entry procedures, data verification, data
storage (physical and electronic) protocols.
- Discuss any
adjustment to assay data.
|
- All assay data
QA/QC is checked prior to loading into XAM’s Geobank data
base.
- The data is
managed by XAM geologists.
- The data base
and geological interpretation is managed by XAM.
- Check assays are
submitted to an umpire lab (SGS Mongolia) for duplicate
analysis.
- No twinned drill
holes exist.
- There have been
no adjustments to any of the assay data.
|
Location of data points |
- Accuracy and
quality of surveys used to locate drill holes (collar and down-hole
surveys), trenches, mine workings and other locations used in
Mineral Resource estimation.
- Specification of
the grid system used.
- Quality and
adequacy of topographic control.
|
- Diamond drill
holes have been surveyed with a differential global positioning
system (DGPS) to within 10cm accuracy.
- The grid system
used for the project is UTM WGS-84 Zone 49N
- Historically,
Eastman Kodak and Flexit electronic multi-shot downhole survey
tools have been used at Red Mountain to collect down hole azimuth
and inclination information for the majority of the diamond drill
holes. Single shots were typically taken every 30m to 50m during
the drilling process, and a multi-shot survey with readings every
3-5m are conducted at the completion of the drill hole. As these
tools rely on the earth’s magnetic field to measure azimuth, there
is some localised interference/inaccuracy introduced by the
presence of magnetite in some parts of the Red Mountain mineral
system. The extent of this interference cannot be quantified on a
reading-by-reading basis.
- More recently
(since September 2017), a north-seeking gyro has been employed by
the drilling crews on site (rented and operated by the drilling
contractor), providing accurate downhole orientation measurements
unaffected by magnetic effects. Xanadu have a permanent calibration
station setup for the gyro tool, which is routinely calibrated
every 2 weeks (calibration records are maintained and were
sighted).
- The project DTM
is based on 1 m contours from satellite imagery with an accuracy of
±0.1 m.
- Trenching
locations for trenches between 2001 and 2007 were located using a
handheld GPS.
- EM survey
locations were located using a handheld GPS.
|
Data spacing and distribution |
- Data spacing for
reporting of Exploration Results.
- Whether the data
spacing, and distribution is sufficient to establish the degree of
geological and grade continuity appropriate for the Mineral
Resource and Ore Reserve estimation procedure(s) and
classifications applied.
- Whether sample
compositing has been applied.
|
- The EM survey
was collected on 25m spaced stations on 50m spaced lines.
- Holes spacings
range from <50m spacings within the core of mineralization to
+500m spacings for exploration drilling. Hole spacings can be
determined using the sections and drill plans provided.
- Holes range from
vertical to an inclination of -60 degrees depending on the attitude
of the target and the drilling method.
- The data spacing
and distribution is sufficient to establish anomalism and targeting
for porphyry Cu-Au, tourmaline breccia and epithermal target
types.
- Holes have been
drilled to a maximum of 1,300m vertical depth.
- The data spacing
and distribution is sufficient to establish geological and grade
continuity.
|
Orientation of data in relation to geological
structure |
- Whether the
orientation of sampling achieves unbiased sampling of possible
structures and the extent to which this is known, considering the
deposit type.
- If the
relationship between the drilling orientation and the orientation
of key mineralised structures is considered to have introduced a
sampling bias, this should be assessed and reported if
material.
|
- EM survey lines
are roughly perpendicular to the interpreted structures.
- Drilling is
conducted in a predominantly regular grid to allow unbiased
interpretation and targeting.
- Scissor
drilling, as well as some vertical and oblique drilling, has been
used in key mineralised zones to achieve unbiased sampling of
interpreted structures and mineralised zones, and in particular to
assist in constraining the geometry of the mineralised hydrothermal
tourmaline-sulphide breccia domains.
|
Sample security |
- The measures
taken to ensure sample security.
|
- Samples are
delivered from the drill rig to the core shed twice daily and are
never left unattended at the rig.
- Samples are
dispatched from site in locked boxes transported on XAM company
vehicles to ALS lab in Ulaanbaatar.
- Sample shipment
receipt is signed off at the Laboratory with additional email
confirmation of receipt.
- Samples are then
stored at the lab and returned to a locked storage site.
|
Audits or reviews |
- The results of
any audits or reviews of sampling techniques and data.
|
- The EM data is
being QA/QC’d and reviewed by an independent geophysical consultant
Barry de Wet.
- Internal audits
of sampling techniques and data management are undertaken on a
regular basis, to ensure industry best practice is employed at all
times.
- External reviews
and audits have been conducted by the following groups:
- 2012: AMC
Consultants Pty Ltd. was engaged to conduct an Independent
Technical Report which reviewed drilling and sampling procedures.
It was concluded that sampling and data record was to an
appropriate standard.
- 2013: Mining
Associates Ltd. was engaged to conduct an Independent Technical
Report to review drilling, sampling techniques and QAQC. Methods
were found to conform to international best practice.
|
1.2 JORC TABLE 1 -
SECTION 2 - REPORTING OF EXPLORATION RESULTS
(Criteria in this section apply to all succeeding sections).
Criteria |
JORC Code (Section 2) Explanation |
Commentary |
Mineraltenementand
landtenurestatus |
- Type, reference
name/number, location and ownership including agreements or
material issues with third parties such as joint ventures,
partnerships, overriding royalties, native title interests,
historical sites, wilderness or national park and environmental
settings.
- The security of
the tenure held at the time of reporting along with any known
impediments to obtaining a license to operate in the area.
|
- The Project
comprises 1 Mining Licence (MV-17129A).
- Xanadu now owns
90% of Vantage LLC, the 100% owner of the Oyut Ulaan mining
licence.
- The Mongolian
Minerals Law (2006) and Mongolian Land Law (2002) govern
exploration, mining and land use rights for the project.
|
Explorationdone
byotherparties |
- Acknowledgment
and appraisal of exploration by other parties.
|
- Previous
exploration was conducted by Quincunx Ltd, Ivanhoe Mines Ltd and
Turquoise Hill Resources Ltd including extensive drilling, surface
geochemistry, geophysics, mapping.
|
Geology |
- Deposit type,
geological setting and style of mineralisation.
|
- The
mineralisation is characterised as porphyry copper-gold type.
- Porphyry
copper-gold deposits are formed from magmatic hydrothermal fluids
typically associated with felsic intrusive stocks that have
deposited metals as sulphides both within the intrusive and the
intruded host rocks. Quartz stockwork veining is typically
associated with sulphides occurring both within the quartz veinlets
and disseminated thought out the wall rock. Porphyry deposits are
typically large tonnage deposits ranging from low to high grade and
are generally mined by large scale open pit or underground bulk
mining methods. The deposits at Red Mountain are atypical in that
they are associated with intermediate intrusions of diorite to
quartz diorite composition; however the deposits are in terms of
contained gold significant, and similar gold-rich porphyry
deposits.
|
Drill holeInformation |
- A summary of all
information material to the understanding of the exploration
results including a tabulation of the following information for all
Material drill holes:
- easting and
northing of the drill hole collar.
- elevation or RL
Reduced Level - elevation above sea level in metres) of the drill
hole collar.
- dip and azimuth
of the hole
- down hole length
and interception depth
- hole
length.
- If the exclusion
of this information is justified on the basis that the information
is not Material and this exclusion does not detract from the
understanding of the report, the Competent Person should clearly
explain why this is the case.
|
- Diamond drill
holes are the principal source of geological and grade data for the
Project.
- See figures in
this ASX/TSX Announcement.
|
DataAggregation methods |
- In reporting
Exploration Results, weighting averaging techniques, maximum and/or
minimum grade truncations (e.g. cutting of high grades) and cut-off
grades are usually Material and should be stated.
- Where aggregate
intercepts incorporate short lengths of high grade results and
longer lengths of low grade results, the procedure used for such
aggregation should be stated and some typical examples of such
aggregations should be shown in detail.
- The assumptions
used for any reporting of metal equivalent values should be clearly
stated.
|
- A nominal
cut-off of 0.1% eCu is used in copper dominant systems for
identification of potentially significant intercepts for reporting
purposes. Higher grade cut-offs are 0.3%, 0.6% and 1% eCu.
- A nominal
cut-off of 0.1g/t eAu is used in gold dominant systems like for
identification of potentially significant intercepts for reporting
purposes. Higher grade cut-offs are 0.3g/t, 0.6g/t and 1g/t
eAu.
- Maximum
contiguous dilution within each intercept is 9m for 0.1%, 0.3%,
0.6% and 1% eCu.
- Most of the
reported intercepts are shown in sufficient detail, including
maxima and subintervals, to allow the reader to make an assessment
of the balance of high and low grades in the intercept.
- Informing
samples have been composited to two metre lengths honouring the
geological domains and adjusted where necessary to ensure that no
residual sample lengths have been excluded (best fit).
-
The copper equivalent (eCu) calculation represents
the total metal value for each metal, multiplied by the conversion
factor, summed and expressed in equivalent copper percentage with a
metallurgical recovery factor applied.
- Copper
equivalent (CuEq or eCu) grade
values were calculated using the following formula:
-
eCu or CuEq = Cu + Au * 0.62097 * 0.8235,
- Gold
Equivalent (eAu) grade values were calculated
using the following formula:
-
eAu = Au + Cu / 0.62097 * 0.8235.
- Where:
-
Cu - copper
grade (%)
-
Au - gold
grade (g/t)
- 0.62097
- conversion factor
(gold to copper)
-
0.8235 - relative
recovery of gold to copper (82.35%)
- The copper
equivalent formula was based on the following parameters (prices
are in USD):
- Copper
price - 3.1
$/lb (or 6834 $/t)
- Gold
price - 1320
$/oz
- Copper
recovery - 85%
- Gold
recovery - 70%
- Relative
recovery of gold to copper = 70% / 85% = 82.35%.
|
Relationship between mineralisationon
widthsand
interceptlengths |
- These
relationships are particularly important in the reporting of
Exploration Results.
- If the geometry
of the mineralisation with respect to the drill hole angle is
known, its nature should be reported.
- If it is not
known and only the down hole lengths are reported, there should be
a clear statement to this effect (e.g. ‘down hole length, true
width not known’).
|
- Mineralised
structures are variable in orientation, and therefore drill
orientations have been adjusted from place to place in order to
allow intersection angles as close as possible to true widths.
- Exploration
results have been reported as an interval with 'from' and 'to'
stated in tables of significant economic intercepts. Tables clearly
indicate that true widths will generally be narrower than those
reported.
|
Diagrams |
- Appropriate maps
and sections (with scales) and tabulations of intercepts should be
included for any significant discovery being reported These should
include, but not be limited to a plan view of drill hole collar
locations and appropriate sectional views.
|
- See figures in
this ASX/TSX Announcement.
|
BalancedReporting |
- Where
comprehensive reporting of all Exploration Results is not
practicable, representative reporting of both low and high grades
and/or widths should be practiced to avoid misleading reporting of
Exploration Results.
|
- Exploration
results have been reported at a range of cut-off grades, above a
minimum suitable for open pit mining, and above a minimum suitable
for underground mining.
|
Othersubstantiveexplorationdata |
- Other
exploration data, if meaningful and material, should be reported
including (but not limited to): geological observations;
geophysical survey results; geochemical survey results; bulk
samples – size and method of treatment; metallurgical test results;
bulk density, groundwater, geotechnical and rock characteristics;
potential deleterious or contaminating substances.
|
- Extensive work
in this area has been done and is reported separately.
|
FurtherWork |
- The nature and
scale of planned further work (e.g. tests for lateral extensions or
depth extensions or large-scale step-out drilling).
- Diagrams clearly
highlighting the areas of possible extensions, including the main
geological interpretations and future drilling areas, provided this
information is not commercially sensitive.
|
- The
mineralisation is open at depth and along strike.
- Current
estimates are restricted to those expected to be reasonable for
open pit mining. Limited drilling below this depth (-300m RLl)
shows widths and grades potentially suitable for underground
extraction.
- Exploration on
going.
|
1.3 JORC TABLE 1 - SECTION 3
ESTIMATION AND REPORTING OF MINERAL RESOURCES
Mineral Resources are not reported so this is
not applicable to this report.
1.4 JORC TABLE 1 -
SECTION 4 ESTIMATION AND REPORTING OF ORE RESERVES
Ore Reserves are not reported so this is not
applicable to this report.
___________________________________________
1 ASX/TSX Announcement 23 March 2021 - Shallow Bornite
Mineralisation at Red Mountain2 ASX/TSX Announcement 16 June 2021 -
Multiple strong MLEM conductors detected at Stairy3 ASX/TSX
Announcement 23 March 2021 - Shallow Bornite Mineralisation at Red
Mountain4 ASX Announcement 31 October 2018 - Major increase in
Kharmagtai Open-Cut Resource to 1.9Mt Cu & 4.3Moz AU5 ASX
Announcement 18 September 2017 - New High-Grade Zone discovered at
Stockwork Hill
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