Ivanhoe hits more gold at Turquoise Hill

Vancouver — Ivanhoe Mines (IVN-T) has tabled encouraging drill results from the Central zone at its wholly owned Turquoise Hill (Oyu Tolgoi) gold-copper project in southern Mongolia.

Seven holes drilled intersected gold-rich, chalcopyrite mineralization. The zone is defined by an induced-polarization (IP) anomaly measuring 1,000 by 500 metres, and is about 1 km north of the Southwest Discovery zone.

The Central zone hosts volcanic hypogene mineralization, which is said to be similar to that found in the Discovery zone.

Holes OTD196, 202 and 207 are stepout holes and were designed to expand the high-grade gold and copper mineralization that was cut in previously reported hole OTD187 (102 metres grading 1.4 grams gold per tonne and 0.84% copper, starting at a downhole depth of 334 metres). The same hole intersected 138 metres grading 0.42 gram gold and 0.57% copper starting at 90 metres downhole.

Hole OTD202 cut 136 metres grading 0.58 gram gold and 0.89% copper starting at a down-hole depth of 280 metres. Included were 44 metres grading 1.09 grams gold and 1.22% copper. The upper part of the hole assayed 0.05 gram gold and 0.86% copper over 82 metres.

Hole OTD207 averaged 0.15 gram gold and 2.15% copper over 68 metres starting at a down-hole depth of 44 metres. This was followed by a 144-metre section of 0.66 gram gold and 0.79% copper starting at 238 metres down-hole.

Hole OTD196 intersected 26 metres of 0.25 gram gold and 2.29% copper starting at 48 metres down-hole. This was followed by a 156-metre interval grading 0.43 gram gold and 0.84% copper starting at 294 metres down-hole.

These new holes identify a near-surface, blanket-like, enriched zone of secondary copper mineralization. Ivanhoe believes the mineralization is potentially amenable to simple flotation concentration or heap leaching. In addition, these holes suggest that there is an underlying gold-copper system similar to that discovered at the nearby Southwest Discovery zone.

As the current program progresses, deeper drilling will test for an increase in the gold-to-copper ratios. The junior believes the two systems, Southwest Discovery and Central, could merge at depth. Holes OTD212 and 215 were collared midway between the Central and Southwest Discovery zones. Both holes encountered primary copper mineralization underneath a thin sequence of gravels. The location of the mineralization was just adjacent to the projected extension of a northeast-trending structure that was intersected in deep drilling in the Southwest Discovery zone.

Ivanhoe recently signed a contract with Major Pontil Drilling, an Australian subsidiary of Major Drilling of Canada, to hire an additional seven drill rigs for a minimum of 50,000 metres of diamond drilling. These will increase the number of rigs on-site to 14.

Ivanhoe has a 100% interest in the Turquoise Hill project, subject to BHP Billiton‘s (BHP-N) 2% royalty. BHP Billiton holds a 40% back-in-right to the project, which can be exercised if a potential resource of at least 250 million tonnes grading 1% supergene copper is discovered by June 7. BHP Billiton’s back-in rights will expire on that date if the requisite copper mineralization is not identified. Ivanhoe also holds mineral rights to more than 50,000 sq. km in Mongolia, mostly within the South Gobi porphyry belt.