Many major gold companies have pulled in their horns over the past four years, rendering a good number of African exploration properties inactive. This has presented an opportunity for junior explorers to get back into the game, provided they can find the financing. One junior company that’s managing to exploit the opportunity is
The company had its genesis both in Asquith Resources, a Toronto-based company that held the Bambari gold project in the Central African Republic, and Axmin, which was formed by the principals of Samax Gold (which had held the Geita and Golden Pride gold deposits in Tanzania) after Samax was taken over by
Axmin, seeking a Canadian listing to raise capital, found a good fit with Asquith, which had the listing and an advanced exploration project in the same part of the world. The two companies had already concluded a joint venture on the Bambari project, where Axmin had earned-in with a 158-hole program of reverse-circulation (RC) drilling.
The pair worked out a reverse-takeover deal last June and arranged a financing conditional on the completion of the merger. The offering was for 14.6 million shares at 25, and when the merger of the two companies closed, last November, the new Axmin had $3.6 million for exploration. The unified company started trading in early December. The offering was brokered by three independent houses — Haywood Securities, Lowen Ondaatje McCutcheon, and Canaccord Capital.
Central to Axmin’s philosophy was the element of opportunity Africa presented. The gold price was low, and large gold producers were occupied with other concerns, such as operational efficiency and the potential for consolidation. Exploration budgets were being cut back, and Axmin management — particularly Samax geologists Michael Martineau and Jon Forster — saw highly prospective ground going unexplored.
While Axmin was still privately held, the company assembled a portfolio of properties, three in West Africa and one in Tanzania. Asquith’s Bambari project fit the portfolio neatly.
RC and rotary-air-blast (RAB) drilling has begun at Axmin’s Kofi project, in Mali. Kofi is in the western part of the country, near the Senegal-Mali zone, a large regional shear that hosts several gold deposits, including Sadiola, held by
Axmin came to Kofi as a result of an option deal in 1999 with
Kofi itself is immediately north of Loulo, where six separate gold deposits have been outlined. Five lie along a single northeast-striking shear that continues into the Kofi property; the other is on a parallel shear about 6 km to the west, which also continues on to Kofi. Northwest-striking cross faults intersect the shear, including one that hosts the Segala deposit just off the southeastern corner of the Kofi land package. The local host rocks are early Proterozoic (in West African parlance, Birimian) graywackes, tuffs and phyllites.
The major surface expression of the Loulo mineralization is gold in soil; zones with more than 50 parts per billion gold in soils dot the shear. Soils with gold concentrations in that range are also common on the Kofi ground and have been the principal focus of exploration.
Kofi Southwest
Previous RC and RAB drilling at one prospect, Kofi Southwest, intersected gold mineralization with grades of 1-3 grams per tonne. The largest zones appear to be in the Southwest B zone, where mineralized intervals were 10-55 metres long, representing horizontal widths on the order of 7-30 metres on two nearly vertical, north-striking structures. The soil anomaly over Southwest B is 350-400 metres in strike length.
Earlier holes were mostly shallow tests, and the current plan is to drill both Zone B structures to a vertical depth of 80 metres.
Other intersections with comparable grades were pulled at two other zones, Southwest A and C, generally over 5-to-10-metre intervals. Zone C, like Zone B, is made up of a pair of structures that underlie a soil anomaly about 350 metres long; Zone A is beneath a larger soil anomaly, but it returned, in previous drilling, only two 10-metre intersections of mineralization.
Axmin also plans to put drill holes down at two other target areas, Kofi Northeast and Kofi Southeast. Kofi Northeast is a 600-metre-long zone of gold in soils where local artisanal mining is known to occur. At Kofi Southeast, a 1-km-long soil anomaly, with peak values in the range 0.3-1 gram per tonne, extends south from an area of extensive artisanal mining.
Axmin also hopes to bring in production that will finance exploration and development work. In January the company inked a deal with
Bombore project
Bombore, 80 km east of Ouagadougou, has a resource of 22.2 million tonnes of oxide material grading 1.5 grams gold per tonne, based on a cutoff grade of 0.7 gram per tonne. The resource dates to before National Instrument 43-101, and will have to be verified to comply with the new regulatory regime.
The Bombore option carried an immediate price tag of $10,000, with another $40,000 payable to Channel and Solomon if the option is exercised. Axmin can vest its 65% interest by providing a bankable feasibility study, at which time the deal stipulates that Axmin buy out Channel and Solomon’s remaining interest at a fixed unit price for the proven and probable reserves identified in the feasibility study.
The actual unit price figure varies with the gold price; if gold is below US$300 per oz. reserves will cost US$10 per oz.; at US$300 per oz. and at each $25 increment above US$300, the price goes up US$1; and at US$400 per oz., it reaches its limit of US$15.
Bouroum has been optioned in a similar deal, with an initial $20,000 payment for the 90-day option and a further $55,000 if the option is exercised. Channel is carried for a 35% interest up to the time Axmin presents a bankable feasibility study, and the minority interest is bought out for the same unit prices that apply at Bombore.
Bouroum’s resource has been estimated at 12.4 million tonnes grading 7 grams gold per tonne (again, a pre-National Instrument resource figure), and Axmin has retained consulting firm Steffen Robertson & Kirsten to make an independent estimate of the resource.
Sonkounkou
Axmin’s other West African projects are in Senegal and Ghana. The Sonkounkou property is in Senegal, in the Mali-Senegal gold belt southwest of Sadiola. Axmin optioned the property from South African mining house
Sonkounkou is at an early stage of exploration, and Axmin’s plans include only reconnaissance soil sampling and geological mapping.
The Cape Three Points property in Ghana lies on the coast between Sekondi-Takoradi and the border with Ivory Coast. The Satin mine, in the northern part of the 72-sq.-km property, was worked by the Anglo-Egyptian Company in the 1930s; historical sampling of an underground drift at a vertical depth of 24 metres returned an average grade of 30.5 grams gold per tonne across a 0.7-metre width, along a 69-metre strik
e length. There are several other old prospects on the property, some of which were mined, or at least tested, during the colonial period.
Axmin’s RC drilling down-plunge of the Satin structure intersected a zone with a 2-metre true width, with three holes returning grades of 55.8 grams, 41.1 grams, and 23 grams gold per tonne.
Meanwhile, work has resumed at Bambari, a 2,000-sq.-km property 250 km northeast of Bangui in the Central African Republic. The geological environment at Bambari is an Archean greenstone belt, unlike the Birimian geology on the West African projects; the belt is part of an Archean craton that extends northwest from the Lake Victoria gold region in Tanzania, across southern Uganda and the Kivu area of the Congo, and toward the Central African Republic.
There are two drilled prospects on Bambari: Passendro (also called the Main zone) and French Camp. Both were first identified by a stream-sediment survey which sampled both fine material for direct analysis and coarse material for heavy-mineral concentration.
Asquith followed up by sampling termite mounds: termites build mounds by burrowing deep into the ground and returning to the surface to leave the earth behind. Samples from the mounds ran as high as 2 grams gold per tonne; panned concentrates of 20-litre samples (which would weigh about 30 kg) had up to 7,000 gold particles.
RC and RAB drilling at Passendro outlined a zone of quartz-tourmaline veins in chlorite-sericite schist, bounded by banded iron formation. Gold grades in the RC and RAB holes generally ran 1-6 grams per tonne in steeply west-dipping structures from 1 to 10 metres wide.
At French Camp, named for the site of an old alluvial-mining operation run by the Compagnie quatoriale des Mines in the 1930s and 40s, a northwest-striking shear zone, 8-15 metres wide, hosts gold mineralization with gold grades mainly in the 2-to-6-gram range. The shear zone runs along the contact between the chlorite-sericite schist and the iron formation.
With so much iron formation in an area of intense shearing and folding, it is perhaps not surprising to find a decent-sized iron ore occurrence. The Bambari property has one, Topa, about 20 km northeast of Passendro; it consists of two magnetite-hematite bodies, each about 300 metres wide and up to 2 km long, possibly making up two limbs of a nearly isoclinal fold with an east-striking axis.
One of the wild cards in the Central African Republic is a 6-year power struggle between the elected government and factions supporting the leader of a former military government, but that has played out almost entirely in and around Bangui, the capital, with no repercussions in the countryside.
Axmin’s one holding on the other side of the continent is a pair of adjoining prospecting licences in Tanzania, called Siga Hills and Magamba. They are located about 20 km east of
Under a deal with Irish-based Ormonde Mining, Axmin can earn a 42.5% interest in the 79-sq.-km Siga Hills licence by spending US$350,000 over three years. Another US$350,000 expenditure over the same period can earn it a 50% interest in Magamba. Only a little trenching and drilling has been done so far, but soil surveys have identified a target of 2,000 metres strike length on the Siga Hills property.
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