Vancouver – An updated resource estimate for the Marg deposit in the Yukon to inform a prefeasibility study already underway shows that Yukon Gold (YK-T) is on track for a production decision in 2010.
The new estimate pegged indicated resources at the volcanogenic massive sulphide project at 4.71 million tonnes grading 1.61% copper, 3.92% zinc, 2.05% lead, 51 grams silver per tonne, and 0.85 gram gold per tonne. Inferred resources add 1.38 million tonnes grading 1.28% copper, 3.78% zinc, 1.79% lead, 42 grams silver, and 0.77 gram gold.
Estimate calculations were done using a US$70 net smelter return cut-off, with the NSR values based on metal prices of US$2.50 per lb. copper, US90 per lb. zinc, US70 per lb. lead, US$13.50 per oz. silver, and US$800 per oz. gold, as well as assumptions about metallurgical recoveries, transportation costs, and smelter charges. For the 4.71 million tonnes of indicated resources the NSR value comes in at US$103 per tonne; the 1.38 million tonnes of inferred resources currently carry a NSR value of US$91 per tonne.
While the new resource estimate does not add significantly to the deposit’s overall tonnage the incorporation of seven additional drill holes upgraded roughly 3 million tonnes of material from the inferred category to indicated status.
Yukon Gold is now drilling to collect samples for metallurgical testwork. Once the five metallurgical holes are complete the company will embark on 2,000 metres of exploratory drilling targeting the extension of higher-grade zones that hold the potential to boost the Marg resource.
The company has asked Scott Wilson Roscoe Postle Associates to postpone completion of the preliminary economic assessment that is already underway until results from the metallurgical and exploration drilling campaigns are available. The study, which was initially targeted for completion in August, will investigate an underground operation.
An internal review by Yukon Gold based on the previous resource estimate postulated a positive production decision would be possible based on a 2,700-tonne per day mining operating over a minimum seven-year mine life.
The Marg deposit sits in the central Yukon, some 40 km east of Keno City. The deposit comprises a series of continuous to discontinuous sheets of massive to semi-massive sulphide mineralization. A single section can contain up to eight sheets but mineralization is primarily contained within four sheets. Strucutural geological studies at Marg reveal and complex history with multiple episodes of strain and deformation.
In 1965 regional geochemical surveys identified strong multi-element anomalies draining the Marg deposit area. A number of companies explored the area in the ensuing 40 years, including mapping, ground geochemical and geophysical surveys, trenching, and over 23,000 metres of diamond drilling in 86 holes.
In 2005 Yukon Gold acquired the project and within two years completed another 4,200 metres of diamond drilling as well as an airborne VTEM survey. An updated resource estimate in 2007 classified most of the deposit as an inferred resource.
Yukon Gold’s share price held steady on news of the new, upgraded resource, closing at 15. The company has a 52-week trading range of 10 to 53 and has 29.1 million shares issued.
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