Following summer drilling on the PDF prospect at the Meadowbank gold project in Nunavut,
The company spent $6.5 million at Meadowbank this past year on a program designed to expand gold resources and prepare the wholly owned project for a final feasibility study. The work entailed 16,000 metres of infill and expansion drilling in 142 core holes, as well as metallurgical tests and environmental studies. Soon, the company will choose an engineering firm to lead the feasibility study.
“This has been an outstanding season of exploration and engineering at the Meadowbank property,” said Kerry Curtis, Cumberland’s interim president. “The discovery of PDF marks the sixth gold deposit outlined on a property in which approximately 70% of the land has yet to be drill-tested.”
Covering some 350 sq. km of ground along a 25-km-long trend, the Meadowbank project is 70 km north of the inland (but ocean-accessible) community of Baker Lake. A 3-million-oz. gold resource is hosted in five near-surface deposits. Prior to this year’s drilling, measured and indicated reserves totalled 7.8 million tonnes grading 5.79 grams gold per tonne, equivalent to 1.4 million oz. An additional 10.9 million tonnes grading 4.44 grams gold, equivalent to 1.6 million oz., are categorized as inferred.
The four original Meadowbank gold deposits — Third Portage, North Portage, Goose Island and Bay Zone — are set in and around the Portage Lakes and confined to the same banded iron formation stratigraphy over a strike length of some 2.5 km. This concentrated area of mineralization accounts for 2.1 million oz. of the project’s total resource. The fifth deposit, known as Vault, was discovered in 2000 a further 5 km to the northeast. After completing two rounds of widely spaced drilling at Vault in 2000 and 2001, Cumberland outlined an inferred resource of 7.5 million tonnes grading 3.9 grams, equivalent to 936,700 oz.
The five deposits are hosted in Archean greenstone supracrustal rocks of the Woodburn Lake Group in the Rae Craton of the Western Churchill structural province. The Meadowbank area is underlain by a structurally complex, folded package of intermediate volcaniclastics and greywacke, with interbedded magnetite-chert iron formation and lesser pelitic schists.
The outlying Vault deposit is a moderately dipping shear zone hosted in a complexly folded package of felsic-to-intermediate volcaniclastic rocks. Gold mineralization in the main deposit area, near Third Portage Lake, occurs predominantly in iron formation with replacement textures.
“As well, we see mineralization similar to the Vault stratigraphy, especially at Goose Island,” said Brian Alexander, project manager, who guided The Northern Miner on a tour of the property.
Two models
“There is a replacement model for mineralization, and a hydrothermal shear-related model,” Alexander explained. “This gives us a little bit more potential in a belt of rocks that is fairly flat-lying. We believe we’re following the same stratigraphy up through the trend. The mineralization is hosted in the same sort of structures. Even though there are changes in the host rock type and in the geometry and orientation of some of the mineralized zones, there are a lot of similarities all the way up through the belt.”
AMEC E&C Services completed a preliminary economic assessment of the Meadowbank project in January 2002 using a design throughput rate of 4,700 tonnes per day (or 1.7 million tonnes per year). The project has the potential to generate 246,000 oz. per year over a mine life of 8.3 years, with cash costs of US$168 per oz. and total costs of US$235 per oz.
Open-pit designs on the Third Portage, North Portage, Goose Island and Vault deposits make up 85% of the proposed mining plan, with the remainder coming from underground mining on deeper resources at Goose Island and Vault. Open-pit resources are modeled at 12.6 million tonnes averaging 4.62 grams, or 1.9 million oz., with a stripping ratio of 7.8-to-1. The underground portion of the mining plan is calculated at 1.8 million tonnes grading 6.52 grams, equivalent to 378,000 oz.
Based on a projected capital cost of US$123 million and a gold price of US$300 per oz., the project has a payback period of five years. At a higher price of US$325 per oz., the period is reduced to 3.8 years.
Cumberland began this year’s drilling in an effort to add 400,000 oz. to the mine plan so that the project would have a lifespan of at least 10 years.
Spring drilling tested the resource potential of the Connector zone, an area between the North and Third Portage deposits, and the downdip component of the Vault deposit. Results from the Connector drilling outlined a shallow zone with high-grade and low-grade components. Cumberland hopes the results will allow the proposed North Portage and Third Portage pits to join-up and form one 1.8-km-long, continuous pit design.
A second phase of drilling, consisting of more than 50 holes, tried to define the Vault resource. “The Vault pit, we suspect, should be in good enough shape for a reserve estimate,” Curtis said. “We may have to do some more drilling on the Vault underground to bring a portion of that into the reserve.”
The definition work confirmed and improved the shallow portion of the Vault resource with wide, consistent intersections, such as 4.06 grams over 11.9 metres at 23 metres below surface in hole 76.
The drilling also returned some of the best intercepts ever. Hole 85 ran 11.57 grams across 12.8 metres (including 1.4 metres of 79.8 grams) starting at 34.6 metres of depth, while hole 64 intercepted 14.07 grams over 10.5 metres (including 1 metre of 104 grams) at 59.4 metres depth.
A highlight of the summer program were the drill results from the PDF target, 10 km north of the Vault deposit. The PDF prospect was discovered in 1999 by surface prospecting. Grab samples, taken at the time, outlined a discontinuous, 250-metre-long, gold-bearing trend consisting of pyritic quartz veins and stringers hosted in an oxide facies iron formation. Several samples ran between 10 and 30 grams topping off at 159 grams.
Follow-up work
Cumberland initially tested the length of the showing with five widely spaced shallow holes in 2000. The best hole of the bunch intersected 7.11 grams across 2.5 metres at 20 metres below surface. Starting in July 2002, a follow-up program of 18 additional holes tested the PDF zone on 50-metre centres.
Significant intercepts from the first 16 holes include: 4.1 metres (from 34 metres) of 18.99 grams gold per tonne in hole 11; 9.5 metres (from 38 metres) of 4.45 grams gold in hole 13; 5 metres (from 75 metres) of 4.64 grams gold in hole 20; and 3.8 metres (from 57 metres) of 4.08 grams gold in hole 22.
The PDF zone of mineralization has been defined almost 200 metres down-dip to a vertical depth of 70 metres below surface and more than 150 metres along strike. The zone remains open along strike and at depth.
“There’s a lot of pinching and swelling, and there are multiple zones — sometimes three, if not four, mineralized horizons,” explained Curtis.
The deposit’s geometry and mineralization controls appear similar to those of the Vault deposit. This year’s program was designed to test for controlling structures similar to those at Vault, where mineralization seems to be controlled along the L1 linear structural features.
“These same controlling structures seem to exist at PDF,” said Curtis. “The difference is that we’re working in an oxide facies iron formation, and we see a lot more quartz veins and stringers, compared with any of the other deposits. One thing we noticed at PDF is that if you get a low-grade hole, don’t stop, because that system can be pinching and swelling quite a lot, and another 50-metre downdip hole can be totally different.”
Cumberland has closed down its Meadowbank camp but intends to return in the spring. The next phase of drilling will be announced in early 2003.
Cumberland is well-financed with $12 million in working capital. It has 35.9 million shares outstanding or 42.8 million on a fully diluted basis.
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