Aussie gold producer helps Pegasus gold boost reserves

Spokane- based Pegasus Gold (TSE) has boosted its overall reserve base by roughly 14% since the close of 1994.

Attributable proven and probable reserves are now estimated to contain 5.3 million oz. gold, while mineralized material (which the company defines as requiring a conceptual mine plan and preliminary economics) stands at 2.2 million oz., an increase of 23%. Also, Pegasus’ total inferred mineral resource, based on mines and advanced exploration projects, is at 5 million contained ounces.

The Mt. Todd open pit in Australia is responsible for much of the increase; its mining plan was revised to incorporate recent drill data. Probable reserves increased to 115.4 million tons averaging 0.031 oz. gold per ton at a stripping ratio of 1.7-to-1, which is equivalent to 3.6 million contained ounces. Mineralized material, or indicated reserves, includes 9.2 million tons grading 0.03 oz., while inferred mineralization is estimated at 98.3 million tons grading 0.029 oz.

A heap-leach mine, Mt. Todd is operated by Zapopan, a 58%-owned affiliate of Pegasus.

Closer to home, near Winnemucca, Nev., drilling at the Florida Canyon mine boosted proven and probable reserves to 48.5 million tons averaging 0.014 oz., while the amount of mineralized material expanded to 29.5 million tons grading 0.013 oz. Infill drilling is expected to upgrade much of the mineralized material to the proven category.

Stepout drilling southwest of the mine tested a new zone, with one of eight reverse-circulation holes intersecting 135 ft. of 0.38 oz. More drilling is planned.

Among the company’s more advanced exploration projects is Diamond Hill in Montana, where deep drilling is testing downdip gold mineralization. A steeply dipping skarn deposit there is estimated to contain 1.2 million tons grading 0.27 oz.

At the Pullalli project in Chile, a drill-indicated resource stands at 10 million tons grading 0.044 oz., with an additional resource estimated at 100,000 contained ounces. Exploration has identified several targets on the 23-sq.-mile property, and follow-up work is continuing.

Grassroots exploration in Chile, Argentina and Guyana has identified several targets on which drilling, if not already under way, will begin shortly. Drilling is also planned for the Minotaur deposit in the Tanami region of Australia.