EXPLORATION 1999 — Celtic stakes more Newfoundland ground

Convinced of central Newfoundland’s mineral potential, Celtic Minerals (CME-A) has staked 111 more claims.

The Alberta-based junior already owns varying interests in 10 properties in the region. Six of these are near the famous Buchans polymetallic deposit and are under option to Rio Algom (RIO-T) and nickel giant Billiton International.

The most recent acquisition comprises 2,775 ha and is contiguous with the Celtic’s Pipestone Pond claims, which lie 70 km southwest of Grand Falls. (The Pipestone Pond claims cover 5,650 ha and overlie an ultramafic suite of rocks that contain coincident soil and till anomalies, the source of which remains elusive.)

The newly acquired claims were first explored three decades ago, when two stratabound copper prospects were discovered 3.6 km apart; they are separated by 1.4 km of near-surface gold-bearing mineralization, which remains open along strike.

The northernmost copper target, dubbed South Pond, has an estimated resource of 293,000 tonnes grading 1.3% copper, plus gold. (Re-assying of historical pulps has returned significant quantities of gold, but a complete analysis is said to be impossible, owing to the paucity of intact core.)

Mineralization is characterized by disseminated-to-semi-massive pyrrhotite containing 1-2% chalcopyrite and minor pyrite. Silicified, sheared and locally brecciated volcanics host the mineralization and, where brecciated, are supported by a matrix composed largely of the sulphide minerals.

Reported values from the 4,200 metres drilled into the gold zone varied from less than 1 gram to nearly 5 grams per tonne, though one 25-cm piece of core averaged 52.17 grams. Mineralized intervals measured between 1.5 and 28 metres in core length, and many contained minor copper values.

Celtic will begin drilling as soon as it finishes compiling historical data. Several targets have already been cited, in particular the southern portion of South Pond, which remains untested for gold potential. Previous drilling at South Pond was directed from the footwall, leaving its true size undetermined.

Hungry Hill

In related news, Rio Algom has completed three preliminary drill holes at the nearby Hungry Hill project. Each hole intersected rocks indicative of a volcanogenic-massive-sulphide (VMS) mineralizing environment, and each was followed up by down-hole pulse-electromagnetic surveys.

Hole 23, which bottomed out at 800 metres, intersected a clast of banded sulphides measuring 42 cm wide and assaying 0.8% copper, 3.9% lead, 4.6% zinc, 8 grams gold and 165 grams silver. The clast occurs at the top of a polylithic-breccia unit and appears to correlate with a 9.7-metre-wide zone of low-grade, semi-massive-to-massive-sulphide mineralization that was intersected in hole 22. That zone begins 450 metres vertically above the clast.

Hole 24, which was drilled to a depth of 870 metres, intersected zones of chloritic alteration with anomalous and sporadic copper and zinc mineralization.

In the remaining hole, drill crews intersected a zone of similar-type alteration, under which occurred 5.6 metres of exhalative bedded pyrite and argillite. Results were insignificant, though the geology suggests that a zone of VMS mineralization is close by.

Geophysical results are still pending.

Previous drilling at Hungry Hill returned up to 4 metres grading 4.99% zinc plus 16.44 grams silver and 0.85 gram gold. Clasts similar to the one intersected in the latest round of drilling were reported as well, and though these were much smaller in size, they were also higher in zinc and copper values.

Hungry Hill is 17 km northwest of the Buchans deposit, which operated between 1930 and 1976. J.G. Thurlow, an authority on the area’s geology, has noted various similarities between the two areas.

Rio can earn a 51% interest by paying Celtic and equal partner Jilbey Exploration (JLB-M) $350,000 in cash and spending $4 million on exploration over the next four years. Once these terms are met, Rio can acquire an additional 9% for $650,000 in cash and $1.5 million in expenditures.

Meanwhile, Billiton has flown airborne magnetic surveys over the nearby Buchans Junction and Skull Hill properties, as well as a large portion of Hungry Hill. Results are still pending, and the data from Hungry Hill will be given to the partners involved in that project.

Billition can earn up to a 70% interest in Buchans Junction by spending $2 million on exploration and paying a total of $50,000 in cash to Celtic and Jilbey, both of which currently own a half-interest in the property.

The major can earn an equivalent interest in Skull Hill and four other nearby properties from Celtic by spending $1.6 million on exploration.