Vancouver — Canadian junior companies are a rare sight in Indonesia since the Busang “gold” deposit went bust in 1997, but for the few contrarians in the game, the dearth of competition means more opportunities are available at better prices than has been the case for decades.
At least that’s the position expressed by
Southern Arc completed its initial public offering in June of this year, and raised $2 million to explore its two key projects situated on two islands immediately east of Bali. Both projects cover prospective ground within the Sunda-Banda Arc, an elongated volcanic arc that hosts several major mines and deposits, notably
The Sumbawa and Lombok properties, on islands of the same name, are both early-stage projects. Southern Arc has focused its initial efforts on the Lemonga prospect centrally situated on the 31,204-hectare Sumbawa concession. The target here is a low-sulphidation epithermal system that saw limited exploration in the 1980s by state-owned Aneka Tambang and a predecessor of
Previous drill results include 10 metres grading 12.4 grams gold per tonne, and 12.15 metres of 3.63 grams gold and 68.6 grams silver.
Surface mapping by Southern Arc and previous operators has confirmed argillic alteration within an area measuring about 1 by 1.5 km.
Five gold-bearing quartz veins have been identified within the alteration zone, with widths up to 10 metres at surface.
Southern Arc recently drilled seven shallow holes to test the best-exposed vein, Amy, which has a mapped strike length of at least 950 metres. The holes were spaced at intervals of between 100 and 250 metres along the strike of the vein. Five holes returned anomalous intersections of 0.87 gram gold or better.
The first hole returned 16.05 metres of 5.3 grams gold and 51 grams silver, including 3 metres of 19.1 grams gold and 228 grams silver. The third hole hit 15.4 metres of 6.67 grams gold and 36 grams silver, including 2 metres of 25.67 grams gold and 25 grams silver, and 5.4 metres of 8.27 grams gold and 79 grams silver. Because the vein pinches and swells, the company notes that true widths are not reported at this stage. The drilling was aimed at confirming the extensive strike length of the Amy vein, and the presence of high-grade shoots within it. All intersections are within 75 metres of surface, and the depth of the structure remains unknown.
The company also drilled two holes to test the Betty vein. One hole returned 0.95 metre of 3.35 grams gold and 106 grams silver, while the other hit 18 metres of 0.51 gram gold and 9 grams silver.
While gold-silver veins are the main target identified to date at the Sumbawa project, the company plans to carry out an airborne geophysical program to better determine the property’s potential to host mineralization similar to that found at Batu Hijau. Newmont’s large copper-gold mine is situated in a Contract of Work (CoW) about 15 km south of Southern Arc’s concession. Batu Hijau produced 683 million lbs. copper and 715,000 oz. gold in 2004.
The Lombok project is on an island just west of Sumbawa, and is considered prospective for porphyry copper-gold systems. A number of anomalies have been identified on this grassroots property, which has yet to be drill-tested.
The company notes that recent prospecting has identified the presence of a possible alteration lithocap — which combined with peripheral base metal quartz veins and the presence of low-sulphidation epithermal chalcedonic veining — suggest potential for subsurface porphyry copper-gold systems.
Southern Arc has proposed a work program of about $500,000 that will include airborne magnetic and radiometric surveys and scout drilling to better determine the potential of the Lombok property.
The company’s strategy in Indonesia is to identify, explore, and advance mineral properties to the stage where they have sufficient potential to attract a senior partner.
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