Jinshan releases resource estimate at Dadiangou gold project in China

Just six months after pouring the first 500-oz. gold dore bar from its remote Chang Shan Hao mine in Inner Mongolia, Jinshan Gold Mines (JIN-T, JINFF-O) is off and running in China’s Gansu province, with an initial National Instrument 43-101 resource estimate for its Dadiangou gold project there.

The Dadiangou gold system, part of central China’s Qinling Fold Belt, has an inferred resource of 26.3 million tonnes grading 0.92 gram gold per tonne, or 778,000 oz. gold, at a cut-off grade of 0.4 gram gold per tonne.

Within that inferred resource, Jinshan delineated a 1.9 million tonne, higher grade core, grading 2.48 gram gold per tonne and containing 152,000 oz. gold at the same cut-off grade (0.4 gram gold per tonne).

Results from the resource estimate within the higher-grade zone indicate that it contains 20% of the total gold at Dadiangou within only 7% of the total tonnage, the company noted in a press release announcing the news.

The company says it will focus on expanding the deposit and preparing a preparing a preliminary economic assessment.

The resource estimate, prepared by Geosystems International, relies on data from 51 drillholes totaling 11,685 metres.

If further studies show that mining the deposit will be economic, Jinshan envisions an open-pit, cyanide-leach gold operation.

Jinshan’s licence stretches across 15 sq. km and is owned by the Northwest Industrial Nuclear Economic Technical Corp.

Jinshan’s joint-venture agreement with Northwest allows the Canadian junior to earn a minimum of 80% on the property and Northwest to participate in the project at a level of 20%, or become diluted.

Dadiangou’s main mineralized shear zone is vertical to steeply north-dipping and spans 3,170 metres in strike length. Typical widths are 50 to 60 metres over two-thirds of its strike length, but can vary from 10 to 80 metres in width.

Jinshan’s shares remained unchanged, closing at $2.82 apiece, with 87,200 shares trading hands.