Mineable reserves up 50% at Neptune’s Colomac bet

Results of a 45,000-ft infill drilling program has enabled the company to announce a 50%-reserve increase at the Northwest Territories-based project.

According to results of the 6- month program, when production begins next January at the rate of 200,000 oz annually, Neptune will draw from a mineable reserve inventory of at least 28 million tons of grading 0.056 oz gold per ton. That compares with 16 million tons grading of 0.064 oz announced previously.

“Needless to say, we are extremely pleased,” said Neptune spokesperson Beverly Bartlett. “We had a good feeling that the reserves were there, but we just had to get it down on paper.”

As a result, the life expectancy of the $128 million project has increased from five to eight years.

Most of the drilling was focused on an area south of the Zone 2 open pit where Neptune has succeeded in outlining a new zone with mineable reserves.

Located between zones 2 and 3 it will allow the company to combine the three deposits into one huge open pit and reduce the waste to ore strip ratio to 3.17 from 3.35 tons of waste to each ton of ore.

The 3.17 to one strip ratio does not apply to the 3.97 million tons of ore grading 0.026 that Neptune will stockpile for processing in 1998.

During the first five years of operations, Neptune plans to use carbon-in-pulp technology to treat ore from the Zone 2 area which hosts 18.4 million tons of grade 0.062 oz. In years six and seven, Neptune will move over to the Zone 3 area containing 5.8 million tons of 0.054 oz.

In a bid to move additional reserves into the mineable category, Neptune is conducting additional drilling at both the Colomac and adjacent Goldcrest deposits. The company will also drill to the North of Zone 2 and on a group of claims to the South of Zone 3 which Neptune recently optioned from Petromet Resources (TSE) and Comaplex Resources (TSE).

The optioned claims are considered important by Neptune because they are thought to contain the southern extension of the Colomac dike — a sub-volcanic structure hosting the Colomac ore.

The latest reserve increase coincided with a sudden hike in Neptune’s share price. It climbed to $3.00 from $2.30 during trading on the Toronto Stock Exchange. The 52-week range is $4.60 and $2.20.

Despite arctic temperatures of between -20 degrees and -40 degrees C, the company is on schedule with construction of a 10,000-ton-per-day milling facility designed to attract joint venture partners in the region.

Neptune is currently clearing the Zone 2 area for mining and drilling to support monthly production for the first 18 months. It is also beginning to truck equipment and supplies to the project along a winter road from Ra e/Edzo to the project.

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