Etruscan, Resolute, look beyond ‘easy oxide’

There’s no time like now for Etruscan Resources (EET-T) and Resolute Mining (RMGGF-O, RSG-A).

On the heel of a 53% increase in the resource estimate for the Finkolo project in Western Mali, the joint-venture partners are forging ahead with a 6,100-metre drill program to test the vertical depths of the Tabakoroni deposit.

The drilling wasn’t part of project operator Resolute’s budget, but because of the resource estimate results, Etruscan has decided to front the money for Resolute so the drill team can go ahead.

Etruscan chief operating officer Don Burton says the program will include 10 diamond drill holes testing depths between 150 and 300 metres for continuation of high grade ore shoots found along more than 1km of strike length of the Tabokoroni deposit.

Burton hopes the results shed some light on the deposit’s potential.

“Those ten holes are widely spaced and they’re going to tell us whether or not the deposit extends at depth,” Burton says.

Measured and indicated resources now stand at 4.62 million tonnes grading 2.6 grams gold per tonne for 382,000 contained oz. gold and a 4.54 million tonnes grading 2.5 grams gold per tonne for 364,000 oz. gold under the inferred category. The current resources include drilling to only 150 metres depth.

Burton says it’s time for West Africa to get credit for long-term potential of deeper gold resources, such as Randgold Resources‘ (RRS-L), Loulo deposit in western Mali, which extends to 900-metres depth.

“In the past the focus has been to drill of an easy-oxide pit kind of deposit,” Burton says.

He says mining companies have not focused much on testing the sulfide ore beneath oxide deposits in West Africa.

And although Finkolo was first discovered by BHP Billiton (BHP-N, BLT-L) in 1985, the sulfide ore has never been tested.

The drill program includes infill and extension drilling on the near surface resource with a focus on the junction of the Tabakoroni main shear zone and the adjacent porphyry zone.

The Finkolo property is close to Resolute’s Syama permit, which is home to the Syama gold mine. The open-pit mine is expected to be ready for production by the end of the second quarter. It has reserves of 1.7 million oz. gold, plus measured and indicated resources totaling 2.4 million oz. gold, which lie beneath the open pit reserves.

Resolute now has a 60% interest in Finkolo. Under the agreement, Resolute must fund all costs of the joint venture until production of a feasibility study at which time Estruscan will reimburse Resolute for 50% of its share of future project cash flow.

The cost of the 6,100-metre drill program will be deducted from this payment.

Etruscan shares rose more than 4% by mid-day, or 10, to $2.39 apiece on a trading volume of 19,000 shares.