TIDMALBA
RNS Number : 9479F
Alba Mineral Resources PLC
20 November 2020
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Alba Mineral Resources plc
("Alba" or the "Company")
Award of Exploration Licence over Gwynfynydd Gold Mine, North
Wales
Progress Report on Clogau-St David's Gold Mine, North Wales
Alba Mineral Resources plc (AIM: ALBA) is pleased to report that
the Company has been awarded the exclusive exploration rights to
the Gwynfynydd Gold Mine in north Wales. The Gwynfynydd Gold Mine
is the second largest producer of gold in the UK's history, after
the Clogau-St David's Gold Mine. With this award, Alba now has the
exclusive exploration rights over the entire length of the
Dolgellau Gold Belt. In this release, the Company also reports on
the progress of work activities at the Clogau St-David's Gold Mine
in north Wales.
Key Points
Gwynfynydd Gold Mine
-- Six-year mineral exploration licence granted to Alba
-- Gwynfynydd Gold Mine has historically produced around 45,000
ounces of gold at a mining grade of 15 grams/tonne. Commercial
operations at Gwynfynydd ceased in 1999 when the gold price was
only around US$300 per ounce
-- Gwynfynydd shares many of the same geological and
mineralogical characteristics of Clogau, enabling Alba to roll out
the same modern exploration and development methods as have been
successfully deployed at Clogau-St David's
Clogau-St David's Gold Mine
-- Surface drilling at Clogau-St David's progressing well, with
drill hole LL001 completed for 183.5 metres and LL002 currently in
progress
-- Pilot processing plant due for delivery and installation by December 2020
-- Alba now has the benefit of a stand-alone bulk sampling lease
entitling the Company to sell all gold recovered, subject to the
payment of a royalty
Alba's Executive Chairman, George Frangeskides, commented:
"We are delighted to have secured the exclusive mineral
exploration rights to the Gwynfynydd Gold Mine and its surrounding
exploration ground. Alba now has the exclusive exploration rights
across the entire length of the Dolgellau Gold Belt."
"Gwynfynydd shares many of the same characteristics and the same
geological setting as Clogau-St David's, and as such we intend to
approach the exploration and development activities at Gwynfynydd
in much the same way as we have done at Clogau, using all the tools
in the extensive modern-day exploration tool-box, from underground
3D mine scanning to geochemical soil sampling, surface trenching,
diamond drilling and bulk sampling."
"Alba has now reunited the two key mines in the Dolgellau Gold
Field, Clogau and Gwynfynydd, meaning that we can now roll out our
regional exploration programme, which identified no fewer than 10
new gold targets over our
Clogau licence area, to the Gwynfynydd licence area too. We are really excited to begin work."
Gwynfynydd Gold Mine: Overview
The Gwynfynydd Gold Mine ("Gwynfynydd" or the "Mine") is located
close to the town of Ganllwyd in the county of Gwynedd, north Wales
(see Figure 1 in the PDF version of this RNS). Gwynfynydd lies
within the Dolgellau Gold Belt (or Gold Field), a known geological
formation which forms an arc approximately 26 km long by 6 km wide
around the south-eastern and eastern margins of the Harlech Dome
(see Figure 2 in the PDF version of this RNS).
The quartz vein (or lode) at Gwynfynydd was discovered in 1860
and started commercial development in 1887. The Gwynfynydd Mine has
produced around 45,000 ounces (around 1.3 tonnes) of gold since
inception with a historical mining grade of 15 grams of gold per
tonne (" g/t Au"). Gwynfynydd became one of the most important
mines in the Dolgellau Gold Field and, together with the Clogau -St
David's Gold Mine, contributed some 95% of the total gold output
from the area. Clogau and Gwynfynydd are the only two mines which
have operated as recently as the late 20(th) Century.
At Gwynfynydd, production last took place between 1991 and 1999
, when 10,000 tonnes of ore was extracted annually from a total
estimated resource base of 180,000 tonnes. All the 20(th) Century
production came from the Chidlaw Link Zone, which varies in
thickness from one to eight metres. When commercial operations
ceased in 1999, the gold price was only around US$300 per
ounce.
A potentially significant target is located below and to the
east of the Chidlaw Link Zone . This deep zone, more than 250
metres below surface, was tested by only a single diamond drill
hole from surface (drilled in 1992) and is constrained by faults
which are known from surface and underground mapping.
The Collett Lode was separately estimated at the time to contain
20,000 tonnes at a grade of between 5 g/t Au to 8 g/t Au between
the No 2 and 6 Levels, west of the Link Zone. Tonnage was based on
projected volumes of reef between the two levels and grade based on
historical gold yields, not based on drilling or sampling as
such.
In 1985, an underground drilling programme was undertaken at
Gwynfynydd. The exploration programme included twelve drill holes
totalling 810 metres, which were drilled from the Mine's Number 6
Level to investigate the Chidlaw Link Zone at depth. On average the
quartz bodies intercepted were 3.5 metres thick and were considered
to be related to lode zones seen during past mining operations on
the Chidlaw Link Zone. The objective of the drilling was to
identify the lode structure, and as such it was successful. As at
Clogau-St David's, gold grades in drill intersections are not
expected to be representative of the actual in-situ grade due to
the extreme nuggety nature of the mineralisation. It is for this
reason that Alba has been undertaking bulk sampling in combination
with drilling at Clogau-St David's and a similar approach will be
warranted at Gwynfynydd.
Important Note: The figures above for tonnages, grades,
production and drilling results have been taken from historical
reports and other papers written by third parties and have not been
the subject of independent verification by Alba. Any reference to
tonnages or grades are conceptual in nature as there has been
insufficient exploration to define a Mineral Resource in accordance
with the "Australasian Code for Reporting of Exploration Results,
Mineral Resources and Ore Reserves, the JORC Code" (JORC 2012) or
other similar internationally recognised mineral resource codes.
Further, it is uncertain if further exploration will result in the
determination of a Mineral Resource.
Gwynfynydd: Geology
The licence area of Gwynfynydd straddles the same stratigraphy
that is found at the Clogau-St David's Gold Mine. The quartz veins,
which like Clogau strike north-east to south-west, and are most
auriferous (gold-bearing) where they intersect the Clogau
Formation, a pyritic and graphitic black mudstone, forming
extremely rich pockets of mineralization. The Gwynfynydd Mine and
option area lies within the continuation of this Clogau Shale
Formation (see Figure 2 in the PDF version of this RNS).
The gold mineralisation is the result of a complex interplay
between the host stratigraphy, different mineralisation periods,
local intrusives and different vein morphologies. The veins can
occur as single discrete veins up to a few metres thick, but often
split into zones where the veins split and can rejoin. These vein
systems can be traceable over several hundred metres.
Within the high-grade areas, free gold is common and can become
very coarse with over 65 per cent reporting to the +300 microns
(um) fraction. This characteristic provides the opportunity for the
recovery of gold using relatively simple gravity methods in the
pilot processing plant which Alba has designed and is in the
process of installing at Clogau-St David's.
Gwynfynydd: Exploration Licence
Alba's wholly owned subsidiary, GMOW (Gwynfynydd) Limited, has
been awarded an exclusive mineral exploration licence (known as an
"Option to Lease Mines Royal") by The Crown Estate over a 20 km(2)
area (the "Gwynfynydd Licence") between the northern and southern
segments of the Dolgellau Gold Belt which are already held by
Alba.
In common with all options granted by The Crown Estate, the
Gwynfynydd Licence will run for a total of six years and is
renewable by up to a further four years thereafter. The licence
holder is required to submit formal progress reports every two
years. As with Clogau, as and when the Company is ready to proceed
to commercial production, Alba will apply to convert the Option to
Lease Mines Royal into a formal, long-term Lease.
Gwynfynydd: Strategy and Work Plans
In the past couple of years, Alba has demonstrated a sustained
commitment to the work which is required to re-open the Clogau-St
David's Mine for commercial production. The Company has also
undertaken an extensive regional exploration programme over several
miles of the Dolgellau Gold Field, as a result of which several
substantial new gold targets have been identified which have the
potential greatly to extend the Clogau-St David's Mine workings out
into hitherto completely untapped gold deposits within the Gold
Field.
All of this work that has been undertaken at Clogau, and the
expertise that Alba has amassed in this type of gold setting, will
be directly applicable to Gwynfynydd. The geological setting at
Gwynfynydd is essentially the same as that at Clogau-St David's.
Further, the nature of the controls on mineralisation at Gwynfynydd
are expected to be the same as those with which Alba is familiar at
Clogau, and as such the Company is confident that extensions to
known lodes and previously undiscovered lodes will be identified at
the Gwynfynydd Mine.
In terms of regional exploration, there are over 300 known
former workings for minerals in the Dolgellau Gold Field (see
Figure 4 in the PDF version of this RNS). A large number of these
former workings are situated within the Gwynfynydd option area.
Alba has already rolled out an extensive regional exploration
programme over the Clogau section of the Dolgellau Gold Field,
involving a combination of geochemical soil sampling and ground
geophysics. This regional programme will now be extended to the
exploration ground at Gwynfynydd, i.e. those parts of the
Gwynfynydd licence which are away from the historical Mine
workings.
This will enable Alba to join the dots between the Clogau and
the Gwynfynydd deposits and to compile a comprehensive and
unprecedented regional exploration data base of the entire length
of the Dolgellau Gold Field.
Through this work, Alba is confident that new mineralized zones
will be discovered at Gwynfynydd to add to the 10 gold target zones
which the Company has already identified over the Clogau section of
the Dolgellau Gold Field, covering about nine kilometres in
total.
Gwynfynydd: Next Steps
In the first phase of work, Alba's technical team will seek to
capture and integrate all historical data sets for Gwynfynydd
within the Company's overall geological model for the Dolgellau
Gold Field. In terms of field work, this will initially comprise
reconnaissance site visits and inspections. More comprehensive
field activities will be planned during Q1 2021, with a view to
commencing a field programme in earnest in Q2 2021.
The Company's intention is to roll out at Gwynfynydd the same
overall exploration and development work plan that has been
developed successfully at Clogau, including:
-- Extensive 3D underground scanning survey of accessible workings.
-- A geochemical soil sampling programme over the existing mine
workings, in order to identify p otential extensions to the
existing footprint of the Mine.
-- An in-mine safety and rehabilitation programme for the key Mine areas.
-- Drilling from underground and from surface in order to
identify promising structures and extensions to known gold ore
shoots. As at Clogau, g iven the narrow-vein, nuggety effect of the
mineralisation, drilling will be primarily for structure rather
than grade, as the focus will be on identifying the known
gold-bearing geological structures and stratigraphy for follow-up
bulk sampling and development.
-- Bulk sampling of underground vein exposure, which would then
be processed through the Company's pilot plant at Clogau to provide
accurate data relating to the gold content over a more
representative sample of ore than can be afforded by drilling
alone.
Progress of the above activities will be dependent upon the
timely receipt of regulatory consents and approvals, contractor
availability and access arrangements being agreed with all relevant
landowners.
Clogau-St David's Gold Mine: Update on Surface Drilling
Programme
Further to the Company's announcement on 5 October 2020, good
progress is being made in the current surface drill programme at
Clogau which has been designed to target mineralisation below the
existing mine workings at the Llechfraith mine area. Drill hole
LL001 has been completed to a length of 183.5 metres and the
Company is now drilling LL002 (currently at 44 metres, as at 18
November 2020).
Final drill results will not be known and reported until all the
drilling has been completed and the drill core analysed, assayed
and the results reviewed and interpreted.
As previously reported, due to the high variability in gold
distribution at Clogau caused by its narrow-veined, nuggety
characteristics, it is not possible to achieve representative
samples by diamond drilling alone. Underground drilling has
therefore been undertaken for structural purposes, to identify the
zones underground which display the geological characteristics
which correlate to the known gold-bearing setting for previously
mined zones at Clogau. Once those zones have been identified, this
will then allow for follow-up bulk sampling and block mining of
those zones, involving the extraction of large volumes of material
for processing, where representative results, in terms of both
quantities and grades, are much more likely to be achievable.
Clogau-St David's Gold Mine: Update on Pilot Processing Plant
and Bulk Sampling Exercise
Subject to there being no unexpected delays in shipment of the
plant that has been ordered from South Africa, the Company expects
its pilot gold processing plant to be fully operational by December
2020.
The Company has signed a stand-alone Bulk Sampling Lease with
The Crown Estate which means that the Company will own any gold
recovered from the processing of the 36-tonne bulk sample extracted
during the underground bulk sampling programme which was completed
last month. As such, Alba will be entitled to retain all sale
proceeds from the sale of that gold, subject to paying The Crown
Estate a Net Realisable Value (NRV) royalty of 4% of the proceeds
of sale (and if the proceeds are derived from post smelting values
then the NRV will be determined after deducting the costs of
smelting, refining and transporting the concentrate or unprocessed
ore to the smelter).
The Company regards it as a very positive development that Alba
will own all gold produced during this pilot processing phase, as
this is not normally the case in the exploration phase of a mining
project.
This announcement contains inside information for the purposes
of Article 7 of EU Regulation 596/2014.
Glossary
Clogau Shales Black pyritous and carbonaceous mudstones and
silty mudstones with rare silt laminae and
sparse fine-grained sandstone beds. The gold
deposits of the Dolgellau Gold Belt have been
shown to be related to the presence of the
Clogau Formation, interactions with igneous
sills, and/or reef splitting to form discrete
ore shoots.
Graphitic Of, relating to, resembling, or having the
structure of graphite.
--------------------------------------------------------
Harlech Dome The Harlech Dome is a geological dome in southern
Snowdonia in north Wales, extending approximately
from Blaenau Ffestiniog in the north to Tywyn
in the south, and includes Harlech, The Rhinogydd,
Barmouth and Cadair Idris.
--------------------------------------------------------
Intrusives Intrusive rock, also called plutonic rock,
igneous rock formed from magma forced into
older rocks at depths within the Earth's crust,
which then slowly solidifies below the Earth's
surface, though it may later be exposed by
erosion. Igneous intrusions form a variety
of rock types.
--------------------------------------------------------
Mines Royal The historic name for naturally occurring gold
and silver, virtually all of which deposited
in England, Wales and Northern Ireland is owned
by The Crown Estate.
--------------------------------------------------------
Morphology A particular form, shape or structure.
--------------------------------------------------------
Pyritic Of, relating to, resembling, or having the
structure of pyrite, a yellow mineral, found
in igneous and metamorphic rocks and in veins
with the composition of iron sulphide.
--------------------------------------------------------
Reef A term used to describe an orebody, and synonymous
with lode.
--------------------------------------------------------
Stratigraphy A branch of geology concerned with the study
of rock layers (strata) and layering (stratification).
It is primarily used in the study of sedimentary
and layered volcanic rocks.
--------------------------------------------------------
Forward Looking Statements
This announcement contains forward-looking statements relating
to expected or anticipated future events and anticipated results
that are forward-looking in nature and, as a result, are subject to
certain risks and uncertainties, such as general economic, market
and business conditions, competition for qualified staff, the
regulatory process and actions, technical issues, new legislation,
uncertainties resulting from potential delays or changes in plans,
uncertainties resulting from working in a new political
jurisdiction, uncertainties regarding the results of exploration,
uncertainties regarding the timing and granting of prospecting
rights, uncertainties regarding the timing and granting of
regulatory and other third party consents and approvals,
uncertainties regarding the Company's or any third party's ability
to execute and implement future plans, and the occurrence of
unexpected events.
Without prejudice to the generality of the foregoing,
uncertainties also exist in connection with the ongoing Coronavirus
(COVID-19) pandemic which may result in further lockdown measures
and restrictions being imposed by Governments and other competent
regulatory bodies and agencies from time to time in response to the
pandemic, which measures and restrictions may prevent or inhibit
the Company from executing its work activities according to the
timelines set out in this announcement or indeed from executing its
work activities at all. The Coronavirus (COVID-19) pandemic may
also affect the Company's ability to execute its work activities
due to personnel and contractors testing positive for COVID-19 or
otherwise being required to self-isolate from time to time.
Actual results achieved may vary from the information provided
herein as a result of numerous known and unknown risks and
uncertainties and other factors.
Competent Person Declaration
The technical information in this release has been reviewed by
Mr Mark Austin. Mr Austin is a member of SACNASP (Reg. No.
400235/06), Fellow of The Geological Society and Fellow of the
Geological Society of South Africa. He has a B.Sc. Honours in
Geology with 38 years' experience.
Mark Austin has sufficient experience that is relevant to the
style of mineralisation and type of deposit under consideration and
to the activity being undertaken to qualify as a Competent Person
as defined in the 2012 Edition of the 'Australasian Code for
Reporting of Exploration targets, Exploration Results, Mineral
Resources and Ore Reserves', also known as the JORC Code. The JORC
code is a national reporting organisation that is aligned with
CRIRSCO. Mr Austin consents to the inclusion in the announcement of
the matters based on his information in the form and context in
which they appear.
For further information, please contact:
Alba Mineral Resources plc
George Frangeskides, Executive Chairman +44 20 3950 0725
Cairn Financial Advisers LLP (Nomad)
James Caithie / Liam Murray +44 20 7213 0880
ETX Capital (Broker)
Thomas Smith +44 20 7392 1494
Alba's Project and Investment Portfolio
Project (commodity) Location Ownership
Mining Projects
Amitsoq (graphite) Greenland 90%
----------- ----------
Clogau (gold) Wales 90%
----------- ----------
Inglefield (copper, cobalt,
gold) Greenland 100%
----------- ----------
Limerick (zinc-lead) Ireland 100%
----------- ----------
Melville Bay (iron ore) Greenland 51%
----------- ----------
TBS (ilmenite) Greenland 100%
----------- ----------
Oil & Gas Investments
Brockham (oil) England 5%
----------- ----------
Horse Hill (oil) England 11.765%
----------- ----------
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