Crude, partners up Moss Lake reserves

Partners Central Crude (TSE), Tandem Resources (TSE) and Storimin Exploration (ASE) have announced a substantial increase in reserves at the Moss Lake gold project, about 50 miles west of Thunder Bay, Ont. Based on exploration to a depth of 800 ft., preliminary reserves are estimated to be 65 million tons grading 0.032 oz. gold per ton at a cutoff grade of 0.015 oz.

At this time last year, when the potential for a low-grade, bulk- tonnage deposit at Moss Lake was just beginning to emerge, reserves from five separate zones stood at two million tons grading 0.17 oz..

Encouraged by the preliminary results, Central Crude is stepping up the intensity of the Moss Lake program. As soon as possible, project operator Noranda Exploration will move up to six rigs on to the property to complete a 50,000-ft., $2-million drilling program.

“We want to fill in on the main zone and extend the QES zone along strike and at depth,” said Richard Nemis, president of Central Crude.

To earn a 60% interest in the property, Central Crude has agreed to spend $6.5 million on Moss Lake before the end of 1995. Since signing the first option agreement in late 1989, Crude has spent $4-5 million, Nemis said.

During the intensive 2-month program proposed by Noranda, Nemis expects to have two rigs infill drilling on the main zone, two rigs testing the depth potential of the QES zone, and another two rigs wildcat drilling and probing strike extensions of the mineralization. The program will also include exploration on Inco’s (TSE) block of ground along strike to the northeast, Nemis said. In order to earn a 50% interest in the 32-claim property, Central Crude must spend $1.4 million over five years and pay Inco a total of $140,000.

After a total of 250 holes, the Moss Lake deposit has been identified along an 8,500-ft. strike length, and remains open in all directions.

At depth, Central Crude is intrigued by evidence of substantially higher grades below the 800-ft. level, which is considered the limit for an open pit mine on the property.

“It may be that we are on top of something,” Nemis said. “The rock is definitely a little juicier at depth.” Significant deep intersections, encountered in quartz-serecite schist, include a 118-ft. length grading 0.10 oz.

Another area that remains to be explored is the wide gap between the main zone and mineralized intersections about one mile to the east, he said. Although Snodgrass Lake overlies part of the eastern extension, Nemis said draining the lake for development would be a simple procedure. Snodgrass reaches nine feet at its deepest point.

By the end of the intensive exploration program, Nemis expects tonnages to reach the 80- to 100-million range. At this point, he said, the project will be turned over to the engineering department for a prefeasibility study. Although recoveries have yet to be estimated, the partners are encouraged by preliminary metallurgical results for both heap leaching and conventional milling, he added.

Central Crude, 42% owned by Noranda subsidiary Hemlo Gold Mines (TSE), has an interest in over 160 contiguous claims — including Moss Lake — stretching across the Shebandowan greenstone belt.