Drilling gives boost to KazMinCo

Drilling on the Samarskoye copper-gold porphyry project in central Kazakhstan is returning some spectacular results for Kazakhstan Minerals (CDN).

Results include a 195-metre intersection grading 2.2% copper and 0.63 gram gold per tonne in hole 109 and a 103-metre intersection grading 4.98% copper and 1.32 grams gold in hole 108.

“These are not just high-grade pods,” company President Bert Kennedy tells The Northern Miner. “They are wide, consistent zones of high-grade mineralization within a lower-grade envelope of about 0.5% copper.” The market reacted well to the news, giving the issue a $2.50 boost to $11.25. Kazakhstan Minerals (KazMinCo) holds a 50% joint-venture interest in the Samarskoye property and is obligated to complete a feasibility study, as well as arrange project financing. Once the project enters production, the company will receive 80% of operating profits until all its costs have been recovered.

KazMinCo has been active in Kazakhstan for over two years, during which time it evaluated 45 properties before selecting its portfolio of gold and copper projects.

To date, it has formed seven joint ventures, including Samarskoye, with Kazakh partners. Armed with the proceeds of a US$25-million financing, the company has 16 drill rigs operating in the country, including five at Samarskoye. All the projects are situated near infrastructure and have undergone work, including detailed drill programs, by the Kazakh partners.

The company’s founders, Kennedy and Chairman Anthony (Tony) Williams, were attracted to Kazakhstan because of its geological potential.

“The country has everything, from the targets you see in the Pacific Rim of Fire to the stuff you see in the western U.S.,” Kennedy says. “It was a mineral treasure house for the Soviet Union, producing 65% of its copper, 70% of its zinc and 95% of its chromite. It was also a major source of bauxite, coal and iron ore. The only thing it did not produce was gold, and that was because the government was more interested in developing gold resources in the Far East.”

As for political risk, Williams says the company is comfortable working in the resource-rich country. “It has political stability and is embracing a free-market economy. And we are up on the learning curve in knowing how to secure title.”

In essence, the projects are held by the Kazakh licence-owner, which, in turn, forms a joint venture with KazMinCo. The licence is then re-issued to the joint venture, thereby allowing the company security of tenure.

Samarskoye is KazMinCo’s most advanced project, and its current drilling phase is part of a program to confirm geological and assay data gathered by state institutions.

Samarskoye is described as a classic porphyry system, and most of the work to date has concentrated on the western limb.

The western limb, which dips steeply to the west, is brecciated quartzdiorite cemented by chalcopyrite mineralization. It measures roughly 700 metres in strike length, 600-700 metres downdip and at least 180 metres in thickness, with localized thicknesses of up to 450 metres.

Based on more than 15,000 metres of drilling, the Kazakhs estimate the resource in the western limb at 130 million tonnes grading 1.17% copper, 0.5 gram gold, 2 grams silver and 0.004% molybdenum.

“We think it is almost certainly open at depth, and the eastern and western limbs may be connected,” Kennedy adds. “In any case, we believe there is substantial potential for increasing tonnage.”

Preliminary metallurgical work by local laboratories recovered all metals into a bulk concentrate, achieving recoveries of more than 95% for copper and more than 75% for precious metals. The current program includes definition drilling, as well as drilling to evaluate other targets on the property.

Drill results are shown below:

Hole Interval(m) Width(m) Copper(%) Gold(g/t) SAM 106 418-553 135 1.35 0.35 SAM 107 390-535 145 0.58 pending SAM 108 378-702 324 3.04 0.88 incl. 378-481 103 4.98 1.32 SAM 109 25-699 674 0.81 0.21 incl. 25-220 195 2.20 0.63 SAM 111 291-440 149 0.77 pending