GOLD AND PRECIOUS METALS — Cumberland expands gold resources in NWT — Drilling reveals high-grade additions at Meadowbank property

Recent drilling by Cumberland Resources (CDB-T) has added high-grade gold resources to the Meadowbank gold deposit, situated 70 km north of the ocean-accessible community of Baker Lake, N.W.T.

Meadowbank is one of three promising projects held by Cumberland in the Kivalliq region, which becomes part of the new territory of Nunavut next April. The most advanced of these is Meliadine West, a gold project currently at the prefeasibility stage. Cumberland owns 100% of Meadowbank, 22% of Meliadine West and 50% of neighboring Meliadine East.

Cumberland President Glen Dickson views the birth of Nunavut as positive for the company, and for others working in the region, because the new government is expected to strongly support mining. “This stable region of Canada is one of the best areas in the world in which to explore and develop mining operations,” he says.

In mid-May, Cumberland announced results from 14 of 45 holes completed at Meadowbank. Several holes were directed at testing the Bay zone, a 1997 discovery that returned near-surface values of up to 30.6 grams gold per tonne over 6 metres.

This year’s drilling revealed high-grade resources situated some 200 metres south of, and 200 metres beneath, the Bay zone. Results include 3.3 metres of 12.64 grams gold at 100 metres below surface and 4.7 metres of 9.42 grams gold at 200 metres below surface.

The Bay zone is adjacent to the Third Portage open-pit deposit, which, at last report, hosted 4.5 million tonnes grading 7.06 grams gold, for 1.02 million contained ounces. This resource calculation is based on 115 drill holes (82% on 25-metre spacings) and a 2-gram cutoff grade. Cumberland states that the combination of high grades and shallow depths (all known resources are within 145 metres of surface) make Third Portage “one of the most robust gold deposits in North America.”

The two other gold deposits at Meadowbank, Goose Island and North Portage, are amenable to underground mining techniques. Situated 500 metres south of Third Portage, Goose Island hosts 976,835 tonnes grading 19.18 grams gold uncut (the grade drops to 11.46 grams when high values are cut to 1 oz.), all of it within 225 metres of surface. The calculation is based on 38 holes drilled on 50-metre spacings and a cutoff grade of 5 grams.

The resource at North Portage is 374,495 tonnes grading 9.72 grams gold, based on 13 drill holes on 50-metre spacings.

Cumberland’s current program includes drilling to expand resources at Goose Island. Four recent holes tested the deposit at vertical depths of up to 510 metres. The best result to date is 2.05 metres grading 19.6 grams gold at about 270 metres below surface.

Infill drilling is also taking place at Goose Island, results of which include 5.5 metres of 22.7 grams and 14 metres of 6.95 grams.

Results from the 31 latest holes drilled at Meadowbank are expected shortly.

The three gold deposits at Meadowbank, all of which remain open for expansion, are dominantly hosted in a structurally deformed iron formation within a sequence of Archean-aged rocks.

Meanwhile, near Rankin Inlet, N.W.T., a $7.2-million work program is taking place at Meliadine West, which Cumberland describes as “Canada’s premier gold project.” The work is being carried out by WMC International, a unit of Australian-based major WMC, which has earned a 56% interest and holds rights to an additional 4% stake. Once WMC acquires its maximum 60% interest, Cumberland and Comaplex Minerals (CMF-T) will each retain 20% of any future mine development.

Since 1995, WMC has spent over $17.5 million at Meliadine West, which, at last report, hosted 3.26 million contained ounces of gold. Of this total, 7.5 million tonnes at 11.9 grams lie within the Tiriruniak zone. The remaining 2.8 million tonnes of 7.7 grams is within the F zone. Cumberland notes that the discovery cost per ounce at Meliadine West was a mere $5.42.

The results of WMC’s prefeasibility study are expected shortly. While the partners envision an underground mine, higher-grade starter pits are believed to be feasible. Metallurgical work to date has shown recoveries of about 95% for Meliadine West.

The 1998 program — one of the largest undertaken in Canada this year — will include up to 40,000 metres of drilling, largely focused on infill and expansion drilling at the Tiriruniak and F zones. Of the total budget, $5.9 million will be spent expanding and upgrading resources at these main deposits, with the remaining $1.3 million directed at nearby gold targets, such as the Wolf and Pump zones.

Gold mineralization at Meliadine is hosted in Archean-aged, structurally deformed iron formation and mafic volcanics. Within the iron formation, mineralization is dominantly controlled by large fold closures.

Cumberland and Comaplex each own 50% of the nearby Meliadine East zone, which covers the eastward extension of the geological formations found at Meliadine West. A resource of about 400,000 contained ounces has been outlined in the Discovery deposit, situated 12 km from the Tiriruniak zone.

Cumberland will operate this year’s $1.25-million program at Meliadine East and the work will be funded equally by both partners. Work will include geophysical surveys and follow-up drill testing of numerous targets.