Hugo grows for Ivanhoe

Continued drilling by Ivanhoe Mines (IVN-T) has extended the high-graded core of the newly dubbed Hugo Dummett copper-gold zone by 350 metres.

The latest batch of holes included three sunk to test northerly extension of the former Far North zone. Highlights include the following:

Hole 505 — 244 metres grading 2.9% copper and 1.13 grams gold per tonne at a downhole depth of 782.

Hole 455B — tested 100 metres up-dip of previous drilled hole 455A, and cut 198 metres of 2. 6% copper and 0.82gram gold.

Hole 449B — 70 metres averaging 1.7% copper and 0.16 gram gold at 1,090 metres down hole, followed by a 14-metre dyke and 68 metres grading 2.85% copper and 1.3 grams gold.

Two other holes are underway; hole 514 encountered bornite and chalcopyrite mineralization in basalt and quartz monzodiorite porphyry at a down-hole depth of 1,058 metres. At presstime, the hole was at a depth of 1,432 metres still in bornite and chalcopyrite. Hole 465B is currently cutting bornite and chalcopyrite in the quartz-rich zone at a down-hole depth of 1,295 metres.

In July, the deposit’s inferred resource was estimated at 642.8 million tonnes grading 1.19% copper and 0.1 gram gold. The latest drilling extends the high-grade core some 350 metres beyond the limits of the resource. Ivan plans to update the estimate in early November. The company also plans to table the results of a preliminary scoping study at the same time. The Hugo Dummett deposit is the largest of four deposits discovered by Ivanhoe at the Turquoise Hill project in Mongolia’s South Gobi Desert.

Ivanhoe recently arranged a US$50 million private placement to help fund ongoing work at Turquoise Hill, including definition drilling and feasibility studies. A portion of the proceeds will also go toward exploration elsewhere in Asia.

Under the financing deal, Ivanhoe will place 5.76 million special warrants at US$8.68 apiece. One special warrants is good for one share plus a tenth of a common share purchase warrant; a full warrant allows the holder to buy one common share for US$8.68 per share until Feb. 15, 2004. The transaction is subject to regulatory approval.