Imperial, Newcrest confirm high-grade mineralization at Red Chris

Exploration drilling has confirmed the continuity of high-grade mineralisation at the Red Chris copper-gold mine in northwest British Columbia, 80 km south of Dease Lake and 1,700 km from Vancouver.

The mine is a joint venture between Imperial Metals (TSX: III) and Australian miner Newcrest Mining (ASX: NCM). Newcrest holds a 70% stake and Imperial a 30% interest. Newcrest is the mine operator.

The drilling program was conducted on the East zone of the 231 sq. km property, below the existing mine, and was designed to gather geological, geotechnical and metallurgical data to support future studies for underground block cave mining.

“The deep drilling on the East zone by Newcrest was a followup to the densest drilling we did on the zone,” Brian Kynoch, Imperial’s president, said in an interview.

The highlight from the program was drill hole RC623, which intersected 232 metres grading 1.5% copper and 2.6 grams gold per tonne and 122 metres grading 2.3% copper and 4.5 grams gold starting from 598 metres downhole.

The hole cut through a high-grade pod of mineralization around 100 metres above hole RC611, a previous hole drilled by Imperial, with a second hole, RC620, drilled 100 metres below RC611, intersecting 610 metres grading 0.38% copper and 0.46 gram gold and 26 metres grading 0.67% copper and 1.20 grams gold from 734 metres downhole.

“The thing about the high-grade pod that is so exciting is that it costs a lot of money to develop a block cave before you start getting ore,” Kynoch said. “So, we’re thinking that if we can undertake some small-scale underground mining in one of these high-grade pods, then that could help finance the development of a larger block cave.”

Drill hole RC620, Kynoch noted, also confirmed the presence of a halo grading 1 gram gold surrounding the pod.

In addition, hole RC616 also identified a broad zone of high-grade mineralization, intersecting 514 metres grading 0.57% copper and 0.81 gram gold from 660 metres downhole.

Since acquiring its interest in the project in August 2019, Newcrest has conducted around 40,069 metres of drilling.

The drill program, Kynoch said, will refine the overall geometry of the system and controls to high-grade copper-gold mineralization located within a sub-vertical zone approximately 600 metres long, 300 wide, and 600 deep, below the East zone.

“Newcrest are hoping to begin underground workings by the end of the year in order to conduct more drilling deeper in the East zone, which they hope will then lead to a block cave feasibility study for the zone,” Kynoch said.

The mineralization in the zone is supported by data from historical drilling, he added. On completion of the East zone campaign, Newcrest plans to incorporate both the current drill results and historical drill data into a new resource model.

In 2019, the mine produced 71.9 million lb. copper, 36,471 oz. gold, and 133,879 oz. silver, with mill throughput averaging around 27,784 tonnes per day. Production guidance for the mine this year is between 25,000 to 30,000 tonnes of copper and 35,000 to 45,000 oz. gold.

At press time in Toronto, Imperial Metals was trading at $1.81 per share within a 52-week trading range of 99¢ and $2.93.

The company has around 129 million common shares outstanding for a $233-million market capitalization.