Drill results boost Windarra

Drill results from the Preview Lake property, 80 miles northeast of La Ronge, Sask., has sparked a 19 cents increase in the price of Windarra Minerals (TSE) shares. Windarra, which holds a 20% stake in the project, reported values as high as 11.81 oz. gold per ton over 15.6 ft., while drilling 13 holes in an area 130 ft. south of Preview Lake’s Bakos zone.

Indications that operator Cameco, holder of a 50% project interest, has encountered a significant, new parallel structure drove Windarra shares up as high as 99 cents from 73 cents as more than 450,000 shares changed hands in three days of active trading. Uranerz Exploration with 30% is the other partner in the project. Only Windarra is a publicly traded company.

Operator Cameco has already undertaken a feasibility study based on probable reserves in the Bakos zone of 1.2 million tons grading 0.31 oz. gold per ton. Results from that study together with an environmental impact report are expected to be released to the public within 30 days.

Located within an granodiorite intrusive, the Bakos zone is regarded as a simple geological structure. It has been defined over a 1,150-ft. strike length and to a depth of 800 ft.

According to a Cameco insider, the latest drill results were reported after the company elected this winter to drill 13 stepout holes to the east of the Bakos zone and beneath Contact Lake. High gold values were intersected in five holes in the new structure, four of which averaged greater than 1 oz. over significant widths.

Some of the best intersections were reported at a depth of 490-680 ft. below surface. As the holes were drilled at 500-ft. spacings, a lot of drilling has yet to be done before the joint venture can categorically state that it has a good zone of mineralization, the Cameco insider said.

But considering results reported so far, Windarra director Francis Patryshen is optimistic that Preview Lake reserves can be increased. About 230,000 tons of possible reserves grading 0.31 oz. are known to exist on the property. “Hitting the new zone is more than we could have hoped for,” Patryshen said.

A 45-minute drive from La Ronge and accessible by road, Preview Lake would be the third La Ronge gold mine that Cameco has brought to the production stage within the past three years. The others are the Star Lake (shut down last year) and Jasper (scheduled to produce 42,000 oz. next year).

If results from a Preview Lake feasibility study are positive, initial estimates are that it would cost about $35 million to complete the underground development and bring the property into production.

With a 750-ton-per-day mill in place, the mine could produce as much as 70,000 oz. gold annually, Cameco says.

Although Windarra has about $4.5 million in working capital, Patryshen said the company would probably look to affiliate Hemlo Gold Mines (TSE) for help in raising its share of costs. Hemlo currently holds about 30% of Windarra’s 19 million issued shares. Core Drill Interval Length Assay Hole No. (meters) (meters) (oz/st Au) Notes TU90-141 118.8-119.2 0.4 10.52 120.2-122.2 2.0 0.149 average 118.8-122.2 3.4 1.33 3.4 0.205 Cut to 1.0 oz. TU90-142 105.5-109.5 4.0 0.308 4.0 0.271 Cut to 1.0 oz. 112.0-113.3 1.3 0.162 TU90-146 204.9-209.5 4.6 11.81 4.6 0.378 Cut to 1.0 oz. TU90-148 210.6-213.6 3.0 1.53 3.0 0.642 Cut to 1.0 oz. TU90-151 156.5-158.5 2.0 0.290 167.5-169.5 2.0 1.01 2.0 0.352 Cut to 1.0 oz.